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Wednesday, December 17, 2014

Yes, Senator Casey, we can

On December 10, Senator Bob Casey issued a statement entitled The Need to Act on Climate Change. The statement began on a very positive note, saying We must take action on climate change because it poses a serious threat to public health, the environment and national security. It then went on to voice support for the Environmental Protection Agency's (EPA) Clean Power Plan and highlighted a number of reasonable points.

With the other member of our U.S. Senate delegation in Pennsylvania, Senator Pat Toomey, completely opposed to limiting carbon pollution, and even our own Pennsylvania Department of Environmental Protection (DEP) opposing many of EPA’s efforts, Senator Casey deserves our thanks for being a voice of reason.

As much as we would like to praise the entire statement, there is one sentence with which we take issue. Midway through the document, the Senator says:
"EPA’s renewable energy target for Pennsylvania imposes an unequal burden on the Commonwealth relative to other states with much greater renewable energy potential, and it wouldn’t be possible to get greater carbon pollution reductions from the other three building blocks in Pennsylvania."
While we can appreciate constructive criticism that fosters debate and will ultimately make a good rule better, this particular statement takes an overly pessimistic view of the EPA’s proposal.

The claim that EPA imposes an unequal burden on us sounds bad, and it is bound to be repeated often by those opposed to the Plan. But, is it really surprising that EPA is proposing more reductions from states that emit more carbon pollution? Sometimes, being unequal is not only fair but also reasonable public policy.

The EPA derived its regional renewable generation targets by averaging existing renewable portfolio standards (RPS) in nearby states. This guarantees that the regional standard will be more moderate than what other states have already found to be achievable. Of the states with existing standards in our region, Pennsylvania is in last place with an 8 percent target—half of the 16 percent average. So, it’s not surprising that we need to do a little extra to catch up. (West Virgina and Virginia are even further behind as neither has a state RPS.)

Because we generate more electricity (and emit more pollution) than many other states, we also need more renewable generation to see the same percentage improvement. Of course, just because it’s unequal doesn’t mean it’s a burden. As a state with more generation, we also have the potential for more cost-effective reductions in many cases. Also, when we consider the benefits of having a clean and inexhaustible energy supply that protects public health and the environment, creates local jobs, avoids volatile fuel prices, and provides a more resilient power grid, the real burden would be remaining dependent on fossil fuels for another generation.

We Can Do It

The second part of the Senator’s statement is not only more troubling but saying that we can’t achieve more from the other elements of the EPA plan is just plain wrong.

The EPA’s plan sets a state’s target by calculating what is achievable using four building blocks (see graphic). These building blocks are simply used as a means to calculate the target. EPA does not require Pennsylvania to use any particular block in its plan nor does it require any particular facility to achieve any specific reduction. States will have the flexibility to choose what measures are best and most cost effective. We could follow the EPA plan; we could choose to pool our resources in a multi-state approach (which could be as much as 30 percent cheaper); and we could even make use of other sources of emission reductions that EPA didn’t consider. Even if we stick to the EPA’s building blocks, we can clearly achieve far more reductions than they have assumed.

We certainly have the potential to exceed EPA’s target for renewable generation (Block #3). Their plan assumes we can get about 35,000 GWh total renewable generation by 2029. Our existing Alternative Energy Portfolio Standard (AEPS) should get us about halfway to that goal with more than 18,000 GWh expected by 2020, leaving us nine years to install the rest. Between solar and wind alone, we have the potential to exceed that target.

A 2009 study showed Pennsylvania could get over 29,000 GWh from on site solar alone and such resources have already become more cost effective. A study from the U.S. Department of Energy showed we could get over 20,000 GWh from offshore wind in lake Erie. Additionally, a study from the National Renewable Energy Laboratory (NREL) showed we could get almost 10,000 GWh from land-based wind. That doesn’t even consider out-of-state resources that could be used if they prove more cost effective.

Not only can we meet the goal, but doing so looks more and more like a smart business choice even without an EPA rule. An analyst at Deutsche Bank recently found that the cost of rooftop solar will reach grid parity in all 50 states by 2016 (ten states are already there.) Our grid operator, PJM, reported that getting 30 percent renewable penetration in our grid (mostly solar and wind) would reduce production costs by up to 16 percent over business as usual and can reduce wholesale electricity prices by over 21 percent.

While we can get all the expected reductions from renewable energy, that isn’t the only option. Contrary to what Senator Casey has said, we can get more reductions than the EPA predicted from many of the building blocks.
  • For redispatch of coal generation to gas (building block #2), we already have. Over the past several years, a number of old coal-fired power plants have either retired or announced their retirement. As as result of low natural gas prices, these are being replaced, for the most part, with new natural gas capacity.
  • For more clean and renewable generation (building block #3), we can take credit for more than just new renewable energy. Because of uprates in capacity at an existing nuclear plant, we are already achieving more than EPA estimated.
  • For energy efficiency (building block #4), we probably have the most potential to exceed EPA’s projections. A recent PUC report prepared by an independent evaluator noted that we could likely triple EPA’s projection with cost-effective measures. These are measures that are already putting roughly $3 into consumers’ pockets for every $1 spent.
The Time is Now

Senator Casey, you said we must take action on climate change. The Clean Power Plan will keep energy cleaner and more affordable. It will create more jobs for Pennsylvania workers. It will protect the health of our citizens, particularly children and the elderly. And, it will help keep Pennsylvania a leader in technology and innovation.

We’ll keep up the fight to reach these goals but your full support would help a great deal. Are you with us?

Rob Altenburg is senior energy analyst for PennFuture and is based in Harrisburg. He tweets @RobAltenburg.

