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August 2, 2024

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DOE Wants US to Produce 50 Million MT of Clean Hydrogen by 2050

The White House and Department of Energy on Friday unveiled a new interagency task force aimed at reaching the administration’s ambitious goals for the deployment of clean hydrogen to decarbonize a range of hard-to-abate industrial and transportation sectors, from steel production to heavy-duty trucking and aviation.

The Hydrogen Interagency Task Force (HIT) “will be designed to … fully leverage the strengths and capabilities of the U.S. government to develop technologies, implement policy and overcome barriers to building a clean hydrogen economy,” said Mary Frances Repko, White House deputy national climate advisor, during a Friday webinar.

The task force will include representatives from 11 federal agencies, including EPA and the departments of Transportation, Labor, Interior, Agriculture and Commerce. Repko will co-chair the group with DOE Deputy Secretary David Turk, who laid out the administration’s timetable for clean hydrogen deployment.

The U.S. currently produces about 10 million metric tons (MT) of hydrogen a year, most of which “comes from fossil fuel sources without carbon capture,” Turk said. “By 2030, we want to produce the same amount of hydrogen, but we want to do it with clean hydrogen. … By 2040, we want to double that … from 10 million MT to 20 million MT, and by 2050, we want to go to 50 million.”

Deployments of clean hydrogen to decarbonize industry, transportation, and the power grid can enable 10 MMT/year of demand by 2030, ~20 MMT/year of demand by 2040, and ~50 MMT in 2050. | DOE

Reaching that goal would produce enough hydrogen to power all the buses, trains, planes and ships in the U.S., and could help the U.S. cut its greenhouse gas emissions by 20% by 2050, he said.

“So, this is not a nice-to-have,” Turk said. “This is not just a sideshow. This is part of the main event going forward.”

One of the core pillars of the agency’s strategy is building out a network of regional clean hydrogen hubs, with the first six to 10 funded with $7 billion from the Infrastructure Investment and Jobs Act (IIJA). Applications for the funding were due in April, and Todd Shrader, director of project management for DOE’s Office of Clean Energy Demonstrations, said the awards would be announced “in the fall.”

The purpose of the hubs is to co-locate commercial-scale production and end uses “to demonstrate different use cases from different feedstock diversity, meaning different power supplies,” Shrader said. Once DOE helps build the first six to 10 hubs, he said, “what that really does is [it] encourages and shows the lessons learned to industry to build plants 11 through 100.”

An analysis from Resources For the Future found that the applicants competing for the DOE money largely are multistate, private-public collaborations, with many planning to use renewable energy to produce clean hydrogen.

The National Clean Hydrogen Strategy and Roadmap, released in May, lays out three pillars for scaling clean hydrogen, beginning with zeroing in on high-impact end uses, such as heavy-duty transportation. The second is cutting costs so clean hydrogen is competitive with the fossil fuels used for other critical end uses, and the hubs are the third, said Sunita Satyapal, director of DOE’s Hydrogen and Fuel Cell Technologies Office,

DOE’s main initiative for cost cutting is the Hydrogen Shot, one of the agency’s Energy Earthshots, which all are aimed at reducing costs for new technologies needed to reduce U.S. greenhouse gas emissions. The goal for the Hydrogen Shot is to decrease the cost of clean hydrogen from about $5/kg to $1/kg within a decade.

Clean hydrogen is produced by using electrolyzers, powered by electricity, to split water into hydrogen and oxygen. The equipment is expensive and not yet produced at the scale needed for significant market growth.

But the lower the cost of clean hydrogen, the more sectors will open up to its use, Satyapal said. For example, getting the cost to $4/kg would make hydrogen competitive for heavy-duty trucking, she said.

“If we can get 10 to 15% of all the trucks using hydrogen fuel cells, that will enable 5 to 8 million MT of hydrogen in terms of demand,” she said.

Clean hydrogen at $2/kg could compete with biofuels, and at $1/kg, demand for clean hydrogen could grow in steel production, ammonia and energy storage, she said.

Production vs. End Use

Friday’s webinar and the announcement of the interagency task force seemed designed to fill the gap in concrete results on clean hydrogen as President Biden celebrated the first year of the Inflation Reduction Act (IRA). The law provides a production tax credit of up to $3/kg for clean hydrogen, which has been a draw for new investment.

While promoting administrative initiatives like the new taskforce, speakers at the webinar also acknowledged the challenges ahead, calling for an “all-of-industry” commitment to match Biden’s all-of-government strategy.

While passage of the IRA led to a doubling of announcements for new clean hydrogen projects in the U.S. by the beginning of 2023, more than half were for production versus about a third for end use, according to DOE. Projects in planning or under construction almost entirely are in hydrogen production, leaving the market decidedly lopsided.

“It doesn’t really do any good to have lots of production capacity if there’s not end-use capacity or an end user for the product itself,” Shrader said.

DOE recently announced $1 billion in IIJA funds to be dedicated to building demand for clean hydrogen, with the government possibly acting as a “market maker,” buying hydrogen from the hubs and selling it to others. (See DOE to Invest $1 Billion to Build Demand for Clean Hydrogen.)

Other obstacles cited in DOE’s recent Pathways to Commercial Liftoff: Clean Hydrogen report include a lack of “midstream infrastructure” — pipelines or other means of transport — for situations where hydrogen production and end use are not collocated, and the need for increased scaling of renewable energy.

Without adequate renewables — wind, solar and nuclear — the report predicts that fossil fuels with carbon capture and storage (CCS) could be used to produce up to 80% of clean hydrogen by 2050, as opposed to fossil fuels with CCS and renewables producing 50% each.

With utilities and other industries looking at mixing natural gas and hydrogen, pipeline safety also could be an ongoing concern. Mary McDaniel, of the Department of Transportation’s Pipeline and Hazardous Materials Safe Administration (PHMSA), said her agency has been tightening regulations on pipeline leak and rupture detection and mitigation.

“We have 1,500 miles [of pipelines] that are pure hydrogen at this point,” McDaniel said. “We’re going to be looking at hydrogen blending for pipelines as it gets more use in the pipeline line system; so, making sure that we have the infrastructure in place for that. Then we’ll be able to make any leak detection and response for those leaks.”

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NYISO: Software Upgrades for DER Participation to be Ready Next Month

NYISO told FERC on Thursday the software development and testing necessary to implement its distributed energy resource participation model will be ready by Sept. 1 (ER23-2040).

The ISO had requested an effective date of Dec. 15 for the revisions it had submitted in June, later than it thought necessary but proposed “out of an abundance of caution.”

“Prompt commission action will enable DER and aggregations to begin enrolling in the NYISO’s markets by the end of 2023,” the ISO said in response to FERC staff’s deficiency letter, which sought more information on the proposal. (See FERC Seeks More Info on NYISO DER Aggregation Proposal.)

FERC had approved NYISO’s participation model in 2020, but the ISO proposed modifications this year to better align the model with its new software and ease the burden on staff. Among those changes was a controversial 10-kW minimum for DERs in an aggregation to participate. The commission directed the ISO to explain how it had come to the 10-kW figure.

NYISO said it had become apparent that the new manual processes developed to enroll and track DER and aggregations “would be unmanageable with a high volume of DER penetration.” It said it analyzed enrollments in its existing Emergency Demand Response Program and Special Case Resource program as comparable proxies to the DER participation model. Of the 9,814 resources in the two programs as of July 1, 6,475 are less than 10 kW, it said. At a combined 7.3 MW, they represent just 0.58% of the programs’ total capability.

