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November 6, 2024

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Suspect in Vegas Solar Array Damage: Act was Protest Against Old Tech

The man arrested last week in Las Vegas for damaging a major solar facility told police he had “no regret” over the incident and that the destruction of his car was necessary “for the future,” according to the police report shared with ERO Insider.

Officers with the Las Vegas Metropolitan Police arrested 34-year-old Mohammad Mesmarian last Wednesday on charges of terrorism, arson, destruction of property and attempting to escape police custody. The officers said Mesmarian, a native of Iran, acted alone.

Mohammad Mesmarian Mugshot (LV PD) Content.jpgThe booking photo of Mohammad Mesmarian | Las Vegas Metropolitan Police Department

Mesmarian allegedly burned his car at the Dry Lake Solar Plant, a 700-acre facility northeast of Las Vegas also known as the Mega Solar Array. The facility, which is operated by Invenergy, provides about 95% of the daily electricity needs for MGM Resorts’ Las Vegas properties, although the incident left it out of commission. An Invenergy spokesperson told ERO Insider that the plant is expected to be fully operational later this week.

Based on what he told police, as summarized in the report, it’s unclear whether Mesmarian actually knew what the array does, as he said he supports clean energy and wanted to destroy his car because it represented old, polluting technology.

“Mesmarian believes in harmony between species and does not approve of old forms of energy,” the report says. “Mesmarian indicated he burned the vehicle because it uses gasoline and oil, as well as produces carbon emissions.”

Employees Gone when Incident Occurred

The police report says Mesmarian drove his car, a red Toyota Camry with an Idaho license plate, through the security fence at the facility around 3:30 p.m. on Jan. 3. Employees were not present at the time, having left around 2:30 after completing a final site check for the day. Mesmarian then tried to drive through the security gate surrounding the plant’s main transformer, but his car got stuck. He used some tools to cut a wide enough opening to get in.

Once inside the transformer area, Mesmarian wandered around a bit; surveillance footage showed him apparently taking photos of the transformer and control house, turning some switches off and trying to get into the control room. Around midnight he drilled a hole in the car’s gas tank and soaked a rag with gasoline. He then put the rag in the engine compartment and used jumper cables to ignite it.

After the rag caught the rest of the engine compartment on fire, Mesmarian was able to get the car moving and watched as it entered the concrete retention pit beneath the transformer. He then sat in a chair and continued to watch the car burn until around 12:30 a.m., when he left.

Burned Phone Leads to Suspect

Employees began to arrive at the Dry Lake plant’s administrative offices around 6 the following morning but didn’t discover the damage and the remains of the car until around 11:30. That was when the site manager received his new credentials for the security system. Upon logging in, the manager realized there was a car smoldering in the concrete pit and directed the other employees to respond. After they put out the remaining embers, an employee called police; detectives from the counterterrorism unit were sent to investigate.

The car was too badly burned to find a license plate or vehicle identification number, but the detectives found a damaged iPhone in the back seat; after contacting Apple with the device’s IMEI number — which is unique to each phone — officers discovered that it was connected to an account in Mesmarian’s name. Officers then discovered Mesmarian’s Instagram account, which showed pictures purportedly taken in Arizona several days earlier of someone who looked like the person in the surveillance footage, wearing similar clothing.

Before the destruction was discovered, Mesmarian had actually had a run-in with police around 8 a.m., when employees of a nearby waste disposal site reported him trespassing. Reviewing video from the officers’ body cameras, detectives saw that Mesmarian was still wearing the clothes he apparently wore during the incident at the solar facility. During the encounter Mesmarian told officers he was in town with his mother, named Deborah, and worked odd jobs. The report does not say what police did, if anything, about the trespassing incident.

Staff at the waste site told detectives that Mesmarian had also been there the day before, driving a red Camry. They showed police photos of the car, which had an Idaho license plate registered to Deborah Mesmarian.

Police were able to track Mesmarian to a camping area, where they found him in a travel trailer bearing an Idaho plate. They took him into custody without incident, although he later tried to run away twice; both times officers were able to restrain him.

Confused Story from Accused

During his interrogation, Mesmarian described his memory of his acts at the solar facility. The account corresponded closely to the surveillance video, but he appeared confused on some elements. For example, he seemed to believe the plant was built or run by Tesla, and he initially referred to the transformer as a “computer” before being corrected by detectives.

It’s also unclear how Mesmarian got the car to move after lighting the engine compartment on fire. The incident report says he placed an object on the accelerator, but under interrogation, he said that didn’t work and had to jump out of the car while it was moving.

Regarding his motive, Mesmarian said he intended to burn the car — which he said belonged to his grandmother — as a protest against old, polluting technology. He got the idea while working on the car on New Year’s Eve, a few days after he arrived in Las Vegas, he said.

