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July 28, 2022November 8, 2023

Study Finds Adding More Hydrogen to Natural Gas Raises Risks

A study commissioned by the California Public Utilities Commission has found that injecting more than small amounts of hydrogen into natural gas pipelines can increase leakage and degrade metal, raising questions about the safety of using existing gas infrastructure for decarbonization.

Advocates have suggested that blending higher amounts of renewably produced “green” hydrogen with natural gas could be a way to partially reduce the gas system’s carbon footprint while retaining the value of existing gas infrastructure. State lawmakers have expressed interest in the concept, with bills directing state energy agencies including the CPUC to study hydrogen’s potential.

As part of that effort, researchers at University of California, Riverside conducted a “Hydrogen Blending Impacts Study,” which the CPUC commissioned as part of its long-running rulemaking on renewable natural gas. Part four of that rulemaking, opened in November 2019, addresses standards for injection of renewable hydrogen into gas pipelines.

“This study provides additional insight into the possibilities and limits of California’s pipeline infrastructure as we explore options for supplying zero-carbon energy to hard-to-decarbonize applications,” CPUC Commissioner Clifford Rechtschaffen, the lead commissioner in the rulemaking, said in a July 21 news release accompanying the study’s release.

The 180-page study assessed operational and safety concerns related to injecting hydrogen into the existing natural gas pipelines at varied percentages.

The researchers found that hydrogen blends of up to 5% in the natural gas stream are relatively safe but that blending more hydrogen in gas pipelines can embrittle steel pipes and raise the risk of leaks.

“A primary concern of hydrogen blending with respect to pipeline durability and integrity arises from a hydrogen embrittlement phenomenon observed in many metals,” the study said. “Hydrogen embrittlement is defined as the process of strength and ductility reduction within a metal due to hydrogen induced damage, which makes it more brittle. Main mechanical properties of steel such as tensile strength, toughness and fatigue resistance are adversely affected by hydrogen embrittlement.”

Hydrogen blends above 5% could require modifications to gas appliances such as stoves and water heaters to avoid leaks and malfunctions, it said.

“This systemwide blending injection scenario becomes concerning as hydrogen blending approaches 5% by volume,” the study said. “As the percentage of hydrogen increases, end-use appliances may require modifications, vintage materials may experience increased susceptibility and legacy components and procedures may be at increased risk of hydrogen effects.”

Hydrogen blends of more than 20% carry a higher risk of permeating plastic pipes, increasing the risk of ignition outside the pipeline, the CPUC noted.

Plastics such as polyethylene “make up more than half of the pipe materials used in the natural gas distribution system,” the study said. Unlike steel, prior reports showed “no degradation [to plastics] by pure hydrogen … and little or no interaction between hydrogen gas and polyethylene.”

“The main concern with pipelines comprising of polyethylene is permeability to hydrogen, which may result in leakage of gaseous hydrogen,” it said.

About 65% of distribution pipelines are made of plastics and 35% are steel, it said.

Another concern identified by the study is that hydrogen has a lower energy content than methane and other natural-gas components, requiring more hydrogen-blended gas to produce the same amount of energy.

The study called for additional examination of hydrogen blending to ensure its safety, including demonstration projects under controlled, real world circumstances.

“As there are knowledge gaps in several areas, including those that cannot be addressed through modeling or laboratory scale experimental work, it is critical to conduct real world demonstration of hydrogen blending under safe and controlled conditions,” the study said.

The CPUC requested public comment on the study by Aug. 26.

“I look forward to party comments on hydrogen-methane blending and its role in decarbonization strategies,” Rechtschaffen said.

July 28, 2022June 14, 2023

Change to PJM Market Seller Offer Cap Falls Short

PJM’s proposal to change its market seller offer cap (MSOC) fell short of the two-thirds endorsement threshold Wednesday as load sector stakeholders expressed concern over its impact on capacity prices.