“NYISO does not currently have sufficient resources to timely and efficiently administer the monthly enrollment processes required for the DER and aggregation participation model if several thousand end-use customers seek to enroll in the markets at once,” the ISO wrote. “The costs associated with building the infrastructure to enable such participation include more staff, more software and the development of new market rules that will result in less oversight of small DER.”

FERC also asked NYISO to explain what it considers a DER “material modification,” address its proposed DER metering and telemetry requirements, justify why it will use the lowest cost DER as an aggregation’s reference level and explain why it would eliminate locational-based marginal pricing and bid-based reference levels for aggregations.

NYISO said a material modification constitutes “any change to the physical and operating characteristics of the DER” and included nearly 40 examples that would trigger a review, including a change of address, ownership or capability.

The ISO also responded that its metering rules ensure consistency among similar resources and do not give one participation model, whether aggregation or standalone, an undue advantage.

Additionally, NYISO justified its reference levels revisions by claiming the proposals will help the ISO better understand aggregation market and bidding behaviors, as the lowest-cost DER level incentivizes aggregations to be available more often, while switching to cost-based references will allow the ISO to better study relevant financial data.

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NCUC Approves Duke’s Performance-based Rates

The North Carolina Utilities Commission (NCUC) on Friday approved Duke Energy Progress’ latest rate case, which includes “performance-based regulation” meant to help achieve the state’s environmental policies.

Gov. Roy Cooper (D) signed HB 951 into law in October 2021, which required the utility to implement performance-based regulation. The law defined that as “an alternative rate-making approach that includes decoupling, one or more performance incentive mechanisms and a multiyear rate plan, including an earnings-sharing mechanism (ESM), or such other alternative regulatory mechanisms.”

The law recognizes that traditional ratemaking no longer works well because utilities are shifting from making larger and more infrequent investments (such as large-scale power plants) to smaller, more frequent investments such as grid improvements and distributed energy resources, the utility said in its initial application.

Duke Energy Progress told the NCUC that it took a conservative approach on its first application for performance-based regulation (PBR) so it could gain experience from its implementation. DEP serves 1.7 million customers in the Carolinas. The firm’s other utility in the state, the larger Duke Energy Carolinas, has a pending application to implement PBR.

The new rate mechanism represents a “fairly significant departure” from how the state has regulated its utilities for decades, Friday’s order said. Specifically, the new law approved four new concepts in retail rate regulation.

First, the multiyear rate plan means DEP has its rates set for several years, with periodic changes in base rates that do not require an additional rate application. Second, utilities including DEP can use a decoupling mechanism for its residential customers. Third, the ESM allows utilities to decide to file a new rate case when their weather-normalized earnings fall below the authorized rate of return and requires them to refund customers on excess weather-normalized revenue, plus 50 basis points.

The fourth major change is the performance incentive mechanism that links rates with performance in targeted areas consistent with public policies. DEP can earn extra money for doing well under the PIMs, or it could face penalties that go back to customers if it does poorly.

The PIMs are designed to increase the number of customers on time-differentiated rates, raise the number of net-metered interconnections, encourage the interconnection of utility scale generation above DEP’s targets and help large commercial and industrial customers achieve decarbonization goals.

The order drew partial dissents from four of the seven NCUC commissioners. Chair Charlotte Mitchell dissented in part and was joined by Commissioner Kimberly Duffley in full and Commissioner Karen Kemerait on its findings on DEP’s rate of return and recovery of COVID-19 costs. Commissioner Daniel Clodfelter wrote a separate dissent.

The commission approved a rate of return of 9.8%, while Mitchell and her colleagues would have approved 10%, reasoning that the costs of borrowing money have risen significantly and DEP risks a potential ratings downgrade at the lower level, which would cost customers. It could force the utility to cut costs to maintain its rating.

“Given the dynamics of the electric system, including changes in the generating mix, as well as the increasingly extreme summer and winter weather in North Carolina, now is not the time to put DEP in a position to cut to the extent that could impair the reliable operation of the system,” Mitchell said in the dissent.

COVID expenses include costs from having a moratorium on disconnections during the pandemic, which led to bad debt and other costs, as well as costs incurred by DEP and its employees to maintain the grid during the pandemic. Mitchell would have allowed DEP to collect additional funds, and, in her dissent, argued the majority decision is not good for the firm’s financial ratings.

Clodfelter’s dissent focused in part on the PIMs, arguing the commission should have adopted ones that encourage DEP to cut costs in order to offset upward pressures on rates, and to encourage the utility to finish projects early or under budget. He noted the law gave the NCUC and stakeholders little time to implement the first rates and argued they should prepare well for the next rate case in a few years.

Duke said it was reviewing the order and that the multiyear rate plan approved by the NCUC would strengthen the electricity grid while facilitating a cleaner energy future.

“We believe this is a constructive outcome that enables Duke Energy to maintain strong progress toward building a cleaner, more reliable energy future for our North Carolina customers,” the firm said in a statement.

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PJM Stakeholders Finalize CIFP Proposals Ahead of Vote

PJM and stakeholders have finalized their critical issue fast path (CIFP) proposals and posted executive summaries detailing how their packages would redesign the capacity market if approved by the Board of Managers.

The proposals will be presented to the board during the CIFP Stage 4 meeting on Wednesday, followed by a special Members Committee meeting in which stakeholders will vote on recommending packages to the board. The board letter initiating the CIFP process stated its intention to direct PJM to make a FERC filing in October with a slate of capacity market changes to be informed by stakeholders’ recommended proposals.

The 20 proposals on the table largely fall into three camps: PJM’s two proposals and variants building off it from Constellation, Buckeye, Vistra, LS Power and the Consumer Advocates of the PJM States (CAPS); the Independent Market Monitor’s Sustainable Capacity Market (SCM) design and variants from Daymark/East Kentucky Power Cooperative (EKPC) and American Municipal Power (AMP)/J-Power; and an annual market with two capacity products designed by Leeward Energy and American Electric Power (AEP).

PJM Adds Annual Auction Design Proposal

Following stakeholder feedback that its seasonal capacity market design may need additional development, PJM added a second proposal retaining the annual Base Residual Auction (BRA) structure, while including all other changes in its original proposal. Both options will be voted on Wednesday. (See PJM Updates Proposal as CIFP Nears End.)

The seasonal design would allow generators to submit a “menu” of offers, with summer, winter and annual components. Seasonal offers would include the incremental costs to deliver capacity for that period, while the annual offer would be based on costs that could be avoided if the resource were to be committed for the full year. Resources would have separate accreditations for each season. Variable resource rate (VRR) demand curves would be created for each season and calibrated to allow the reference resource to recover its full annual costs in one season if the other season clears at zero.

Both the annual and seasonal proposals would include correlated outages, ambient de-rates and other availability risks in resource accreditation and all resources, except for energy efficiency, would be accredited under a marginal effective load carrying capability (ELCC) approach.

PJM’s proposals would shift to expected unserved energy (EUE), which aims to measure the breadth of an outage both in duration and number of megawatts shed, as the reliability metric instead of loss of load expectation (LOLE), which tallies the number of outages experienced. Marginal effective load carrying capability (ELCC) would be used for the accreditation of all capacity resources, except for energy efficiency.

The option for retroactive replacement of capacity obligations after a performance assessment interval (PAI) would be eliminated and the proposals would create a market where resources can trade hourly obligations prior to the day-ahead market.