Mesmarian told detectives he “believed in clean sources of energy and was against carbon [emissions], as well as oil and coal energy.” Burning the car, he believed, would send a message to the public to “let go of the old forms of energy,” along with freeing him personally from “harmful memories of his past.” Asked if he would do the same thing again if he could go back in time before the incident, Mesmarian said, “Oh yeah. … No regret.”

Despite having no training related to electrical systems, Mesmarian believed he had made the facility “safe” by turning off the switches before he set the car on fire and denied that he was trying to sabotage it. When detectives pointed out that setting the fire inside the solar plant was dangerous, he told them he “figured [that] had been thought [of] ahead of time.” When further pressed he admitted that he knew he could have damaged the unit but that he did it for the greater good.

According to reports from local media, Mesmarian behaved erratically at a court appearance on Tuesday, interrupting other defendants’ proceedings to complain about the justice system to the point where the judge ordered him escorted out. During a hearing, for which Mesmarian was let back in, the judge ordered him to undergo a psychiatric evaluation ahead of a Jan. 31 appearance in state court.

Electric Attacks Continue

Mesmarian’s actions are at least the third high-profile disruption of U.S. electric facilities in a month. At the beginning of December, attackers damaged two substations run by Duke Energy in Moore County, N.C., with rifles, leaving 45,000 customers without power for days; no suspects have been identified and their motive is unknown. (See Duke Completes Power Restoration After NC Substation Attack.)

Later in the month four electric substations in Washington state were broken into and damaged on Christmas morning, cutting power to about 15,000 customers. The Justice Department has charged two men with carrying out all four attacks to cover up a burglary plot. (See Feds Charge Two in Wash. Substation Sabotage.)

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IRA Funding Lures $2.5B Investment by Korean Solar Maker

Hanwha Qcells said Wednesday it will spend $2.5 billion to develop a complete solar supply chain in the U.S., the largest solar investment in U.S. history, according to the Biden administration, and further evidence of industry’s response to the clean energy incentives in the Inflation Reduction Act.

Seoul-based Hanwha said its Qcells unit will break ground in 2023 on a factory near Cartersville, Georgia, with capacity to make 3.3 GW of solar ingots, wafers, cells and finished panels.

The company also plans to expand the 300,000-square-foot factory it opened in 2019 in Dalton, Georgia, increasing it from 1.7 GW to 5.1 GW of solar panel capacity.

Qcells Worker (Qcells) Alt FI.jpg

A worker at Qcells Dalton, Ga., plant prepares solar modules for shipping. | Qcells

The investments would give the company 8.4 GW of capacity by 2024. Qcells, which currently employs about 750 people in Georgia, will expand its workforce there to 4,000.

Hanwha says the buildout of a U.S. supply chain is central to its plan to evolve into an “energy solutions provider” and capitalize on the growth of the solar panel installation market, which is expected to more than double from 19 GW in 2022 to a projected 44 GW by 2026, according to Wood Mackenzie.

Qcells said its investments were triggered by the solar subsidies included in the IRA: It expects to collect $875 million per year by 2026 in investment tax credits and advanced manufacturing production credits.

Companies announced $40 billion in investments on 20 manufacturing facilities between August and December 2022, representing 7,000 new jobs and more than 13 GW of additional clean energy capacity, American Clean Power said in a recent report.

Shares of other solar stocks rose Wednesday following Hanwha’s announcement, with SolarEdge Technologies (NASDAQ:SEDG) shares up almost 6% on the day, while Shoals Technologies (NASDAQ:SHLS) was up 7.4% and Array Technologies (NASDAQ:ARRY) up 9.4%.

Mark Hagedorn, vice president of manufacturing services for Clean Energy Associates, which provides quality assurance, supply chain management and engineering services for the solar PV and battery storage industries, said the scale of the new facilities is creating unique siting challenges.

“If you look at a cell factory, whether it be solar or storage, the size of these things … is huge. They start in the hundreds of acres of space, with millions of square feet under the roof,” he said. “There’s clean rooms involved. There’s lots of power, there’s lots of water; all of that stuff has to be reduced, reused, recycled, optimized.”

Economic Development Agencies Look to Lure Growth

Hagedorn’s comments came at a Solar Energy Industries Association webinar Tuesday on how manufacturers can work with regional economic development agencies to evaluate potential sites for new factories.

“Sometimes we’re [involved] way earlier on in the process. Sometimes, the deals are at the two-yard line, and they need help to get over the goal line,” said Thomas Maynard, vice president of business development for the Greater Phoenix Economic Council.

Maynard said the IRA, which has an estimated $379 billion in clean energy subsidies, and the CHIPS Act, which will spend $54.2 billion to build domestic semiconductor manufacturing, have changed the role of the federal government, which had previously been “pretty hands off” on economic development. “The federal government definitely has a seat at the table and is driving a lot of growth,” he said.