The proposal, which would ensure sellers are always able to represent the cost of their Capacity Performance (CP) risk when offering into the capacity auction, won only 60.4% support in a sector-weighted vote of the Markets and Reliability Committee following more than an hour of debate.

PJM proposed MSOC schedule (PJM) Content.jpg

PJM hoped to win stakeholder and FERC approval of the revised market seller offer cap (MSOC) in time for its next Base Residual Auction in December. | PJM

The rule change would set the MSOC at the greater of the CP quantifiable risk (CPQR) or net avoidable-cost rate (ACR) inclusive of CPQR.

PJM, which sponsored the proposal in response to requests from generators, said it would address circumstances in which a unit with a positive CPQR value has that cost offset by an otherwise negative net ACR, which could result in a $0 offer cap.

PJM had hoped to win stakeholder and FERC approval for the change effective with the 2024/25 capacity auction in December. After the vote, Adam Keech, PJM vice president of market services, said staff hadn’t had “real material discussions” on whether to recommend the Board of Managers file the proposal without stakeholder approval.

American Municipal Power’s Steve Lieberman said he was “extremely disappointed” with the way the issue was “shepherded” through the Resource Adequacy Senior Task Force, rejecting PJM’s characterization of it as a “narrow” change. (See “Stakeholders Wary of ‘Narrow’ Change to Market Seller Offer Cap,” PJM Markets and Reliability Committee Briefs: June 29, 2022.)

Lieberman said the proposal would be “a major change” to the Reliability Pricing Model and was proposed in response to the low prices in the last Base Residual Auction in June, when capacity prices dropped by one-third to almost one-half. (See PJM Capacity Prices Crater.)

Examples of market seller offer caps (MSOC) under current rules and under PJM’s proposal | PJM

He said AMP is willing to consider changes to the MSOC as part of a “holistic” review of capacity market rules.

PJM’s Pat Bruno said CPQR is defined in the tariff as part of ACR and must be “quantifiable and reasonably supported.”

Steve Lieberman, American Municipal Power | PJM

“It’s still supposed to reflect the market sellers’ evaluation of the risk,” he said.

Independent Market Monitor Joe Bowring said it is impossible to evaluate the impact of the CPQR change without understanding how PJM would interpret “reasonable support.”

“This is a very significant change to the concept of what the MSOC is,” he said. Removing a part of the ACR “simply is not logical and doesn’t make sense.

“There’s no issue that requires a short-term solution. We think this is a bad idea. It’s not narrow. It should be part of a broader package.”

Jeff Whitehead, of GT Power Group, said stakeholder concerns that the rule change would set a minimum capacity “floor” price would be addressed by PJM and IMM reviews of the generator filings.

“I don’t believe it does [create a floor. But] as long as it’s supported … it’s not inappropriate that a new floor would be created,” said Whitehead, who said he asked PJM to pursue the change.

“Unfortunately, a holistic approach went out the window with the MOPR,” he added, referring to FERC’s order effectively eliminating the minimum offer price rule for subsidized generation.

Jeff Whitehead, GT Power Group | © RTO Insider LLC

“This is a fair and simple reform, despite what the opponents are going to claim,” said Jason Barker, of Constellation. “People have said this is a response to the last auction. It’s not. This is a longstanding issue.”

Susan Bruce, representing the PJM Industrial Customer Coalition, said allowing market sellers to reflect their risks in their offers “is a concept that’s hard to say no to.”

But she said her group would oppose the change without more certainty over the CPQR definition. “We don’t know the size of the breadbox,” she said.

Carl Johnson, representing the PJM Public Power Coalition, said he could not recommend his members support the measure.

Greg Poulos, executive director of the Consumer Advocates of PJM States, said most of his members would not support the change because of the “piecemeal” nature of the proposal.

Erik Heinle, however, said the D.C.’s Office of the People’s Counsel would support the change, saying Whitehead and others had identified a “legitimate issue with the current construct.”