A new kind of International Climate Change Agreement is on the horizon

For more information on COP 20, see my previous post from December 3, 2014: COP 20: U.S. optimistic about establishing a new international climate change pact

Last weekend, delegates from nearly 200 countries signed a preliminary global climate agreement (the “Lima Call for Climate Action”) committing each nation to reducing carbon pollution. The agreement affirmed the Conference of the Parties’ (COP) “determination to strengthen adaptation action.” A formal legal agreement (to be legally enforced under the U.N. Framework Convention on Climate Change) will be negotiated and hopefully signed next year at COP 21 in Paris, France and then implemented in 2020. 

It is refreshing to see that the U.S. and China were finally able to come to an agreement a few weeks ago, even if COP 20 discussions were still quite tense.  Here in the U.S., we tend to put a lot of the blame on China for its high greenhouse gas (GHG) emissions. However, that is an unfair assessment, especially considering that a lot of the items we purchase in the U.S. are made in China. American consumerism, particularly during this time of the year, is a significant part of the problem. We want more and more material items and expect China to produce them as quickly as possible. Now that the two nations have sort of come to an agreement, it is time for individuals to step up and make a change as well.

The new agreement will be unlike prior agreements such as the Kyoto Protocol and the Berlin Mandate in that it will bind more than just the “industrialized” or “developed” Annex I countries to carbon emission reductions.

The “Lima Call for Climate Action” states that the COP “underscores its commitment to reaching an ambitious agreement in 2015 that reflects the principle of common but differentiated responsibilities and respective capabilities, in light of different national circumstances.” “Common but differentiated responsibilities” (CBDR) is the phrase used in U.N. agreements to attempt to describe the roles of countries based on their level of development.

According to Professor Ellen Hey, the core principle is having a “global partnership linked to the duty to cooperate, in which states are to take on obligations based on their situation as determined by their contribution to environmental degradation and their access to technological and financial resources with developed states taking on a special responsibility.”

In addition to the presence of the U.S., inclusion of non-Annex I countries in the new agreement is a significant development. Climate change is a global issue and CO2 reductions should be mandated across the board. The biggest polluters, such as the United States and China, should clearly have the largest CO2 reduction mandates, but we can no longer afford to keep developing countries out of the mix.

Without a binding agreement requiring developing countries to limit emissions, there is nothing preventing them from increasing emissions as they continue to industrialize. Developing nations can continue to grow by using the most efficient renewable energy sources, but the developed nations need to help them obtain those sources by providing technological knowledge and financial aid.

Professor Hey emphasized that point by saying that developed countries have an obligation to help developing states adapt to climate change and because of the principle of “common but differentiated responsibilities,” they are encouraged to do so. Yet, there is still a strong divide between developed and developing nations so between now and next December, countries will need to discuss how they will finance the necessary mechanisms to achieve the required emission reductions. 

Compromise and hope for the future

According to Robert Stavins, the preliminary agreement represents “both a classic compromise between the rich and poor countries, and something of a breakthrough after 20 years of difficult climate negotiations.” He goes on to say that “a new way forward has been established in which all countries participate and which, therefore, holds promise of meaningful global action to address the threat of climate change.” In addition, Sierra Club Executive Director Michael Brune stated that the conclusion of COP 20 “marks another step forward on the path to a significant agreement in Paris, though there is much more left to be done.” 

Climate change is a global issue that requires participation from all the nations of the world, and we are pleased that the U.S. is finally coming to this realization. What we need to do now is seriously consider implementing cost-effective measures such as energy efficiency and renewable energy that will put us on the right path toward achieving essential GHG reductions.

What to look for in the coming months

Each country now has to submit its Intended Nationally Determined Contributions (INDC) by the end of March 2015 (June at the latest), which will include how they will further reduce CO2 emissions (have to go beyond what they are currently doing). Each nation’s INDC will be listed on the UNFCCC website as they come in. Meetings with technical experts will also continue in order to properly assess measures such as energy efficiency, renewable energy, and carbon capture and storage (CCS) that will aid reductions.

Jennie Demjanick is energy associate for the PennFuture Energy Center and is based in Harrisburg. She tweets @JennieDemjanick.

Wednesday, December 10, 2014

Pollution and the Pareto Principle

In 1906, the economist Vilfredo Pareto noticed what has come to be called the Pareto principle, or the 80-20 rule. This is the observation that for a variety of events around 20 percent of the causes are often responsible for around 80 percent of the results. This rule of thumb has been applied to a wide range of subject matter including economics, human resources, safety, natural disasters and many others.

Polluters often try to use this rule to their advantage. We frequently hear the claim that a pollution control program isn't "effective" because relatively few facilities are found to be violating a standard. We also hear polluters discuss their average emissions, which lets them avoid discussing how high the peaks are.

When we drive down the road, we don't notice the air pollution from most of the cars around us. Fossil fuel cars are all emitting pollutants to some degree, but a fairly high percentage of them are meeting or exceeding the applicable emission standards. Every once in a while, however, we see (or smell) one car that is emitting way more pollution than any of the others. This is an example of the Pareto principle—most of the emissions come from relatively few cars. We need to be sure it is cars like that which we identify and fix.

In most cases, the solution is to have most or all of the cars do a simple emissions test. Having such a test creates reductions in different ways: There will be a certain number of high emitting cars that will fail the test and will be fixed; there will be some owners who know their cars will fail and will repair or replace those cars before even taking the test; and, there will be some owners who will be a little bit better at regular maintenance and will avoid having any problems in the first place.

While more people can probably relate to this idea in the context of vehicle inspection, it works in other areas, too.

A recent study out of the University of Texas at Austin notes that, in natural gas production, 19 percent of the pneumatic controllers studied accounted for 95 percent of the gas and methane emissions. That suggests the Pareto principle applies to methane leakage as well.

In Pennsylvania, drillers and processors of gas from the Marcellus shale reported using 9,491 pneumatic controllers in 2012. If we have a similar pattern to what was found in the Texas study, that would mean that a little over 1,800 controllers would be responsible for the majority of the emissions. Or, on average, about 60 high-emitting controllers for each Pennsylvania county with active Marcellus wells.