Generators would have the option of using a default capacity performance quantified risk (CPQR) calculation to represent the risk they take on as a capacity resource.

Several Stakeholders Propose Variants of PJM Proposals

Three proposals — from the Monitor, Daymark/EKPC and AMP/J-Power — focus on the capacity performance (CP) non-performance penalty charge rate and the annual stop-loss limit. The three would redefine both parameters to be based on the annual BRA clearing price, rather than the net cost of new entry (CONE). Since their effect is the same, they will be combined in Wednesday’s voting.

The penalty rate and stop-loss were two of the three changes to the CP structure the MC recommended changing in a May vote. However, the Board of Managers directed PJM to file changes to the triggers initiating a PAI, which defines when a generator can be penalized for not meeting its capacity obligations. (See FERC Approves PJM Change to Emergency Triggers.)

In addition to changing the penalty and stop-loss to the capacity clearing price, Buckeye Power recommended that all capacity resources be required to offer into the energy market, provide hourly operating parameters and real-time telemetry, and have a fuel cost policy if their capacity offer is above zero. The company offered two variants of its proposals, including PJM’s seasonal and annual designs and the bulk of their other components.

Buckeye stated that PJM’s report on the December 2022 winter storm showed that the RTO lacks insight into the amount of curtailment it will receive from demand response (DR) resources and additional provisions are needed to ensure it can deliver on its capacity obligations. Either firm-service level (FSL) or guaranteed load-drop (GLD) would be required for DR to participate in the capacity market. Intermittent and DR resources would retain their exception from the requirement that generators offer into the capacity market.

Constellation’s two proposals mirror the bulk of PJM’s annual and seasonal capacity options, but change the risk modeling to use 50 years of historical weather data, rather than 30 years and would use a “prompt auction” timeline with six to 12 months between the auction and delivery year. The proposals also include a commitment to open a stakeholder process to consider additional changes to the energy and ancillary services (E&AS) markets.

PJM had proposed to use 50 years of weather data in previous iterations of its proposal, but arrived at the conclusion that an adjustment for warming temperatures would be needed past 30 years. After presenting multiple versions of how such an adjustment could be done, PJM decided to start its weather lookback with data from 1993 with no adjustment. The Constellation proposal would not include a climate change adjustment.

While it’s supportive of a more granular capacity market design in the future, Vistra’s executive summary argued that additional work is needed on a seasonal design before the company can support filing changes with FERC. Its proposal is based on PJM’s annual auction proposal, but with several modifications including retaining the ability for generation owners to retroactively substitute capacity obligations after a PAI, changing the default CPQR calculation and holding off on expanding the ELCC construct to all resources to the 2026/27 BRA to allow for more refining.

Vistra’s proposal would retain the penalty rate and stop-loss based on net CONE, arguing that using auction clearing prices to determine the penalties would reduce the incentive for resources to perform during an emergency. Eligibility for bonus payments to generators that overperform during a PAI would include all resources that are eligible to participate in capacity auctions, including those that do not clear. PJM’s proposal would tighten eligibility to only cleared capacity resources, which Vistra argued would reduce the incentive to perform.

The proposal includes PJM’s testing requirements, but states PJM should account for market and operating conditions when scheduling tests to avoid creating “testing traps” where a generator that would meet its obligations under real-world conditions nonetheless fails the test. It recommends testing take into account the gas pipeline nomination cycle, arguing that many resources would not procure fuel when system conditions do not indicate they will be dispatched.

The company’s proposal also calls for a stakeholder process to be initiated looking at improving accreditation for thermal resources, including marginal ELCC or alternatives, and a second CIFP process with the goal of “developing a framework that protects both consumers and market participants alike from market power, but allows resources to employ their best commercial judgement in submitting offers into the market.”

The consumer advocates’ proposal supports PJM’s seasonal model, but opposes calibrating the demand curves to allow full annual cost recovery in one season, arguing that could lead to a doubling of capacity payments. It also opposes removing the capacity benefit of ties (CBOT) from the balancing ratio, a proposition it calls “overly conservative” and not in line with the probabilistic manner in which the value of generation resources is viewed.

Removing CPQR from the calculation of resources’ avoidable cost rate (ACR) also raises market power mitigation concerns and leads to uncompetitive auctions.  It recommends leaving CPQR as a component of ACR so that risks can be offset by net E&AS revenues.

“It is unlikely that any consumer advocate office could support such a significant change in PJM’s philosophies. The consumer advocates have always strongly supported competitive wholesale markets and see the competitive construct focus as a pillar by which PJM stands upon,” the CAPS executive summary states.

The proposal also includes changing the distribution of CP bonus payments to include a share going to consumers to reimburse them for the capacity that was not delivered by resources not meeting their obligations.

LS Power based its proposal off PJM’s annual capacity package, arguing the seasonal design has not been adequately vetted, modeled and back-cast. It would substitute the marginal ELCC accreditation for thermal resources with an equivalent unavailability factor-weighted approach, which reduces accreditation for any historical shortfall in performance. Capacity offers would be similar to the energy market, with generators offering market-based and cost-based offers. The marginal offer would be subject to the Monitor market power test and would be mitigated to the cost-based offer if it fails and the auction re-run until the marginal offer does not fail the market power test.

Fixed resource requirement (FRR) entities would be required to meet their own capacity needs, as well as the average percentage that the BRA has cleared above the installed reserve margin in the prior five years. The proposal also retains retroactive replacement transactions for generators and status quo eligibility for CP bonus distribution.

The LS proposal would change the CP penalty charge rate to be based on the BRA clearing price but leave the annual stop-loss based on net CONE. The company offered a second proposal identical to its first but leaving the status quo charge rate in place.

Monitor Proposes Hourly Model with Annual Pricing

The Monitor’s proposal would create a forward capacity market where committed resources are paid for the capacity they’re available to provide in each hour of the year based on a single annual clearing price.

Resources would be cleared based on their expected hourly availability, which is based on historical data including outage correlations with temperatures and weather.

Resources would be tested at least twice each year, once each in the summer and winter, and if they fail to start then or when dispatched they would forfeit all capacity revenues going back to the last time they started and reached their full installed capacity (ICAP) and going forward until they successfully start and ramp up to their ICAP. The Monitor’s executive summary argued that the model would incentivize resources to mitigate their risk by ensuring they’re able to start at any time of the year and to self-schedule their generators periodically to both self-test and to limit the potential lost revenue if they fail a test.

All resources, including intermittent and storage, would be subject to the requirement that resources offer into the capacity market, which the Monitor argued is imperative to ensure access to transmission capability is not withheld, as intermittents make up an increasing share of the PJM fleet. Resources’ obligation would be based on their availability in each hour and they would be paid when they’re available according to their obligation, which the Monitor argued means that intermittents would not be penalized for not being available when they couldn’t produce energy.

Without penalties for nonperformance, the proposal would eliminate the CP construct and its bonuses and penalties, which the Monitor said fail to provide functional incentives outside of PAIs and potentially can increase the likelihood of emergency conditions. The high penalty rates also create a corresponding relationship with the CPQR component in generators’ offers, increasing clearing prices.

“This impact illustrates the circular logic of the CP model. The CP model creates arbitrarily high penalty rates which affect CPQR which increase the ACR market seller offer caps … Under the SCM approach, the arbitrary and extreme penalties would be eliminated and therefore the impact on CPQR and the impact on capacity market clearing prices would be eliminated,” the Monitor’s executive summary states.