He noted that wind generators cleared 434 MW less in the last auction than the previous one, a drop of 25%. “We certainly recognize the impact of this rule change on intermittent resources that often have very low ACRs and very high CPQRs. That was a major part of our thinking on this issue,” he said.

Although he said more discussion is needed on the “parameters” of CPQR, he said his office is confident that the change wouldn’t undermine PJM and the IMM’s ability to prevent exercises of market power.

Bowring wasn’t so confident.

“There’s no good information on how high [the CPQR] could be or the impact on the clearing price without knowing PJM’s rules,” Bowring said. Expecting the IMM to prevent market power “cannot happen if the rules are bad.”

July 28, 2022November 15, 2023

Report: Maine Surpassed 10% by 2020 Emission Reduction Target

Decreased fossil fuel use helped Maine meet its 2020 greenhouse gas reduction target, according to a state Department of Environmental Protection report released Thursday.

The department’s analysis of the most up-to-date federal GHG emissions data through 2019 showed that Maine’s GHG emissions were 25% below 1990 levels, surpassing a reduction target of 10% below 1990 levels by Jan. 1, 2020.

Total estimated annual GHG emissions in Maine peaked in 2002 compared to 1990 levels and declined to below 1990 levels by 2009, according to the department’s Ninth Biennial Report on Progress Toward GHG Reduction Goals. Emissions increased slightly from 2013 to 2015, then continued to drop through 2019.

“A reduction in residual fuel oil consumption, 97% since 1990, is a large driver of the overall decline in GHG emissions,” the report said.

Included in the report are the state’s first CO₂ budget data, including details on sequestration by forests, fields and wetlands.

“It is essential for the creation and evaluation of emission reduction programs to take into account this more comprehensive view of carbon released and captured within Maines borders,” DEP Commissioner Melanie Loyzim said in a statement.

The department’s analysis of total GHG emission sources and sinks showed the state is 75% of the way to achieving its 2045 carbon neutrality target.

“Maine’s significant forest cover — approximately 89% — results in the state having a large capacity to store carbon, and in recent past, a high accumulation rate of forest carbon via tree growth, offsetting a high percentage of anthropogenic emissions,” the report said.

Forest biomass and soils in the state are sequestering -26.2 million metric tons of CO₂ (MMTCO₂) per year, while wetlands and urban biomass are sequestering carbon at -0.2 and -0.4 MMTCO₂ per year, respectively.

Although the department said there are “many uncertainties” associated with the CO₂ accounting methodologies used for the budget, it expects to continue to improve the budget, update data through 2021 for the next report and further research opportunities.

Sector Insights

While Maine’s industrial sector emissions were higher than transportation emissions from 1990 to 2009, they have steadily decreased, leaving transportation as the highest emitting sector. In 2019, the report said, the transportation sector produced 49% of all CO₂ emissions from fossil fuel combustion in the state, up from 42% in 1990. The sector also was responsible for 31% of Maine’s gross GHG emissions.

By comparison, the state’s electric power sector generated 9% of Maine’s gross GHG emissions in 2019, down 41% from 1990 levels.

For 2019, the report said, natural gas was the top contributor, at 72%, to fossil fuel-based CO₂ emissions in the electric power sector. And renewable resources, including hydropower, wood, wind, waste, solar and geothermal, provided 84% of the energy consumed by electricity generating facilities in 2019, up from 37% in 1990.

Maine’s industrial sector is the biggest contributor to emissions from the combustion of wood, and it was followed by the electric sector until the residential sector surpassed it in 2019, according to the report. In 2019, electric sector wood emissions were 13% lower than in 1990, while residential wood emissions increased 50% for the same period.

July 28, 2022October 30, 2023

HUD, DOE Aim to Boost Low-income Community Solar

The Biden administration on Wednesday announced a set of initiatives aimed at connecting the clean power of community solar projects to low-income families already enrolled in federal housing assistance programs, with the goal of cutting their utility bills by 10% to 50%.