The DEP has some requirements for leak detection, but it is far from a comprehensive program. Just as with cars, a stronger program would not only help catch high emitters, but it would send a signal to operators that it's worth it to prioritize maintenance, thus preventing problems in the first place. It's a small step, but it would be a step in the right direction.

Rob Altenburg is senior energy analyst for PennFuture and is based in Harrisburg. He tweets @RobAltenburg.

RGGI Part Two: Lack of Pennsylvania participation is one of RGGI’s biggest flaws

For more background on RGGI, see my previous post from November 19, 2014: "What is RGGI and why should PA be interested?"

The Regional Greenhouse Gas Initiative (RGGI) is responsible for a reduction in regional power sector carbon dioxide (CO2) pollution by over 30 percent. Emissions trading is one of the best available options to reduce ghg emissions at the lowest cost possible and, as a result, lessen the overall cost of dealing with climate change. The fact that the European Union and California are using cap and trade emphasizes its potential to effectively and dramatically decrease ghg emissions. 

RGGI and other regional cap and trade programs are great examples of utilizing the “bottom-up approach” when it comes to climate change mitigation. According to Robert N. Stavins, Albert Pratt Professor of Business and Government, Harvard Kennedy School, “the bottom-up approach could be an important part, or perhaps even the core, of the future of U.S. climate policy, at least until there is meaningful action at the federal level.”  If state cap-and-trade systems link, they may become “the (interim) de facto national climate policy architecture.”

If PA does become a member, how will that benefit RGGI?

Even though RGGI has made significant progress in reducing CO2 emissions, it has its flaws. The major economic issue is that, just like any other free market, the carbon market fluctuates and, every so often, hits bottom. Other issues with the program include low prices for allowances, declining interest in future trading, and one original member state (New Jersey) that has already dropped out. 

Another issue with trading is carbon leakage, which involves driving carbon sources out of the market into an area with no control. Leakage undercuts the viability of RGGI. For instance, one of the reasons why New Jersey resigned from RGGI is due to Pennsylvania not being a member. According to Sara Bluhm, vice president of energy and environmental affairs at the New Jersey Business and Industry Association, "Our biggest problem was that Pennsylvania was never part of the program.” Since a lot of New Jersey's pollution comes from out of state, including Pennsylvania, New Jersey was not reaping enough benefits under RGGI. 

According to New Jersey’s Former Democratic Committee Chairman, Upendra Chivukula, “retreating from RGGI was a tactical blunder and we believe it is crucial that New Jersey rejoin.” He recognizes that getting Governor Chris Christie’s support is the biggest issue because he has used his executive powers three times previously to keep his state out of RGGI. However, if Pennsylvania joins that could quite possibly put “political pressure on New Jersey Gov. Chris Christie (R) to reconsider his state's decision to leave RGGI,” says Peter Shattuck, a director for market initiatives at Environment Northeast. 

Proponents of RGGI have suggested that there may have been political motives involved in the governor’s decision considering the persistent rumors he will be running as a Republican candidate in the 2016 Presidential election.  

New Yorkers would also be happy if the Keystone state joined RGGI because that would reduce leakage from New York into Pennsylvania, meaning utilities will no longer have an incentive to buy cheaper power from our state. According to Stavins, "for RGGI to work as it's supposed to, you need power generation in Pennsylvania to be covered as well."

Additionally, as a big coal state, Pennsylvania's joining RGGI could cause a domino effect of other large states with similar energy profiles entering into RGGI or other multi-state initiatives. According to Jackson Morris, an energy analyst at the Natural Resources Defense Council, “this could be especially true with states like Virginia and Ohio that are not in RGGI but, like Pennsylvania, are part of the PJM Interconnection, the regional transmission organization (RTO).” 

Furthermore, based on data from the U.S. Department of Energy (DOE), California and Texas are the only states that release more total CO2. That is significant because there are a lot of states much larger than ours that release fewer CO2 emissions. If Pennsylvania joins RGGI, it would be a “revolutionary development” and the state could benefit as well. RGGI could help Pennsylvania go beyond its CO2 reduction goals and make a serious difference in the amount of ghg emissions in the region.

Most importantly, there is something wrong with this picture. Right now, there is a gaping hole in the RGGI program where Pennsylvania and New Jersey should be. We should consider filling in the region component of the REGIONAL Greenhouse Gas Initiative. Otherwise, they may as well call it the New England/DelMar Greenhouse Gas Initiative. 

Jennie Demjanick is energy associate for the PennFuture Energy Center and is based in Harrisburg. She tweets @JennieDemjanick.

Wind and solar least cost, lowest risk form of electricity

Ceres, an organization that champions sustainable investments and sustainable corporate leadership, recently released an update to its groundbreaking 2012 report, Practicing Risk-Aware Electricity Regulation: What Every State Regulator Needs to Know. The report looks at key trends that continue to reshape the U.S. electricity industry, and analyzes changing costs and risk profiles of energy resources (especially renewable energy). 
In this 2014 update, authored by utility industry and finance experts, utility scale solar joins onshore wind as the least cost—and least risk—resource for the generation of electricity save for energy efficiency, which will always fall into the least cost resource category. Distributed solar (think rooftop solar) with incentives also significantly improved its ranking for reduced costs.  
The riskiest investments for utilities—the ones that could cause the most harm to ratepayers and investors—are large base load fossil fuel and nuclear plants. In contrast, energy efficiency, distributed energy, and renewable energy are seen as more attractive investments that have lower risks and cost.
In addition to the updated rankings, the report goes on to highlight trends for which utilities and regulators need to prepare.  This includes grid integration of distributed generation sources such as rooftop solar.