Stakeholder Hourly Capacity Proposals

The joint EKPC and Daymark proposal also would clear capacity to meet firm load in each hour of the delivery year with locational deliverability constraints, but would bifurcate the product into base capacity (BC), which would be hourly expected load plus the reserve margin, and emergency capacity, which is aimed at meeting hourly load during emergency conditions with modeling of extreme weather and fuel delivery force majeure. Resources could take either an EC or a BC position in capacity auctions, but not both.

Emergency capacity resources would be required to demonstrate they can operate under extreme temperatures and humidity, akin to the enhanced winterization concept in PJM’s proposal, show they have the financial ability to absorb non-performance penalties and have verifiable firm fuel. It would be procured in tranches and committed for three-year intervals.

Base capacity would be considered to have met its obligation if it offers committed capacity into the day-ahead and real-time markets, while EC would be considered to have not met its obligation if it’s unavailable during a dispatch day where emergency conditions are present. A non-performing EC resource would be subject to a penalty of the daily capacity rate multiplied by 120 and its unforced capacity. If it’s unavailable three times during a three-year interval, it would be removed from the roster of EC resources for the remainder of the period.

The third joint EKPC and Daymark proposal would combine PJM’s risk modeling component, eliminate CP penalties and use the Monitor’s hourly method of measuring and compensating capacity.

Taken together, the three joint AMP and J-Power proposals would create a two-phased transition to a modified version of the Monitor’s SCM. The transitional phase would include the proposed shift to a CP penalty and stop-loss based on capacity clearing prices, as well as changes to the balancing ratio to include net exports and applying the same penalties to FRR resources that generators participating in PJM’s Reliability Pricing Model face. The option of using physical penalty commitments also would be eliminated for FRR entities.

The proposal for the second phase would revise the SCM to have a two-year procurement horizon with two Incremental Auctions and no exceptions to the requirement that capacity resources offer into the energy market.

Leeward and AES Propose Four-plus Season Market

A proposal from Leeward and AES, jointly made as the capacity coalition, would create a capacity market with at least four seasonal and four intervals for each day of the delivery year. The auction structure would follow the status quo for establishing clearing prices, but would have separate accreditation for their expected output for each seasonal and daily interval. All resources would be subject to the must-offer requirement into the capacity market once the new market structure has been established.

Rather than being designed for implementation in coming auctions, like other proposals, the coalition’s proposal recommends rollout in the 2030-31 delivery year. The proposal calls for an additional CIFP-like process to create more detailed rules for the new structure.

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Contentious Commentary on Zero-Emissions Path in NY

As the New York Public Service Commission probably already knew when it requested comments on “zero emissions,” everybody has their own solution to save the world — and it often aligns closely with their income stream.

The answers to a series of PSC questions in case 15-E-0302 on the theory and execution of zero emissions in the state drew a wide range of responses.

The PSC in May formally recognized what others have been warning about for some time: The preferred renewable technologies now available at scale — wind and solar — may not be enough for the state to meet its statutory goals for the clean energy transition. (See NY Renewable Portfolio May Come up Short on Getting to Net Zero.)

The landmark Climate Leadership and Community Protection Act of 2019 mandates 70% renewable energy by 2030 and a zero-emissions grid by 2040.

As state leaders point out, accurately and frequently, New York has a robust pipeline of renewables in development. But what they don’t highlight is that the pipeline is flowing slowly, with numerous project delays and cancellations, as well as spiraling costs.

Perhaps more importantly, no renewable technology has been identified to keep the lights on when the wind doesn’t blow and the sun doesn’t shine in a state increasingly reliant on electricity.

So the PSC is looking for other ways to reinforce the power portfolio, potentially including renewable natural gas, nuclear fission and hydrogen — none of which are supported by the progressive activists and environmental advocates who are helping push New York’s energy transition.

The commission requested public input on decisions that may direct billions in spending and impact millions of New Yorkers. It received comments from dozens of stakeholders before the comment period ended last week.

Push And Pull

As one would expect, the answers covered a spectrum of possibilities.

Labor unions urged the PSC to choose the options that best protect their members and the planet.

Gas utilities said they’re ready to heat and power the state with climate-friendly gas, be it RNG or hydrogen.

Environmentalists decried any rush to unravel the CLCPA, such as by burning RNG or hydrogen.

A developer with wind power, energy storage and transmission projects in the works said more renewables, more storage and more transmission are needed.

Progressives demanded continued focus on the disadvantaged communities that have been breathing elevated levels of fossil fuel emissions for decades.

The waste management industry wants RNG extracted from landfills and the dairy industry wants RNG extracted from cow poop. An RNG trade organization wants both.

New York City, with a poverty rate 47% higher than the national average, supports decarbonizing the grid but wants someone other than its residents to pay to do it.

Nuclear power generation must expand. No, it must halt!

National Grid — whose utilities serve more than 2.5 million natural gas customers statewide and are facing a huge if not existential threat from the campaign for zero emissions — advocated for continued use of gas. It also questioned the very concept of zero emissions.

“‘Zero emissions’ as used in this section of the law cannot be defined literally, as very few sources of energy have literally zero GHG emissions associated with their production and use throughout their life cycle,” National Grid wrote.

It also parsed the language of the law to conclude that “zero emissions” must not exclusively mean “renewable energy systems.”

The New York State Energy Research and Development Authority, which is administering the clean energy transition in New York, provided a two-page comment that at once was among the broadest and most succinct of all submitted.

In summary, NYSERDA said New York needs to identify the appropriate resources to meet the grid’s 2040 needs, refine the cost and performance estimates, further evaluate their emissions, find a place to site them, calculate impacts on disadvantaged communities, factor in demand response and storage, incorporate any future nuclear or 100-hour storage technology yet to be perfected, then integrate all this with existing resources.

Comments

A cross-section of these comments is excerpted and summarized below:

The Energy Justice Alliance said the state’s climate targets and its most urgent environmental justice challenges can be met only through retiring fossil fuel generation in an orderly and just manner. It urged stakeholder and public input before selecting any nonrenewable resources. It said alternatives such as RNG, green hydrogen biofuels, carbon capture and advanced nuclear technology were recommended in the Climate Action Council Scoping Plan for only limited and strategic use, to be considered only after rigorous review.

U.S Plumbers and Steamfitters Local 22 urged an expanded, inclusive definition of “zero emissions energy sources” as anything that does not lead to a net increase in greenhouse gas emissions in the process of generating electricity. Clean hydrogen should be recognized as fitting the bill, it said.

Constellation Energy Generation, owner of the state’s nuclear fleet, said all types of nuclear technology should be included in the definition of “zero emissions.” One of its New York nukes recently began sustained generation of pink hydrogen in a pilot project; Constellation said hydrogen combustion will be a valuable part of the puzzle.

The supervisor of the town of Scriba, home to two of the nukes, urged the PSC to formally recognize nuclear fission as a zero-emission resource.

The Alliance for a Green Economy said it’s deeply concerned about the environmental, human health and financial implications of including nuclear power in a definition of zero emissions — which it is not, because it emits radiation.

Nuclear New York said nuclear power should be the backbone of the state’s future emissions-free energy system, not the backup, adding that the state itself found that adding 4 GW of nuclear generation would eliminate the need for 12 GW in intermittent renewables and 5 GW of storage.