Brock Herr, senior vice president of business retention, expansion and attraction for the Indiana Economic Development Corporation, said his agency has created an interagency affairs division to coordinate efforts with agencies responsible for environmental management, taxes and workforce development.

“We work with them on matters ranging from program and initiative development to make sure that we’re aligned across state government, but then also specific project items — you know, bring them in to facilitate a conversation on permitting,” he said. “We like to act as that concierge, if you will, so a company doesn’t have to cold call various government agencies and explain what they’re doing and why the state or the locality should treat it with the deference that it needs.”

Linda Bonelli, who leads the incentives group in Deloitte Tax LLP’s National Multistate Tax practice, said labor shortages are becoming an increasing concern for manufacturers looking to expand.

“Labor used to be something that … was not as big of a concern. That tends to be people’s No. 1 concern [now],” she said. “The skills we need may not be in that jurisdiction.”

Greater Phoenix’s Maynard had one parting piece of advice for dealing with regional development agencies.

“The ribbon cutting shouldn’t be the finish line. It shouldn’t be the end of the discussion,” he said. “It should be the start of the relationship.”

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FERC Approves PacifiCorp’s Interconnection Replacement Rules

FERC on Monday approved PacifiCorp’s changes to its generator interconnection procedures that will allow it to use retiring generators’ interconnection capacity for new power plants in a process overseen by an independent coordinator (ER23-407).

The commission has already approved similar rules for Dominion Energy South Carolina, Public Service Company of Colorado and Duke Energy’s utilities in the South.

PacifiCorp argued that its new rules are superior to FERC’s pro forma interconnection rules because they create efficiencies by using existing interconnection capacity of retiring facilities, cutting interconnection timelines and uncertainty for new plants that use the process. Using existing interconnection capacity means that no new lines will have to be built to reliably connect power plants.

The Western Power Trading Forum told FERC that the independent coordinator was needed to minimize possible anticompetitive impacts from PacifiCorp reusing its old plants’ interconnection capacity, especially when the new generators use a different fuel.

TerraPower supported the rules, which it plans to use in the development of its Natrium nuclear reactor demonstration project at the site of PacifiCorp’s coal-fired Naughton Power Plant, where the remaining two units are set to retire in 2025.

FERC conditionally accepted the rules, subject to PacifiCorp fixing a typographical error on one of its tariff sheets.

“We find that PacifiCorp’s proposed generator replacement process provides substantial benefits and, in combination with the safeguards against unduly discriminatory implementation provided by the proposed independent coordinator, satisfies the consistent with or superior to standard with respect to the pro forma” large generator interconnection procedures, FERC said.

The generator replacement rules are similar to ones FERC has approved for other utilities in the past, and they should produce the same benefits, the commission said. They will create efficiencies by using existing interconnection facilities at retiring facilities; reduce interconnection timelines; save money for customers by decreasing new construction; and cut interconnection-related uncertainty in generation resource planning.

While PacifiCorp owns “a significant share” of the existing generation on its system, FERC said the replacement model would provide benefits, as it comes with the independent consultant’s review.

The order drew a dissent from Commissioner Allison Clements, who said PacifiCorp failed to show that the proposal is consistent with or superior to FERC’s pro forma interconnection rules.

“In particular, protesters make compelling arguments, not present in those previous generator replacement rights proceedings, highlighting the potential for anticompetitive outcomes under PacifiCorp’s proposal,” Clements said. “Based on the record before us, I cannot conclude that the benefits of this proposal outweigh the potential significant negative impacts on open access and competition in the PacifiCorp region.”

The main question is whether PacifiCorp will be able to retain up to 5,000 MW of interconnection rights in perpetuity without any opportunity for new generation to gain access to it. Clements said that the D.C. Circuit Court of Appeals rejected similar rules for Xcel Energy because of concerns of their anticompetitive effects and potential for undue discrimination.

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CEQ Raises Bar on GHG Analysis in NEPA Reviews

The White House Council on Environmental Quality on Monday released updated guidelines for federal agencies performing environmental reviews, requiring them to include a detailed quantification of a project’s greenhouse gas emissions, the estimated social costs of those emissions, and their impacts on climate change and community resilience.

Environmental assessments required under the National Environmental Policy Act should quantify a project’s “GHG emissions; place GHG emissions in appropriate context and disclose relevant GHG emissions and relevant climate impacts; and identify alternatives and mitigation measures to avoid or reduce GHG emissions,” CEQ said in the new guidelines published in the Federal Register on Monday.

The issuance started a 60-day comment period, but the guidelines will go into effect immediately on an “interim” basis, CEQ said. Potential revisions may be made before they are finalized.

