UCS Blog - Clean Energy (text only)

Three Possible Solutions to Uneconomic Coal Generation

Photo: Rennett Stowe/Flickr

 This year, utility regulators in Missouri and Minnesota are looking into a practice known as self-committing, which research from UCS shows is costing customers a billion dollars a year in unnecessary costs. Now that this uneconomic and inefficient practice has caught the attention of a few regulators it is time to dive deep into just a few options utility regulators and state policy makers could avail themselves of as potential solutions to uneconomic coal generation.

Disclaimer: This list is meant to illustrate some of the many options regulators and state policy makers have available to them and is not an endorsement of any one course of action as the preferred solution or policy recommendation of this analyst or of UCS.  

Disallowance

Monopoly utilities are generally allowed to recover the costs they incur to serve their customers, so long as those costs are prudent. When those costs aren’t prudent, the utility regulator can disallow, or prevent, those costs from being recovered from ratepayers.

Running expensive coal plants when less expensive, less polluting power plants are available doesn’t seem prudent to me.

A disallowance forces a utility’s investors, instead of the ratepayers, to bear the above market costs. Essentially, it would cut into utility profits.

In the world of utility regulation there are few statements stronger than a disallowance. The utility would immediately find a way to protect itself from having future costs disallowed, it would find better ways to run its coal plants, renegotiate coal contracts, and do a better job ensuring that the unit would operate more efficiently. But the ripple effect wouldn’t end there. Other utilities under that regulator’s jurisdiction would hear about the decision and get in line.

Such action is well within the jurisdiction of a state regulator and to the extent it would motivate utilities to operate more in line with rational economic theory, it presents itself as an elegant solution to the problem at hand.

Tracker reform

Another option that I’ve discussed with regulators seems to be the preferred choice for at least one former utility regulator and former president of NARUC, Travis Kavulla. Travis takes exception to the idea of disallowing past costs and argues in a blog that asking, “a regulator to judge whether a utility should have signed a particular fuel contract is a hopeless task in retrospection.”

I would argue that utility regulators need to scrutinize utility decision making more, not less. But I do agree with Travis that there are alternatives to the inevitable game of utility whack-a-mole that can ensue when trying to pin down the prudency of utility decision making.

What is Travis’ preferred solution?

“It involves reforming the “trackers” that cause utilities to be fully indifferent to their power-supply costs. Instead, trackers should incorporate cost-sharing. The basic design is fairly straightforward. First, the regulator sets a rate that reflects anticipated costs over a certain interval. When actual costs deviate (as inevitably they will), both shareholders and consumers share in the added costs or profits of that deviation. This approach motivates the utility toward efficiency in any given fuel supply issue—including its coal contracts. It also allows the regulator to put away the microscope and align the incentives of the utility with its customers’ interests to minimize their power costs. Indeed, this spin on a tracker has already been successfully adopted in several jurisdictions in the Pacific Northwest, though it is regrettably still not commonplace nor is it as amplified an incentive as it should be.”

Travis’ “light touch” regulation, isn’t without its own drawbacks. While serving as a regulator in Montana, it took years to put into place the tracker reform he describes above. Plus, regulators would have to set the target price right (no easy task) all the while avoiding the potential for unintended consequences.

Divestment

For those that prefer a more “free market” approach to solving this issue, there are options. There are several ways to introduce competition into the utility space and at one end of the spectrum is restructuring. Restructuring commonly (but not always) includes the requirement that incumbent monopoly utilities (the utilities that you and I buy electricity from) divest from ownership of any power plants.

After the divestment, the power plants have new owners that no longer have captive customers and become “merchant generators” that rely on the markets for their revenues.

Last year, my analysis showed very clearly that merchant coal plants in restructured states are far more likely run their plants as economically efficient as possible because they no longer have captive customers on the hook to bailout the company after bad business decisions.

Results from my analysis last year. The actual vs expected value of several large utilities. You would expect the dots to fall along the diagonal line, but monopoly owned plants tend to overgenerate while merchant power plants operate at or below expected values.

Some of those merchant power plants have switched to seasonal operations because they knew they wouldn’t be economic to run for 60-75% of the year. Others have remained available but simply don’t self-commit, they allow the market to give them instructions. At the end of the day, one has to ask: how come some monopoly owned coal plants struggle to operate rationally while merchant coal plants do so with such ease?

After years of frustration with the local utilities, advocates and policymakers in both North Carolina and Florida are considering legislation that seeks to introduce competition to their incumbent utilities. Could frustration over $100’s of millions of dollars of uneconomic behavior precipitate similar courses of action in other states?

Conclusion

Some people are ideologically driven to push for “free-market” solutions. Luckily, UCS isn’t driven by ideology one way or the other. We analyze the pros and cons of all policies and evaluate the merits of proposals on the details of the individual proposals.

So, I am not saying restructuring or divestment is right for every state and I’m certainly not saying that a state should force the divestment of coal assets simply because a few coal plants are operating inefficiently. Restructuring is a policy pathway that should be led by the local community that will be most affected by such decisions. Similarly, I understand that a regulator might balk at the idea of disallowing fuel costs or taking up a long arduous proceeding to reform the tracking of fuel costs.

Whatever your policy preference is, we should be able to agree that something needs to be done.

The three ideas I’ve postulated in this blog are far from the only options to regulators. In fact, this blog focuses on what can happen at the state level, ignoring options for regional and federal interventions. But rest assure, UCS’s analysts aren’t ignoring those options. Stay tuned to this blog and follow me on twitter to stay up to date as we explore all of the ways to stop this uneconomic practice.

Photo: Rennett Stowe/Flickr

What’s a Coal State to Do?

As we collectively work to minimize the impacts of climate change, which we are already seeing today, we will transition to a clean energy economy—and we must ensure fairness to the workers in fossil fuel industries and the communities that depend on them. This is especially true for coal, which has helped keep the lights on for generations. With the ongoing decline in the coal industry thanks to eroding economics, and despite the administration’s unsuccessful efforts to breathe life into a dying industry, policymakers at all levels of government will soon face a sobering reality: How do we ensure that coal workers have access to new jobs with family-sustaining wages and benefits, and that coal communities can retool their economies? This summer, the BlueGreen Alliance, a coalition of labor unions and environmental organizations (including UCS), released its Solidarity for Climate Action, which underscores our collective obligation to ensure that people don’t suffer economically from climate policy. Forward-thinking policymakers in Colorado and Canada offer some steps in the right direction that can light the way for coal-dependent states and the federal government to tackle the climate challenge while lifting up the people and communities that helped make our country strong.

Connecting climate action with just transition

Colorado’s lawmakers enacted seven energy-related bills in the 2019 legislative session, and one of the new laws (HB 1261) sets a statewide goal for greenhouse gas emissions reductions of 50 percent by 2030 and 90 percent by 2050, both below 2005 levels. Building on a campaign promise, Governor Jared Polis has outlined a vision for achieving 100 percent renewable energy by 2040. But perhaps the most groundbreaking law was HB 1314, which establishes a just transition office and associated advisory committee to focus on coal workers and communities.

Image courtesy of W Jones

With the passage of HB 1314, Colorado has combined strong climate action with an explicit recognition that the momentum towards a clean energy economy will impact people and communities, and that the best way to deal with change is to plan for it. The General Assembly highlights (1)(c)(I-II) the “moral commitment” to helping both coal workers and communities as well as communities disproportionately impacted by coal pollution to ensure a “just and equitable transition.”

The primary aim of the law is to develop a just transition plan for the state of Colorado, due by July 1, 2020. To get there, the state will convene an advisory committee made up of a diverse group of stakeholders—to include not just the usual suspects (representatives of state government agencies, legislators, and utilities with coal-fired power plants)—but also representatives of directly affected communities. Specially, the committee will include three representatives from coal transition communities, two members with actual experience in economic development or workforce retraining, and two representatives of disproportionately impacted communities.

The law funds the establishment of the Just Transition Office within the state’s Department of Labor and Employment, and the new office will support the advisory committee in the development of draft recommendations to the legislature. The committee is charged with identifying potential funding streams from all levels of government that could be used to invest in communities and workers—and identifying gaps and resource needs. The committee will develop options for the establishment of benefits to dislocated workers, workforce development and training, and community economic development grants.

While another government-sponsored report might not sound terribly exciting, this is a significant step for a state that currently gets about half its electricity from coal. The draft transition plan will offer specific options for how to fund the transition and what form the benefits might take, and lawmakers will then need to act on that information. In that sense, the hard work is ahead—but this is a significant first step and an important recognition of the reality facing the coal industry as Colorado moves toward cleaner energy and steeper greenhouse gas reductions.

Looking to our neighbors to the North

Outside the United States, policymakers are facing the reality of coal’s decline and how to address the very real impacts on workers and communities. Last year, the Government of Canada finalized its plan to phase out coal by 2030; this summer a task force finalized a comprehensive report that offered recommendations for transition policies based on detailed input from affected communities. Similarly, as part of its commitment to strong climate targets, a German task force offered a specific road map for ramping down from about 35 percent of its electricity from coal in 2018 to a complete phaseout by 2038—and the report included recommendations on how to address some 20,000 jobs in the country’s mining regions. The German government is proposing to spend 40 billion euros to transform the country’s coal regions.

Imagine that. Policymakers at the national level facing challenging problems head-on and developing solutions!

 

Let’s take a deeper look at Canada’s recommendations, because they offer some specific insights that can and should inform US policymakers. As the report notes, the decline of the coal industry is expected to impact about 50 communities located in four Canadian provinces. Based on the best available data, the report finds that between 1,880 and 2,400 people work at 17 coal-fired generating stations, and between 1,200 and 1,500 miners work at 9 thermal coal mines—and these workers earn considerably higher wages than the average provincial wage. The task force offers detailed recommendations, but a few are worth highlighting here:

  • Fund the establishment and operation of locally driven transition centers in affected communities (Recommendation 4): The hubs would ideally be launched in advance of closures, would be staffed with local residents and experts, and would offer a range of services to include training and employment services but also, importantly, social services.
  • Create a pension bridging program for workers who will retire earlier than planned due to the coal phase out (Recommendation 5): Workers close to retirement should have access to a financial bridge that allows them to retire with dignity and with access to health care.
  • Create a detailed and publicly available inventory with labor market information pertaining to coal workers (Recommendation 6): In short, dislocated workers need access to up-to-date information about what opportunities are out there and how those prospective jobs match up to their skill sets.
  • Create a comprehensive funding program for workers staying in the labor market to address their needs across the stages of securing a new job, including income support, education and skills building, re-employment, and mobility (Recommendation 7): Funding will be needed to facilitate workers moving into new careers, which includes the obvious things like unemployment insurance and educational and training benefits. But in addition, the task force highlights health care coverage needs and travel costs for workers that have to travel long distances.
  • Identify, prioritize, and fund local infrastructure projects in affected communities (Recommendation 8): By investing in local infrastructure projects, the government can help offset employment losses and simultaneously improve communities.
  • Establish a dedicated, comprehensive, inclusive, and flexible just transition funding program for affected communities (Recommendation 9): Here the task force highlights the importance of long-term economic planning, which is very location-specific, and the need for replacing lost tax base to ensure that local services are not interrupted.

The full list is worth a read.

A model for the states—and the federal government

The point is short and sweet: policymakers don’t need to reinvent the wheel.

From these forward-looking examples, we can start to see the outlines of a broader plan—a framework for ensuring that, in the wake of coal’s decline, coal workers and their families can survive, and coal communities can thrive. That framework starts with an open and honest reckoning with reality. It involves planning that includes real engagement and deep insights from actual people on the ground whose lives will change as a result of coal’s decline. And finally, it involves investments in community-driven and place-based solutions that recognize that one size doesn’t fit all, and that each community is unique.

If we are going to get serious about solving the climate challenge, it’s high time we get serious about ensuring that our coal workers have a fighting chance to be a part of the solution—and that their communities can be made whole. Over the coming months, I’ll be digging into some of these sticky questions, so stay tuned.

Photo: Peabody Energy

Gut Check Time for the Paris Agreement

Nearly four years after countries adopted the Paris Agreement, it faces the first real test of whether it is fit for purpose: will enough countries step up by the end of next year to increase the ambition of their Paris emissions reduction pledges, as is needed to meet the agreement’s bold temperature increase limitation goals?

The outlook is uncertain–growing public concern about the mounting impacts of climate change and the sharp reductions in the cost of solar, wind and other clean technologies provide political and economic rationales for higher ambition, but President Trump’s decision to withdraw the US from the Paris Agreement and the trade war he has launched with China are creating headwinds against bold action.

The growing ambition gap

As I noted when the agreement was reached, it is a triumph of multilateral diplomacy, representing the culmination of 25 years of intense negotiations over how to confront the immense challenge of climate change (with lots of ups and downs along the way).

It requires countries to put forward national climate action plans (referred to as “nationally-determined contributions,” or NDCs), and to periodically report on their progress towards implementing those plans, but leaves it up to each country to determine the plan’s content and level of ambition. This last feature has resulted in near-universal participation in the agreement.

That’s the good news. The not-so-good news is that the collective level of ambition of the initial round of country NDCs, most of which extend out to 2030, is well short of what is needed to have any chance of meeting the ambitious temperature limitation goal set forth in the Paris Agreement: “holding the increase in the global average temperature to well below 2ºC above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5ºC above pre-industrial levels.”

This ambition gap was explicitly acknowledged in the decision adopting the agreement, which also requested the Intergovernmental Panel on Climate Change (IPCC) prepare a report on what it would take to meet the 1.5ºC and 2ºC goals.  That report, released last October, found that:

“In model pathways with no or limited overshoot of 1.5°C, global net anthropogenic CO2 emissions decline by about 45% from 2010 levels by 2030 (40%–60% interquartile range), reaching net zero around 2050 (2045–2055 interquartile range). For limiting global warming to below 2°C CO2 emissions are projected to decline by about 25% by 2030 in most pathways (10%–30% interquartile range) and reach net zero around 2070 (2065–2080 interquartile range). Non-CO2 emissions in pathways that limit global warming to 1.5°C show deep reductions that are similar to those in pathways limiting warming to 2°C.”

The sharp disconnect between the pathways that the IPCC report says are needed to hit the 1.5ºC and 2ºC goals and the emissions trajectories associated with the current Paris Agreement pledges is illustrated by this graph from the Climate Action Tracker (CAT) team.

Before Paris, the world was on track for warming of 4ºC or more by 2100; the Paris pledges, if fully implemented, would bring that down to a 2.6º to 3.2º range. But the emissions curve must bend sharply downward to get on pathways consistent with the Paris temperature limitation goals. (Source: Climate Action Tracker, December 2018 update.)

And as CAT’s latest update makes clear, nations are far from making progress in closing this gap. In fact, the situation is getting worse. After three years of little or no increase in global carbon dioxide emissions, we have seen sharp increases in 2017 and 2018, with every expectation that we’ll see the same again this year.

The NDCs of most major emitting countries are rated by the CAT team as “insufficient,” “highly insufficient,” or “critically insufficient” (spoiler alert: the U.S., along with Russia, Saudi Arabia, Turkey, and Ukraine, is in that last ignominious category).

What’s clearly needed – and soon — is a massive injection of political will.

Not all the news is bad

There are some signs of hope. A number of countries, including France, Norway, Sweden, and the United Kingdom, have set net zero emissions targets in national law, meaning that any emissions of carbon dioxide and other heat-trapping gases will need to be fully offset by actions to remove or sequester carbon from the atmosphere. Costa Rica, Denmark, Finland, and several other countries have adopted such targets as policy positions, but not yet embodied them in law. Most of these countries are aiming to reach this goal by 2050, while Norway, Finland and Sweden intend to reach this target much sooner. The European Union is now considering whether to adopt a collective 2050 net zero emissions target for its 28 member states.