First on the list were new guidelines from the Department of Housing and Urban Development that will allow families in “HUD-assisted rental housing” to subscribe to community solar projects that use virtual net metering to provide savings on the families’ utility bills. The guidelines ensure that those savings will not be included in the calculation of families’ household income or utility allowances, which could increase their housing costs.

Based on HUD guidelines recently rolled out in Illinois, New York and Washington, D.C., the first-ever national guidelines will set “the stage for 4.5 million families to reap the benefits of community solar,” according to a White House fact sheet.

“The combination of extreme heat and rising utility prices creates a perfect storm, and HUD-assisted families and communities are some of the most vulnerable,” Secretary Marcia L. Fudge said in a press release announcing the guidelines. “The steps announced today … will not only help families reduce utility costs, but also provide an opportunity for HUD-assisted residents to participate in the clean energy economy through local community solar programs.”

In a second initiative, the Energy and Health and Human Services departments will team up to develop an online platform to help households in the Low Income Home Energy Assistance Program (LIHEAP) and other low-income assistance programs sign up for community solar projects in their areas. Administered by HHS, LIHEAP helps low-income families with heating and cooling costs, as well as weatherization and energy-related home repairs.

DOE and HHS will collaborate with five states — Colorado, Illinois, New Jersey, New Mexico and New York — and D.C. to design and pilot the Community Solar Subscription Platform, according to a DOE press release.

The states were chosen because they already have programs supporting low-income community solar development, the release said. DOE is targeting bill savings of 20% in Illinois, New Jersey, New Mexico and New York, and 50% in Colorado and D.C.

“Community solar programs are essential to the expansion of renewable energy across the state of Illinois and the entire nation,” Illinois Gov. J. B. Pritzker said in the release. “By supporting low-income communities who want to participate in this program, we can increase energy efficiency in the long term and provide impactful access to cost-saving solar energy for the households … that need it most.”

“The implementation of community solar is critical to creating a future that promotes healthy, renewable and sustainable living,” said D.C. Mayor Muriel Bowser. “By working with property owners, especially of multifamily affordable homes, and local businesses, we can ensure our future is a clean and resilient one.”

DOE released a request for information for the platform, also on Wednesday, seeking input on questions such as which stakeholders should be included in developing the platform and how to “ensure all subscriptions protect customer privacy and provide adequate monthly savings.”

The department also announced $10 million in funding from the Infrastructure Investment and Jobs Act, for new workforce development programs “that bring together employers, training providers and labor unions to support pathways to the solar industry to recruit, train and retain an inclusive workforce.”

According to the 2021 National Solar Job Census, released Tuesday by the Interstate Renewable Energy Council, the industry is lagging on diversity. For example, women accounted for 29.6% of the solar workforce in 2021, compared to 47% economywide, and African Americans were 8.2% of the solar workforce, compared to 12.3% economywide.

Making Solar Accessible

Following President Joe Biden’s recent vows to use all executive powers at his disposal to fight climate change, Wednesday’s announcements were modest in scale and likely impact, but still strategic — framing clean energy as a key tool to cut energy bills for vulnerable, low-income communities in the midst of ongoing summer heatwaves. (See Biden: ‘I Will not Back Down’ on Climate Action.)

Heat.gov, a new website launched by the Commerce Department’s National Integrated Heat Health Information System, showed close to 48.5 million Americans under extreme heat warnings on Wednesday.

The U.S. has 3,200 MW of community solar projects spread across 39 states, though figures from the National Renewable Energy Laboratory show that 74% of the market is concentrated in Florida, Minnesota, New York and Massachusetts.

These projects have long been seen as a way to make solar accessible to low-income families and others who may live in rental housing, or any homeowner who cannot or does not wish to install rooftop panels. Consumers subscribe to a community project, often located in or near their city or town, and receive credits on their utility bills for a share of the power produced.

Credits are typically calculated by “virtual net metering,” that is, treating the subscribers as if they were putting the solar on the grid. D.C.’s model Solar for All program uses virtual net metering to provide subscribers to its community solar projects with savings of 50% on their utility bills.