According to a 2020 review by CEQ, NEPA environmental reviews can take anywhere from two to more than six years, making them a major factor in the long permitting times for large energy projects on public land in the U.S., be they utility-scale solar, natural gas pipelines or interstate transmission.

The new guidelines lay out detailed recommendations for NEPA reviews, for example, saying quantification of a project’s GHG emissions should include both separate analyses of carbon dioxide, methane and nitrogen oxide emissions, as well as an aggregated total, factoring in “each pollutant’s global warming potential.”

“Where feasible, agencies should also present annual GHG emission increases and reductions,’” the guidelines say. “This is particularly important where a proposed action presents both reasonably foreseeable GHG emissions increases and reductions.”

They also say that “the relative minor and short-term GHG emissions associated with construction of certain renewable energy projects, such as utility-scale solar and offshore wind, should not warrant a detailed analysis of lifetime GHG emissions.”

Clean energy alternatives to fossil fuel projects also get a boost in the guidelines, which frame them as “in line with the urgency of the climate crisis,” as well as U.S. national and global climate commitments. While noting that neither NEPA nor CEQ require agencies to go with a project with the lowest net GHG emissions, the guidelines say, “agencies should evaluate reasonable alternatives that may have lower GHG emissions, which could include technically and economically feasible clean energy alternatives.”

These provisions, contained in a few sentences in the 14 pages that the guidelines take up in the Federal Register, received immediate support from clean energy trade groups.

“The interim guidance will enable clean energy developers to move forward with projects, particularly on federal lands, that not only reduce climate impacts from the power sector, but that also create jobs and add economic benefits for communities in areas where solar projects are sited,” said Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association.

The American Clean Power Association also issued a positive review. “The guidance appropriately recognizes that agency resources and time should not be spent reviewing the relatively minor and short-term greenhouse gas emissions associated with construction of clean energy projects and infrastructure that will provide large net emissions reductions over the course of their life.”

‘Should,’ not ‘Shall’ 

Industry analysts ClearView Energy Partners see the guidelines as evidence of a White House “lean into greening” strategies. But, ClearView says, the guidelines also set a de facto bottom line of zero GHG emissions as the minimum “significance level for purposes of triggering review under NEPA.”

“The lack of a specific significance level also eliminates a bright line below which a project can be deemed to be ‘not significant’ for purposes of NEPA,” ClearView said in its analysis of the guidelines.

ClearView also points to the guidelines’ warning that “NEPA requires more than a statement that emissions from a proposed [project] or its alternatives represent only a small fraction of global or domestic emissions.”

The intent of the guidelines is to treat all federal projects the same, ClearView says. “The CEQ makes clear that all projects must quantify direct emissions, and that only projects with ‘small’ GHG emissions may be able to use less detailed analysis of lifetime emissions due to overall negative carbon emissions of the project.”

Further, the guidelines could nudge FERC and other agencies toward more in-depth analysis and quantification of GHG emissions. ClearView references FERC’s practice of not evaluating a project’s upstream or downstream emissions, arguing that it lacks jurisdiction to request such information from a project applicant. Rather, the guidelines say agencies should “seek to obtain the information needed to quantify GHG emissions” by requesting or requiring it from project applicants.

Here, ClearView sees an opening for the kind of litigation that can delay or derail a project.

“We think the interim guidance creates a significant, and potentially insurmountable, obstacle to agencies relying on a ‘don’t ask’ strategy to limit the scope of GHG reviews in the future,” ClearView says. “Now project opponents have strong grounds for appeals if they challenge an agency to make such inquiries in order to make upstream (or downstream emissions) estimates and the agency fails to do so.”

ClearView expects plenty of opposition to the guidelines from the fossil fuel industry and congressional Republicans, who may argue that CEQ has gone “well beyond the statutory requirements of NEPA.”

But, ClearView says, CEQ avoided using the word “shall,” which signals hard and fast obligations, and instead provided agencies and itself cover by “strongly recommending” the guidelines “should” be followed.

CEQ also stakes out its interpretation of NEPA’s jurisdiction on GHG emissions in the introduction to the guidelines. “Climate change is a fundamental environmental issue, and its effects on the human environment fall squarely in NEPA’s purview.”

Permitting Reform Preview

On the same day the CEQ guidelines were published, Rep. Pete Stauber (R-Minn.) introduced a bill that would cut NEPA review for mining projects to 12 months for an environmental assessment and 24 months for an environmental impact statement. The bill would also require that appeals against a permit be filed within 120 days of a project approval.

Under NEPA, an environmental assessment is an initial study to determine whether a project will have significant impacts requiring a full review and environmental impact statement.