Twenty-two countries and more than 200 states, provinces, and cities all over the world are members of the Under 2 Coalition, committing to “limiting emissions to 80%-95% below 1990 levels, or to below 2 annual metric tons per capita, by 2050 – the level of emission reduction necessary to limit global warming to under 2°C by the end of this century.”

And more than 200 companies – including Coca-Cola, Dell, Kellogg’s, Pfizer, Proctor & Gamble, and Sony – have adopted science-based targets “in line with what the latest climate science says is necessary to meet the goals of the Paris Agreement.” Here in the U.S., nearly 4,000 states, cities, counties, companies, and other institutions are members of the We Are Still In coalition, which is committed to meeting the U.S. emissions goals under the Paris Agreement despite President Trump’s irresponsible decision to withdraw the United States from the agreement.

Show me your plans

These initiatives are all most certainly to be welcomed. But the hard fact remains that unless more countries–especially those that make up the G20, which are collectively responsible for about 85 percent of global emissions–commit to significantly increasing the ambition of their existing Paris commitments, the possibility of staying well below a 2ºC increase in global temperatures, much less meeting the 1.5ºC limit, will be totally foreclosed.

Recognizing this fact, United Nations Secretary-General (UNSG) Antonio Guterres announced over two years ago that he would hold a leaders’ climate summit in conjunction with the opening of the UN General Assembly in September of 2019. The summit is scheduled for September 23 at UN headquarters in New York, and Secretary-General Guterres has been quite clear as to what he wants from world leaders:

“I am telling leaders: ‘In September, please don’t come with a speech; come with a plan.’ I am calling on leaders to come to New York…with concrete, realistic plans to put us, once and for all, on a sustainable path. These plans must show how to enhance Nationally Determined Contributions by 2020. I also want leaders to demonstrate how we can reduce greenhouse gas emissions by 45 percent over the next decade and get to net zero emissions globally by 2050. That is what science says is needed.

I will also ask leaders to address issues such as a just transition–where no one is left disadvantaged by necessary climate action. And I will ask them to demonstrate the many benefits of climate action, such as job creation, reduced air pollution and improved public health.”

In addition to announcements of commitments to enhance country NDCs, the summit also intends to showcase transformative actions in a number of key sectors, including energy, industry, infrastructure and cities, nature-based solutions, climate resilience and adaptation, and climate finance and carbon pricing.  It will also attempt to respond to “the unprecedented mobilization of young people worldwide who are demanding ambitious climate action” with several initiatives, including a Youth Climate Summit on Sunday, September 22.

Speaking of youth, Greta Thunberg and other leaders of the student climate strike movement have announced they are organizing a global climate strike to be held on September 20th and 27th, and they are calling on adults everywhere to join them.  “Our house is on fire,” they declare. “The climate crisis is an emergency but we’re not acting like it. People everywhere are at risk if we let oil, coal and gas companies continue to pour more fuel on the fire. Millions of us will walk out from home, work, school or university to declare a climate emergency and show our politicians what action in line with climate science and justice means. The climate crisis won’t wait, so neither will we.”

Photo Credit: Alden Meyer

 

A marathon, not a sprint

No one is under any illusions that the UNSG’s climate summit and the global climate strikes are going to lead to an immediate shift in the thinking and actions of world leaders — this is a marathon, not a sprint, and the forces of denial, delay, and obstruction of climate action are powerful indeed. The fossil fuel industry has a track record of nearly 40 years of deception and harm, and there’s little indication that they intend to transform their business models to be compatible with the Paris temperature goals.

The real test will come over the next year-and-a-half, as countries face the end-of-2020 deadline set out in the decision adopting the Paris Agreement to determine whether to increase the ambition of their initial NDCs. There will be opportunities galore this year and next for countries to showcase their commitments to enhanced climate action, including at the annual Conference of the Parties meetings being hosted by Chile in Santiago this December, and likely by the United Kingdom in November of 2020.

President Trump’s decision to withdraw the US from the Paris Agreement and his efforts to dismantle climate action at the federal level mean the United States will be on the sidelines of the climate fight until January of 2021 at the earliest. In the meantime, all eyes are on the other major emitting countries, in particular China and the European Union.

Can the EU persuade the four Eastern European member states that blocked agreement earlier this summer on a collective long-term net zero emissions goal and a commensurate increase in the EU’s 2030 NDC to drop their opposition? Are China’s leaders ready to follow through on the pledge they made together with France on the sidelines of the G20 summit in June to “update their nationally determined contributions in a manner representing a progression beyond the current one and reflecting their highest possible ambition,” by announcing a significantly strengthened NDC? Or will the uncertainties created by the current US-China trade war lead them to be more cautious?

Perhaps most intriguing is whether the EU and China could make a joint announcement on enhancing the ambition of their NDCs; conversations on this are underway but getting to yes requires overcoming their differences on trade, security, and other issues, and there are no guarantees.

Such an announcement could have a real impact on other major emitters, much as the U.S.-China joint announcement in late 2014 on the two nations’ intended post-2020 climate actions helped spur progress in the last phase of negotiations leading up to adoption of the Paris Agreement.

Time is not on our side

Meanwhile, the climate clock keeps ticking, with heat waves breaking temperature records across Europe this summer and accelerating ice loss in the Arctic and Greenland, water shortages affecting cities and villages across India, and extreme flooding devastating farm communities across the American heartland, to mention just a few recent examples. As former Vice President Al Gore has been saying for several years now, “every night on the network news is like a nature hike through the Book of Revelations.” Each of these events is just one more reminder that the climate system is reality-based – it doesn’t respond to plans and speeches, but to emissions.

The Paris Agreement provides the framework for countries to collaborate on the bold action we need to confront the climate emergency, but realizing its promise requires much greater leadership, especially from presidents and prime ministers. We will soon know whether that leadership is forthcoming at the pace and scale needed to start bending the emissions curve down sharply, as the world’s scientists have made clear we must do to avert climate catastrophe.

How Can I Choose My Electricity? Options that Make a Difference Personally and Nationally

If you’re getting a roommate, you might end up spending a lot of time together, so choosing a good one is something you probably want to give a lot of thought to.

The same is true for the energy that keeps your lights on. It’s why we just released a new video on the topic. The good news is that we’ve got a big range of clean options when it comes to choosing our electricity supply, as consumers and constituents, from the personal to the national. Options that can reduce waste, save money, and forestall the worst effects of climate change.

In other words, electricity choices we can all live with.

Why choose?

Why should we care about where our electricity comes from? Because how we get our power can have a lot of implications for our health, the environment, our communities, and the economy.

It’s good to know about our choices, and to say yes to better options whenever we have the chance. I’ll start with what you can do at home, scale up to the community level, and finish with action you can take to help the country choose wisely.

Choosing energy at home

Like the choice of roommate, some of the options for switching up our electricity mix are really close to home, whether it’s buying green power, embracing rooftop solar, or tapping into solar without a roof.

Green power. Would you invite just anyone to live with you? It used to be that you had to accept whatever power sources your electric utility served up, and that was that.

Not anymore. Some states have reconfigured their power sector in ways that allow homes and businesses to choose from a variety of electricity providers or offerings. That gives you a say in what types of electrons your dollars are encouraging. And that can include green power options, which allow you to select renewable energy sources like solar and wind energy.

Even if you don’t have green power options through your utility, you can buy renewable energy certificates/credits (RECs) to overlay on whatever your utility is giving you. Your REC purchases can help drive the development of more renewable energy by rewarding those projects for the fact that they’re different from (and better than!) fossil fuel-powered generators. (See here for a handy video on how green power/RECs work.)

Whether you choose green power or buy RECs, your local utility still provides you with the service, via the same poles and wires, and keeps the lights on (for you and your fellow co-habitators).

Solar on the roof. Some households might have the option of generating some of their own electricity, generally via a home solar array. This option is more involved, and open only to those who have a suitable roof. (Details on my own solar journey are here, here, and here.) But having a device overhead that churns out kilowatt-hours directly from sunlight can be a pretty neat way of connecting with the source of your electricity.

Community solar. Fortunately for those looking to connect with solar without having it overhead, there’s another option. A community solar project involves a bunch of subscribers—homeowners or businesses—getting utility bill credits from a larger solar array somewhere other than on their roofs. A colleague described community solar here. Community solar can bring a lot of the benefits of solar, without the roof.

OUR CHOICES: Not all these options are available everywhere, or to everyone. But if one or more is, they can be good ways to make a difference right at home.

Choosing energy in your community

Focusing on communities brings new options into the picture when it comes to electricity choice.

Community Choice Aggregation. How about making it easier for people to embrace clean energy by making it the default option? Community Choice Aggregation, also known as Community Choice Energy or municipal aggregation, involves a community choosing a default electricity supplier for the whole town that is different from the poles-and-wires utility. And the ability to shift to a renewables-rich electricity supply is often a key driver. Homes and businesses still generally have the power to opt out of the new default if they choose. But for the rest, once it’s in place, community-level aggregation can make choosing clean energy easy as doing nothing.

Community Empowerment. Another, budding idea involves a community using its financial strength to accelerate the switch to clean energy. With Community Empowerment, communities help drive more renewables by entering into long-term contracts with particular clean energy projects. It doesn’t necessarily (directly) change the energy the community will be using, since the electricity and other outputs from the contracts might get sold off, with the community getting debited or credited for any difference from the contract price. But the community’s investment via the contracts help get more renewable energy projects underway.

OUR CHOICES: At the community level, the choice part for us comes in pushing our communities down one (or both) of these paths, so that we move toward clean energy together.

Voluntary green power purchases—via utilities, through REC purchases, and now through CCAs—have been an important driver of renewable energy, and a good complement of required utility purchases (the “compliance” market). (Source: NREL)

Choosing energy in your state

Each new level is a bigger lift, but also offers a bigger impact. That’s the way it is with actions at the state level.

Renewable electricity standards. RESs (or renewable portfolio standards/RPSs) have been a really important driver of renewables for at least two decades now, and 29 states and Washington, DC, have them in place. Typically, a state sets a schedule for the increasing amount of renewable electricity that an electricity supplier (utility or other) has to use in meeting their customers’ needs.

And the bar is getting set higher all the time. There are now at least eight states (plus DC and Puerto Rico) that have committed to switching to 100% clean electricity over the next 2-3 decades.

Long-term contracts. Like at the local level with Community Empowerment, long-term contracts at the state level are another way of driving positive change in the power sector. Several states are contracting (directly, or through their utilities) for power from clean energy sources as a way of offering price stability and potentially lower pricing for electricity customers, and oomph for those technologies—including newer ones like offshore wind.

Integrated Resource Planning. This one is a little more obscure, but is where a lot of the action happens with utilities in many states. IRPs involve utilities spelling out what mix of energy sources they’re thinking of using over the decade or two to meet electricity demands and satisfy public policy obligations. As a colleague describes it, IRPs “determine where consumers’ electricity will come from, how clean that power will be, and whether states will meet their clean energy and climate goals.” If the process is public enough (it should be), stakeholders like you and me can weigh in on behalf of clean energy.

OUR CHOICES: Our job as electricity choosers is to push for the enabling policies, or other state action, to bring these tools into effect, or, where they already exist, to increase their level of ambition.

Choosing energy in your nation

And then there’s our country.

Renewable electricity standard. The RES idea that has been so well proven at the state level is now in play at the federal level, along with a clean energy standard proposal, which is a variant of the idea. UCS’s analysis of the national RES proposal in Congress right now found benefits in terms of energy diversity (less risk of overreliance on natural gas), economic development, consumer benefits, and pollution reduction.

OUR CHOICES: Here, too, our job is clear: The RES won’t happen without Congress… Fortunately, it’s easy to tell them you care. First, ask your senator to support a national standard that would commit the US to producing 50% of its energy from clean sources by 2035. After you’ve taken the action, please share the video and this blog with friends and family and ask them to act at CleanUpTheGrid.org.

Choosing unstoppability

In some ways, choosing your electricity is a lot lower pressure than choosing your roommate. You don’t have to worry about whether you have compatible tastes in music, or can coordinate schedules, or have the same sense of what’s acceptable when it comes to management of dirty laundry or dirty dishes. Electrons are electrons.

Except that they’re not. Because where those electrons come from matters. A lot.

So it’s good to know that we have more options for shaping our energy destiny than we might realize, and that we can do a whole lot better than business as usual—just as we might be able to do better roommate-wise than just grabbing the first person who wanders in, no questions asked.

The “Unstoppable” image below can be seen on billboards in multiple US airports starting next week. If you happen to see it, remember that it’s not talking just about wind turbine blades or wind farms or the tremendous progress clean energy is making. It’s talking about us, about what happens when we choose to change the way we make electricity. About the power (as it were) we have to make a difference in a key sector of our society.

We wouldn’t take choosing our roommate lightly, and we shouldn’t take lightly what electricity we let into our homes and communities either.

Photo: Recurrent Energy Photo: John Rogers

Up Close with California’s Power Grid Operator

I went on a tour of the California Independent System Operator.

“The who?” my parents asked me. “Never heard of them.”

I explained: “the California Independent System Operator – or CAISO for short – they operate the grid in most of California.”

“Huh,” they replied, somewhat puzzled, “I thought the utilities, like PG&E, did that.”

“Nope!” I said, being a totally unhelpful son and energy analyst, failing to explain further.

So let me do a better job of explaining the CAISO to you than I did to my parents.

What do Independent System Operators do?

Independent System Operators, or ISOs, are like air traffic controllers, but for electricity. Just as air traffic controllers supervise take-off and landing at airports and manage routes between airports, ISOs manage the flow of electricity on transmission lines and instruct power plants to turn on and off in order to match electricity supply and demand. Air traffic controllers don’t own the airplanes or the airports; likewise, ISOs don’t own transmission lines or power plants. Both air traffic controllers and ISOs are an independent third party that keep these complex systems operating efficiently and safely.

There are seven ISOs and RTOs in the United States (RTO stands for Regional Transmission Operator, which is very similar to an ISO). Together, these serve roughly two-thirds of the United States. For the large swaths of the country without an ISO/RTO operating the electric grid, the local electric utility is likely operating the transmission system and balancing electricity supply and demand. (So my parents were sort of right, except this isn’t the case in northern California!) Of all the benefits of having an ISO operate the grid, the most significant is the increase in efficiency, which helps ensure reliable and lower-cost electricity.

The CAISO started operating in 1998 when they opened their two California control centers. Today, the CAISO manages roughly 80% of California’s grid and nearly 26,000 miles of transmission lines, serving 30 million customers. The CAISO also operates numerous markets to facilitate the buying and selling of electricity and other services that keep the grid operating smoothly.

There are seven ISOs and RTOs in the United States, serving roughly two-thirds of the country.

Grid operators learning as they go

For the grid to work properly, electricity generation must exactly match electricity demand at all times – right down to the second! The grid operator’s job has always been to stay ahead of the daily changes in electricity supply and demand to keep the grid in balance. For instance, grid operators must anticipate and respond to weather changes that affect renewable energy production and electricity demand (e.g. cloud cover that reduces solar output and heatwaves that increase air conditioning use). Grid operators must also respond to unexpected power plant and transmission line outages.

