NDN Blog

In last night's State of the Union Speech, President Obama devoted a far smaller portion to energy than in the past.  Energy had a starring role in the last three SOTUS, however energy and environment played a supporting role in this year's speech.  Indeed, the President took the middle Ground on energy calling for an "all-of-the-above strategy that develops every available source of American energy".

Pointing out that the United States is less dependent today on foreign oil than we have been for decades, the President outlined initiatives that would enable US to tap fossil fuel reserves as well as wind and solar power.  Addressing our newly found abundance of natural gas, extracted by hydraulic fracking, Obama asked for a disclosure of chemicals used to extract natural gas from federal land.  While this might sound good, there was no muscle behind this disclosure, disappointing the enviros and just the idea of 'disclosure of chemicals' will raise the ire of the oil patch. 

He committed the Department of Defense to purchase 1,000 megawatts of renewable energy.  In addition the President recommitted his longtime promise of 10,000 megawatts of renewable projects on public land in 2012.  Both of these would be a huge boast to the wholesale and commercial market for renewable energy. The President re-cycled last year's 'Clean Energy Standards' which will include natural gas and nuclear in addition to wind, solar, biomass and thermal.

Important to the wind industry, Obama called for permanent extension of federal tax credits for wind energy.  These tax credits are set to expire at the end of the year.  More to the point, Obama made it clear that renewable energy needs same support that fossil fuels have received for decades. 

As expected, the President never mentioned the Keystone Pipeline nor did he bring up the Solyndra company.  However, in a thinly veiled sentence that addressed these two issues, Obama said, "Some technologies don't pan out; some companies fail.  But I will not walk away from the promise of clean energy."  

The House Subcommittee on Energy and Power holds a  hearing today on  H.R. 3548, the North American Energy Access Act, legislation that would transfer authority to approve the Keystone XL pipeline to FERC. This is part of the Republican strategy to do what it will take to make the Keystone Pipeline a reality. 

The Energy Information Agency rolled out its much anticipated 2012 Energy Outlook on Monday and says that the United States  will reduce its dependence on foreign oil and become a net exporter of natural gas by 2021.   Howard Gruenspecht, Acting EIA Administrator, said natural gas and renewable energy sources will gain “an increasing share of U.S. electric power generation, with domestic crude oil and natural gas production growing, and reliance on imported oil decreasing."  The EIA report also adds that projected decreases in dependence on foreign oil are predicated on estimates that the economy will grow at only a moderate pace.

Look for President Obama, in his State of the Union Address,to lay out his plans for an economy that’s “built to last.”  The President is expected to link energy policies to the broader economic blueprint and will highlight steps the administration has taken to encourage oil and gas development and investments in clean energy. Those steps, the officials say, create far more jobs than approval of Keystone would have.  This blueprint will be supported by four pillars: American manufacturing, American energy, skills for American workers and American values,” according to WH press secretary Jay Carney.  The speech gives Obama a major opportunity to define his energy record following months of GOP attacks over the Solyndra, and controversy over the Keystone XL oil pipeline.

Tennessee Valley Authority announed that it has added 535 MW of renewable wind power from four farms in Iowa, Illinois and Kansas to its power grid.  Currently TVA has a total of 542 wind turbines that could help generate more than 1,500 MW of clean and renewable energy. The total wind energy of TVA is 950 MW or over 3 million MWh per annum and it provides sufficient electricity to power over 200,000 homes in the service region.

A  recent legal analysis by the Congressional Research Service notes that while the executive branch has historically handled the approval of border-crossing facilities, it doesn’t have to be that way. “[I]f Congress chose to assert its authority in the area of border crossing facilities, this would likely be considered within its Constitutionally enumerated authority to regulate foreign commerce,” the analysis states.  The CRS analysis may buoy Republicans rallying around the bills to attack Obama’s Jan. 18 denial of TransCanada Corp.’s permit application.  The House Energy and Commerce Committee panel will hold a hearing next Wednesday on Rep. Lee Terry’s (R-Neb.) bill that takes review of the pipeline away from the State Department and instead requires the independent Federal Energy Regulatory Commission to issue a permit.  Sen. John Hoeven (R-N.D.), who is planning a separate bill to put approval in the hands of Congress, requested the study.

Maryland Gov.Martin O'Malley will introduce a second plan to subsidize offshore wind power, but it faces bipartisan opposition in Annapolis and from the energy lobby.  However, powerful Democrats say they are more likely to support the governor’s plan after months of behind-the-scenes negotiations.  The plan would also require state regulators to hire an independent analyst to assess whether the costs to ratepayers — which would probably be added to monthly bills beginning in 2017 and continue for 20 years.  The Governor's office states this would be outweighed by potential benefits: 1,800 new construction jobs, increased electricity production and reduced air pollution.