Some of the other key recommendations in the CEQ guidelines include that:

  • agencies should “leverage early planning processes” to incorporate GHG emissions quantification and analysis of climate impacts and options for mitigation from the very beginning of environmental reviews;
  • such early planning should also include consideration of impacts on and active engagement with low-income, minority and other environmental justice communities;
  • along with the quantification of GHG emissions, agencies should perform an analysis of the social cost of emissions, as opposed to a comprehensive cost-benefit analysis;
  • the impacts of climate change ― such as extreme weather, drought and wildfires ― on a project over time should also be factored into the environmental review; and
  • quantification of a project’s GHG emissions should also be “contextualized” in terms of impacts on international, national, state and local climate goals.

ClearView sees this last provision as “bringing global dynamics home in requiring federal agencies to discuss the impacts of a project with a large GHG footprint in context of international commitments and federal policy. It could allow for agencies to determine that a project’s GHG emissions [are] contrary to emission targets or goals established.”

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NYISO Finalizes CRIS Tariff Revisions

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RENSSELAER, N.Y. — NYISO on Wednesday presented the Installed Capacity Working Group/Market Issues Working Group with a proposed timeline for finalizing tariff revisions related to capacity resource interconnection service (CRIS) expiration and transfer rules for deactivated facilities looking to adjust their unexpired CRIS rights.

The ISO’s Nikolai Tubbs told stakeholders that NYISO would be finalizing the discussion on tariff provisions related to the CRIS project, which has been an extended ongoing process. (See “Tariff Revisions on CRIS,” Study: NYISO Dynamic Reserves Could Lower Congestion, Costs.)

Currently, NYISO anticipates these new provisions to go into effect in the second quarter, or 60 days after they have been filed with FERC toward the end of the first quarter.

Scott Leuthauser of Hydro Quebec Energy Services asked about the status of external CRIS and whether it would be affected by any of the proposed revisions. NYISO attorney Sara Keegan answered that those rights would be unaffected.

Howard Fromer, who represents the Bayonne Energy Center, asked when NYISO expected the proposed requirements for CRIS transfers would go into effect and what the ISO meant by “functional requirements,” which NYISO expects to be their 2023 deliverable.

Zach Smith, vice president at NYISO, responded that “all of the rules will become effective upon FERC acceptance,” including the requirements related to CRIS transfers.

Smith then clarified that the functional requirements that NYISO is seeking to deliver by the fourth quarter relate to partial CRIS expiration, and the ISO “needs software tools to facilitate the partial CRIS tracking.” Smith also told stakeholders that the first time NYISO will “expire someone under the new partial CRIS rules would be three years from the effective date.”

Mark Younger, president of Hudson Energy Economics, thought it was confusing that NYISO “have the deliverable for this year called ‘functional requirements,’ when, in fact, the real deliverable is implementation.”

Doreen Saia, an attorney with Greenberg Traurig, asked whether the tariff revisions specifically related to the same-location CRIS transfers rules, would be impacted by the Class Year 2023 base case lockdown.

Keegan responded that it would not, and that, “regardless of this filing, CRIS transfers would be requested by the class year start date.”

NYISO will seek approval for the proposed CRIS tariff revisions at both the Jan. 18 Business Issues Committee and Jan. 25 Management Committee meetings.

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DOI’s Klein Picked to Run Bureau of Ocean Energy Management

The U.S. Department of the Interior announced on Monday that Elizabeth Klein has been named director of the Bureau of Ocean Energy Management, which oversees offshore energy and mineral resources.

She will replace Amanda Lefton, who has run BOEM since the start of the Biden administration and is resigning effective Jan. 19.

Under Lefton, BOEM approved the country’s first two commercial-scale offshore wind projects and has held three offshore wind lease auctions. The three lease auctions included a record-breaking sale off New York and the first-ever sale off the West Coast.

“Liz has been an invaluable asset at the department since Day 1, and we are thrilled she is taking on this new role,” Interior Chief of Staff Rachael Taylor said. “The Interior Department is leading the effort to foster a clean energy future, and Liz will be critical to our efforts to meet the president’s ambitious goals to deploy affordable clean energy to power homes across America and create good-paying jobs in the growing offshore wind industry.”

Klein, who currently serves as senior adviser to Interior Secretary Deb Haaland, was previously nominated for deputy secretary of the department, but that was withdrawn early in President Biden’s term after opposition from Sen. Lisa Murkowski (R-Alaska).

This is Klein’s third stint at DOI, having worked at the department during the Clinton and Obama administrations. Before joining the Biden administration, she was deputy director of the New York University School of Law’s State Energy & Environmental Impact Center, which supports state attorneys general when they defend, enforce and promote laws and policies on clean energy and the environment.

Klein was a key architect of the Obama administration’s work to create a new offshore wind industry and leasing program.

The American Clean Power Association thanked Lefton for helping lay the foundation to get to 30 GW of offshore wind by 2030 and welcomed BOEM’s new boss.