Wednesday, December 3, 2014

COP 20: U.S. optimistic about establishing a new international climate change pact

Right now, delegates from the U.S. are meeting with delegates from roughly 200 countries (all parties to the United Nations Framework Convention on Climate Change (UNFCCC)) at the 20th session of the Conference of the Parties (COP 20) in Lima, Peru. They will be in meetings until December 12 and, if all goes well, each country’s delegates will decide their future emissions reduction targets (after 2020) and develop the first draft of a new international pact to be signed at COP 21 in Paris next year.  

Why COP 20 matters for the U.S. and the rest of the world

COP 20 is especially important since the United Nations' top climate scientist, Rajendra Pachauri, has recently stated, “the world has already used up 65 percent of its "carbon budget"-- that is, the estimated maximum amount of carbon dioxide that can be spewed while still keeping the most dangerous climate disasters at bay.” We only have 1,000 gigatons of CO2 left in the budget until we see global temperatures rise more than 2 degrees Celsius above pre-industrial levels. According to Pachauri, “What we really need to do is come up with an equitable, ethical, implementable set of actions.” Even so, there has been some discussion about abandoning the goal of keeping global rise in temperatures below 2° C.

The U.S. has been lagging behind other developed countries on addressing climate change. As you may already know, our country did not ratify the Kyoto Protocol, mainly because China was not a party to it. However, delegates from other large nations remain hopeful considering that the United States and China recently entered into an agreement wherein the U.S. agreed to cut greenhouse gas emissions (GHGs) 26 to 28 percent below 2005 levels by 2025, and China pledged to peak emissions by 2030.

In addition to the new reduction targets, the U.S. has also pledged to put $3 billion into the International Climate Fund and proposed rules such as the Clean Power Plan. Paul Bledsoe, a climate and energy fellow at the German Marshall Fund, says, “The U.S. position is more deeply respected around the world than ever before, because all the major nations are convinced the administration genuinely wants an equitable agreement.”

On the other hand, some delegates, especially those from small island countries like the Marshall Islands which are particularly susceptible to sea level rise, say the U.S. can and should go further in reducing its emissions.  Yet, according to Stern, “The U.S. target is actually extremely ambitious and quite comparable to the European target if you analyze it.”  Additionally, he notes that the Obama administration developed a target that could be delivered using executive authority under the Clean Air Act (CAA), without requiring “legislation that would be great to have but we don't know whether it would be enacted.”

If the U.S. meets the reduction target, it will increase our rate of decarbonization by about 2.8 percent a year. Stern went on to say that an “ideal agreement would see countries aggressively 're-up' their targets every five years, but the deal must be grounded in every country deciding how far it can cut emissions” and not require countries to enact certain targets to meet the goal of keeping temperatures below 2° C.

Other nations, and former UNFCCC Executive Secretary Yvo de Boer, are also finding it hard to forget the U.S.’s failure to enter the Kyoto Protocol when President Clinton was in office. de Boer is hoping COP 20 will not be “Kyoto revisited.”  Seychelles Ambassador Ronny Jumeau has even mentioned that “When using a 1990 base line -- a year that the United States rejects but that many other countries in the U.N. talks use -- the proposal amounts to a 10 percent emissions cut compared to Europe's proposed 40 percent below 1990 levels.”

What to watch for at COP 20

As far as energy developments are concerned, at one of the meetings, the International Energy Agency (IEA) will present its report entitled The Way Forward: Five Key Actions to Achieve a Low-Carbon Energy Sector, which proposes five actions and implementation options for decarbonizing the energy sector.

In addition, on December 9, the World Energy Council will present the key findings of the Global Electricity Initiative (GEI), which lays out the views of the utility sector, representing more than 80 percent of the global installed generating capacity.

Jennie Demjanick is energy associate for the PennFuture Energy Center and is based in Harrisburg. She tweets @JennieDemjanick.

Pennsylvania's first Solarize campaign couldn't come at a better time

Solar is cheaper than it's ever been. Large-scale solar projects are seeing prices that are stunning utilities and shifting the utility business model, or at least business decisions, faster than ever. Price parity is within reach in just a few years in many major markets. And even residential solar continues its cost decline.

However, as I've blogged in the past, a lack of consistent policy signals and the expiration of grant programs has led to a solar slowdown in Pennsylvania, despite having the lowest cost solar we've ever seen.

Enter Solarize Allegheny County (Allegheny County is where the City of Pittsburgh is located, for all our friends back east). This non-profit project, spearheaded by clean energy marketing group, SmartPower, aims to sweeten the solar deal once again by using price reduction achieved by group purchase of solar, solar education, and solar marketing. The Solarize model has accelerated deployment of solar in markets across the county but this will be the first comprehensive Solarize campaign executed in Pennsylvania.

The model works by getting a group of would-be solar purchasers educated in a non-pressure community environment where their questions and concerns around solar are addressed. They then pool their buying power and select an installer as a group.

The cost reductions come not only from bulk purchase of equipment and blitz installation but also by reducing the solar installer's often substantial, customer acquisition costs. Customer acquisition costs are the time and money it takes for a solar sales representative to find new customers, explain the various solar details, and wait for them to make the final decision. Yes, it adds up.

One more catch: Consumers only have a limited time frame to throw their hat in the ring to benefit from the reduced price, and since folks don't want to miss that train, they make their decision faster. Consequently, Solarize has been proven to reduce the cost of solar for those who participate by as much as 20 to 30 percent in many markets.

The Solarize Allegheny County project is starting its first phase with three communities, or Pittsburgh city neighborhoods, in Allegheny County. Additional phases will follow. But if you're a reader from Allegheny County, consider leading your neighborhood to participate in Pennsylvania's First Ever Solarize Campaign. The deadline is December 12.

At a time when solar education is essential to bringing solar out of the early adopter phase and into the Pennsylvania mainstream, this campaign has the dual benefit of raising the profile of solar and educating consumers. As a solar advocate, I constantly hear misconceptions about solar energy in Pennsylvania, from "It doesn't work well enough" to "I need batteries" and "Solar is illegal, isn't it?" This education, combined with the group purchase cost reduction provided by Solarize, on top of already low prices, is exactly what's needed.