Operating the grid has gotten considerably more complicated over time. Decades ago, grid operators had to consider the weather and the calendar to get a pretty good idea how much electricity people would be using the next day. The grid operator would tell coal and natural gas power plants to turn on to make sure there was enough electricity throughout the day. And that was pretty much it.

Nowadays, California has made significant investments in renewable energy. While wind and solar generate low-cost and emissions-free electricity, they only generate during certain times of day, and the CAISO has to fill in the gaps with electricity from other sources.

The CAISO has been learning as they go, figuring out how to integrate more and more renewables into the state’s grid as California strives to achieve its clean electricity goals. While ISOs and RTOs across the country have been steadily adding renewables to their grids, California is much further ahead, and the CAISO hasn’t had many examples to look to – they have been figuring it out on their own. The CAISO’s efforts have enabled them to operate at times with 78% of demand met by renewable energy.  This is an achievement reflecting a lot of learning.

Ramping up in the evening

Traditionally, grid operators have been most concerned about the “peak demand,” which happens on the hottest summer days when folks are blasting the air conditioning. But California’s grid operators are now more concerned with “evening ramp,” which is the time in the evening when the renewable generation (mostly solar) tapers out and other sources of energy must ramp up to meet electricity demand. The evening ramp is a yearlong challenge for the CAISO.

On the January 1, 2019, the CAISO broke their all-time evening ramp record: over a three-hour period, they ramped up by 15,639 MW. Considering that the peak demand in all of January 2019 was just under 30,000 MW, having the flexibility to ramp up by half the month’s peak demand in only three hours is not a simple feat.

A big evening ramp makes the grid operator’s job more difficult because not all resources can be ramped up to produce electricity that quickly. So California is implementing solutions to help ease the evening ramp. Energy storage, flexible demand, and diverse sources of renewable energy like geothermal and wind can all make the grid easier to operate. As California continues progressing towards its clean electricity targets, the state will need to double down on these solutions to make the transition go smoothly.

The biggest challenge

I can’t discuss challenges faced by the grid operator without mentioning cyber security, reportedly the CAISO’s biggest challenge. The CAISO computers are hit millions of times per month with attempted intrusions, and the CAISO must stay on top of the constant probing to ensure their networks remain secure. A security breach could have serious consequences (e.g. power outages). Suffice it to say, the CAISO takes both cyber security and physical security at their headquarters very seriously.

The control room

The CAISO control room in Folsom, CA is staffed 24/7/365 to keep California’s electric grid operating smoothly.

I visited the CAISO control room in Folsom, California this past July. The first thing I saw when I laid eyes on the control room was the probiotic ads on the TV. I thought, “Why do these blessed control room operators get to watch TV on the job all day long?” The answer, as I learned, is “situational awareness.” The control room operators need to know what’s happening in the outside world that might affect the grid, things like terrorist attacks or wildfires. So they monitor the TV news 24/7 (which is probably more a curse than a blessing) to stay on top of current events.

The people who operate the CAISO grid don’t have an easy job. No matter the time of day, the operations room is always staffed, and operators work 12-hour shifts in a windowless room. Tough job! It turns out many CAISO operators are ex-military folks who used to work on submarines (with no windows!). Their prior experience makes them a natural fit because they are used to working long hours and keeping a cool head in high-stress situations. When something goes wrong and the grid is out of whack, operators must be able to make good decisions on the fly to restore balance and keep the lights on.

Why you should care about the CAISO

For the most part, the CAISO flies under the radar, and most Californians are probably not even aware of its existence. But the CAISO plays a critical role in California’s electricity system. When California’s utilities add more renewable energy to the grid, the CAISO is the one who is figuring out how to utilize all that clean energy while keeping the lights on. When wildfire risk is high and California’s utilities de-energize transmission lines, the CAISO is the one who must figure out how to minimize the impact and keep the lights on.

The bottom line is, on a day-to-day basis, the CAISO is the organization responsible for keeping the lights on in most of California. And they do this despite all the challenges that come their way.

FERC CAISO

States March toward 100% Clean Energy–Who’s Next?

One year ago this week, the California legislature passed landmark legislation committing the state’s power providers to supplying 60% of their electricity from renewable energy by 2030 and setting a target of 100% clean, or carbon-free, power by mid century. It was a bold action that significantly raised the bar for other states considering policy action.

And over the last 12 months, another six states (bringing the total to eight states) plus the District of Columbia and Puerto Rico have answered the call with various obligations toward 100% clean energy over the next few decades.

What’s driving this surge in state-level clean energy leadership? And which states will be the next to step up?

A banner year for state clean energy policy

State-level policies supporting renewables and other carbon-free resources are on a roll in 2019. In January, the District of Columbia committed to a renewables-only future when the mayor signed a measure passed unanimously by the city council to increase its renewable electricity standard (RES) to 100% by 2032, a target only previously matched in ambition by Hawaii, which adopted a similar measure (with a target year of 2045) in 2015.

Later in the spring, Puerto Rico also committed to a 100% renewable energy future by 2050—while ending coal use by 2028—as the strong and resilient island rebuilds from the devastation of Hurricane Maria.

And in June, Maine adopted a sweeping set of clean energy measures, including a doubling of its RES to 80% by 2030 and setting a goal of 100% renewables by 2050.

Maine Governor Janet Mills signs into law a bill increasing the state’s renewable energy standard and setting a goal of 100% renewables by 2050.

During the same period, another tranche of states took a similar path to 100% as California by broadening the policy support to other carbon-free technologies—like nuclear power and carbon-capture and storage—while also ensuring a dominant role for renewables. For example:

  • In March, New Mexico adopted an 80% by 2040 RES along with requiring a 100% carbon-free power sector by 2045.
  • Also in March, New York’s Governor Cuomo signed a sweeping climate and clean energy bill into law in July that includes a 70% RES by 2030 and 100% carbon-free requirement by 2040.
  • In Washington state, which already gets more than 70% of its electricity from renewables (mostly large-scale hydropower), Governor Inslee signed a measure in May to make the state’s power sector coal-free by 2025 and carbon-free by 2045.
  • In addition, the Nevada legislature included the goal of a 100% clean energy power supply by mid-century as part of the bill it adopted in April to double its RES to 50% by 2030.

And finally, in June, New Jersey Governor Phil Murphy released a detailed draft energy master plan through the Board of Public Utilities to achieve 100% clean energy by 2050, a goal the governor put forward through an executive order in May of 2018. This plan builds on an increase in the state’s RES to 50% by 2030 that became law earlier in 2018 and is a meaningful step toward a 100% clean energy future, despite not having a legislative mandate behind it.

A tipping point?

A decade or more from now, when we reflect on the progress made in the urgent race to de-carbonize the US power sector, this past year will likely be viewed as a pivotal tipping point. To be sure, a lot of work remains to be done to ensure the 100% clean energy transition is achieved affordably, reliably, and equitably. And not every state is moving in the right policy direction with respect to renewable energy (see Ohio’s HB 6 as Exhibit A).

However, this is the year when the vision of a clean energy economy has come into focus with the weight of strong policies to back it up. What was once only a rallying call of progressive climate and clean energy advocates is now enshrined in statute in states across the nation.

Consider the aggregate influence these 100% clean energy states can have in moving the entire country toward a carbon-free power supply:

  • More than 86 million residents, 27% of US population in 2016
  • 18% of US electricity consumption in 2016
  • 138 million metric tons of power sector carbon dioxide emissions in 2016, 8% of the US total
Many factors contributing to 100% momentum

Momentum has been building toward 100% clean energy for some time now, but the recent surge in state-level clean energy leadership can be attributed to several key factors. First and foremost, the 2018 election ushered in a wave of new governors and state legislators who campaigned on an aggressive clean energy agenda. At least six of the newly elected governors last year made pledges to join the US Climate Alliance, support the Paris Climate Agreement, and pursue 100% clean energy policies.

While all six of these governors were Democrats, it should also be noted that the push for 100% is not exclusively a partisan issue. That’s because a large majority of Americans—including 95% of Democrats and 71% of Republicans according to one recent poll—support the goal of 100% renewable or clean energy by 2050.

And while that strong bipartisan public support hasn’t materialized into bipartisan policy support in many cases, there is encouraging evidence that it is beginning to happen at the state level at least. For example, the 100% clean energy policies passed in Nevada, New Mexico, and Maine this year all garnered solid bipartisan support.

Of course, a primary reason that public support for renewable energy has soared is because they are cost competitive with new and existing fossil fuels, and in many places are helping to reduce consumer electricity bills. In addition, through innovative technologies and practices, utilities and grid operators are getting increasingly comfortable with the notion that the grid can reliably accommodate much higher levels of renewable energy. Low prices and increased reliability have resulted in a surge of renewable energy investments by major corporations and voluntary decarbonization commitments by many utilities, which has in turn given more confidence to political leaders in supporting aggressive policy action.

Further fueling state momentum on 100% clean energy is the urgent call to action by the world’s leading scientists in the United Nation’s climate report released last October. With the complete abdication of climate or clean energy leadership within the Trump Administration and among majority leadership in the US Senate, state leaders know their actions are critical for maintaining clean energy progress and reducing carbon emissions.

Eight states plus Washington DC, and Puerto Rico (not pictured here) have committed to 100% Renewable or Clean Energy Standards. Another 13 states are actively considering similar measures.

Who’s going to commit to 100% next?

The flurry of state action on 100% clean energy policies is poised to continue as a broad and diverse set of stakeholders and political leaders are pursuing legislation in at least 13 states, including Connecticut, Colorado, Florida, Illinois, Iowa, Massachusetts, Maryland, Michigan, Minnesota, North Carolina, Pennsylvania, Virginia, and Wisconsin.

  • Among the most promising in the near-term is Illinois, where the Clean Energy Jobs Act, a comprehensive clean energy and climate bill that requires 100% carbon-free electricity by 2030 and 100% renewable energy by 2050, has already been co-sponsored by a majority of state Senators and is supported by the governor.
  • In addition, just two weeks ago, Wisconsin’s Governor Tony Evers issued an executive order creating a new Office of Sustainability and Clean Energy with the goal of working with the state’s utilities to achieve 100% clean energy by 2050.
  • And in Maryland, Republican Governor Larry Hogan indicated, after in May allowing to become law an increase in the state’s RES to 50% by 2030, he plans to push for a 100% clean energy standard during the 2020 legislative session.

The urgent need to act on climate change by decarbonizing our economy is recognized now more than ever. A critical step in achieving that goal is a swift transition to 100% clean and carbon-free energy. The barriers to such an ambitious vision have been torn down and many states are now stepping forward to lead. Let’s work together to keep the 100% list growing.

DOE State of Maine, Office of Governor Janet Mills

Is this Michigan Utility’s Resource Plan the Worst Ever?

Just a few years ago, Michigan passed a law to guide the state’s utilities on proper resource planning (known in the industry as an Integrated Resource Plan, or IRP). The point of the law was to help promote better utility planning. Utilities, after all, are poised to invest $150 billion in capital this year. When they don’t make smart decisions, it is customers like you who pay the price. Having now reviewed the latest of such plans–DTE’s Integrated Resource Plan (IRP)–I am left wondering if the utilities themselves are listening to the legislated guidance.

I filed testimony—along with James Gignac, Eric Woychik, Kevin Lucas, Will Kenworthy, and Anna Sommer—in the case, and I want to highlight just a few of the glaring problems with the resource plan.

Rigid blinders

DTE, like most utility companies, bought proprietary models to conduct planning analysis, but it doesn’t appear DTE knows how to use them.

So much of the resource plan was “hardcoded” that DTE actually prevented the model from selecting resources that would otherwise provide real economic value to DTE’s customers. This is the exact opposite of the outcome one should hope for when conducting resource planning. Rather than allowing the modeling to illuminate opportunities, the company placed such rigid blinders on the process that it was impossible to glean any useful information from the modeling exercise.

There were a number of ways that the company forced the model to produce a specific set of results. One way that I testified about was their use of the “must-run” designation in the modeling. The must-run designation forces the model to use coal and gas resources, even when it isn’t economic to do so.

When set this way, the model will run uneconomic power plants year-round and prevent the utility from finding opportunities for ratepayer benefits from things like seasonal operation.

When the “Must run” designation is removed, many of the company’s coal plants operate much less frequently

Analysis from the Direct Testimony of J. Daniel. Data scrubbed of any confidential information.

The must run designation is a way to hardcode self-committing into the utility long term plans—a practice utilities should strongly consider stopping given how much it costs customers. Commissions in Minnesota and Missouri are investigating the economics of must-run designations. Maybe Michigan should be the next state to look into it?

“Junk in, junk out”

In my testimony, I outline that there were at least four different ways that the company was underestimating the benefits of energy efficiency, called energy waste reduction in Michigan. What was striking was the cavalier manner in which these underestimations were presented. So much so, that DTE didn’t seem to mind engaging in some cognitive dissonance, with one witness describing higher levels of energy waste reduction (EWR) as being “not cost-effective” while another witness reported that those same levels of EWR produce $2 of benefits for each $1 of costs.

Usually, I would try to quantify the numerical value of the underestimation in a proceeding like this, but DTE’s convoluted and opaque process made that task impossible. I was able to partially unravel how the company underestimated the “avoided transmission and distribution investments” benefit that resources like efficiency can help defer. The company assumed a zero-dollar value in all but one of their analyses and attempted to justify assuming a zero-dollar value by pointing to two reports.

The two reports they cite to justify their assumption both do a better job casting doubt on the assumption than supporting it

The first report (a biannual avoided cost study for the New England states) dedicates nearly a page to debunking the use of an assumed zero-dollar value. The other report, which was specific for Michigan, describes a zero-dollar value assumption for Michigan as “very conservative” and casts serious doubt on the use of such an assumption.

DTE does compute a $7/kW value for use in one of the model runs. This value, however, is far below what other utilities have come up with. A meta-analysis of other utilities’ avoided transmission and distribution (T&D) value found only 2 utilities that used a zero-value, the rest all had values two-times higher than DTE’s “high” value.

A meta-analysis of avoided T&D studies, values adjusted for inflation.

Speaking of wasted energy…

Assembling a utility’s resource plan, conducting the modeling, writing the testimony, hiring experts, and filing everything with the commission, is expensive.

Joe Daniel

A picture of the direct testimony of DTE’s experts.

It is also expensive for those that want to engage in thoughtful critique to try to improve the IRP (like UCS and the coalition we worked with that included Ecology Center, SEIA, Vote Solar and ELPC).

None of these issues outlined above are particularly unusual, though they are intellectually egregious.

Outdated cost data for renewables is frustratingly more common than you’d hope.

There is plenty of institutional inertia fighting against designating coal plants as “must run.”

And underestimating the benefits of energy efficiency (EE), well that’s damn near a time-honored tradition among utilities.

What makes DTE’s IRP unusually bad is just how hard it was for the experts in the case to reveal these issues. More often than not, these issues are sitting in plain sight not buried three layers deep.

In all my years of reviewing IRPs the DTE IRP might be the worst. The only thing preventing me from using more definitive language is that I’m not entirely certain it qualifies as an IRP.

Why?

Well, because if the company corrected for every error, misstep, and poor assumption identified in our coalitions’ 100’s of pages of testimony it would have had zero impact on DTE’s planning. Why is that? Well to answer that question I’ll have to quote expert witness Keven Lucas:

“The answer is simple but astonishing.  DTE did not base its [plan] on any modeling runs in this case, but instead based on a now-dated [levelized cost of energy] analysis from its 2018 Renewable Energy Plan… which was in turn based on even-more-dated 2017 cost estimates.

That’s right, this multi-billion-dollar a year corporation spent hundreds of thousands of dollars conducting what turned out to be a sham analysis which results were predetermined by an outdated calculation.