“We also are excited to work with Elizabeth Klein, who brings a wealth of experience to BOEM, having worked in the highest levels of the Department of the Interior under Presidents Obama and Biden,” ACP Vice President for Offshore Wind Josh Kaplowitz said. “The offshore wind industry looks forward to ongoing collaboration with incoming Director Klein and her team to accelerate offshore wind energy development and deployment, while creating jobs for American workers and investing in American communities.”

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Illinois, Public Citizen Ask for Confidential Docs in Dynegy Probe

The Illinois attorney general’s office and Public Citizen are calling on FERC to release private files pertaining to the commission’s investigation of Dynegy’s conduct during MISO’s 2015 capacity auction.

The organizations lodged a motion Jan. 6 asking FERC to direct its Office of Enforcement to allow access to “all documents and materials in its possession collected by enforcement staff during the non-public investigation of Dynegy.” (EL15-71)

The Office of Enforcement concluded in a heavily redacted report last September that Dynegy engaged in market manipulation to ensure it could set prices in MISO’s 2015-16 planning resource auction. The finding reversed a three-year, non-public FERC investigation that cleared Dynegy of wrongdoing before ending abruptly in 2019. (See FERC Staff Finds Dynegy Manipulated 2015 MISO Capacity Auction.)

Illinois and Public Citizen said they’re seeking documents that Dynegy or others provided to FERC enforcement staff during the investigation that they weren’t privy to. They said they anticipate documents and depositions “that will likely be relevant to the issues” raised in their complaints.

The organizations have requested $428.6 million and interest from June 2015 to refund Illinois load serving entities’ customers in MISO’s Zone 4.

They said they have executed nondisclosure agreements to receive non-public filings from Dynegy about the refunds’ status. They also said they’ve already committed to safeguarding information when they were granted access to the case’s confidential remand report and appendix documents.

“The People and Public Citizen have already agreed to protect investigation materials in accordance with the commission’s model protective order and should be granted the ability to review any and all materials in the possession of, or acquired by, enforcement staff,” they wrote.

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Biden Admin Releases Blueprint for Transportation Decarbonization

The Biden administration on Tuesday released what it described as a national plan to eliminate carbon dioxide and other greenhouse gas emissions from the nation’s transportation sector by 2050, including from private automobiles, the trucking industry, freight and passenger rail, and aviation.

The 88-page National Blueprint for Transportation Decarbonization argues that successfully addressing the climate crisis will require nothing less than a total commitment of the federal government working with state, local and tribal governments, and with industry.

Underlying these objectives will be the research, development and refinement of new technologies: battery electric systems in light-duty vehicles, fuel cell electric systems running on hydrogen in heavy trucking, synthetic low-carbon liquid fuels for aviation and maritime use.

Transportation accounts for up to 29% of all U.S. emissions, and the administration announced as early as April 2021 its goal to reduce emissions from the sector by 50 to 52% by 2030 compared to 2005.

The blueprint is the work of the departments of Energy, Transportation and Housing and Urban Development, and EPA. It describes itself as “the first comprehensive, whole-of-government approach to decarbonizing the transportation sector that aligns decision-making among agencies and identifies new and innovative opportunities for collaboration that are critical to achieving our shared vision of a future decarbonized transportation system.”

“It’s not an accident that these four agencies are represented here. It is because the president has made it clear that he expects to see action,” Jeff Marootian, senior adviser at DOE, said at a launch event for the report at the Transportation Research Board’s Annual Meeting in D.C.

“So much of the work that’s reflected in the blueprint isn’t really a starting point,” he said. “This is very much an orchestration of what has already been done, both in DOE and at other agencies as well, to help move this forward.”

The blueprint also provides the first details of the administration’s plans to use funds provided by the passage of the Infrastructure Investment and Jobs Act and the Inflation Reduction Act.

The resources from the two laws are allowing DOE and its national laboratories to deliver “end-to-end research and development so we can take these technologies that many have worked hard on developing and commercialize them, de-risk them, and help really support our partners in industry to help actually commercialize them and provide these for consumers,” Marootian added.

“The blueprint is predicated on three ideas,” said Andrew Wishnia, deputy assistant secretary for climate policy at DOT. “One is how do we improve convenience? The second is how do we improve efficiency? And the third is how do we improve clean options?”

On convenience, for example, Wishnia pointed to funding from the IIJA that will support “more bike infrastructure, more walking infrastructure, better land use coordination [and] more money going to metropolitan planning organizations.”

But the blueprint acknowledges that the third “idea” will drive the majority of emission reductions. Given the broad array of vehicle types, technologies and usage patterns, a successful transition will require various vehicle and fuel solutions and must consider full life-cycle emissions.

It also acknowledges the impact transportation technologies have had on U.S. society over time, pledging that remaking transportation will be done with a clear focus on the impact it will have on communities. It includes more federal attention to urban planning.