The fight for appropriate state and federal policies that expand and defend the solar market, along with other renewable energy opportunities, needs to continue. Victories in these arenas will give the already successful Solarize model even more to capitalize on, leading ever more people to adopt solar. Likewise, appropriate incentives and healthy market signals, when re-established, will need Solarize models to educate, further reduce costs, and expand solar beyond early adopters.

As this fight continues, Pennsylvania's first Solarize campaign couldn't come at a better time.

Evan Endres is project manager for PennFuture and is based in Pittsburgh. He tweets @ER_Endres.

Fighting smog: Let's do it right this time

Under the federal Clean Air Act (CAA), there are many different compounds recognized as air pollutants and they can impact us in different ways. Some cause climate change; some cause cancer or birth defects; some deplete our protective ozone layer; and some cause lung disease, heart problems, and a host of medical issues. Because there are many different types of pollutants, Congress created different mechanisms in the CAA to address different groups.

One such group known as the criteria pollutants includes ozone, a component of what we commonly call "smog." Unlike the ozone layer miles up in the stratosphere that protects us from harmful UV radiation, breathing the ozone at ground level can damage our lungs and cause, or worsen, a number of health problems such as asthma, bronchitis, and emphysema. While this pollution is often invisible, the human and economic impacts are staggering, with hundreds of thousands of people suffering from asthma attacks, hospital admissions, missed work, and even premature deaths.

For all criteria pollutants, the EPA is required under the CAA to set national ambient air quality standards (NAAQS) that are protective of human health, and then periodically review those standards. EPA proposed such a standard for ozone last week and, right on cue, we heard the loud voices of big polluters and their friends in Congress complaining that setting a health-protective standard will cost too much. This crowd has a long history of overestimating costs and understating the benefits of limiting pollution -- but they have a bigger problem with their arguments.

Of all people, members of Congress should know that the CAA—a law Congress wrote—doesn't allow EPA to consider costs at this point even if they would like to. As Supreme Court Justice Antonin Scalia explained, the CAA requires the EPA "to identify the maximum airborne concentration of a pollutant that the public health can tolerate, decrease the concentration to provide an 'adequate' margin of safety, and set the standard at that level. Nowhere are the costs of achieving such a standard made part of that initial calculation."

What? No Consideration of Costs?

Yes, and that makes a lot of sense when you think about it, contrary to what polluters and their friends would like folks to believe. If we are interested in protecting public health, we need to know how much pollution, as Justice Scalia put it, "public health can tolerate." For that decision, the cost of fixing the problem is just not a factor. Looking at costs up front would be like expecting a doctor to do a credit check before deciding on a diagnosis. Cost may be a factor in deciding what course of action to take, but it doesn't change how sick the patient is.

Setting a NAAQS, like a medical diagnosis, is the first step in a long process toward fixing a problem. The next step is the designation process, where EPA determines what areas meet, or fail to meet, the new standard. If EPA finalizes the NAAQS by October 2015 as proposed, it could be as late as October 2018 before designations are final and the real work begins.

If an area is designated as nonattainment, it is expected to meet the standard "as expeditiously as practical." There, "practical" is a key word—if costs are too high, then meeting the standard quickly won't be practical and EPA may approve cheaper controls, even if they aren't the fastest or most effective. EPA can also grant extensions to various deadlines—in an extreme case, the attainment date could be as late as October 2030 even if Congress does not step in to grant more time. Those decisions, however, are years down the road. Right now, we just want to know the goal.

How Did We Get Here?

In 1997, the EPA set the ozone standard to an eight-hour average of 0.08 parts per million (ppm) which, because of rounding, was effectively 0.084ppm. The CAA requires review of NAAQS standards every five years, but delays ensued.

By 2005, EPA submitted its staff's work to the agency's Clean Air Scientific Advisory Committee (CASAC), a seven-member panel of experts on air pollution issues. The CASAC also met with a larger group of professors, medical doctors, and other technical experts known as the Ozone Review Panel to peer review the analysis. As a result, they sent three separate letters to the EPA administrator between 2006 and 2008 wherein each unanimously recommended the standard be set between 0.060 and 0.070ppm.

On March 12, 2008, the Bush-era EPA ignored their expert's unanimous advice and set the standard at 0.075ppm. The CASAC responded by sending a letter to then-EPA Administrator Stephen Johnson reminding him of their unanimous conclusions and saying: "As you are well aware, numerous medical organizations and public health groups have also expressed their support of these CASAC recommendations. We sincerely hope that, in light of these scientific judgments and the supporting scientific evidence, you or your successor will select a more health-protective primary ozone standard during the upcoming review cycle."

Moving Forward

Under CAA requirements, EPA should have completed the review of the 2008 standard by March 2013. For a while, it seemed that the Obama administration was on track, going as far as releasing a draft in 2010 that supported the science-based standards. But political pressure took its toll and the rule was delayed. After the EPA missed the legal deadline, environmental groups won a court order requiring EPA to issue a proposal by December 1, 2014 and finalize any changes by October 1, 2015.

Just before Thanksgiving, EPA complied with the court order and proposed a new ozone standard. After years of reviewing the new scientific data, the CASAC and the Ozone Review Panel once again found "strong scientific rationale" for considering a NAAQS in the range between 0.060 and 0.070ppm. This time, EPA has listened to the science, (finally), followed the law, and proposed a standard in that range. Thank you, EPA!

Make no mistake, the political pressure will be as intense as ever as big polluters and their friends fight this every step of the way. Science and the law are on our side but being right isn't always enough. All of us who support the EPA's proposal are going to need to work together to see it through.

Rob Altenburg is senior energy analyst for PennFuture and is based in Harrisburg. He tweets @RobAltenburg.

Wednesday, November 19, 2014

What is RGGI and why should PA be interested?