Verdict: Michigan Customers deserve better than “not the worst

At the end of the day, I’m not sure if DTE’s resource plan qualifies as a resource plan, certainly not by standards set forth by Michigan IRP laws. With intervenor testimony now filed, there is a mountain of evidence laid out that suggest there were deep and meaningful flaws to DTE’s “IRP.” And while reasonable people can disagree about what “the worst IRP” would look like, I would assert that Michigan deserves better than “not the worst.” And better than what DTE has put forward.

DTE’s plan favors its own expensive power plants over a truly robust process to ensure cleaner and more affordable energy for Michigan customers. I’ve seen utility commissions reject resource plans for far less egregious missteps. The Michigan Public Service Commission should send this plan back to the company and insist that DTE take seriously its obligation to fairly evaluate all resource options, especially earlier investments in renewable energy and energy efficiency.

Many other groups have now called for the Commission to reject the utility’s IRP, which would hopefully force the company back to the drawing board and precipitate a more thoughtful and robust resource plan.

Is DTE’s plan the worst IRP you’ve ever seen? Think you’ve seen worse? Then @ me on twitter (@electronecon) and tell me who wins your vote for worst utility IRP.  

Geniuserp

The $2.5 Billion Question Waiting at FERC

Photo: Pictures of Money/Flickr

The electricity industry is watching closely for news that will raise consumer costs some $2.5 billion per year.  The Federal Energy Regulatory Commission is expected to change the payments for new and old power plants in 13 states. This decision has been delayed a year by the resignation of a commissioner leaving split FERC and has an added feature: it tramples on state policies and prerogatives. (I’ll list those states and policies later.)

Changes proposed by PJM

States where PJM seeks to increase customer costs and discredit utility and energy policies. Credit: PJM

The grid operator PJM runs the largest electricity market in the US for one-fifth of the population. They argued that a variety of state practices and policies established to fund power plants, some old and some new, conflict with and corrupt the market it has set up to create competition.  PJM proposed to change the prices bid in its market for plants with some kinds of subsidy payments. UCS and others argued that the subsidies are widespread throughout the energy industry, but PJM declared to FERC that it would decide which subsidies are bad and which are good.

FERC action in 2018

In June 2018, FERC decided that PJM’s existing rules for its capacity market are unjust and unreasonable.  FERC rejected PJM’s distinctions that would protect some resources receiving state support from others that receive state support, saying that there is no evidence showing a difference in impact on market price interference.  FERC ordered PJM to include all resources receiving state support in its proposed price-adjustment practice. FERC Commissioner Robert Powelson, a supporter of markets appointed by Donald Trump, resigned the same day.

The cost of excluding state policies

While FERC tried to soften the blow on consumers and make some accommodation for state policies, the cost of this decision will clearly be in the billions of dollars. In the previous annual running of this auction, payments to generators from consumers was $9.3 billion.  In anticipation of a ruling from FERC to get the market started again, one investment bank advisory suggests that the total increase from the repricing rules will be 30% higher prices. This would translate to a cost impact over $2.5 billion per year from consumers.  All sorts of critical issues are not yet known about the power supply once this rule is adopted, (not to mention court challenges).

More controversy

I’ve written about states’ policy-making and reliability goals coming into conflict with PJM’s initiatives to run a market with incomplete products, PJM’s continuous opening and patching loopholes, and inconsistent approaches to reliability.  Also I wrote about the absence of leadership and PJM’s shared authority with state and federal governments on what turned out to be the day PJM announced a management shakeup.

Will FERC let PJM select subsidies?

In the anticipated decision, FERC will resolve the central question: which subsidies will be penalized by PJM and which will be allowed. PJM had proposed to safeguard from its repricing practice a list of support payments, tax advantages, and subsidies which are predominantly used for fossil fuel plants.  PJM also hoped to include in that protection from competition the plants that are owned by a utility that has state-monopoly protection and revenues to supply its customers.  Whether that category is protected from repricing will be critical to the challenges to this decision. FERC earlier noted the argument that those plants, with state-set rates paying the plant owner, also interfere with market prices.

FERC said no state policy supports

FERC’s order in June 2018 excluded all resources receiving state supports, apparently removing from competition many nuclear plants, many renewables, coal plants receiving state bailouts, and any plant in a utility rate charged to consumers. (This is not a comprehensive list).

The states with policies supporting old or new power plants:

  • Renewable Energy Standard: DC, DE, IL, IN, MD, MI, NC, NJ, OH, PA, VA (These add up to approximately 25,000 MW of wind and 12,000 MW of solar resources, by PJM estimates.)
  • Offshore wind commitments: NJ, MD, VA (6,700 MW)
  • Nuclear support: IL, NJ, OH (6,900)
  • Coal support: OH, PA, WV (Policies vary)
  • Consumer rates cover costs for utility-owned generation: KY, OH, TN, VA, WV (This is 40,000 MW or roughly 20% of generation in PJM.)
  • PJM-area states with no subsidy to power generators: None

Investor-owned utilities that collect generator costs from consumers under state-set rates:

  • Dominion’s Virginia Electric & Power Co
  • First Energy’s Monongahela Power Co. and Potomac Edison
  • PPL’s Louisville Gas & Electric Co. and Kentucky Utilities Co.
  • AEP’s Appalachian Power Co. (West Va, Va, Tenn.), Kentucky Power Co., Wheeling Power Co., Ohio Power Co. and Indiana Michigan Power Co.

This story is still unfolding. PJM has said during this debate that a new federal payment to favor plants that have fuel on-site (i.e. coal and nuclear) would also be a market interference that will require those plants’ bids to be set higher, too. How states react to PJM’s efforts to raise prices, and counteract the laws enacted by every state in its footprint should be interesting. The leadership change at PJM and a growing realization that our markets are not designed for the needs of a changing energy supply create room for writing another chapter in this story after this one.

Photo: Pictures of Money/Flickr

Coal Power Trends: Visualizing the Decline of America’s Dirtiest Fuel

Coal fueled half of US electricity generation just a little over a decade ago, but its market share has been collapsing ever since. My colleague Emma Spellman, one of our 2019 UCS Schneider Sustainable Energy Fellows, took a closer look at the data and generated some great new perspectives on that downward trajectory. Here are her thoughts and visuals:

America’s dirtiest fuel is on the decline. The need to transition fossil fuels to renewable sources of energy is not new; in fact, it’s on its way. Policy, market development, and technological progress play pivotal roles in this transition.

Emma Spellman, UCS Schneider Sustainable Energy Fellow 2019

While these components continue to change and progress, it’s important to recognize how far we’ve come to help us keep the momentum going.

A graphic in a recent Guardian article skillfully illustrates these concepts in showing Britain’s quick transition away from coal. In the graphic, which shows the percentage of coal in their electricity mix each day over several years, coal-heavy days in 2012 give way to the first coal-free days by 2017, and a predominance of coal-free days this summer—including its first “coal-free fortnight.”

Indigo rising: transition in the Northeast and Great Plains

Inspired by the Guardian graphic, I set out to replicate this gradient approach for the US.

Unlike Britain, the US has multiple electrical grids, and those are separated into regions. Many are operated by regional transmission organizations (RTOs) or independent system operators (ISOs). And I found the right data for a couple of those—ISO-NE (New England) and SPP (the Southwest Power Pool, stretching from Oklahoma and parts of Texas and New Mexico to the Canadian border).

ISO-New England. New England states were early champions in clean energy policy and energy efficiency, and have been making a move away from coal for years. And when I graphed the ISO-NE data for generation in the region over the last dozen years, that transition showed quite clearly—in black and white and indigo.

In my graphic, each row corresponds to a year and each stripe within that row corresponds to a day. Pure black indicates the maximum during these years (in ISO-NE’s case, about 21% of that day’s generation coming from coal). Lower percentages are linearly scaled to some shade of gray. Indigo indicates days with zero coal generation within ISO-NE.

There is a clear gradient from 2008, with each year becoming lighter and lighter, and coal-free days beginning to pop up in 2012. In 2018, New England saw indigo for 108 days— 29.6% of the year, and over five times as many days as in 2013, just five years earlier.

Southwest Power Pool. SPP shows a different version of the transition away from coal. The speed of transition may not be on par with its northeastern counterpart, but the direction is right.

To start, it’s scaled to 77%, thus starting at a much larger ratio of coal to total generation for the maximum days. Unfortunately, there are also no indigo days. In fact, the minimum in the time frame observed is 24% (higher than ISO New England’s maximum).

However, there is still lightening as the years go by, which, for a historically coal-dependent region, is definitely promising. Days in which coal accounted for more than half of the region’s generation dropped to 55 in 2018 (15% of days) from 357 in 2014 (as in, virtually every day of the year). And coal’s average contribution over those years dropped to 42% from 60%.

Looking Forward

While these are two important case studies, I would love to continue to look at other regions as well. Unfortunately, some regions’ data wasn’t publicly available, some only went a couple years back, while others had varying formats between each year or even each month. However, the difficulties in data retrieval don’t negate the importance of the analysis.

While the transition to renewables from dirty sources of energy  is clearly not over, these graphics prove that we’re going in the right direction when it comes to coal, verifying past analyses by UCS and others.

Obviously, these graphics point towards the question: What’s taking coal’s place? We have to be aware of what fuel types we’re moving to as transitions like these happen.

Natural gas is an important example: While it burns more cleanly than coal, it is certainly not the standard we’re reaching for (and some regions’ ramped-up reliance brings challenges of its own).

Fortunately, our rapid increase in using renewable energy sources like wind and solar, plus energy efficiency, has been another way we’ve decreased our reliance on coal. Wind power’s portion in the Southwest Power Pool in spring, for example, more than quadrupled between 2011 and 2018, rising to 27% from 6%.

A decline in coal is notable and as the trend continues. We must keep our sights on policy and technology to allow for clean energy to fill the gaps.

 

Credit: Emma Spellman, Union of Concerned Scientists Credit: Emma Spellman, Union of Concerned Scientists

Tribute to Dr. Frank Ackerman, a Second Draft

The confidence a good mentor places in you can give you confidence in yourself. When a good mentor is willing to invest in you, you can become willing to invest in yourself. Good mentors can be hard to come by, and earlier this month the most influential mentor I’ve ever had passed away.

Dr. Frank Ackerman was a giant in his field; I was truly honored to have been so fortunate to have worked with him. Frank took me under his wing when I was at Synapse Energy Economics. During my time there, I had the privilege of working with him on a range of economic analyses. From the role of climate modeling in public policy to the costs of generic drug regulation. From the social cost of carbon to the long-term plan of a small Kentucky cooperative utility.

Renowned for his robust analytical capabilities in the field of environmental economics, Frank was also an incredibly skilled writer.

I was not.

I still find myself comparing my work to Frank’s and find my work wanting. Having said that, the most important thing Frank taught me was that good writing isn’t a “gift.” If you want to get good at it, you must work at it and keep working at it.

I was 28, and nobody had ever bothered to tell me that until then.

Here are the three things Frank taught me about technical writing that I’ll never forget:

1. Write

In Calculus, those that give up rob themselves of ever solving the puzzle; it was those willing to struggle that found the right answers. I liked struggling through the math equations but when it came to writing, I lacked encouragement and motivation. Frank gave me both.

“Putting the work in” was a big part of what Frank coached me to do. He would assign me to do write-ups of our work, forced me to think through how to frame the issue, and would show me what worked (and what didn’t). Frank made sure I develop muscle memory so that I would get it right the second go-around (or third, or fourth). It would have taken less time for him to have just written it himself, but he really invested in me.

Thanks, Frank.

I used to do whatever I could to make sure writing wasn’t a big part of my job, for fear of failing at it. Today, I tweet at wonks, testify to utility regulators, write briefs to legislators, author technical reports for who knows, and you are currently reading my blog.

2. Read

“What science writers do you read?”

That was one of the first questions he asked me and I couldn’t think of any. He challenged me to find writers that tackle challenging topics and read how those people do write. Learn from the best.

I was reading mainstream economists like Joseph Stiglitz and Paul Krugman. Frank’s suggestions led me to David Roberts (then at Grist, now at Vox) who has taken on topics like discount rates (with otters).

My job required me to read 1,000’s of pages of intense testimony from energy economists and financial analysts, still does. What Frank impressed upon me the need to pay attention to how reporters were covering issues. I was busy trying to impress economists. Trying to show that I knew economics, all the while my writing had become incomprehensible to the outside world.

I started reading Frank’s books (Priceless, Poisoned for Pennies, and Climate Economics) as well as his articles (like Climate Economics in Four Easy Pieces).

Frank was a prolific writer.

I still go back and read Frank’s work. I still read David Robert’s work. I read Julia Pyper, Jenny Chase, Brad Plummer, Gavin Bade, Iulia Gheorghiu, Catherine Traywick, Russel Gold, and countless others. Learning from the best, just like Frank taught me.

3. Rewrite

One element of writing that I’ve learned to appreciate is that you get a chance to be a smarter version of yourself.

Who hasn’t thought, “I have the perfect response to that.” Or, having walked away from an argument thought, “Gee I should have worded it differently!”

When you are doing the writing, you get to walk away, come back, and the rewrite your argument exactly how you want it. Frank was infinitely patient with me and taught me to be patient with myself. I used to write up to the deadline of projects, rather than stagger the writing. Giving myself a day (or even an hour) to step away and come back with fresh eyes, it can make a big difference.

Frank helped me become a better writer and I tried to thank him in a Twitter thread that I botched with broken tangential thoughts and poor grammar. I’m sure if he had seen it, he would have taken out his red pen and gone to work on it. It was no way to honor him, so I’m giving it another shot. This post is my rewrite. My way of memorializing my thoughts the way I wanted to. To sound like me, only better.

I hope I did right by you, Frank.

Frank in his element.

Patrick Fore on Unsplash http://frankackerman.com/

An Absence of Energy Leadership in a Climate Crisis

Photo: Ma. William Carraway/Wikimedia Commons

These are interesting times for electricity regulators and legislators in the 13 US states, from the Mid-Atlantic through the Ohio Valley to Illinois, that share authority with PJM and FERC. PJM has been in direct conflict with state activity and autonomy in regulating environmental effects from energy power production. With a hastily retired CEO at PJM and indecision at FERC, states now should stand up for the role of clean energy in PJM, and be heard.

Renewable Energy Standards are law in 29 states plus D.C. Additional state payments to generators are made through ZECs and cost-of-service regulation. Credit: DSIRE. Click to enlarge.

State officials have a variety of policies and goals for the electricity supply for each of their states, from rate stability and economic development incentives, to ambitious renewable goals, to health and safety protections for workers and consumers. Governors and legislators are closer to constituents and respond to the interests of their communities more directly than a regional utility or federal agency. And in light of the federal government’s abdication of numerous duties, this is more true now than ever before.

State decisions on plants

Decisions about new power plants are arguably the largest and most impactful decisions state leaders can make in the energy field. The present tension surrounding PJM and FERC over capacity market rules stems from PJM seeking to abandon the past balancing of funding power plants between states and PJM. The treatment of state clean energy policies in wholesale markets, and in fact the functioning of the PJM capacity market, are now in limbo.

Every state in PJM sponsors payments

Every one of the 13 states plus the District of Columbia have policies of paying power plants in addition to market rules PJM adopted under FERC jurisdiction. Some of these existing practices were directed by state laws establishing renewable energy procurements (known as RPS or RES), as those states promoted customer choice and “de-regulation.” More recently, in response to lower energy prices, some states enacted laws to keep existing nuclear plants from closing (i.e. ZEC payments).