Marion McFadden, principal deputy assistant secretary for community planning and development at HUD, stressed “the interconnectedness of transportation and where people live.”

“Decarbonizing transportation will affect everyone, and solutions must address the needs of all urban, suburban and rural communities; businesses of all sizes; and individuals and families at every socioeconomic level,” the blueprint predicts in an introductory explanation.

Recognizing the enormity of the undertaking, the blueprint further notes that “the scope, scale and speed of the shift will continue to require solutions that leverage market forces and private sector investments, which government policies and investments should jumpstart and guide.”

John Bozzella, president and CEO of the Alliance for Automotive Innovation, said the auto industry is approaching decarbonization as both an environmental and economic imperative.

Electrification is a “big opportunity for our economic competitiveness [and] our ability to compete with economies around the world,” Bozzella said. He predicted that by the end of the decade, the auto industry will pour more than a trillion dollars in electrification.

But, he said, even though “[electric] vehicle sales have doubled year over year, it’s 7% of new vehicle sales. To get to 50% by the end of the decade, it’s going to require not only an all-of-government approach at the agencies here today. … We also need to pair that with an all-of-the economy collaborative approach.”

Multiagency Approach

In remarks accompanying the release of the plan, Energy Secretary Jennifer Granholm also noted the ambitious nature of the plan’s objectives. “The domestic transportation sector presents an enormous opportunity to drastically reduce emissions that accelerate climate change and reduce harmful pollution.”

Transportation Secretary Pete Buttigieg underscored the importance of a multiagency approach.

“Transportation policy is inseparable from housing and energy policy, and transportation accounts for a major share of U.S. greenhouse gas emissions, so we must work together in an integrated way.

“Every decision about transportation is also an opportunity to build a cleaner, healthier, more prosperous future. When our air is cleaner; when more people can get good-paying jobs; when everyone stays connected to the resources they need and the people they love, we are all better off.”

EPA Administrator Michael Regan said the blueprint supports the agency’s “priority is to protect public health, especially in overburdened communities.”

Housing and Urban Development Secretary Marcia Fudge said one of her department’s objectives is to “ensure that clean transportation investments are made equitably and include communities and households that have been most harmed by environmental injustice.”

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Calif. Governor Proposes $6B in Climate Budget Cuts

California Gov. Gavin Newsom on Tuesday presented his fiscal year 2023/24 budget plan, which proposes eliminating $6 billion in funding for clean transportation and other climate initiatives because of a projected plunge in tax revenue caused mostly by the declining value of technology stocks.

The cuts would reduce last year’s $54 billion five-year commitment for climate initiatives to $48 billion, maintaining 89% of last year’s historic funding levels. Even reduced, the amount represents the world’s largest climate pledge at a “sub-national level,” Newsom said.

California could still see billions of dollars from the federal Inflation Reduction Act (IRA), “not only filling that bucket back up but substantially increasing the total investment,” and that’s the reason why climate and transportation were targeted for some of the largest cuts in this year’s budget, the governor said.

If financial conditions improve, the budget proposes a $3.9 billion “trigger” mechanism to restore much of the reduced spending in FY 2024/25, Newsom noted. A recession, however, could require even deeper budget cuts in the May revision of the budget plan, he said.

The governor’s budget summary details the financial conditions that made it necessary to reduce overall state spending next fiscal year.

“As 2023 begins, risks to the state’s economic and revenue outlook highlighted in the 2022 budget have been realized — continued high inflation, multiple federal reserve bank interest rate increases, and further stock market declines,” it says. “This last risk is particularly important to California, as market-based compensation — including stock options and bonus payments — greatly influences the incomes of high-income Californians. Combined with a progressive income tax structure, this can have an outsized effect, both good and bad, on state revenues.”

The state’s revenue outlook is “substantially different than … in the last two years” of record surpluses, it notes. The governor’s budget forecasts that state general-fund revenues will be $29.5 billion lower than in 2022/23.

“California now faces an estimated budget gap of $22.5 billion in the 2023-24 fiscal year,” it says.

Bond sales or withdrawals from the state’s budget reserves could offset further reductions, it says. In 2014 voters approved Proposition 2, requiring funding upgrades to the state’s Budget Stabilization Account, known as the rainy day fund. To make withdrawals, the governor must declare a state of emergency.

The account now holds $22.4 billion and constitutes the largest portion of the state’s $35.6 billion in total budget reserves, the budget proposal says.

Major cuts proposed in the governor’s budget include a $1.1 billion reduction in the state’s $10 billion, five-year commitment to funding for light-, medium- and heavy-duty zero-emission vehicles that was adopted in the past two fiscal years.

“The budget maintains $8.9 billion (89%) of ZEV investments with a focus on communities that are the most affected,” the budget summary says. “This includes targeted investments in disadvantaged and low-income communities by increasing access to the benefits of clean transportation and by continuing to decarbonize California’s transportation sector and improve public health.”