Recent modeling by our power grid operator, PJM, shows that reducing carbon pollution through a multi-state program will likely be much less expensive than if Pennsylvania and other states go it alone. Joining the Regional Greenhouse Gas Initiative (RGGI), is not our only choice, but it's definitely one of the options to consider.

What is RGGI?

RGGI, launched on January 1, 2009, is our nation’s first market-based regulatory program to reduce greenhouse gas (ghg) pollution. RGGI is an electric sector cap and trade program. A cap and trade program involves establishing a tonnage limit or a cap on pollutant emissions. The 2014 RGGI cap is 91 million tons (a 45 percent reduction to the previous RGGI CO2 cap) and will decline 2.5 percent each year from 2015 to 2020 and by 2020, power plant CO2 pollution in the nine RGGI states is projected to be half of 2005 levels. The cap only applies to electric generation facilities (i.e. fossil fuel power plants) producing 25 megawatts (MW) or more and restricts the amount of CO2 they can release.

RGGI’s overall cap equals the total number of CO2 allowances issued by RGGI states in a given year. A tradable allowance is created for each ton under the cap. Allowances are a new kind of currency that emitters subject to the program must acquire and they represent a limited authorization to emit one short ton of CO2, as issued by a respective state. Emitters then surrender allowances that correspond to their emissions in each compliance period.

Currently, RGGI has nine member states: Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont. Within RGGI, each state has its own cap and CO2 budget trading program.

Why should Pennsylvania consider joining RGGI? Greenhouse Gas (GHG) Reductions
Through the RGGI program, 792,000 short tons of CO2 emissions have already been avoided. If no action other than the recent state and federal government actions is taken to reduce ghg emissions, the Pennsylvania Department of Environmental Protection (DEP) projects that Pennsylvania’s emissions will increase slightly to 295 MMtCO2e by 2020.

As the third largest producer of electricity in the nation, Pennsylvania produces more than 226 billion kilowatt hours of electricity. Electricity generation, mainly for heating and cooling residential and commercial buildings, is the most significant contributor to Pennsylvania’s emissions. As of 2009, Pennsylvania is responsible for 4 percent of the United States’ ghg emissions and a full 1 percent of the world’s ghg emissions. Pennsylvania has set a ghg emissions reduction goal of 30 percent below year 2000 levels by 2020.


If the recommendations in Pennsylvania’s Final Climate Change Action Plan are implemented, Pennsylvania expects to see a net creation of 65,000 new full-time jobs and to add over $6 billion to the gross state product in 2020.   Joining RGGI could help our state create those jobs and possibly even more.  Over 3,600 workers in RGGI states have already been trained.

Despite what you may have heard, investing in renewable energy DOES create jobs. According to the RGGI website, “Data from the Renewable Energy Policy Project shows that every $1 million invested in renewable energy systems creates about six full-time manufacturing jobs, as well as additional jobs in construction and facility maintenance.” And not just any jobs, but well paid jobs. “According to 2008 data collected in New York State, the average annual salary for jobs created at renewable energy facilities is about $75,000.”

Funding for Programs
During the first three years of the program (2009-2012), RGGI “powered a $700 million investment in the region’s energy future” plus an additional $93.1 million was transferred to state general funds. Joining RGGI could help reduce our energy bills, accelerate the development of local clean and renewable energy sources, and limit the release of harmful pollutants into the air and atmosphere.

Research has shown that every RGGI state has had a positive gain to its economy. According to an article in the April 2013 issue of the Columbia Journal of Environmental Law, “The report, Regional Investment of RGGI CO2 Allowance Proceeds 2012, estimates that RGGI proceed investments in energy efficiency, clean and renewable energy, and other strategic energy programs will return more than $2 billion in lifetime energy bill savings to more than 3 million participating households and more than 12,000 businesses in the region.”

Jennie Demjanick is energy associate for the PennFuture Energy Center and is based in Harrisburg. She tweets @JennieDemjanick.

DEP's hasty action on Marcellus permitting

In February 2013, the Pennsylvania Department of Environmental Protection (DEP) issued a General Plan Approval and/or General Operating Permit for Natural Gas Compression and/or Processing Facilities, known as GP-5 for short. While this permit does not apply to Marcellus shale wells directly, it is used by midstream operators that process the gas from those wells.

Last Saturday, the DEP took two actions. First, it published a proposal to revise that permit and second, it suspended enforcement of certain provisions of that permit, effective immediately.

Brief introduction to DEP Permitting 

DEP has a pamphlet explaining its permitting process in a bit more detail, but the short version is that unless a source of air pollution is exempt, it will need a plan approval from DEP before beginning construction, and an operating permit to operate.

The type of permit needed depends, for the most part, on how much pollution a source has the potential to emit. "Title V permits" (named for the part of the federal Clean Air Act that governs the program) are required at larger sources whereas smaller sources often qualify for "state only" permits. While there are some additional requirements associated with Title V permits, either case will require a facility to provide a specific and detailed description of the emissions source, demonstrate it will be controlled in accordance with existing rules, show that there will be appropriate record keeping, and a host of other requirements. Also, before a permit is approved, the DEP must publish notice of the permit application and consider any timely public comment.

General Permits (GPs) are a special case. The DEP is allowed to issue such permits for categories of sources if they "are similar and can be adequately regulated using standardized specification and conditions." GPs are popular with industry because qualified sources that elect to use them can save considerable time and expense. They are much less popular with the public because the opportunity to comment occurs when the GP is proposed, not when it is used. This means the public comment periods are often closed months or years before a resident has any idea they may be impacted by the source seeking to use a GP.

What DEP proposed: The good

There were a number of minor changes that fixed typos or added clarifications, and that is generally a good thing.

Another positive change was a requirement for owners or operators to send an annual compliance certification to the local DEP regional office. This certification will include valuable information about how compliance was determined and whether it was continuous or intermittent. DEP will likely see comments asking for additional clarification but more reporting is a step in the right direction.