More subsidies in rates than RES or ZECs

But the largest share of plants in the PJM region under state programs are those receiving cost-of-service payments through ratepayer bills. Approximately 40,000 MW, or roughly 20% of generation in PJM, is owned by for-profit utilities (AEP, Dominion, First Energy and PPL) that collect costs for this generation through state-approved customer rates. That fleet is three times larger than the amount PJM identified to FERC as needing PJM’s market intervention to reset prices. PJM’s challenge to the state-supported renewable and nuclear generators has been delayed at FERC. FERC’s initial response—remove all generators that have state-supported payments—was unacceptable to PJM. There is no schedule or approved rules for the next annual PJM procurement of capacity. A stand-off has ensued, and with it we are beginning down the path of living without a capacity market.

What are the stakes?

The stakes are higher than the $6-7 billion per year that consumers pay through the PJM capacity market.  PJM uses the capacity market results to plan the needed transmission, and ensure adequate power plant reserves. The PJM approach is favoring the power plants that contribute to climate change. In the acceptance of past state-supported fossil-fuel burning plants, which have costs recovered in state-set rates, PJM allows old polluting plants to avoid competition.

What are the climate change factors in PJM’s territory? Record-breaking weather is one way to look at climate change. According to a new UCS analysis on extreme heat, historically, there have been an average of 4.6 days per year in the PJM territory with a heat index above 100 degrees. This would increase to an average of 33.5 days per year by mid-century without carbon and methane emission reductions.

Coastal flooding impacting over 2 million homes on US coasts, and 500,000 homes in PJM states alone, is another way to consider the cost of the grid operator ignoring state purchases of carbon-free energy.

This comes down to the familiar conflict between Policies vs. Markets. PJM describes itself as having three core functions: transmission planning, grid operations, and wholesale markets. PJM continues to seek “evolution in its markets to value what policymakers find valuable.” UCS notes an example of PJM adopting winter capacity rights for wind, first on an interim basis and soon to be formalized on a permanent basis.

As is so often necessary in our economy, the state policy goals must be articulated and enforced, and then incorporated into markets. Seat belts for cars, for example, became standard when required by law. Perhaps after many more thousands of injuries, consumers would have selected only cars with seat belts, but policymakers set a policy to protect the public health and safety. The car market includes the cost of seat belts in the price of all cars, and other innovations in the industry can proceed without a stand-off over seat belt policy.

This is how democracy works

In the electricity market, pollution policy hasn’t become as unified and clear as seatbelt policy.  States (and corporations and cities) have adopted clean energy procurement policies to deal with market externalities, those good things and bad things that are outside the prices paid for electricity. This kind of leadership, especially in the absence of leadership at the regional and federal level, is essential. It is also how democracy works, how our federal system is designed, and fortunately how can make progress on getting more of the good things (energy without heat-trapping emissions) that we need to keep our climate and economy in some recognizable balance.

Photo: Ma. William Carraway/Wikimedia Commons

Why Berkeley Banned Natural Gas in New Buildings

Photo: Christian Naenny/Flickr

Two weeks ago, Berkeley, California became the first city in the nation to ban natural gas hook-ups in new construction. The ordinance passed unanimously with overwhelming public support, but the gas industry has been quietly fighting back by stealthily funding “consumer” groups that criticize gas bans like Berkeley’s. So let me explain what the rule actually does and why it’s a great idea.

The fine print

The Berkeley rule goes into effect January 1, 2020. The rule will initially only apply to low-rise residential buildings, but as the California Energy Commission develops all-electric building standards for mid-rise, high-rise, and commercial buildings, the natural gas ban will automatically apply to newly constructed buildings of those types as well. To be clear, this rule applies only to new buildings – so for those of you who love your gas stove so much that Berkeley would have to pry it out of your cold dead hands, you won’t have to let go of your gas-burning appliances quite yet. (But why hang on when electric induction ranges routinely top Consumer Reports’ performance tests?) Existing buildings in Berkeley can continue to use natural gas… at least for the time being.

Small city, big impact

Berkeley is a small, liberal city, so some folks may just dismiss this new rule as a far-out Berkeley thing that won’t ever get any traction.

But not so fast.

Berkeley has long been a city of “firsts.” There are numerous examples where cities and states have followed Berkeley’s lead and passed ground-breaking policies that originated in Berkeley. For example, Berkeley was the first city to:

  • Integrate public schools voluntarily (1968)
  • Limit smoking in restaurants (1977)
  • Ban Styrofoam (1989)

…And the list goes on. In short, Berkeley’s novel policies have a history of getting replicated at a much larger scale, leading to a big impact.

Berkeley and the big picture

Given the urgency of reducing emissions to avoid the worst impacts of global warming, Berkeley’s ordinance is significant because it sets in motion what could be a huge breakthrough in building decarbonization.

Let’s take a minute to think about the bigger picture.

Last year saw the release of the Special Report on Global Warming of 1.5°C. Amongst its many findings, the report highlighted the urgency of reaching net zero greenhouse gas emissions by mid-century in order to avoid the worst impacts of global warming. Again, that’s net zero by mid-century, which means we have just over 30 years to eliminate as many emissions as possible and to offset all the rest. The state of California has already signaled its intention to achieve that goal – last year, Governor Jerry Brown signed an executive order committing the state to reach carbon neutrality by 2045.

Eliminating emissions one step at a time

So how do you eliminate emissions from buildings when buildings tend to stick around for many decades and retrofits are notoriously expensive? Berkeley’s answer is to nip the problem in the bud by preventing natural gas use in all new buildings, which immediately eliminates one of the largest sources of emissions from buildings.

Roughly 27% of Berkeley’s greenhouse gas emissions come from natural gas use in buildings. (For comparison, buildings both in California and nationwide account for only 12% of emissions since California and the United States both have much more agricultural and industrial emissions – see comparison charts below.) Twenty seven percent is a big chunk, but Berkeley’s total emissions are miniscule in comparison to California’s or the United States’ emissions.

For example, California’s commercial and residential buildings produce roughly as much greenhouse gas emissions as the entire country of Switzerland. Buildings in all of the United States produce roughly as much emissions as the entire country of Canada. In short, buildings, and the natural gas burned inside, are a big contributor to global warming.

Enter Berkeley, which is leading the way with its new ordinance. Many other cities, such as San Francisco, are considering similar action. Looking ahead, if California or the United States were to adopt a similar policy, it would be a big step towards reducing the large amount of emissions from buildings.

Over a quarter of Berkeley’s emissions come from buildings. In California and nationwide, buildings account for 12% of emissions. Sources: Berkeley data, California data, United States data.

Saving money and sparing the air

But this isn’t just about preventing climate change. It’s also about saving people money and improving indoor air quality. A recent analysis demonstrated that new all-electric homes end up saving homeowners money in comparison to new homes built with natural gas; these findings apply not only to Oakland (Berkeley’s neighbor to the south), but also to cities in significantly different climate zones, such as Chicago, Houston, and Providence, Rhode Island. From a financial standpoint, building new homes that are all-electric is a good choice.

My mother-in-law’s electric induction stovetop, which is pretty fun to cook on. The burners on the right are induction, and the burners on the left are the old-school electric kind that actually heat up (which allows you to use any pan on those burners).

Furthermore, burning natural gas in your home can be bad news for indoor air quality. Cooking with a gas stove without proper ventilation can make indoor air unhealthy to breathe. One study found that, during a typical winter week, millions of Californians could be exposed to unhealthy levels of indoor air pollutants when cooking with a gas stove without proper ventilation. Cooking with an electric stove doesn’t eliminate all indoor air pollution from cooking (e.g. think about the last time you accidentally burned something), but taking the gas stove out of the equation keeps the air in homes healthier to breathe.

All-electric homes are already becoming the default for new construction in some areas of California. Modern electric appliances are totally unlike their inefficient and ineffective predecessors – many of today’s all-electric technologies (e.g. heat pumps and induction cooktops) perform even better than their natural-gas-fueled counterparts. All-electric homes aren’t some remnant of the past – on the contrary, the technology exists to build comfortable, functional, and affordable all-electric homes for the future.

Let the fondue flow begin

In an effort to ensure Berkeley’s new ordinance would pass, one of Berkeley’s city council members had a staffer make chocolate fondue on an electric induction cooktop to demonstrate the safety and efficacy of all-electric cooking appliances.

Such a demonstration seems a little over the top to me, but if that’s what it takes to get cities, states, and countries to pass similar policies, then I am hereby requesting that all fondue enthusiasts pack your bags (don’t forget your portable induction cooktop!) and prepare for a world-wide tour – we need your help!

Photo: Christian Naenny/Flickr

UCS Extreme Heat Report: A Call to Action on Midwest Clean Energy

Excessively hot weather spread across the Great Plains and Midwest states last week. On Friday, Chicago faced heat indexes well above 110 degrees, and many other areas endured dangerous heat warnings and advisories.

According to a sobering new report issued earlier this week by the Union of Concerned Scientists, the heat impacts of climate change will bring increasingly frequent extreme heat events such as these if we don’t take aggressive action to mitigate global warming pollution.

The report, Killer Heat in the United States: Climate Choices and the Future of Dangerously Hot Days, is scary news—but it’s also a call to action. Clean energy is moving forward in the Midwest and that’s a good thing. By pursuing rapid emission reductions, we can work to lessen the brunt of extreme heat we’ll face in the years to come.

What are the projected heat impacts in the Midwest?

Here’s some findings from the Killer Heat report focusing in on our region assuming no action to limit global heat-trapping emissions:

The U.S. Midwest region (Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Ohio, and Wisconsin), which has historically seen an average of 6 days with a heat index over 100°F, is projected to see an average of 53 days per year with a heat index over 100°F. The region will also see 38 days per year with a heat index above 105°F and seven “off-the-charts” days per year by the end of the century.

For Illinois specifically, there have historically been 34 days per year on average with a heat index above 90°F. This would increase to 80 days per year on average by midcentury and 107 days by century’s end. The state has historically had 7 days per year on average with a heat index above 100°F, but this would increase to 43 days per year on average by midcentury and 69 by the century’s end. And instead of having an average of two days per year with a heat index above 105°F, Illinois would see such extreme heat events 26 days per year on average by midcentury and 51 days a year by the century’s end.

By mid-century (2036-2070) regions of the United States with little to no extreme heat in an average year would experience such heat on a regular basis. Heat conditions across the Southeast and Southern Great Plains regions, including Southern Illinois and Missouri, are projected to become increasingly oppressive, with off-the-charts heat days happening an average of once or more annually.

While dangerous to everyone, these extreme heat events are especially risky to outdoor workers and vulnerable populations such as children, the elderly, and pregnant women. Lower-income neighborhoods may also be more vulnerable to heat-related illnesses and death due to lack of transportation and air-conditioning infrastructure—similar to what happened during the tragic 1995 heat wave that gripped Chicago. My colleague Joe Daniel posted a blog today focusing on utility disconnection policies and the need to ensure that vulnerable populations are not cut off from vital services during extreme heat events.

An opportunity to reduce extreme heat days

Even with rapid, aggressive action to reduce emissions, it’s going to get hotter in the Midwest and everywhere else. But perhaps the most important finding from this new analysis is that curbing emissions can reduce the number of days of extreme heat.

For instance, the UCS report found that, with global action to limit emissions, the average number of days in Midwest states with heat indices above 90°F could be reduced from 62 to 54 by mid-century. And instead of averaging 30 days with heat indexes of 100°F or more, we could have 22.

So yes, it’s going to get hotter in the Midwest. But by reducing the number of dangerous heat days, we can save lives. Indeed, another recent study found that limiting global warming to 2°C or 1.5°C can avoid hundreds of heat-related deaths in cities like Chicago, Detroit, and St. Louis.

Taking action in Midwest states

In addition to demanding climate action at the federal level and supporting international agreements to limit carbon pollution, we can take important steps to ensure Midwest states are leading the way and doing our part to reduce emissions.

For instance, advocates in Illinois are pushing for enactment of the Clean Energy Jobs Act to provide additional clean energy policies and build on the progress that has made the state a leading wind energy producer and a developer of solar programs to benefit all communities.

In Michigan, UCS and other stakeholders are urging electric utilities to continue phasing out coal-fired power plants and replace them with clean energy technologies like wind and solar power and energy efficiency instead of natural gas.

Minnesota is considering legislation to increase rapid deployment of solar and wind power, as well as energy storage, in a smart and cost-effective manner to complement Xcel Energy’s own plan to reduce carbon emissions and boost solar power.

Moving forward

In addition to last week’s heat wave, we have seen climate change affecting us here in the Midwest through the extremely wet weather in recent months contributing to the Great Lakes’ record high water levels and the disruption of corn and soybean planting season due to flooded farmland.

Last week’s Killer Heat report stands as a warning of not only a wetter, but a dangerously hotter region.

We don’t have to accept this outcome as a foregone conclusion. Starting at the local and state level, we can take action to lessen the severity of extreme heat in ways that save lives and revitalize our economy through clean energy and clean transportation.

Thank you to Sarah Sung, Midwest Clean Energy Policy and Outreach Intern, for assistance in preparing this blog post.

As Heatwave Blankets Nation, Utility Disconnect Policies Can Kill

As temperatures increase, so does our reliance on things like air conditioning. That increased electric load can stress the grid, but it can also stress our pocketbooks with the increased use of A/C translating into increased electric bills.

Sadly, an increasing number of people in the United States struggle to pay their electric bills. When temperatures get high enough, not being able to pay your electric bill turns out to be a matter of life or death.

A deadly decision:

In almost every state, there is some sort of protection for consumers unable to pay their bills that prevent electric utilities from disconnecting customers from the grid. The most common reason for protection is for those with medical conditions or in case of illness.

Nearly every state (save Florida and Hawaii) have consumer protections when it comes to health and medical reasons.

States with protections against utility disconnect for health or medical reasons (in blue). 

The only two states that don’t have protections from utility disconnections: Florida and Hawaii.  Source: Union of Concerned Scientists analysis of Health and Human Services data.

Now, that isn’t to say that those laws and protections are perfect. In some states, the protection is only in the form of a delay in shutoff, in some states the customer must have a special doctor’s note on file with the utility.

Oftentimes, disconnects will occur and the burden of proof falls on the customer with a medical condition to get electricity reconnected. If you rely on an electronic medical device, such as a respirator, you may not have time.

When electricity gets shut off, people can die.

That was the case last year, after APS, the largest monopoly utility in Arizona, jacked up the bills of its residential customers.

Stephanie Pullman, a 72-year-old woman in Sun City West, was $51 short on her electric bill so APS shut off her power. A month later, temperatures in Arizona reached 107°F, and Stephanie died from a heat stroke. She wasn’t the only one, two other APS customers died after APS shut off their power, APS settled both lawsuits.

It also happened in New Jersey, when Linda Daniels died of congestive heart failure last summer. Linda’s death spurred the state to pass “Linda’s Law” which aims to prevent such tragedies from happening again.

Health vs heat.

While a great number of states have shutoff protections for those with health problems, as people face problems associated with heat, the same protections simply don’t apply. Only 9 states have temperature-based shutoff restrictions for extreme heat (many more states have temperature-based disconnects for temperatures below freezing). You can find a summary of all state’s utility shutoff and disconnect policies here.

States with utility disconnect protections based on temperature based limits. 

Only nine states have temperature based shutoff restrictions when extreme heat hits. Source: UCS analysis of Health and Human Services data.