On a typical utility bill, these credits would be listed separately from a consumer’s actual energy consumption. According to the HUD guidelines, in such cases the amount of the credits should not be included in the calculation of a family’s household income, used to determine their eligibility for federal housing assistance. In other words, low-income families will not be penalized for saving on their utility bills.

Reactions from solar industry advocates were mostly positive.

Solar Landscape, a community solar developer in New Jersey, guarantees at least 15% savings on utility bills for its subscribers, according to the company’s website. “The coming wave of clean energy is also affordable,” said Shaun Keegan, the company’s CEO. The new initiatives will “protect and empower underserved communities — those most hurt by climate change and pollution from fossil fuels.”

Jeff Cramer, CEO of the Coalition for Community Solar Access, an industry trade group, praised the White House for doubling down on its support for community solar. “The new executive actions highlight just how versatile community solar policy can be to help states achieve their specific energy goals,” he said.

Similarly, Sean Gallagher, vice president of state and regulatory affairs at the Solar Energy Industries Association, commended DOE for taking targeted action and creating a program that addresses one of the top challenges for obtaining community solar customers.”

But Gallagher said that some low- and moderate-income families might not be able to benefit from the initiatives due to “the burdensome and lengthy signup process to qualify as an LMI household,” and recommended loosening eligibility requirements.

July 28, 2022

Schumer, Manchin Reach Climate Deal

Senate Majority Leader Chuck Schumer (D-N.Y.) and Sen. Joe Manchin (D-W.Va.) announced Wednesday they had reached a deal on a climate package that Democrats will seek to enact next week on a party-line reconciliation vote.

President Biden signed on immediately, saying the $670 billion Inflation Reduction Act, as dubbed by Manchin, would provide tax credits to promote clean energy in addition to reducing the costs of health insurance and prescription drugs.

“This afternoon, I spoke with Sens. Schumer and Manchin and offered my support for the agreement they have reached on a bill to fight inflation and lower costs for American families,” Biden said in a statement. “We will improve our energy security and tackle the climate crisis — by providing tax credits and investments for energy projects. This will create thousands of new jobs and help lower energy costs in the future.”

“After many months of negotiations, we have finalized legislative text that will invest approximately $300 billion in deficit reduction and $369.75 billion in energy security and climate change programs over the next 10 years,” Schumer and Manchin said in a joint statement. “The investments will be fully paid for by closing tax loopholes on wealthy individuals and corporations.”

It is expected to be added to legislation to lower prescription drug prices and extend expiring health care subsidies. Senate Democrats hope to vote on the deal next week under budget reconciliation rules that would sidestep a Republican filibuster.

The announcement was a boost to weary Democrats, coming weeks after Manchin seemed to kill the last chance for climate legislation due to his alarm over inflation. Although it is far from the over $3 trillion in spending Democrats had sought earlier, its passage would give the party’s candidates an accomplishment as they head into the midterm elections in November. (See Biden: ‘I Will not Back Down’ on Climate Action.)

Manchin said the plan “will advance a realistic energy and climate policy that lowers prices today and strategically invests in the long game.”

“As the superpower of the world, it is vital we not undermine our superpower status by removing dependable and affordable fossil fuel energy before new technologies are ready to reliably carry the load,” he said in a statement. “Rather than risking more inflation with trillions in new spending, this bill will cut the inflation taxes Americans are paying, lower the cost of health insurance and prescription drugs, and ensure our country invests in the energy security and climate change solutions we need to remain a global superpower through innovation rather than elimination.”

The bill “ensures that the market will take the lead, rather than aspirational political agendas or unrealistic goals, in the energy transition that has been ongoing in our country,” Manchin continued. And it “invests in the technologies needed for all fuel types — from hydrogen, nuclear, renewables, fossil fuels and energy storage — to be produced and used in the cleanest way possible. It is truly all of the above, which means this bill does not arbitrarily shut off our abundant fossil fuels. It invests heavily in technologies to help us reduce our domestic methane and carbon emissions and also helps decarbonize around the world as we displace dirtier products.”