Gina McCarthy, Assistant Administrator for Air and Radiation for the Environmental Protection Agency, gave an enlightening presentation to our Clean Energy Initiative Solution Series last Friday on the impact of the newly released EPA national standards for mercury and other air toxins which will ultimately prevent 90% of mercury, 88% of natural gas emissions, and 41% of sulpher dioxins.  

She addressed the fears that EPA regulations would result in a loss of jobs and a failed economy by pointing out that  in the 40 yearlong EPA history of monitoring the environment, the economy has mostly been on a good note and jobs have only grown because of EPA regulations.  According to McCarthy, these regulatory upgrades will provide 46,000 short term jobs and 8.000 short term jobs for our country.

The new mercury standards, required by the Clean Air Act of 20 years ago, will significantly reduce air pollution, bring new health benefits and align with the President's vision of a clean energy future.  McCarthy believes the health benefits are foremost and that cleaner air will result in less lung and heart issues resulting in less economic burden for a family's burgeoning healthcare expenses. 

These new standards will have a rather large impact on power plants because power plants are the biggest source of stationary air pollution producing 50% of mercurary emissions and 70% of acid gas emissions. 
A big question is whether the power sector can afford to make these investments to comply with the new standards? 

McCarthy says the answer is yes.  Because these standards were part of the original Clean Air Act passed 20 years ago, many utilities, knowing that, have already made the necessary adjustments to comply with new regulations.  However, there are some plants with aging infrastructure that will require deep investments.  But McCarthy says the time line is fair for completion - 3 years plus another 4th year at discretion of the state.  She made clear that EPA wants to work with all utilities, including the Rural Electric Cooperatives and the the Municipal utilities to ensure fairness.  In addition, EPA will counsel with Department of Energy and Federal Energy Regulatory Commission to make sure this process is reliable and cost effective.

McCarthy pointed out the substantial health benefits of enacting these standards - especially as it affects heart disease, asthma, and other lung related illness.  To comply with these national standards, many utilities will have to make major changes to their infrastructure and thus, according to McCarthy, will provide thousands of short and long term jobs for Americans.

To watch Gina McCarthy's speech in it's entirely, click here

On December 21, 2011, the Environmental Protection Agency issued an historic ruling which set the first ever national standards to reduce mercury and other toxic air emissions.  This ruling will not only impact our air quality and environment but will significantly impact the utility sector, the business industry, and other related entities.    

To better understand this ruling, NDN/New Policy Institute has invited Gina McCarthy, Assistant Administrator for the Office of Air and Radiation at the EPA to speak to our Clean Energy Initiative.  Please join us for a luncheon discussion on Friday, January 20, at 12noon at the NDN event space which is located at 729 15th Street on the first floor.  Ms. McCarthy will spotlight the broad implications of these newly instituted standards which will require deep cuts in emissions and most likely reshape the utility industry in the process. 

Gina McCarthy’s presentation is the sixth in our “Clean Energy Solution Series" to showcase the leaders, companies, ideas and policies who are hastening our transition to a cleaner, safer and more distributed energy paradigm of the 21st Century.

Please RSVP today to me here cgiesen@ndn.org.  And if you can't join us in person feel free to watch the live webcast starting at 12:15pm.

The Environmental Protection Agency has made available a map which shows the sources of carbon dioxide and other toxic emissions throughout the United States.   It  is an amazing, searchable, computerized map. I clicked on my hometown of Port Arthur, Texas and found every single plant's greenhouse gas emissions.  Awesome.  By the way, Port Arthur is  the destination for the Keystone XL Pipeline, assuming it ever gets built.

A Japanese firm, Mitsui, has joined European Power Exchange and Tres Amigas to partner on the U.S. hub that would allow electricity to flow more freely between grids, and, in the future, develop a trading system that could work seamlessly in a global market.  Tres Amigas President states, "With the technology that we have today, the communications we have and the environmental issues we need solved ... you've got to have a way to trade on all the derivatives and all of the other environmental constraints. There's definitely a huge need for us to find a worldwide platform."

ISO New Englands recently released report states that Cape Wind Offshore Wind Project is unlikely to be producing wind by 2015.  Cape Wind begs to differ stating that they will be running at least partially by 2015.  National Grid agreed to purchase one half of it's output, but the project is still seeking buyers for the other unsold half which is critical to getting financing for the full 130-turbine project, planned for Nantucket Sound. 

