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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.

Jobs

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 lbutler@sustainablepittsburgh.org by 11/20)
For more information, including registration and agenda, please visit:
www.energy4p32.org
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.