In a joint comment, the Sierra Club and Earthjustice advocated for strict and literal interpretation of “zero emissions” — no pollutant emissions. That rules out hydrogen, RNG, carbon capture and sequestration, biomass and, under some circumstances, demand response. They did not mention nuclear power, a longtime target of the Sierra Club.

The New York State AFL-CIO and the New York State Building & Construction Trades Council, umbrella groups for unions representing 2.7 million people, said the PSC must prioritize maintenance and creation of good union jobs while maintaining service and limiting price increases. They indicated support for the broader definition of “zero emissions.”

A collection of 43 environmental and progressive organizations jointly commented that while it was good the PSC is looking for strategies beyond wind and solar to meet the zero-emissions mandate, technology may advance in the coming decade, and it’s premature to create policies now to avert a resource gap in 2040. There is no “need to water down” the CLCPA’s targets, they said.

NYISO urged that “zero emission” be defined to allow as many technologies as possible to qualify. It noted that increasing transmission and increasing generation will not by themselves fully solve the problem of insufficient resources. The technologies that would solve the problem are not available, and it’s unknown when they will be.

Plug Power, a New York-based generator of green hydrogen and manufacturer of hydrogen technology, said the PSC should fully support and incentivize the full suite of existing and emerging green hydrogen applications. In fact, the PSC should establish a new tier in the state’s Clean Energy Standard for zero emissions resources, with an emphasis on green hydrogen, and help jump-start investment in hydrogen infrastructure.

PSC should expand the definition of net-zero “combustion turbines” to include reciprocating internal combustion engines, said Wartsila Energy, North America, whose parent company has deployed over 76 GW of reciprocating internal combustion engine power plants worldwide.

National Fuel Gas Distribution Corporation said a good definition of zero emission would be “systems other than renewable energy systems that generate electricity or thermal energy technologies that do not lead to a net increase in greenhouse gas emission into the atmosphere.” And that should be construed to include RNG.

New York Transmission Owners stated electric system reliability must remain the paramount priority, coordination with NYISO is essential, an agnostic approach to technology is best and pilot programs will be helpful. And all of this must be done in a timely and deliberate fashion.

The PSC in May directed Department of Public Service staff to convene a technical conference on the matter.

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Commerce Department to Reimpose Tariffs on SE Asian Solar Manufacturers

The Commerce Department on Friday announced its final decision to impose tariffs on solar cells and panels imported from Cambodia, Malaysia, Thailand and Vietnam, finding that some Chinese manufacturers are shipping their products through the four countries to avoid paying tariffs called “antidumping and countervailing duties” (AD/CVD).

Confirming a preliminary decision from December 2022, Friday’s ruling found that of eight companies operating in the countries, five “were attempting to avoid payment by completing minor processing in third countries, and that three companies were not circumventing.” The three noncircumventors are Hanwha Q CELLS and Jinko Solar, both with facilities in Malaysia, and Boviet Solar in Vietnam.

The circumventing companies are BYD Hong Kong and New East Solar in Cambodia; Canadian Solar and Trina Solar in Thailand; and Vina Solar in Vietnam. Other solar manufacturers in these countries, though not part of the official investigation, also were found to be circumventing.

Hanwha is the No. 1 panel provider in the U.S. market, according to industry analysts Wood Mackenzie, while Jinko, Canadian and Trina also are in the top 5, which in 2022 accounted for 50% of the U.S. market.

President Joe Biden declared a two-year moratorium on the tariffs in June 2022, which means the Commerce decision will not go into effect until June 2024. Following a congressional resolution seeking to roll back the moratorium in May, Biden also stated he does not intend to extend the moratorium. (See Biden Veto Upholds 2-year Moratorium on Solar Tariffs.)

No tariffs will be imposed on any solar imports from the four countries until June 2024, providing that any products from the four countries “are consumed in the U.S. market within six months” of the end of the moratorium, according to Commerce’s announcement.

“This provides U.S. solar importers with sufficient time to adjust supply chains and ensure that sourcing is not occurring from companies found to be violating U.S. law,” the department said.

The solar industry quickly criticized the decision, arguing that it undercuts the administration’s efforts to increase solar deployment as part of its fight against climate change.

The department’s investigation was based on a complaint from a U.S. solar manufacturer, Auxin Solar, that was “meritless from the beginning,” Abigail Ross Hopper, CEO of the Solar Energy Industries Association (SEIA), said in a statement released Friday.

“The inquiries have caused uncertainty in the U.S. market at a time when solar energy is on the rise. The final affirmative determinations only perpetuate current supply problems, given the lack of adequate domestic supply of cells and modules,” Hopper said.

While noting that clean energy manufacturing incentives in the Inflation Reduction Act (IRA) have driven a “$20 billion solar manufacturing renaissance” in the U.S., “it will take at least three to five years to ramp up domestic solar manufacturing capacity, and the global supply chain will be vital in the short term,” she said. “This case will just make it harder for American businesses to keep deploying, financing and installing solar power.”

Gregory Wetstone, CEO of the American Council on Renewable Energy, lamented that the Commerce decision comes just days after Biden had celebrated the first anniversary of the IRA at the White House. The decision “directly undermines Biden administration efforts to accelerate the deployment of renewable energy and address climate change,” Wetstone said. “The policy whiplash now being inflicted on the U.S. solar industry is incredibly disruptive and will only delay our nation’s clean energy progress.”

“Our collective focus should be on fostering smart policies that accelerate clean energy deployment nationwide,” said George Hershman, CEO of SOLV Energy, a utility-scale solar contractor. “Detrimental trade barriers like this one run counter to our efforts to meet deployment goals while the industry capitalizes on the incentives provided in the Inflation Reduction Act to boost domestic manufacturing and grow our national supply chain.”

Mamun Rashid, CEO of Auxin, previously has defended his company’s complaint to the Commerce Department, saying Chinese imports are an “existential” threat to its business, according to a CNN report.

“When prices of finished panels from Southeast Asia come in below our bill of materials cost, American manufacturers cannot compete,” Rashid said. “If foreign producers are circumventing U.S. law and causing harm to U.S. producers like Auxin Solar, it needs to be addressed.”

Carrots and Sticks

The Commerce decision highlights the conflict between the U.S. solar industry’s ambitious targets for market growth and its ongoing dependence on foreign — specifically Chinese — manufacturers for its key components.

A 2022 Energy Department report found that 97% of silicon wafers, an essential component of solar panels, are manufactured in China, and 75% of the silicon solar cells built into panels installed in the U.S. come from Malaysia, Thailand or Vietnam.

Also, the industry has been hobbled by the Uyghur Forced Labor Prevention Act (H.R. 6256), passed in 2021, which prohibits the import into the U.S. of any goods produced in China using forced labor. This year, U.S. Customs and Border Protection was holding a major backlog of solar imports under the law, hitting hard at solar developers and causing project delays, according to an Axios report.

Both sides of the aisle in Congress have been taking a harder line on China, and ClearView Energy Partners sees Friday’s decision as in line with Commerce’s “protectionist leanings … irrespective of political polarities.”

The department first slapped tariffs on Chinese solar panels in 2012, during the Obama administration, siding with U.S. solar companies that argued that Chinese companies, heavily subsidized by their government, were undercutting domestic manufacturers and dumping cheaper panels in the U.S. market. AD/CVD tariffs — from 31 to 250% at the time — were intended to level the playing field and spur the buildout of a domestic supply chain, they argued. (See Solar Industry Slams Commerce Decision Extending Solar Tariffs.)