Pike's latest research shows that consumer interest in Electric Vehicles has dropped by 8% in the last two years.  Higher cost of EV in this stagnant economy is the biggest concern, followed by fear that EVs would not have sufficient driving range for their purposes.  Some consumers hesitate to make such a big investment until the technology is more proven.  Age and demographics do not have an impact on EV choice. 

Good news for consumers who don't want to pay high heating bills, but mixed for the oil patch.  The Wall Street Journal reports that U.S. energy companies are pumping so much natural gas out of the ground that prices are plummeting, and the cheap gas isn't likely to evaporate anytime soon.  natural gas prices fell 5.7% to their lowest level in over two years.

Tres Amigos signs an agreement with power spot operator, EPEX SPOT, to operate the connection of three grid structures.  EPEX SPOT will help launch the Tres Amigas Power Exchange when the Tres Amigas Superstation goes comercial in 2015 with the physical interconnection initially between eastern and Western interconnections.   Ultimately they will tie together WCEE, Eastern and ERCOT power grids and catalyze the adoption of renewable energy.

On Tuesday, a company in Hillsboro, Ore.,ClearEdge Power, announced a deal with an Austrian company, Güssing Renewable Energy, to supply 8.5 megawatts of fuel cells that would run on methane made from renewable sources. The companies said the 8.5 megawatts would be in place within three years, and the longer-term goal is 50 megawatts by 2020.  Fuels cells are another pathway for converting gas to electricity.  This is one of the largest deals every made involving stationalry fuel cells.

Jesse Berst has an interesting article about a Silicon Valley smart grid startup working to lower the cost of demand response by 90% while increasing efficiency 30%. AutoGrid  company is tackling what may be the smart grid's hardest problem – how to manage it as an integrated system, not just a series of adjacent, siloed apps that occasionally swap data. Analytics is the firm's core differentiator – ultra-fast analysis of ultra-large data sets. In fact, its stated mission is to "provide a new generation of software analytics  to enable a sustainable energy infrastructure of the future." 

In the race to claim ever-higher fuel-economy numbers and keep up with government regulations, automakers are rolling out hybrids and electric cars at this week’s Detroit auto show. However the public is not yet buying them in great numbers.  McKinsey said hybrids could account for up to a quarter of sales by 2020, with battery-powered cars making up 5 percent, but internal-combustion engines would dominate the industry through at least 2030.

Ribbons were cut last Friday on the Webberville Solar Farm, an array of 127,000 solar panels set to provide enough electricity to power 5,000 homes in the Austin area. The farm will be the largest of its kind in Texas and the largest solar project of any public power utility in the United States, according to Austin Energy CEO Larry Weiss.  ERCOT is projecting a growing need for energy in the state in the coming years and this solar facility will contribute to the state's energy needs.  Weldon said the real benefit of solar, the fact that it comes free of polluting emissions,  should be taken into account when consumers consider the price competitiveness of energy sources.

Given the partisian gridlock in Congress, especially on the House Energy and Commerce Committee, expect the Administration to take a harder look at its existing legal authorities in the realm of energy and environmental policy, building on its energy efficiency, sustainability, and infrastructure development initiatives in 2011, according to the Van Ness Feldman energy law firm.

The oil and gas sector is set to play a big political role this 2012 election year as President Obama must decide whether or not to approve the controversial Keystone Pipeline which would send tar sands crude from Alberta to Texas. Last week at his annual "State of American Energy" speech, American Petroleum Institute head Jack Gerard proclaimed that President Obama faces "huge political consequences" if he does not approve the proposed 1,700-mile Keystone XI pipeline that would link Alberta's oil stands to refineries on the U.S. Gulf Coast. The Obama administration must decide by February 21 to accept or deny a permit for the project.

ComEd filed with Illinois Commerce Commission (ICC) its 10-year, $2.6 billion Infrastructure Investment Plan which includes  investments of $1.3 billion to strengthen the electric system and another $1.3 billion to add new, digital smart grid and advanced meter technology that will transform the delivery of electricity to homes and businesses throughout northern Illinois.  The filing also included the utility's $233 million Investment Plan for 2012 and its plan for a smart grid Test Bed to provide entrepreneurs "on-grid" locations for testing of smart grid-related technologies and services.

Unlike ComEd and the Illinois mandate, many utilities have been stunned by public pushback on smartgrid technology.  Interesting article in Greenbag highlights some of the reasons for comsumer backlash on smartgrid installation.