The bad

One change of concern is that DEP is proposing to remove a restriction on usage of this GP by large sources of carbon pollution (more than 100,000 tons per year of CO2e). The DEP says that this restriction was removed because of the recent United States Supreme Court decision in Utility Air Regulatory Group (UARG) v. EPA. According to EPA's current interpretation, this means that large sources can't be considered a "major source" requiring a Title V permit under the Clean Air Act solely because of carbon pollution.

It is true that after the UARG decision, the DEP may have the legal authority to grant a general permit to large sources of carbon pollution, but nothing in that decision says they must offer those sources streamlined permitting. To have the authority to do so, the DEP needs to determine these large sources "can be adequately regulated using standardized specification and conditions." They then need to make a policy decision that streamlined permitting is appropriate. These are both decisions that the public should have a chance to comment on. Even if it were obvious that this is something that the DEP can and should do, reasonable people may have questions about how suspending this provision impacts a host of other requirements. This is exactly why Pennsylvania rules require at least a 45-day public comment period for changes to general permits.

The ugly

DEP did open a comment period as required, but they took the unusual step of suspending enforcement of the greenhouse gas (GHG) provisions, effective immediately. This was done without public input and without even consulting internal advisory groups like the DEP's Air Quality Technical Advisory Committee or their Citizens Advisory Council.

Even giving DEP the benefit of the doubt and assuming the agency was justified in rushing into this decision without consulting the public and outside experts, it should at least explain why there was a need to take this extra step.

In the meantime, all we are left to do is send DEP our comments by January 6, 2015, and hope they make a difference. (See the notice for details on how to comment).

Rob Altenburg is senior energy analyst for PennFuture and is based in Harrisburg. He tweets @RobAltenburg.

Power of 32 Conference to unveil first Regional Energy Baseline

On Thursday, December 11, a conference will take place in Pittsburgh that is unlike most others. "Energy for the Power 32" will bring together representatives from four states and covering 32 counties within the Ohio River Valley and surrounding regions, including southwestern Pennsylvania.The purpose of the meeting is to discuss ENERGY and, more specifically, what a region can do, independent of political borders, to breed innovation and advancement of energy opportunities and issues.

To start off this conversation, Power of 32 will release our region's first-ever Regional Energy Baseline. This baseline will include our region's sources of energy production and consumption, derived from fact-based research.

Power of 32 Region
The event features TED-style presentations from: Ted Ford, President & CEO, Ohio Advanced Energy Economy; Annie Gilleo, State Policy Research Analyst, The American Council for an Energy-Efficient Economy (ACEEE); Mustafa Ali, Senior Advisor to the Administrator for Environmental Justice, U.S. EPA;  Dr. Grace Bochenek, Director, National Energy Technology Laboratory (NETL); Robyn Beavers, Senior Vice President of Innovation and Founder of Station A Group, NRG Energy.  

The event will also include small group deliberation on regional energy principles, values, pressing needs and opportunities, and recommendations for a process to create a regional energy plan and strategy.

Thursday, December 11, 2014
8:30 am - 3:30 pm
Registration begins at 7:30 am
David L. Lawrence Convention Center, Downtown Pittsburgh
Registration: $65
Student rate: $25 (for instructions email by 11/20)
For more information, including registration and agenda, please visit:
To exhibit, please contact Ginette at (412) 258-6646.

Evan Endres is program manager for the PennFuture Energy Center and is based in Pittsburgh. He tweets @ER_Endres.

Wednesday, November 5, 2014

Batteries and Pennsylvania's contribution to a clean energy future

Pennsylvania certainly is a battery mecca these days. Not only do we have one the top technology developers of low-cost grid storage options in Aquion Energy, we are also home to one of the first practical solar grid storage project developers.

Aquion uses cheaper "Sodium-Ion" based batteries. They're big, but they're cheap and efficient. A perfect complement to wind and solar farms.

Solar Grid Storage, a company with projects in Philadelphia, has technology that allows for a different kind of revenue generation and cost savings for solar projects. They install a unit, which they own and manage, right next to a solar facility of 150kW or greater. The unit has a smart computer system and batteries that allow it to be called upon as a demand response resource, dumping solar energy onto the grid any time it's needed, not just when the solar panels are producing electricity. In return, they get a premium payment as a demand response provider and save the host money by providing a free inverter -- a pretty expensive part of any large solar installation. With the Keystone state packed to the gills with battery innovation, it makes you wonder why we weren't one of the potential "giga-factory" states for Tesla founder Elon Musk's ambitious project to reinvent the battery industry.

Grid storage is an incredibly important conversation to be having, and an  important technology to be developing, right now. It's no secret that we need an electric grid that contains enough renewable energy to mitigate the current CO2 and methane emissions that make up Pennsylvania's considerable per-capita contribution to global climate change. More solar and wind also means we will need some grid storage. A PJM report from last March found that 1GW of storage or demand response would be needed to cost effectively achieve penetration of 30 percent wind and solar. To put that in perspective, we are now close to having 2GW of solar capacity installed in the entire PJM region. It only took us about five years to get to that point.

Although storage is important, we don't have to tap our foot in anticipation of impending battery breakthroughs to move forward with renewable energy. We are nowhere near having 30 percent renewables on our grid, and especially far from it in the Keystone state. Grid reliability may be the mantra for big utility rhetoric against renewable energy but we're pretty far afield from those issues with the small amount of wind and solar we have now.

In the scheme of things, transmission lines for wind projects are a much more important, and immediate, issue. Preserving and expanding our net metering rules, which allow distributed generation systems—such as rooftop solar—to use the grid as a battery, also ranks high. And, of course, pushing for even greater renewable energy requirements by improving renewable portfolio standard policies here in Pennsylvania. Which, by the way, would again make us competitive with neighboring states that have more renewable energy -- and more renewable energy jobs.