Another six states—Arizona, Minnesota, Mississippi, Rhode Island, Texas, and Wisconsin—have restrictions for disconnects during “extreme heat,” but leave the threshold fuzzy (for example, when a heat emergency is declared).

Even if an official heat emergency is not declared, temperatures may be hot enough to be unsafe for heat-vulnerable populations like the elderly, pregnant women, the very young, and those with pre-existing medical conditions.

In Arizona, the threshold is not only ill-defined, but the decision is left up to utility commissioner’s judgment on what constitutes extreme heat.

Utility commissioners generally act as economic regulators, not public health regulators. Most are not informed or equipped to make decisions about the medical and health issues related to extreme heat.

In light of revelations of a dramatic increase in heat-related deaths and shutoffs—and sadly after the tragic story of Stephanie has made the news—the commission has taken action and halted future shutoffs.

In June, after considerable local pressure, the utility commission in Arizona decided to exercise its jurisdictional authority to end utility shutoffs and suspended all shutoffs until October 15th.

However, the moratorium excludes those electric providers that aren’t regulated by the commission. This is why advocates in Arizona say it shouldn’t be up to the commission’s discretion. Advocates like Stacey Champion say the state law should have mandatory protections.

When it comes to utility disconnects, we need science-based policies.

The science is clear, the hotter our summers get, the more the public will need protections.

Above 95oF sweating stops acting as an effective way of cooling the human body.

At heat index above 100oF, children, the elderly, and pregnant women are at risk of heat-related illness.

Some states have special protections for those groups, but many don’t. And none of them should need a doctor’s note to prove that they would suffer if they were to lose their ability to run an A/C or fans.

At 105oF, anyone can be at risk of heat-related illness or even death as a result of prolonged exposure.

As temperatures increase, so do the risks to our health. Source: Killer Heat in the United States (UCS).

As the effects of global warming intensify, cities across the US will experience weather that is literally off the (heat index) charts, which represents an extreme danger for all humans. To learn more about this, UCS has developed this handy online widget and interactive map.

As climate change worsens, summers will be getting longer and hotter. Cities and states that may not have had a need for shutoff protections due to heat may need them in the future.

The number of excessive heat days is avoidable if we act on climate change, but we must also implement policies to protect human health, human lives. Hopefully, we won’t need to be overly reliant on such safeguards, but better to have them because the alternative will be deadly for some.

Science-based policies today will prevent deaths tomorrow

A recent report by UCS details the just how deadly increasing extreme heat will become. Cities like Chicago, Boston, New York, Minneapolis, and Kansas City are all expected to see multiple days where the heat index will be off the charts. Many of those cities have never seen the heat index go off the charts.

Florida–which has no protections for electric customers–is going to be one of the hardest-hit states.

Meanwhile, while most states have protections for health emergencies, they don’t have temperature-based protections. But when the temperature is at or above 105oF, it is a health emergency for everyone.

Policies should be in place to ensure that they have uninterrupted power, especially to protect low-income households that may struggle to pay bills.

State utility regulators and legislators should require utilities to provide uninterrupted power service for residents—especially elderly adults, pregnant women, sick people, and people with disabilities—during periods of extreme heat.

Disconnect policies currently vary by state; some states do not have protections in place for periods of extreme heat. This patchwork of protections needs to be replaced with standards based on the science and research of public health professionals.

Policymakers should put into place safeguards to protect human health in case of heat emergencies, and utility disconnection banned during those times for any reason, including non-payment of bills. Science-based temperature thresholds should be set to eliminate any ambiguity or uncertainty to the process.

If you’re in the path of the heatwave this week, make sure to pay attention to alerts from local authorities and take protective actions to safeguard your health and the health and well-being of your friends and neighbors. Here are some resources that can help.

UCS

Raising the Bar on Offshore Wind: Massachusetts, Connecticut, New Jersey, New York, Maine, Maryland, Virginia…

Kim Hansen/Wikimedia Commons

Not that this is a bad thing, but it’s tough keeping up with US’s offshore wind progress. The latest announcements from states in the Northeast and Mid-Atlantic mean even more momentum, as they keep outdoing each other in the drive to be national leaders.

I’ve been using my recent post on offshore wind’s next steps as something of a yardstick or a checklist. By that measure, we’re hopping right along. But even that doesn’t capture everything that’s going on.

My next-steps list had six things on it, and we can already check four of those boxes:

  • Massachusetts doubles its offshore wind requirement. The Bay State almost beat me to the punch on this one; it happened between when I posted the English version and when I had my Spanish translation ready to go. The legislature last year told the administration of Governor Charlie Baker to decide whether it made sense to double the state’s offshore wind requirement on local utilities, from 1,600 megawatts (MW) to 3,200 MW. And the administration’s decision was a resounding yes.
  • Connecticut leaps into offshore wind. The ink was hardly dry on Massachusetts’s announcement when Connecticut ticked off its own part of my what’s-next list: The legislature sent Gov. Ned Lamont a bill authorizing up to 2,000 MW of offshore wind, and the governor gladly signed. “Connecticut should be the central hub of the offshore wind industry in New England,” he says, and the new law aims to help make that case.
  • New Jersey goes big. The Garden State followed through on its plan to announce the first tranche of its 3,500 MW commitment. It announced the selection of a 1,100-MW project 15 miles off the state’s shores, almost 40% bigger than the largest project approved to date in this country, and bigger than any other existing project in the world.
  • New York goes even bigger. Unlike NJ, the Empire State didn’t stick to the script. It had been expected to announce what project(s) it would be moving forward with, potentially in the neighborhood of 800 MW total. When it hadn’t announced anything before NJ’s own project selection, it seemed clear that NY was going to have to find a way to make a bigger splash. And it sure did: On the same day that Gov. Andrew Cuomo signed a bill codifying a 9,000-MW offshore wind target, the state announced the selection of two more-than-800-MW projects, totaling just shy of 1,700 MW.

So those take care of the bulk of what I had been watching for.

Need a bigger yardstick

But it turns out that there’s even more going on than what I had been focusing on.

Maine began the process of getting its offshore wind plans back on track as part of an impressive suite of bills—a “Clean Energy Grand Slam”, in the words of one my colleagues—signed by Gov. Janet Mills last month. One of the bills directed the state’s public utility commission to approve a contract for a particular offshore wind project. The project is small—only two turbines, totaling 12 MW—but would be the first floating turbines in the Americas. Moving along that technology potentially opens up a lot more options for offshore wind in the deeper waters off Maine and the West Coast.

And then there’s Maryland, which, with little fanfare (I, at least, almost missed it), upped its offshore wind target to at least 1,200 MW as part of a 50%-renewables Clean Energy Jobs Act this spring.

Meanwhile, construction has just kicked off on Virginia’s own two-turbine, 12-MW pilot project, and the state is getting more serious about building out 2,000 MW over the next decade.

Welcome progress

Targets, requirements, and authorizations that send clear signals about each state’s intent are really important. They aren’t the same as getting steel in the water, which is why it’s also important to have construction underway in Virginia, and Rhode Island following up on its first-in-the-nation project (what might be the first large-scale offshore wind project, off Massachusetts, has just hit a couple of speed bumps). But they’re key pieces of the development of not just projects, but the US offshore wind industry as a whole.

So it’s great to see the states continuing to move the ball down the field. I’ll try hard to keep up.

Photo: Kim Hansen/Wikimedia Commons Photo: Erika Spanger-Siegfried/UCS

10 Ways Andrew Wheeler Has Decimated EPA Protections in Just One Year

EPA Administrator Andrew Wheeler signs the so-called Affordable Clean Energy rule, replacing the Obama-era Clean Power Plan that would have reduced coal-fired plant carbon emissions. Photo: EPA

On July 8, President Trump hosted a White House event to unabashedly tout his truly abysmal environmental record. The next day, coincidentally, marked the one-year anniversary of Andrew Wheeler at the helm of the Environmental Protection Agency (EPA), first as acting administrator and then as administrator after the Senate confirmed him in late February.

The good news, if there is any, is that Wheeler is an Eagle Scout compared to his ethically challenged predecessor, Scott Pruitt. The bad news is, as predicted, Wheeler has been more effective than Pruitt in rolling back and eliminating EPA safeguards.

My organization, the Union of Concerned Scientists, has compiled a list of 80 Trump administration attacks on science since taking office, and Wheeler has been the driving force behind many of them. Below are 10 of the more egregious ways he has undermined the EPA’s time-honored role to protect public health and the environment so far.

1. Sidelined scientists

Wheeler, a former coal industry lobbyist, has taken a number of steps to systematically reduce the role of scientists in the agency’s policymaking process. Last fall, for example, he eliminated the agency’s Office of the Science Advisor, which counseled the EPA administrator on research supporting health and environmental standards, and placed the head of the EPA’s Office of Children’s Health Protection on administrative leave. He also disbanded a 20-member scientific advisory committee on particulate matter, or soot; failed to convene a similar panel on ozone; and packed a seven-member advisory committee on air quality standards with industry-friendly participants.

2. Proposed to restrict the use of scientific data

Claiming his intent is to increase “transparency,” Wheeler is promoting a rule Pruitt proposed that would dramatically limit the scientific studies the agency considers when developing health standards. If adopted, the rule would restrict the use of scientific studies in EPA decisions if the underlying data are not public and reproducible, which would disqualify many epidemiological and other health studies the EPA relies on to set science-based public safeguards. Given that EPA health standards often rely on studies that contain private patient information, as well as confidential business information that cannot be revealed, the rule would significantly hamper the agency’s ability to carry out its mission. Wheeler plans to finalize the rule sometime this year.

3. Gutted the coal ash rule

The first major rule Wheeler signed as acting administrator refuted his claim that he could fulfill President Trump’s directive to “clean up the air, clean up the water, and provide regulatory relief” at the same time. By rolling back the Obama-era coal ash rule, Wheeler provided regulatory relief to his old friend the coal industry by weakening environmental protections established in 2015 to clean up coal ash ponds, which are laced with toxic contaminants that leak into groundwater. The move was a top priority for coal baron Bob Murray, owner of Murray Energy, Wheeler’s most lucrative client when he worked for the Faegre Baker Daniels law firm.

Coal-fired power plants have been dumping this residue from burning coal into giant, unlined pits for decades. According to the EPA, there are more than 1,000 coal ash disposal sites across the country, and a recent analysis by Earthjustice and the Environmental Integrity Project found that 91 percent of the coal plants filing monitoring data required by the 2015 rule are polluting water with unsafe levels of toxic contaminants. Wheeler’s EPA says the new rule—which extends the deadline for closing some leaking ash ponds and allows states to suspend groundwater monitoring and set their own standards—will save utilities as much as $31 million. But the agency ignored the enormous costs of cancer and neurological and cardiovascular diseases linked to coal ash ingredients, which include arsenic, chromium, lead and mercury.

4. Recommended unsafe levels of drinking water contaminants

Poly- and perfluoroalkyl substances (PFAS), which are used in firefighting foam and a variety of nonstick, cleaning, packaging and other household products, have been linked to thyroid disease and kidney, liver, pancreatic and testicular cancer. According to a recent study by the Environmental Working Group and Northeastern University, these chemicals threaten the drinking water supplies of an estimated 19 million Americans. A 2018 Union of Concerned Scientists report, meanwhile, found that PFAS water contamination at 130 military bases across the country exceed the 11-parts-per-trillion safety threshold determined by the Department of Health and Human Services Agency for Toxic Substances and Disease Registry. Nearly two-thirds of the sites had contamination that was more than 100 times higher than the safe level.

In February, Wheeler announced the “first-ever nationwide action plan” to regulate PFAS chemicals in water, saying the agency would develop and set a limit for two of the most prevalent PFAS chemicals, perfluorooctanoic acid and perfluorooctanesulfonic acid. During the announcement, he told reporters he believes the agency’s voluntary 70-part-per-trillion health-advisory level for the chemicals is “a safe level for drinking water,” despite the fact that this level is more than six times higher than what the Disease Registry considers safe.

While Wheeler slow-walks the EPA’s response, members of Congress have introduced at least a dozen bills to address PFAS contamination, and the Senate recently passed a defense bill that would require the EPA to set a science-based standard for PFAS in drinking water.

5. Rolled back Clean Water Act protections

Clearing up a decade-long dispute over the scope of the Clean Water Act, the Obama EPA adopted a broad, science-based definition of the law that included protecting intermittent and ephemeral streams and wetlands that do not have surface water connections to other waterways. A 2015 EPA meta-analysis of more than 1,200 peer-reviewed studies concluded that even infrequently flowing small streams and isolated wetlands can affect “the integrity of downstream waters.” Trash them and that pollution could wind up in rivers, lakes, reservoirs and estuaries.

Regardless, Wheeler announced plans during a December telephone press briefing to reverse the Obama EPA definition of waters protected by the Clean Water Act, a thinly disguised gift to land developers and the agriculture industry. When asked what wetlands would no longer be protected, Wheeler replied, “We have not done … a detailed mapping of all the wetlands in the country.” Likewise, EPA Office of Water head David Ross—who represented industry clients against the EPA before joining the Trump administration—told reporters on the call that the agency had no idea how many streams would be dropped from Clean Water Act protection under the proposal.

In fact, Wheeler and Ross were well aware of the damage their new definition would do. At least 18 percent of streams and 51 percent of wetlands across the country would not be covered under their proposed definition, according to an internal 2017 slideshow prepared by the EPA and the Army Corps of Engineers and obtained by E&E News under the Freedom of Information Act.

6. Suppressed an inconvenient formaldehyde report

Last August, Wheeler disingenuously told a Senate committee that the EPA was holding up the release of a report on the risk of cancer from formaldehyde to confirm its veracity. “I am sure we will release it,” he said, “but I need to make sure that the science in the report is still accurate.”

In fact, the report—which concluded that formaldehyde can cause leukemia and nose and throat cancer—was completed by EPA scientists a year before Wheeler testified, according to a Senate investigation, and their conclusion was hardly a surprise. Both the World Health Organization’s International Agency for Research on Cancer and the US Department of Health and Human Services National Toxicology Program have already classified formaldehyde as a known human carcinogen.

The EPA’s review process normally takes 60 to 90 days. The formaldehyde report has been in limbo for at least a year and a half, a blatant giveaway to the American Chemistry Council, the US chemical industry’s premier trade association, which has blocked tighter restrictions on formaldehyde for decades.

7. Ignored EPA scientists’ advice to ban asbestos

Instead of heeding the advice of agency scientists and lawyers to follow the example of 55 other countries and ban asbestos completely, the EPA announced in April that it would tighten restrictions on asbestos—not ban it—despite overwhelming scientific evidence of its dangers. Manufacturers will be able to continue to use the substance if they obtain EPA approval.

Asbestos has not been produced in the United States since 2002, but is still imported for use in a wide range of commercial and consumer products, including auto brake components, roofing, vinyl floor tile, fire-resistant clothing, and cement pipes, sheets and shingles. One of the deadliest known carcinogens, asbestos kills nearly 40,000 Americans annually, mainly from lung cancer.

8. Weakened the mercury emissions rule

In late December, the EPA proposed to significantly weaken a rule restricting mercury emissions from coal-fired power plants by recalculating its costs and benefits. The Obama EPA, which issued the rule in 2011, estimated it would cost utilities $7.4 billion to $9.6 billion annually to install pollution controls and lead to $37 billion to $90 billion in health benefits by reducing not only mercury, a potent neurotoxin, but also sulfur dioxide and soot, thus preventing 130,000 asthma attacks, 4,700 heart attacks, and as many as 11,000 premature deaths. The Wheeler EPA ignored the “co-benefits” of limiting sulfur dioxide and soot, and flagrantly lowballed the health benefits of curbing mercury alone at only $4 million to $6 million annually.