In addition, it proposes $2.5 billion in “reductions across various ZEV programs, which are partially offset by approximately $1.4 billion in fund shifts to cap-and-trade funds.

“Further, the administration will pursue additional federal funding to help offset the decrease in state funds,” it says. “For example, the federal IRA includes $100 billion to states for clean energy and climate investments. The administration will continue to aggressively pursue this federal funding.”

Some proposed program cuts include:

  • A reduction of $745 million in state general fund dollars for programs that “expand affordable and convenient ZEV infrastructure access in low-income neighborhoods.” The cuts would be “partially offset by a shift of $535 million to the Greenhouse Gas Reduction Fund. This maintains approximately $2.1 billion (91%) for programs,” according to the budget summary.
  • A $1.5 billion general fund reduction for programs that support drayage trucks, transit buses and school buses, “which is partially offset by a shift of $839 million to the Greenhouse Gas Reduction Fund. This maintains approximately $5.3 billion (89%)” of the original funding,” it says.
  • A $270 million cut to the California Public Utilities Commission’s residential solar and storage program. “This maintains approximately $630 million (70%) for solar and storage incentives for low-income utility customers,” the budget summary says.
  • A reduction of $50 million from the long-duration energy storage program at the California Energy Commission. “This maintains approximately $330 million (87%) for support of long duration energy storage projects that will help with the state’s energy transition,” it says.
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ERO Submits E-ISAC Outreach Clarifications to FERC

NERC last week submitted a compliance filing that sought to reassure FERC about the fairness of the Electricity Information Sharing and Analysis Center’s (E-ISAC) industry outreach efforts.

FERC ordered the filing in November, as part of its order accepting NERC’s 2023 Business Plan and Budget and those of the regional entities and the Western Interconnection Regional Advisory Board (RR22-4). (See FERC Orders Clarification in ERO Budget Filing.) The commission’s request was based on comments submitted by the Edison Electric Institute in response to the budget documents.

In its order, FERC said it needed “additional transparency into certain E-ISAC costs” because the $38 million budgeted for the E-ISAC represents more than 25% of NERC’s overall budget for 2023 and an increase of more than 15% from the previous year’s budget. Specifically, the commission raised questions about the E-ISAC’s Vendor Affiliate Program (VAP), a membership plan for suppliers of hardware and software products to the electricity sector.

Membership in VAP consists of three tiers; higher levels cost more but confer additional benefits, such as access to networking sessions at the GridSecCon security conference or participation in GridSecCon panels. The commission asked NERC to explain why it chose this structure for the program, how it prevents participating vendors from engaging in sales and other “business development opportunities,” and how it promotes collaboration and information sharing.

In its response, the ERO said that along with sharing threat indicators and other intelligence with the electricity sector, the E-ISAC aims to “take a holistic approach to cyber and physical security” by inviting vendors to participate in information sharing and providing information on the vendors to grid operators. Through the VAP, NERC can connect “security-focused professionals, service providers, and original equipment manufacturers [OEM] … together with E-ISAC members to share information and enhance security practices.”

NERC told the commission that participants in the VAP are screened before being admitted into the program. This screening is designed to keep out security risks. Criteria include being a known provider of cybersecurity products or services, an OEM, or a provider of other related services to the industry. Companies based outside the U.S. may be admitted, but only if they are not subject to U.S. sanctions, compliant with E-ISAC security procedures, or not presenting other, unspecified risk factors.

Approved vendors are given access to the E-ISAC Portal, but “are limited to certain discussion channels created specifically for the VAP.” The same confidentiality and use restrictions apply to vendors as to all other users.

Regarding the membership structure, NERC said the tiers are meant to “accommodate vendors of different sizes and resources.” However, the only benefit the ERO identified for higher-paying vendors is improved visibility; NERC emphasized that the program “does not promote any particular vendor, product, or service.” Participants in VAP must limit their discussions to “specifically agreed-upon topics … that are directly relevant to the security of the electricity industry.”

The E-ISAC said it reviews vendor presentations prior to their participation in any E-ISAC event and monitors posts on the portal to check for material that might serve a business purpose. While the E-ISAC acknowledged that some members and VAP participants have business relationships, it said these are exclusively outside the domain of the VAP and “incidental to the vendor’s participation.”

FERC also expressed worries about the relationship of the E-ISAC to its counterpart in the natural gas sector, asking NERC to show whether costs were shared fairly between the two organizations. NERC replied that its communications with the Downstream Natural Gas-ISAC had created “no new or incremental costs [and] no additional tools, FTEs, or other investment are required at this time.” NERC observed that organizations in the gas sector are already providing $60,000 per year to the E-ISAC to cover any costs associated with cross-sector engagement.