Batteries are clearly going to be an important part of Pennsylvania's contribution to the energy renaissance. But we can't let the need for battery breakthroughs in the future slow us down on the jobs that need to be done now to get us to our clean energy future.

Evan Endres is project manager for the PennFuture Energy Center and is based in Pittsburgh. He tweets @ER_Endres.

Coal's quick fixes mean we'll all pay more

Last Friday, I attended an energy industry conference in Harrisburg. It was appropriate that a conference held on Halloween led off with a speaker from the U.S. Chamber of Commerce telling scary stories and trying to frighten people about the Environmental Protection Agency's (EPA) Clean Power Plan. If you represent the big pollution industry, the thought of actually getting serious about carbon pollution and putting some of the responsibility on polluters to clean up their act would be a nightmare.

The Chamber's speaker started his talk by attempting to argue that none of the elements of the EPA plan were achievable. However, the facts were not on his side. He argued that we can't meet the targets for moving away from coal power while neglecting to mention that the status quo in Pennsylvania has us exceeding those goals. Likewise, he argued that energy efficiency cannot be improved at the proposed rate as he neglected to show graphs for years when such rates were achieved and by neglecting to show the results of independent studies showing it to be cost effective. He saved so much time by avoiding discussion of the facts he found inconvenient that he ended up filling the balance of the talk with pre-election political attacks. Luckily, the rest of the conference was more informative and less factually-challenged.

Much of the conference centered around the polar vortex of last January, which was the most significant test of our wintertime grid reliability since the blizzard of 1994. Our grid includes over 62,000 miles of transmission lines across 13 states and the District of Columbia, and almost all of it was plunged into extreme cold earlier this year. Because of the demand for heat, the grid was called upon to produce 35 gigawatts (gW) more electricity than normal. (For comparison, that is almost four times the output of all of Pennsylvania's nuclear plants.) During this spike, the grid also faced significant forced outages where plants that were called upon to generate power were unable to do so. While in a normal winter, a forced outage rate of 7 percent is expected, we saw 22 percent of the total grid capacity, or over 40 gW, unable to provide needed power. In Pennsylvania, the grid managed to avoid the need for load shedding (aka rolling blackouts), but it was a close call.

Of the forced outages, about 9 gW was the result of interruption of natural gas supplies but over 23 gW in outages came from coal and gas plants that faced other issues. Our grid operator is taking steps to prevent a repeat of this scenario and, at least for this coming winter, we have enough capacity in place to get through a similar event. The big question comes in the winter of 2015/2016 as more of our aging coal fleet retires.

In years past, our coal plants ran almost constantly to provide base load power. Gas plants were more expensive to run and, as a result, they were only used during periods of higher demand and higher power prices. Now, with low gas prices and newer technologies, we see gas being a cheaper alternative and making up more of the base load. (In fact, in 2015/16 we will have more gas generation than coal providing our power.)

While coal plants are well suited to provide base load power, it just isn't economical to run them intermittently as you can with gas. With changing times, coal plants that can no longer make a profit retire and new ones are not being built. This raises legitimate concerns that we will not have as much idle capacity ready to come online during severe events such as a polar vortex.

The pro-pollution crowd wants to blame the EPA and tells us that the solution is to sacrifice our health and welfare so coal plants don't need to spend as much money preventing pollution. In human terms, they are saying that thousands of premature deaths and over 100,000 childhood asthma attacks are the price we must pay for reliable electricity. Absent consideration of the tens of billions of dollars in financial impacts, that is a steep price to pay. Worse yet, since this "fix" doesn't address the real issue, it would be, at best, a temporary solution.

Years ago, there was a cartoon going around by John Morris where two people were looking at a chart showing a steep decline and one says to the other, "What we really need is a long term quick fix." It sounds funny in the cartoon, but the "long term quick fix" is just what the polluters are trying to sell us. Instead of quick fixes, we need to focus on sustainable solutions.

Fossil fuel generation isn't going away any time soon, but it's time to think of the true costs of our dependence on coal and natural gas. Doing nothing means we will continue to pay hidden costs in the form of higher medical bills, lost productivity, and worse quality of life. We need to keep in mind how much the status quo will cost us when we discuss alternatives such as increasing renewable energy and energy efficiency.

Rob Altenburg is senior energy analyst for PennFuture and is based in Harrisburg. He tweets @RobAltenburg.

Monday, October 27, 2014

PA solar growth slow in 2014

Pennsylvania is abuzz with talk of solar. On the tail of the 2014 Pittsburgh Solar Tour; great newspaper clips on Pennsylvania companies on the fast road to solar-battery Shangri-La; more public institutions, towns, and schools looking at solar as a way to save precious budget dollars; and the nation on track to install more solar than coal capacity in 2014, you may assume that the solar boom is alive and well here in the Keystone state. Unfortunately, the numbers paint a different picture.

Pennsylvania installed over 16MW of new solar capacity in 2013. In 2014, we will be lucky to break 5MW. The graph below charts new solar energy system registrations for January 1 – October 1 for both 2013 and 2014. All systems charted are located in Pennsylvania, and eligible to produce solar renewable energy credits (SRECs) for portfolio standard compliance.

One silver lining: Although Pennsylvania may only install one third of the total solar capacity in 2014 that was installed in 2013, the residential and small commercial installers continue to build projects, spurred by solar cost declines and electricity price increases. 294 of the 295 new installations registered so far in 2014 were from residential and small commercial systems.

How do we make sure Pennsylvania gets its share of the solar boom and the jobs that go with it? We need good state policies to provide the right market signals to Pennsylvania's consumers and our solar industries. As we draw closer to the November elections, you'll hear the word "jobs" more than you can count. Any leader serious about Pennsylvania jobs should be serious about Pennsylvania solar. See our Clean Energy Wins Policy Road Map for Clean Energy and Energy Efficiency and learn how we can gain ground for clean solar energy.

Evan Endres is project manager for the PennFuture Energy Center and is based in Pittsburgh. He tweets @ER_Endres.