Reaction

“The entire clean energy industry just breathed an enormous sigh of relief,” said Heather Zichal, CEO of the American Clean Power Association. “This is an 11th-hour reprieve for climate action and clean energy jobs.

“Congress now is inches away from passing a $369.75 billion investment in energy security and climate change programs over the next 10 years. … Passing this bill sends a message to the world that America is leading on climate and sends a message at home that we will create more great jobs for Americans in this industry.”

Abigail Ross Hopper, CEO of the Solar Energy Industries Association, hailed the deal as “a major opportunity to relieve the inflation pinch on families and tackle the climate crisis” and called on Congress to “seal the deal and pass this legislation.”

“With long-term incentives for clean energy deployment and manufacturing, the solar and storage industry is ready to create hundreds of thousands of new jobs and get to work building out the next era of American energy leadership,” Hopper said.

Gregory Wetstone, CEO of the American Council on Renewable Energy, said he is “hopeful that the provisions in the budget reconciliation deal … will spur critical investments in renewable power, energy storage and advanced grid technologies.”

“Legislation that finally moves the country beyond years of on-again, off-again renewable tax credits and establishes a long-term, full-value clean energy tax platform will help provide renewable companies with the stability they need to do business,” Wetstone said.

July 27, 2022June 14, 2023

Load Growth Boosts AEP Earnings

Boosted by load growth that has returned to pre-pandemic levels, American Electric Power (NASDAQ:AEP) executives told financial analysts Wednesday that the company is building on the momentum it experienced last year.

Nick Akins | © RTO Insider LLC

Leave it to AEP CEO Nick Akins, a drummer and huge rock fan in his spare time, to explain the company’s good place in a different way.

“What’s going on today at AEP is a perfect blend of the execution of Bachman-Turner Overdrive’s ‘Takin’ Care Of Business’ with the edge of Prince’s ‘Let’s Go Crazy.’ In a good sense, of course,” he said during the company’s second-quarter earnings call.

CFO Julie Sloat said AEP’s normalized sales through June were 2% above pre-pandemic levels. Residential sales were up 1.2% during the quarter and up 1% year-to-date, compared to 2021. That helped drive a 14-cent increase in the earnings per share for the company’s vertically integrated utilities.

“Last year’s strong growth numbers were expected considering it was a recovery year from the pandemic shutdowns,” Sloat said. “This year’s growth is perhaps even more impressive considering the growth as compared to a strong recovery year.”

Akins agreed with an analyst who remarked that the Columbus, Ohio-based company’s load growth provides a “very strong tailwind” for this year.

“It’s always good to be ahead a little bit any time you go in the latter part of the year because summer is always good,” Akins said. “Our load guy is pretty optimistic. And if you knew our load guy, you know it takes a long way for him to get there. But we feel really good about the position that we have.”

AEP reported quarterly earnings of $525 million ($1.02/share), down slightly from earnings of $578 million ($1.16/share) a year ago during the same quarter.

Operating earnings, which exclude special items, came in at $618 million ($1.20/share). That beat Zacks Investment Research analysts’ average estimate of $1.18/share. AEP reaffirmed its 2022 operating earnings guidance range of $4.87 to $5.07/share and 6 to 7% long-term growth rate.

The excluded items included charges related to the expected sale of AEP’s Kentucky operations and an equity investment’s write-off in the Flat Ridge II joint venture wind facility in Kansas. The company is currently discussing the possible sale of its 235-MW ownership.

Kentucky regulators in May signed off on the $2.8 billion transaction with Liberty Utilities, but the deal still awaits approval from FERC and West Virginia regulators. Akins said both states have approved the operating agreement for the 1.55-GW Mitchell Power Plant in West Virginia but with different formats and some divergent post-2028 plant provisions. (See PSC OKs Sale of AEP’s Kentucky Operations to Liberty Utilities.)