Most utilities have already complied with the mercury rule at a fraction of the estimated cost, but health advocates fear that this new, industry-friendly accounting method, which makes it appear that the cost to polluters far outweigh the rule’s benefits, will set a precedent for the EPA to sabotage an array of other public health protections.

9. Slammed vehicle emission rules into reverse

Last August, the EPA and the Transportation Department issued a proposal to freeze vehicle tailpipe pollution and fuel efficiency standards, rolling back a 2012 Obama-era rule requiring automakers to boost passenger vehicle fuel economy to a fleetwide average of 54 miles per gallon by 2025. In a Wall Street Journal opinion piece titled “Make Cars Great Again” published a few days before the two agencies announced their proposal, Wheeler and Transportation Secretary Elaine Chao charged that the Obama-era standards—the first to limit vehicle carbon emissions—are too burdensome for automakers and “raised the cost and decreased the supply of newer, safer vehicles.”

Parroting the Trump administration’s line of reasoning, Wheeler and Chao argued that fuel-efficient cars—which weigh less than gas-guzzlers—are not as safe, a contention that has been widely debunked. In fact, a 2017 study concluded that reducing the average weight of new vehicles could result in fewer traffic fatalities.

In any case, freezing the standards at 2020 levels would be hard on the planet, not to mention Americans’ wallets, according to the Union of Concerned Scientists. It would result in an additional 2.2 billion metric tons of global warming emissions by 2040, amounting to 170 million metric tons in 2040 alone—the equivalent of the annual output of 43 average size coal-fired power plants. It also would cost drivers billions of dollars. In 2040 alone, they would have to pay an additional $55 billion to fill their gas tanks. Meanwhile, the design improvements automakers have made so far to meet the standards have already saved drivers more than $86 trillion at the pump since 2012, and off-the-shelf technological fixes, the Union of Concerned Scientists says, would enable automakers to meet the original 2025 target.

10. Rescinded the Clean Power Plan

Perhaps Wheeler’s most damaging move to date came late last month when he signed a final rule to repeal and replace the Obama-era Clean Power Plan, which would have required coal-fired power plants to dramatically cut their carbon emissions. Yet another gift to the coal industry, Wheeler’s so-called Affordable Clean Energy rule grants states the authority to determine emissions standards but sets no targets, leaving them the option to do absolutely nothing.

Before Wheeler released the final rule, an April study in the journal Environmental Research Letters found that his draft version would boost carbon emissions in 18 states and the District of Columbia and increase sulfur dioxide emissions in 19 states. The EPA’s own analysis of the draft rule, meanwhile, found that the proposal could have led to as many as 1,400 premature deaths annually by 2030 due to an increase in soot, and as many as 15,000 cases of upper respiratory problems.

Reversing decades of bipartisan protections

If Wheeler truly cared about transparency, he would petition the Trump administration to change the name of his agency to “Every Polluter’s Ally.” In just 12 months, he has killed or weakened dozens of safeguards with the sole intention of bolstering polluting industries’ profit margins even after Congress slashed the corporate tax rate. As a result, millions of Americans will be drinking filthier water and breathing dirtier air, and more will suffer from serious diseases, according to his agency’s own accounting.

Wheeler and his predecessor Pruitt have sullied the bipartisan track record of one of the nation’s agencies entrusted with protecting public health and safety. So it is little wonder that three former EPA administrators who, notably, served under Republican presidents, recently sounded the alarm on Capitol Hill, urging legislators to step up their oversight of the agency and denouncing its attempts to hamstring science.

“There is no doubt in my mind that under the current administration the EPA is retreating from its historic mission to protect our environment and the health of the public from environmental hazards,” former EPA Administrator Christine Todd Whitman, who served under President George W. Bush, stated in her written testimony for the House Committee on Energy and Commerce Subcommittee on Oversight and Investigations. “This administration, from the beginning, has made no secret of its intention to essentially dismantle the EPA…. Therefore, I urge this committee, in the strongest possible terms, to exercise Congress’s oversight responsibilities over the actions and direction of the EPA.”

Maine Hits Clean Energy Grand Slam

As a baseball fan, I’m looking forward to watching the best players in the world compete for bragging rights in the 90th Major League Baseball All-Star game tonight. As a Maine resident for the past 11 years, I’m even more thrilled to see Maine regain its all-star status as a clean energy leader.

Thanks to the leadership of Governor Janet Mills and strong bi-partisan support in the legislature, Maine hit a clean energy grand slam this year, passing several major climate and clean energy bills. In addition to creating new jobs and reducing the state’s reliance on imported oil and natural gas, these laws will put Maine on a pathway to achieve its statewide target of reducing global warming emissions 80 percent below 1990 levels by 2050.

UCS was part of a broad coalition of groups representing businesses, municipalities, and clean energy advocates that supported these bills.

On June 26, Governor Mills signs 3 major climate and clean energy bills into law at state’s largest solar farm in Pittsfield.

Increasing renewable energy to 80% by 2030

LD 1494 doubles Maine’s renewable portfolio standard (RPS) from 40% by 2017 to 80% by 2030 and sets a goal of 100% renewables by 2050. This puts Maine at the top of the batting order, with the highest RPS in the country by 2030. Maine’s RPS surpasses renewable standards of 50% or more by 2030 recently adopted by other leading states (CA, NY, NJ, NM, NV and VT), as shown in the map below.

Sponsored by Sen. Eloise Vitelli (D-Arrowsic), LD 1494 was enacted with strong bi-partisan support, passing the Senate by a unanimous vote of 34-0 and the House 93-48. In addition to testifying in support of the bill, I was a peer reviewer of an analysis of the bill conducted by Synapse Energy Economics and Sustainable Energy Advantage. The study found that the policy is affordable and would deliver the following benefits between 2020 and 2030:

  • Install 700 MW of new renewable energy capacity in Maine
  • Create 1,900 new jobs in Maine, or about 170 per year.
  • Reduce electric sector global warming emissions attributable to Maine by 55 percent.
  • Avoid $500,000 per year in health-related damages from burning fossil fuels.
  • Result in a modest 1.1% increase in monthly residential and small commercial electricity bills

Maine’s 80% RPS makes the state well-positioned to benefit under a national RPS. The same day Gov. Mills signed LD 1494 into law, Senator Tom Udall (D-NM) introduced a national RPS that would more than double the supply of renewable energy to 50% of US electricity generation by 2035. A UCS analysis showed that a 50% RPS would boost the US economy, benefit consumers, and put the nation on a pathway to decarbonize the power sector by 2050. Senator King co-sponsored the bill because of the potential economic and environmental benefits to Maine of selling renewable energy credits to utilities in other states to help them meet their targets. We hope Senator Collins follows suit, as she has voted in favor of a national RPS at least four times it has come up for a vote in US Senate over the past two decades (see votes in 2002, 2005, and 2015).

Joining the solar revolution

While the RPS is expected to drive significant investments in utility-scale solar projects, LD 1711 is a complementary policy that will allow all Maine’s residents, businesses, and municipalities to become more energy independent by investing in distributed solar projects. Sponsored by Senator Dow (R-Lincoln), it uses competitive markets to deploy at least 400 MW of distributed solar projects of 5 MW or less, with prices that decline over time as more solar is deployed.

By removing arbitrary limits on community solar projects, it provides greater access to clean, affordable power for all renters and homeowners, including provisions that will increase solar investments in low- and median-income households. It will also enable businesses, schools and municipalities to invest in larger solar projects and provides incentives to install projects on landfills and brownfields.

Despite being a northern state, Maine has a much better solar resource than you might expect. According to data from the National Renewable Energy Lab (NREL), a solar PV system installed in Portland will generate slightly more electricity than a system installed in Houston and only 5 percent less than a system installed in Miami.

This bill has a long history going back at least five years. The original proposal was developed by the Maine Public Advocate’s Office following the Maine Value of Solar (VOS) Study in 2014. In addition to participating in the VOS study, I represented UCS in a diverse stakeholder process at the Maine PUC to revise the proposal, which was eventually introduced as legislation. Previous versions of the bill passed the Legislature with bi-partisan support, only to be vetoed by former Governor Paul LePage, who was also a vocal opponent of the RPS.

Governor Mills also signed LD 91 on April 2nd to eliminate so-called “Gross Metering,” reversing a recent PUC decision that penalized homeowners and business for going solar. When combined with LD 91, LD 1711 will finally unleash solar investment in Maine.

Reducing global warming emissions 80% by 2050

LD 1679 establishes the Maine Climate Council, which is charged with developing action plans to reduce Maine’s global warming emissions 45% below 1990 levels by 2030 and at least 80% by 2050. The bill also promotes clean energy jobs and climate resiliency for local communities as Maine transitions to a low-carbon economy. Sponsored by Senator David Woodsome, a Republican from York, this bill shows that climate and clean energy policy is not a partisan issue in Maine.

Electrifying transportation and buildings

Electrifying vehicles, buildings and industry with clean energy has been identified as a key strategy for replacing fossil fuel use in other sectors and achieving deep cuts in emissions. Maine adopted several policies this legislative session that would help accomplish this, including:

Maine’s clean energy future looks bright

We applaud Governor Mills and the Maine legislature for passing strong, bi-partisan clean energy legislation that recognizes the urgency of the climate crisis and takes meaningful steps to address it. Maine can finally rejoin the big leagues and regain its all-star status as a clean energy leader that puts the state on a pathway to achieve significant cuts in global warming emissions.

Photo: Barbara Barrett

How Do Power Grids Beat the Summer Heat?

Credit: iStockphoto/Pleasureofart

In the searing heart of summer, when blazing days stack end on end and the air hangs heavy and still, the power grid gets put to the test as people turn to air conditioners to find reprieve.

Millions upon millions of air conditioners, cranking away on rooftops, in windows, behind buildings; block by block, business by business, home by home: together, these many machines can add up to a major increase in electricity demand.

In Texas, grid operators estimate that such sweltering summer days can result in a doubling of peak electricity use compared with during spring.

When summer rolls around, people start using a lot more electricity to try to stay comfortable. In Texas, grid operators show this surge in summer use and estimate nearly half can be attributed to the weather. Credit: ERCOT.

At the same time, many power plants and power grid components can themselves struggle in the face of sky-high heat, which means even more strain is placed on the grid right when it’s needed most.

The upshot is that while most of us are lying low to try to beat the heat, the power grid is in an all-out sprint to ensure that it keeps up. And that means grid operators pull out all the stops, from long-range planning to moment-of operations, targeting both supply and demand.

Some of these approaches, like keeping polluting power plants around to run just a few times a year, are costly and inefficient. But as cleaner resources come online and technologies on the grid evolve, new and exciting solutions are emerging that are not only cleaner but cheaper, too.

These advances couldn’t come at a more critical time as climate change increasingly points toward more dangerous high-heat conditions that threaten health and well-being, especially in the absence of cooling, which elevates the importance of increased access to cooling itself, as well as ensuring the resilience and reliability of the enabling grid.

Planning

The foundation of reliable grid operations is planning: estimating how much electricity people will need and whether there are enough resources around for that need to be met—including during heat waves, and including during heat waves when unexpected incidents occur.

One check on this is the annual summer reliability assessment conducted by the nation’s top reliability cop, the National Electric Reliability Corporation (NERC), which evaluates just such questions for every region of the grid.

In its annual summer reliability assessment, NERC examines each region of the grid and assesses sufficiency of resources to meet potential summer needs. For the vast majority of regions in 2019, resources far outpace anticipated needs. Credit: NERC (2019).

This consideration of “resource adequacy” and “reserve margins” ends up shaping grid decisions large and small, which makes it critically important to get the underlying assumptions just right. Otherwise, for example, uneconomic power plants might be unnecessarily kept around, wasting consumer money and hindering the transition to clean electricity. Or, operators might not recognize that the timing and magnitude of peak demand can rapidly change in shape as installations of rooftop solar surge across the country, with abundant solar power easing afternoon grid stress and in turn pushing the peak later and lower in the day.

As ISO-New England illustrates, as more and more rooftop solar gets added to the system, the summer load profile can change, with peak demand not only dropping lower but also shifting later, too. Credit: ISO-NE.

Operations

But long-range planning is really just the start. Next up is making sure that all those power generating, power saving, and power transmitting resources can actually be used.

Power plants and supporting grid infrastructure routinely undergo maintenance, meaning sometimes they have to go offline. If fixes are quick, then outages during low-demand seasons like spring mean there’s still plenty of slack on the system to mitigate effects. For longer lasting outages, though, operators plan ahead to ensure that not too many outages are planned at once, and that enough resources remain available to make it through those hottest summer days.

Yet even when operators do the best planning they can, equipment still breaks and accidents still happen. And then, too, there’s the fact that summer heat can itself wreak havoc on the grid.

For example, virtually all coal and nuclear power plants require cool water to run; in the summer, as hot weather steadily drives up the temperatures of area waterways, that water can eventually get too hot to be of cooling use or can be limited by drought, meaning those massive generators have no choice but to curtail operations or even entirely shut off—right when we need their power the most.

High temperatures can also decrease the efficiency of transmission lines and increase the likelihood of a disruption on the system, which if not rapidly addressed can quickly cascade into far larger outage events, like the 2003 Northeast blackout which thrust over 50 million people into the dark. And now in California, in the face of climate change and the growing threat of wildfires, utilities are starting to pre-emptively shut off transmission lines in high-risk areas during high-risk days to minimize chances of sparking a new blaze.

Which all means operators need to keep a watchful eye on the grid, managing resources to be prepared for contingencies to occur, and relying on weather forecasters to help them anticipate exactly when such conditions might arise in order to proactively plan for how these situations can be overcome.

Markets and management

And when a heat wave does finally arrive? After all the planning, and the operations, and the forecasts—how does the grid actually manage that overwhelming dystopian symphony of compressors cycling on and off, on and off, day after day after day?

With good offense and good defense.

First, there’s the usual starting lineup of least-cost, most efficient, and often cleanest resources, ready and reporting for action (minus those lost to outages, planned or otherwise). These are the ones that are typically relied on all throughout the year.

Then, as hot days continue and the demand for power grows, the grid is increasingly forced to call on its back bench: the more expensive and less efficient “peaker plants,” some of which run only a handful of times a year.

Peaker plants often take the form of combustion turbines, and can be sited right in the heart of communities—which means on some of the worst air quality days of the year, these polluters are roaring to life, exacerbating exposures to already unhealthy air.

Unsurprisingly, inefficient plants running just a few times a year end up being quite expensive, too. In regions with energy markets, this is when prices on the grid start to spike.

Prolonged hot weather can send real-time electricity prices surging, as seen in this chart of a 2013 heatwave in New York. Credit: EIA.

This way of running the power system is ripe for disruption, and indeed recently, new technologies have started to edge in. In particular, peaker plants are beginning to be replaced by combined solar-plus-storage projects. These projects couple solar power plants with battery energy storage, resulting in clean, reliable, and rapidly dispatchable resources, useful not just in those peak moments, but in fact the whole year round.

But during heat waves, it’s not just power plants coming in to save the day—it’s everyday people, too. That’s because a huge part of responding to peak demand is actually lowering power demand itself during those very highest hours.

Some of these actions are systematic: utilities can permanently preclude the need for that last peaker plant by incentivizing people and businesses to use less electricity during those highest hours of the day, not just during heat waves, but every day. They can guide that response through time-varying electricity rates, which are high during high-demand hours and lower during the rest, to encourage shifting of flexible electricity use, like running a dishwasher or drying laundry, away from periods of grid stress.