Over the next decade, solar manufacturing migrated to Cambodia, Malaysia, Thailand and Vietnam, and U.S. tariffs failed to catalyze a homegrown supply chain. In 2018, President Donald Trump expanded the Chinese tariffs to the four Southeast Asian countries.

Biden decided in February 2022 to continue the tariffs but instituted the two-year moratorium after Commerce opened the investigation of the Auxin complaint. In an April 2023 policy statement, the White House said the moratorium was intended as “a short-term bridge to ensure there is a thriving U.S. solar installation industry ready to purchase the solar products that will be made in these American factories” built with incentives from the IRA.

Jason Grumet, CEO of the American Clean Power Association, said his organization has counted 52 new or expanded solar manufacturing facilities announced since passage of the IRA. But the majority of the announcements are for plants that will make panels or related system components, not the silicon wafers and cells to replace the Chinese supply chain.

Hanwha, a Korean company, announced in January it would invest $2.5 billion to expand its manufacturing capacity in the U.S. Similarly, Jinko is putting $52 million into expanding its U.S. plant in Jacksonville, Fla.

CubicPV, a U.S.-based company with backing from Bill Gates’ Breakthrough Energy Ventures, is planning a U.S. facility to produce wafers. NorSun, a Norwegian wafer and ingot manufacturer, also has announced plans for a 5-GW U.S. plant.

ClearView believes the U.S. solar industry will continue to have a lopsided supply chain even as the market continues to grow. SEIA estimated that the U.S. industry had about 7.5 GW per year of panel manufacturing capacity at the end of 2021, a figure that could triple by 2024 with incentives from the IRA, according to the White House.

But the Energy Information Administration is estimating solar deployments of more than 39 GW this year alone, which ClearView says will leave the industry still dependent on imports, with further help from Biden unlikely.

Writing ahead of Friday’s announcement, ClearView said, “The Biden administration may view new and expanded renewable power tax credits as sufficient ‘carrots’ to offset a possible affirmative AC/CVD circumvention determination ‘stick.’”

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CEC: California Renewable Use Rose Sharply in Past Decade

Natural gas made up the largest share of California’s electric generation mix in 2022, but solar is accounting for a growing percentage as the state works toward 100% clean energy by 2045.

The data are in a report the California Energy Commission (CEC) released Friday.

Natural gas accounted for 36% of the state’s overall power mix last year, which includes in-state electric generation plus imports from the Northwest and Southwest.

The second-largest share was from solar, at 17%, followed by wind at 11%. Nuclear power and large hydroelectric generation each contributed 9% to the state’s 2022 energy mix.

Fifty-four percent of the state’s total energy mix came from non-GHG and renewable sources in 2022, up from 52% in 2021.

CEC Vice Chair Siva Gunda called the findings “encouraging.”

“Even as climate impacts become increasingly severe, California remains committed to transitioning away from polluting fossil fuels and delivering on the promise to build a future power grid that is clean, reliable and affordable,” Gunda said in a statement.

California’s energy mix has changed markedly since 2012, when 43% of the total came from natural gas. Over the past decade, natural gas generation decreased 20%, to 104,495 GWh.

Meanwhile, solar generation has grown from 2,609 GWh in 2012, when it was less than 1% of the power mix, to 48,950 GWh last year.

Wind generation in California’s power mix grew by 63% since 2012. Coal has been nearly phased-out, the CEC said, contributing just 2% of the power mix in 2022.

Total utility-scale electric generation for California increased 3.4% in 2022, to 287,220 GWh. Twenty-nine percent of the power mix was from imports, about the same as in the previous two years.

Despite the decrease in natural-gas fueled power generation in California, some are calling for a faster phase-out. Looking just at in-state electricity generation, natural gas made up 47% of the total in 2022.

Advocacy groups including Regenerate California point to the disproportionate effect the gas-fueled plants have on disadvantaged communities.

And the group said gas “stands in the way” of the state meeting its target under Senate Bill 100 of 2018, which directs the CEC and other state agencies to plan for all retail electricity sales in California to come from renewable energy and zero-carbon resources by the end of 2045.

“As we power down California’s dirty fossil fuel infrastructure, this gives us the opportunity to create thousands of clean energy jobs and an entirely new system that transforms current and historic social injustices,” Regenerate California said on its website.

The issue of retiring gas plants boiled over this month at a CEC hearing, where the commission voted to keep three old gas-fired plants along the Southern California coast in operation for grid reliability. (See Calif. to Keep Old Gas Plants Operating for Reliability.)

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Counterflow: World of Hurt

Do you remember reading a couple years ago that the worldwide reduction in aerosol emissions[1] would likely double the rate of global warming from what it’s been for the past 50 years?

Steve Huntoon | Steve Huntoon

No? Neither do I.

But there it was in Inside Climate News in September 2021.[2] James Hansen, the Paul Revere of global warming since 1988, had a heretical warning. Aerosols have a climate cooling effect, and the reduction in aerosols is accelerating global warming. The headline wasn’t cryptic: “The Rate of Global Warming During Next 25 Years Could Be Double What it Was in the Previous 50, a Renowned Climate Scientist Warns.”[3]

If you thought this warning of existential threat would have garnered worldwide media attention, you would be wrong. Instead, crickets.

This Summer

So here we are, two years later, setting new heat records. The aerosol cooling effect is diminishing relative to the warming effect of greenhouse gases.

Not that the reduction in aerosols like sulfur dioxide didn’t have a benefit. Aerosols are air pollutants estimated to kill several million people worldwide every year (although there are sources of aerosols other than fossil fuel combustion).[4]

But what we didn’t recognize was the double-edged sword: These same aerosols have been offsetting a lot of the warming effect of GHGs.

What’s Going On

Please take a look at these charts of global carbon dioxide emissions and global sulfur dioxide emissions.[5] See the difference?

Our World in Data

The difference in change between carbon dioxide and aerosol emissions is even more dramatic in places like PJM, as shown by this chart where the left axis is carbon dioxide and the right axis is aerosol emissions:[6]

PJM system average emissions rates | PJM

As PJM summarizes: “From 2005 to 2022, carbon dioxide emission rates fell 37% across PJM’s footprint; emission rates for nitrogen oxides are down 87% and sulfur dioxide 95%.” Thus, carbon dioxide emissions have fallen less than half as much as aerosol emissions.

No Good Deed Goes Unpunished

The cooling effect isn’t small. Hansen and his colleagues think the cumulative cooling effect of aerosols has been offsetting about half the cumulative warming effect of GHGs, as this chart from their recent study shows:[7]

| \”Global warming in the pipeline,\” by James E. Hansen, et al.

If you compare the red lines based on expected warming from paleoclimate and other records with actual warming, there is about a 1- to 1.5-degree Celsius gap in 2022. Hansen and his team attribute the gap to the cooling effect of aerosols.

Recent research, analyzing COVID-19 pandemic period data, suggests this even understates the relative effects of GHGs and aerosols on global warming.[8]

The most recent Intergovernmental Panel on Climate Change (IPCC) report does estimate an offsetting effect of aerosols, but it pegs the offset at only a quarter of the otherwise warming effect of GHGs.[9] As the prior chart suggests, Hansen and his colleagues think the IPCC has greatly understated the aerosol effect: “Aerosol climate forcing is larger than the recent (AR6) IPCC estimate. Aerosols probably provided a significant climate forcing prior to the Industrial Revolution. We know of no other persuasive explanation for the absence of significant global warming during the past 6,000 years, a period in which the GHG forcing increased 0.5 W/m2. Climate models that do not incorporate a growing negative aerosol forcing yield significant warming in that period, a warming that, in fact, did not occur.”[10]

So between Hansen’s team and the IPCC — as Clint Eastwood might ask — do you feel lucky?