After opening at $94.83 on Wednesday, a $1.59 drop from the previous close, AEP’s share price gained $1.46 and finished the day at $96.29. It was trading at $94.99 following the market’s close.

July 27, 2022

Funds Going Quickly in Calif. Clean Off-road Voucher Program

A California program to encourage the purchase of zero-emission off-road equipment has handed out more than $100 million in incentives since reopening this month.

The Clean Off-Road Equipment Voucher Incentive Project (CORE) opened on July 18 with $125 million in funding. As of Wednesday, $16.6 million remained.

CORE provides vouchers of up to $500,000 for the purchase of zero-emission equipment used in agriculture, airport, railyard, port, construction and marine operations. Types of equipment funded include terminal tractors, large forklifts, airport ground-support equipment and railcar movers.

CORE is a program of the California Air Resources Board (CARB), which uses proceeds from cap-and-trade auctions to fund the incentives. CALSTART, a national clean transportation nonprofit, administers CORE.

While off-road equipment makes up only a small percentage of vehicles in California, the equipment releases significant amounts of greenhouse gases, CARB said.

“CORE is specifically designed to assist industry sectors that currently use off-road equipment and can help clean up the communities hardest hit by air pollution,” CARB Deputy Executive Officer Craig Segall said in a statement.

CALSTART Deputy Director Niki Okuk said CORE increases awareness and adoption of zero-emission equipment in a range of industries while encouraging manufacturers to bring more equipment to market.

The program has been streamlined based on participant feedback, Okuk added. Buyers of zero-emission equipment can use the vouchers at the point of sale, and they’re not required to retire existing internal-combustion equipment.

“We are anticipating significant interest in this second round,” Okuk said in a statement this month.

CORE opened its first funding round in February 2020 with $44.6 million. That round closed in August of that year after issuing more than 460 vouchers.

The program, which was initially only for freight equipment, was expanded this year to include commercial harbor craft and agriculture and construction equipment.

CORE is initially offering up to 20% of its funding, or $25 million, to each of nine categories of equipment. Once a category reaches the $25 million cap, additional voucher requests are placed on a waiting list. CARB will re-evaluate the per-category cap after six months.

As of Wednesday, voucher requests for terminal tractors had reached $67.2 million, exceeding the $25 million per-category cap. Terminal tractors, which are used to move cargo containers or semi trailers over short distances, were also the most requested equipment type during CORE’s first funding round.

Other categories that exceeded the cap as of Wednesday were transport refrigeration units with $28.5 million in vouchers requested and construction equipment with $29.8 million requested.

If the caps are lifted, priority will go to requests from small businesses or projects in disadvantaged communities.

A funding map on CORE’s website gives more details on vouchers that have been issued. For example, five vouchers totaling $1.1 million went to Los Angeles County for railcar movers. In San Bernardino County, 70 vouchers totaling $11.9 million were issued for zero-emission terminal tractors.

In another new development for CORE, the program plans to allocate $30 million in incentives starting this fall for zero-emission equipment used by professional landscaping services. The equipment will include lawn mowers, leaf blowers, string trimmers and chainsaws. Funds will go to small businesses and sole proprietors.

July 27, 2022November 30, 2023

Rhode Island Experts Seek Policy Shifts for Secure, Low-carbon Food System

The best opportunities for Rhode Island to reduce state food system emissions will require long-term planning and systemwide change, Diane Lynch, board president at the Rhode Island Food Policy Council (FPC), told state climate officials Wednesday.

“If we are going to achieve our mandated reductions set forth in the [2021] Act on Climate, it’s going to be necessary to engage the land sector and the food system as a whole in achieving these reductions,” Lynch said during a webinar hosted by the Rhode Island Executive Climate Change Coordinating Council (EC4).

Lynch presented recommendations to the EC4 that the FPC believes should be considered in an update to the state’s 2016 Greenhouse Gas Emissions Reduction Plan due in December.

Among the food council’s top priorities is the need for a comprehensive long-term strategy to reduce food waste and organic material in landfills.