Other demand-side interventions are more specific to major peak events. For example, in exchange for handsome compensation, electricity customers can agree to be called on a few times a year to ease their electricity consumption, much of which can be done automatically, like raising thermostats several degrees, or stopping industrial operations, or flipping off every other bank of lights in a big box store, all to avoid bringing the costliest final power plants online.

Yet even after all of that, sometimes, it’s still just not enough. Despite all the planning, all the power plants, all the demand response—still, more power is needed than the grid is able to give. That means first, looking to neighboring regions to see if they might have some electricity to spare and sell. Especially when weather varies across regions, sharing of resources can be an effective and efficient solution.

But sometimes, especially when wide swaths of the country are enduring a heat wave at once, it’s still just not enough. And that means turning to the extreme last resort of “load shedding,” the forgiving term assigned to cutting power to some consumers to keep the lights on for the rest. Because if not, and the grid gets overloaded, it can quickly become lights off not just for some but for all.

Looking ahead

To get through a heat wave, grid operators employ a highly dynamic approach informed by careful planning, toggling switches and turning dials to modulate supply and demand. And it turns out, this dynamic method of operations is in fact where the grid of the future is headed, as more variable renewable resources like wind and solar come online and technologies support far more flexibility and coordination in when and how electricity is consumed.

Indeed, grid management of heat waves can teach us a lot about how to get the most out of the resources we want, and how to limit our use of the ones we don’t.

It also elevates the critical importance of paying attention to these challenges, and proactively planning for an increasingly flexible, resilient, and reliable grid as we face the growing strain and stress of climate impacts in the years to come. Because during a heat wave, reliable access to electricity isn’t only a matter of comfort—it’s a significant matter of health and safety, too. Which makes it all the more important to ensure that grid operators aren’t just prepared for heat waves this summer, but are also looking out for worsening conditions to come.

Postscript: If you want to track heat waves rippling across the grid this summer, take a look at one of these data feeds, including at the national level or from the regional grid operators below:

Credit: iStockphoto/Pleasureofart

6 Maps That Show How Bad Energy Poverty is and Reveal 2 Ways to Make it Better

Fresh off the presses is the latest tool from the US Department of Energy (DOE) that generates color-coded maps (known as choropleths) of the deep energy burden many Americans face. There is a wealth of data and hundreds of different ways to display it (you can check it out for yourself here). I’ve chosen 3 sets of maps (6 maps in total) that show the extent of the energy burden but also illuminates a couple of ways we can address the problem of energy poverty.

The energy burden is incredibly regressive

Economists like to talk about ‘progressive’ and ‘regressive’ policies. These aren’t political descriptors, rather, they describe the distributive effects of various policies. Progressive policies place a higher burden as you move up the income ladder. Regressive policies place a higher burden on lower income folks. Generally, decisionmakers try to avoid creating regressive policies. However, we haven’t succeeded on that front when it comes to energy.

The energy burden is far worse for those already living in poverty. Data from the DOE Office of Energy Efficiency and Renewable Energy.

This map on the left isn’t all that exciting, it shows the percent of household income spent on household energy bills (electric, heating, stuff like that) for households that have a combined income four times higher than the federal poverty line (FPL), which is $25,750 for a family of four. It shows a mostly uniform distribution across the US, with households in that income bracket typically spending only 1-2% of their income on household energy. Even if you add in anyone above the federal poverty line the map doesn’t get all that more exciting, in all 50 states, and Puerto Rico, households above the poverty level spend about 2-3% of their income on energy.

Things start to look much different once you look at those households below the poverty level (the map on the right), the burden balloons to 10% up to 26%. 10 percent of household income is also an important threshold because it is often used as the delineation for energy poverty.

This new data suggests that those families in the US that are below the poverty line are far more likely to be suffering from energy poverty.

There are a few clusters of higher burdened areas. Some of the worst burden is in states like Connecticut, Massachusetts, Maryland, New York, Pennsylvania, and the District of Columbia. Outside of the northeast two clusters stand out. The first is in the Midwest, in states like Michigan, Illinois, Missouri, and Kansas. It is worth noting that Kansas and western Missouri are both served by Evergy, while eastern Missouri and parts of Illinois are served by Dynergy.

Michigan has an incredibly high burden, with 22% of low-income household’s income going to energy bills.

Another cluster that stands out is in the southeast. Alabama, Georgia, and Mississippi (all served by subsidiaries of Southern Company) along with South Carolina. Some Commissioners in those states claim that the high bills are a function of high AC load, which is odd because Florida, Arkansas, Louisiana, Arizona, New Mexico, and Nevada also have high AC loads and they all have lower energy bills and lower energy burden.

Multi-unit buildings are better

Creating affordable housing is an important part of a set of anti-poverty policies, but this new data suggests that it may also be helpful in the fight against energy poverty.

Multi-family households below the poverty line tend to be more efficient and have lower energy bills so the burden is lower on families living in those houses. Data from the DOE Office of Energy Efficiency and Renewable Energy.

In every state, the annual energy bill in multi-unit households is lower, and for low-income households it is a considerable saving, by at least $300 and as high as $1,850 a year. That is considerable savings for a family that is below the federal poverty line. Single-family households spend as much as 13% more of their income on energy expenditures.

The split incentive

The split incentive is another wonky piece of economic jargon. It boils down to this:

Owners tend to have the capital and long-term interest to make investments that will lower energy bills but often don’t pay the bill, so the incentive is split with renters. Renters generally don’t have much of an incentive to make investments in the homes they rent but they do pay the energy bills.

Looking at the maps of renters vs owners shows this phenomenon in effect for those below the federal poverty line.

Owners below tend to have an incentive to invest in efficiency (appliances or home retrofits)  and so have lower energy bills. Data from the DOE Office of Energy Efficiency and Renewable Energy.

Owners tend to have lower energy bills, probably b/c they are more likely to live in their home for long enough periods where investment in more efficient appliances or home insulation will pay off. Renters are sadly facing higher energy bills which could mean that those unable to afford buying a house are also more likely to be unable to afford to pay their energy bill.

The maps illustrate the magnitude of the problem. Luckily there are ways to solve the split incentive which include:

Action worth taking

Policies that promote multi-family households not only help deal with energy poverty but can be a centerpiece the housing crisis. States (like Oregon) and cities (like Minneapolis) are already taking on this issue.

The split incentive is also an issue worth tackling. A 2014 study found that fixing the split incentive problem would save consumers $4-11 billion per year.

$4-11 BILLION per YEAR.

That is a lot of money and considering that a lot of those savings would be enjoyed by low-income households it means that it would go a long way at easing the energy burden.

Making households more energy efficient will go a long way to reduce energy costs. That increased efficiency will reduce energy bills, reduce energy burden, and reduce pollution. That last point, reduced pollution, is critically important because low-income households are also disproportionately burdened by healthcare costs.

It turns out, housing policy is energy policy and energy policy is climate policy.

Public Domain

Can Trees, Oceans and Giant Carbon Sucking Machines Save Us from Climate Catastrophe?

The world needs leadership on climate change–as witnessed by the limited progress made by nearly 200 country delegates to the climate conference last week who failed to overcome Saudi Arabia’s block on formal discussion of the latest climate science produced by The Intergovernmental Panel on Climate Change (IPCC).  As we confront ever more obvious impacts of a warming world, we must immediately tackle the political and technical challenges of reducing the pollution causing climate change. And, just as actively, seek ways to remove, store and manage carbon to bring our climate back into balance.

Florida is perhaps the US state facing the most obvious evidence of a warming world. Sea level rise has already cost Florida taxpayers billions of dollars to keep the ocean at bay. And they are fighting a losing battle if we don’t act fast to move our economy off fossil fuels.

Democratic presidential hopefuls in the Miami debate spent more time than ever before addressing climate change, and many candidates indicate it will be a high priority. But without truly transformational change, Florida and the rest of this country are destined for a world of more dangerous storms, longer and hotter heat waves, wildfires, and floods threatening the health, homes, and economies of thousands of communities.

While moving to a clean energy economy and adaptation must be our first-line solutions to climate change, scientists are signaling that carbon dioxide removal will also need to be a part of our strategy.  Carbon dioxide removal (CDR), also known as negative emissions technologies (NETs), is a term used to describe a range of options to actively remove carbon dioxide (CO2) from the atmosphere.

The host nation for the next world climate conference, Chile, is planning to feature natural ways for trees and oceans to store carbon.  Meanwhile, Exxon and other oil companies, along with Bill Gates, are making news with investments in new technologies to draw CO2 out of the air.  It may well be that both types of approaches are needed to grapple with the climate crisis that is upon us.

What is carbon dioxide removal and why consider it?

A crucial insight from the recent IPCC 1.5° C report is that meeting the long-term goals of the Paris Agreement on climate change will require not just getting to zero emissions, but getting to “net negative” global CO2 emissions by mid-century.  Unfortunately, we are rapidly running out of time to avoid severe climate risks through deep cuts in emissions alone, and some sectors of our economy may find it difficult to stop using fossil fuels.

The report highlighted, in a more pointed way than had been done before, the need to invest in measures to protect communities from the impacts that are already unfolding and/or are unavoidable by helping them adapt.  At the same time, there are limits to adaptation, especially as we get closer to high-risk or irreversible climate impacts, like sea level rise.

In this daunting context, understanding the risks and potential of CDR will be essential for climate activists, scientists, the media, and lawmakers.

CO2 removal occurs naturally on land (e.g. forests, soils and wetlands) and the ocean (e.g. seagrasses, microalgae), and we can enhance that natural process to increase the amount of carbon stored.  More attention has been given lately to engineered, technological approaches, include capturing carbon from the air directly (Direct Air Capture or DAC) and storing it in secure geologic formations or converting it into fuel, cement, minerals, and plastics, or used as a feedstock for chemicals – all of which are at various stages of research and development.

The National Academy of Sciences released last year its analysis of the major CDR options, titled Negative Emissions Technologies and Reliable Sequestration: A Research Agenda.  Specifically, they looked at a number of natural and engineered approaches including:

  • Coastal blue carbon (Chapter 2)—Land use and management practices that increase the carbon stored in living plants or sediments in mangroves, tidal marshlands, seagrass beds, and other tidal or salt-water wetlands.
  • Terrestrial carbon removal and sequestration (Chapter 3)—Land use and management practices such as afforestation/reforestation, changes in forest management, or changes in agricultural practices that enhance soil carbon storage (“agricultural soils”).
  • Bioenergy with carbon capture and sequestration (Chapter 4)—Energy production using plant biomass to produce electricity, liquid fuels, and/or heat combined with capture and sequestration of any CO2 produced when using the bioenergy and any remaining biomass carbon that is not in the liquid fuels.
  • Direct air capture (Chapter 5)—Chemical processes that capture CO2 from ambient air and concentrate it, so that it can be injected into a storage reservoir.

A broad portfolio of negative emissions technologies are needed if we are to reach a goal of limiting global average temperature to well under 2°C. Coastal blue carbon, afforestation/reforestation and soil carbon are among the best options we have available today. Bioenergy with CCS, Direct Air Capture and Accelerated Weather are technologically based approaches that need varying levels of research to determine whether they can be safely and affordably deployed. Source: National Academies of Science

 Important considerations to help evaluate CDR options

CDR options must be evaluated on an individual basis as well as how they interact with each other (e.g. competition for the same land). Some are an enhancement of natural processes and others are more heavily reliant on technological solutions. While some of these options are well-understood and already being implemented, others are still at early stages of research and development. In addition to climate benefits, some of these options also have the potential to provide other valuable co-benefits—such as ecosystem benefits, flood protection, and more productive soils and forests—and might make sense to deploy for those reasons.

Many CDR options may, though, pose significant risks, costs and uncertainties. These include trade-offs in terms of use of scarce resources like land and water and the risks of a sudden release of CO2 from a failed repository. There are many challenges and issues raised by the different CDR approaches, including important questions of sustainability and equity (Dooley and Kartha 2018, Creutzig et al. 2013), that can be addressed broadly by asking three questions:

  • How much land does the approach require, and what kind of land is it? How permanent is land storage, in different ecosystems and at different depths, likely to be?
  • How much (external, non-photosynthetic) energy does the approach require?
  • How much matter (e.g. biomass, rock, or CO2) does the approach require to be transported, pyrolyzed, crushed, buried or otherwise processed, and what kind of processing, transportation and infrastructure are required?

Scenario of the role of negative emissions technologies in reaching net zero emissions. NOTE: For any concentration and type of greenhouse gas (e.g. methane, perfluorocarbons, and nitrous oxide) CO2e signifies the concentration of CO2 which would have the same amount of radiative forcing. Source: UNEP, 2017

It is very important to consider the equity and environmental justice impacts of CDR approaches, with particular attention to competition for land and pollution when evaluating CDR options.  Community groups are already overburdened with pollution from facilities like power plants, whether they are coal, natural gas or bioenergy.

While adding carbon capture technology to a bioenergy facility would reduce CO2 emissions, other pollution control technologies will be necessary to reduce other harmful air pollutants. And there are concerns about the demand these plants present for water and land and how their needs for those natural resources would affect the community that also relies on them.

In addition, the network of pipelines required to transport carbon to safe storage sites could encroach on indigenous people’s lands.  Similarly, even the natural solutions, like reforestation, can pose threats to the rights of indigenous peoples by commoditizing their homes and property.

A less technical and more common risk cited by many is the potential “moral hazard.” Could a focus on CDR give politicians and polluters yet another excuse for delaying action to rapidly reduce fossil fuel emissions and fund adaptation, in the hopes that we could engineer our way out of the climate crisis?

Some argue that CDR could endanger our transition to carbon-free energy options, possibly with drastic consequences, by diminishing both the investments for and the political pressure to eliminate high-carbon energy sources.  Or it could make the transition dependent on negative emissions from CDR approaches that may not pan out or that may have unforeseen risks for ecosystems or environmental justice.  Or it might lock the world in to overshoot scenarios (temporary increases of global average temperature over 1.5 or even 2 degrees) with potentially irreversible climate consequences.

What could a path forward for CDR entail?

The National Academy of Sciences report on carbon removal recommended that the US “launch a substantial research initiative to advance negative emissions technologies (NETs) as soon as practicable:”

A substantial investment would (1) improve existing NETs (i.e., coastal blue carbon, afforestation/reforestation, changes in forest management, uptake and storage by agricultural soils, and biomass energy with carbon capture and sequestration) to increase the capacity and to reduce their negative impacts and costs; (2) make rapid progress on direct air capture and carbon mineralization technologies, which are underexplored but would have essentially unlimited capacity if the high costs and many unknowns could be overcome; and (3) advance NET enabling research on biofuels and carbon sequestration that should be undertaken anyway as part of an emissions mitigation research portfolio.

If the US is to embark on such an initiative, it needs to be paired with significant stakeholder engagement to develop a framework for governance that will minimize the moral hazard threat and ensure equity concerns are addressed in any research and development project.

Policymakers, scientists, private companies and civil society will need a thorough understanding of the costs, benefits, uncertainties, and potential harms associated with various CDR options. Engagement with a diverse set of stakeholders who would be affected by their use should occur ahead of making any major decisions or large investments. And more public education about CDR options is an essential step to help foster an informed stakeholder process.

Robust and inclusive systems of governance that are mindful of relevant societal, environmental, ethical, and political considerations can lead to wiser decisions about all technologies and practices that have potentially far-reaching consequences.

 

National Academy of Sciences National Academy of Sciences

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