Wait, It’s Worse Than That

Aerosols have a relatively short duration in the atmosphere (weeks), while GHGs have a relatively long duration (decades). As fossil fuel generation continues to be reduced, the presence of cooling aerosols drops off rapidly while the presence of GHGs continues for decades. So the cooling effect dissipates rapidly while the heating effect persists. As a recent study says: “A complete phaseout of today’s fossil fuel combustion to zero-emission renewables would result in rapid aerosol demasking, while the GHGs linger on.”[11]

Hansen’s team projects that the rate of global warming post-2010 has been and will be at least 50% greater than the prior 40-year rate: “Decline of aerosol emissions since 2010 should increase the 1970-2010 global warming rate of 0.18 C per decade to a post-2010 rate of at least 0.27 C per decade.”[12]

Here’s a chart depicting this dire future:[13]

| \”Global warming in the pipeline,\” by James E. Hansen, et al.

So this summer’s heat waves should have come as no surprise.

Wait, It’s Even Worse Than That

Hansen’s other heretical warning — also largely ignored by major media — is that the conventional scientific wisdom has greatly overstated the time lag between rising temperatures and rising seas. That wisdom is based on models showing gradual sea rise over many centuries. The IPCC’s various emission scenarios project sea level rise of no more than 1 meter by 2100.[14]

Hansen and colleagues say we need to pay more attention to the paleoclimate record revealing a past in which sea levels rose rapidly, with the prospect for several meters of sea rise over the next 50 to 150 years.[15] There’s also conforming evidence from a Greenland ice core as revealed in a new study.[16]

Not to minimize other consequences of a hotter climate over the decades to come, but this is the threat of entire coastal cities disappearing. Three hundred twenty million people live less than 5 meters above sea level.[17]

This isn’t about adaptation; this is the end of the world as we know it. And no, to riff on R.E.M.,[18] I don’t feel fine.

Now What?

The response by most climatologists appears to be two-fold: (1) reducing aerosols is worth it because the reduced air pollution saves lives, and (2) even if Hansen and colleagues are right, it just means we need to do more to decarbonize faster rather than distract from that mission.

Re. response 1: Yes, aerosols are a form of air pollution that causes several million deaths per year. But that doesn’t explain why non-toxic aerosols like sand can’t replace toxic aerosols as discussed more below.

Re. response 2: Worldwide decarbonization isn’t going to happen any time soon, if ever.[19] The “A” in Plan A could stand for “Ain’t happening.” I’ve discussed the prospect, or lack thereof, of worldwide decarbonization before, with references to that and othering sobering news in the footnote.[20] And here’s a recent data point from Pew Research: Only 31% of Americans support a full phaseout of fossil fuels[21]; you can imagine what that number is for the rest of the world.

And it’s probably too late for Plan A anyway. Hansen offers this somber reality (buried in a paragraph on page 45 of the recent study): “Phasedown of emissions cannot restore Earth’s energy balance within less than several decades, which is too slow to prevent grievous escalation of climate impacts and probably too slow to avoid locking in loss of the West Antarctic ice sheet and sea level rise of several meters.”

It’s baked in, figuratively and literally.[22]

Plan B

As I wrote last year, we need a Plan B: putting aerosols back into the atmosphere,[23] at least to get back to the cooling effect we’ve had before, and to buy us time for decarbonization to occur and to be impactful.

The best candidate may be non-toxic sand added to the stratosphere (with longer duration than the short-duration aerosols in our close-in troposphere).

This isn’t just neophyte Steve Huntoon talking. This is Hansen talking: “A promising approach to overcome humanity’s harmful geo-transformation of Earth is temporary solar radiation management (SRM). … An example of SRM is injection of atmospheric aerosols at high southern latitudes, which global simulations suggest would cool the Southern Ocean at depth and limit melting of Antarctic ice shelves.”[24]

To climate purists who reject this as humans messing with the environment, what do they think we humans have been doing for millennia? We need to focus on what’s best for our species, our children and their children.

And to the objection that the world’s nations wouldn’t agree on what specific geoengineering should be done, is it more likely that there will be worldwide agreement on rapid elimination of GHGs and who pays for it, assuming the requisite technologies even exist at feasible cost? As Aerosmith said, dream on.[25]

Isn’t It Ironic

It’s ironic that what we thought was an unadulterated good — reducing aerosol emissions — has a dark side. I’ll give Alanis Morissette the last word about what we might (or might not) do about it:[26]

It’s the good advice that you just didn’t take
And who would’ve thought … it figures.

Columnist Steve Huntoon, principal of Energy Counsel LLP, and a former president of the Energy Bar Association, has been practicing energy law for more than 30 years.

[1] Principally sulfur dioxide (SO2) and nitrogen oxides (NOx) — the latter of which is not to be confused with nitrous oxide (N2O), which is a greenhouse gas.

[2] https://insideclimatenews.org/news/15092021/global-warming-james-hansen-aerosols/.

[3] The net cooling effect of aerosols has been known for some time, as reported by Scientific American in 2018, https://www.scientificamerican.com/article/cleaning-up-air-pollution-may-strengthen-global-warming/, but the Hansen warning was specific in magnitude and timing of impact.

[4] https://www.who.int/en/news-room/fact-sheets/detail/ambient-(outdoor)-air-quality-and-health;  https://www.washingtonpost.com/business/energy/2023/03/27/climate-change-how-cleaning-up-pollution-may-heat-the-planet/dd7496b0-ccdc-11ed-8907-156f0390d081_story.html.

[5] https://ourworldindata.org/co2-emissions (setting start year at 1850 to track with SO2 chart);  https://ourworldindata.org/grapher/so-emissions-by-world-region-in-million-tonnes.

[6] https://insidelines.pjm.com/annual-study-shows-decrease-in-average-emission-rates-for-pjm-footprint/.

[7] https://arxiv.org/ftp/arxiv/papers/2212/2212.04474.pdf, Figure 13.

[8] https://www.nature.com/articles/s41612-023-00367-6.pdf.

[9] https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_FullVolume.pdf, page 43, comparing 1.5 C of GHG warming effect with 0.4 degrees of offsetting principally aerosol cooling effect.

[10] https://arxiv.org/ftp/arxiv/papers/2212/2212.04474.pdf, page 39.

[11] https://www.nature.com/articles/s41612-023-00367-6.pdf.

[12] https://arxiv.org/ftp/arxiv/papers/2212/2212.04474.pdf, page 1.

[13] https://arxiv.org/ftp/arxiv/papers/2212/2212.04474.pdf, Figure 25.

[14] https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_LongerReport.pdf, page 45.

[15] https://acp.copernicus.org/articles/16/3761/2016/acp-16-3761-2016.pdf.

[16] https://www.cnn.com/2023/07/20/world/greenland-ice-sheet-melt-sea-level-rise-climate/index.html;  https://www.nytimes.com/2023/07/21/science/climate-greenland-ice-sheet.html.

[17] That’s 4.1% of the world’s population of 7.9 billion. https://data.worldbank.org/indicator/EN.POP.EL5M.ZS. Six hundred million live less than 10 meters above sea level. https://www.un.org/sustainabledevelopment/wp-content/uploads/2017/05/Ocean-fact-sheet-package.pdf.

[18] https://www.youtube.com/watch?v=wa43FNUdpU8.

[19] https://energy-counsel.com/wp-content/uploads/2022/05/We-are-Going-to-Need-a-Plan-B-RTO-Insider-5-10-22.pdf. And the prospects aren’t improving in terms of international collaboration and funding, https://www.reuters.com/business/environment/bonn-climate-talks-prepare-cop28-summit-end-with-little-show-2023-06-16/ or in resources like offshore wind, https://www.wsj.com/articles/wind-industry-hits-rough-seas-as-problems-mount-5490403a?mod=Searchresults_pos1&page=1, and long-duration storage, https://www.canarymedia.com/articles/long-duration-energy-storage/is-azelios-abrupt-bankruptcy-a-bad-omen-for-long-duration-energy-storage.

[20] Response 2 also evokes the punchline to that joke about economists: assume a can opener.

[21] https://www.pewresearch.org/science/2023/06/28/majorities-of-americans-prioritize-renewable-energy-back-steps-to-address-climate-change/.

[22] For more on this, https://arxiv.org/ftp/arxiv/papers/2212/2212.04474.pdf, Figure 28 and pages 42-43.

[23] https://energy-counsel.com/wp-content/uploads/2022/05/We-are-Going-to-Need-a-Plan-B-RTO-Insider-5-10-22.pdf.

[24] https://arxiv.org/ftp/arxiv/papers/2212/2212.04474.pdf, page 46.

[25] https://www.youtube.com/watch?v=sZfZ8uWaOFI

[26] https://www.youtube.com/watch?v=Jne9t8sHpUc

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PJM MRC/MC Preview: Aug. 23-24, 2023

Below is a summary of the agenda items scheduled to be brought to a vote at the PJM Members Committee special meeting Wednesday and Markets and Reliability Committee meeting Thursday. Each item is listed by agenda number, description and projected time of discussion, followed by a summary of the issue and links to prior coverage in RTO Insider.

RTO Insider will be covering the discussions and votes.

Members Committee

Endorsements (2:10-5:00)

Stakeholders will discuss and vote on 20 proposals Wednesday, considering packages that seek to overhaul the PJM capacity market through the critical issue fast path process (CIFP) initiated by the board in February. Voting will not follow the MC’s usual truncated protocol — in which voting ceases after a package garners sector-weighted support — and stakeholders instead will vote on each proposal in turn. The committee’s support of the packages will serve as recommendations to the PJM Board of Managers, indicating how the membership feels the board should proceed in its aim of directing PJM to make a FERC filing with changes to the capacity market in October.

Markets and Reliability Committee

Consent Agenda (9:05-9:10)

B. Endorse proposed revisions to Manual 13: Emergency Operations to address requirements in NERC’s EOP-011 standard.

Endorsements (9:10-9:50)

  1. Enhancements to Deactivation Rules Issue Charge (9:10-9:50)

PJM’s Paul McGlynn will present a problem statement and proposed issue charge, drafted in conjunction with the Independent Market Monitor, seeking to initiate a stakeholder discussion looking at PJM’s generation deactivation process. The proposed scope includes potentially increasing the deadline for generators to notify PJM of their plans to deactivate, the compensation level for generation owners that agree to continue operating their resources through reliability-must-run contracts and the triggers for offers a generator such a contract. (See “PJM and Monitor Present Generation Deactivation Issue Charge,” PJM MRC/MC Briefs: July 26, 2023.)

The committee will be asked to approve the proposed issue charge.

  1. Peak Market Activity (9:50-10:15)

PJM’s Yong Hu will present a proposal and corresponding tariff revisions addressing peak market activity credit requirements. The language was endorsed by the Risk Management Committee.

The committee will be asked to endorse the proposed solution and corresponding tariff revisions.

Issue Tracking: Peak Market Activity Credit Requirement

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Texas Seeking Lead Role in Nuclear SMRs

Texas Gov. Greg Abbott last week directed the state’s Public Utility Commission to create a working group to study and provide recommendations that will “position Texas as the national leader on advanced nuclear energy.”

In a Wednesday letter to interim PUC Chair Kathleen Jackson, Abbott wrote that Texas should consider nuclear energy and all other forms of dispatchable power to ensure a reliable grid. He said the PUC should evaluate advanced nuclear reactors to determine whether “they can provide safe, reliable and affordable power.”

“Nuclear energy is a proven, reliable and dispatchable generation resource. It will become ever more critical as Texas’ need for reliable power continues to grow,” Abbott said. “The state of Texas must plan now to best harness these new advanced technologies and ensure the future of the Texas grid.”

ERCOT, the grid operator for about 90% of Texas, has seen peak demand increase by more than 14% in the past four years as its population and industrial growth boomed. It has set 21 peak demand records during the past two summers. (See related story, Population Growth Fuels ERCOT’s Record Demand.)

Abbott directed the working group to consider all potential financial incentives, determine nuclear-specific changes to the ERCOT market, identify any federal or state regulatory hurdles to development and analyze how Texas can streamline and accelerate permitting for building advanced nuclear reactors.

He also asked that PUC Commissioner Jimmy Glotfelty lead the group and that it coordinate with ERCOT to begin addressing the technical challenges of incorporating advanced nuclear technology.

Glotfelty agreed that Texas will need to “harness every source of dispatchable power” as the state’s population continues to multiply.

“The nuclear industry is ripe with technological advancement, and through collaboration with our state’s top-tier universities, it has great potential for growth in Texas,” he said in a statement provided by the PUC.

Texas already has more than 5 GW of conventional nuclear capacity in the South Texas Project and Comanche Peak plants. The four units came online between 1987 and 1994.

“I think that small modular reactors [SMRs] are very exciting and an important piece of the decarbonization puzzle for 2035 and beyond, especially if we use them to replace aging coal and gas plants. I would like to see more of them gain traction,” Michael Webber, a professor at the University of Texas at Austin leading clean energy technology research, told RTO Insider. But “they don’t really help us with the immediate need for power in the next five years, which is what Gov. Abbott called for,” he added.

Abbott made the announcement during a public fireside chat Wednesday with Dow CEO Jim Fitterling and X-energy CEO Clay Sell before about 70 attendees on the UT Austin campus.

The two companies said they had selected Dow’s UCC Seadrift Operations manufacturing site along the Texas Gulf Coast for a proposed advanced SMR project. They plan to install four 80-MW X-energy high-temperature gas reactor technology at the site by the end of this decade.

The companies will have to submit construction permit applications to the Nuclear Regulatory Commission. Construction on the project is planned to begin in 2026.

The NRC has approved only one small modular model, NuScale’s SMR water reactor. The 70-MW unit costs about $9 billion. X-energy says its design reduces costs by using off-the-shelf components manufactured and shipped to the sites.

The commission soon will file a new rule and regulatory guide for SMRs’ emergency preparedness requirements that it says will help their licensing. (See related story, NRC Eases Emergency Preparedness Rules for SMRs.)

The Department of Energy has named Dow a sub-awardee under X-energy’s Advanced Reactor Demonstration Program Cooperative Agreement. The agreement provides for up to $50 million in engineering work, with half funded by Dow.

Abbott touted the state’s new tax-abatement program passed by the Texas Legislature this year as a tool to incentivize similar projects.