Rhode Island already has a variety of independent operations for food waste handling, such as small- and large-scale composting, leftover food gleaning and diversion, and food recycling in schools. Lynch said all those activities need to come together into one knowledge base.

“The value of taking a comprehensive approach to this issue is that it will help policymakers and stakeholders evaluate the wide range of options that are already being deployed to increase food waste diversion and identify where there are regulatory or legislative reforms that are needed and where there are activities that merit state incentives or investment,” she said.

Strategic food waste plan development should be the responsibility of the Department of Environmental Management, which already oversees waste management, according to Lynch. That responsibility, she said, might require working with outside partners or increasing department staff.

The FPC also wants to see the state increase budget allocations for farmland conservation and soil-regenerative agricultural practices.

Rhode Island’s Agricultural Land Preservation Commission has worked for many years to conserve farmland in cooperation with farm owners, with 55 farms currently approved for conservation, according to Lynch. Despite the interest from landowners in the program, she said that this year, the state did not earmark any green bond investment for farmland protection for the first time in many years.

“The message in this year’s budgeting process was clear: The importance of farmland preservation for its climate and other benefits needs to be better understood by our state leadership,” she said.

Without conservation support from the state, Rhode Island is in danger of losing farmland to development. The state lost an estimated 3,600 acres of farmland to urban development or residential land use from 2001 to 2016, Chelsea Gazillo, New England policy manager at American Farmland Trust, said during the webinar. If that trend is not reversed, AFT expects 8,100 acres, or the equivalent of 200 farms, in Rhode Island to transition to urban use between 2016 and 2040.

Support for regenerative agriculture on existing and conserved farmland is equally important in establishing a low-carbon food system for the state, Lynch said. State incentives can help in that effort, but Lynch said another important pathway will be lobbying at the federal level for increased funding for regenerative practices, especially on small farms, in the 2023 Farm Bill.

Regenerative agriculture can “shift us from agriculture being one of the No. 1 emitters of greenhouse gases to perhaps being a very powerful actor in sequestration and carbon storage,” Dawn King, senior lecturer at Brown University, said during the webinar.

The practice of regenerative agriculture is about soil health, King said. It includes maximizing crop diversity, minimizing soil disturbance and maintaining cover crops.

“That healthy soil keeps the microorganisms happy that are storing carbon,” King said.

Additional recommendations from the FPC for building a low-carbon food system in Rhode Island include:

- - adding emissions from the entire state food system to the state’s GHG emissions inventory;
  - quantifying the carbon sequestration value of Rhode Island’s agricultural lands;
  - measuring the impacts for food imported into the state from outside of New England;
  - funding research for improving the environmental sustainability of food production, processing, transportation and distribution activities in the state; and
  - developing a standalone climate strategy for nature-based climate solutions that include bay and coastal waters, wetlands, and the natural and working lands in the state.

July 27, 2022

New York Issues 3rd and Largest OSW Solicitation

New York officials on Wednesday issued the state’s third and largest-ever offshore wind energy solicitation, seeking proposals for up to 4.8 GW in new projects on federal leases in the New York Bight.

The state has already contracted 4.3 GW in OSW projects toward meeting the 2035 goal of 9 GW set in the Climate Leadership and Community Protection Act (CLCPA).

“New York is proud to continue leading the way in offshore wind development while establishing a blueprint for building a locally-based green economy,” Gov. Kathy Hochul said in a statement. “Today we are putting words into action and making it clear that New York state is the national hub of the offshore wind industry.”

The New York State Energy Research and Development Authority (NYSERDA) is seeking proposals by Dec. 22 to award OSW renewable energy certificates (ORECs) next spring of between 2-4.8 GW.

In its call, NYSERDA cited the CLCPA and its final supplemental generic environmental impact statement (SGEIS) issued in September 2020, which concluded that, since the lease areas comprise only 3% of the Bight, effects on fishing and marine life would be minimal.

The solicitation includes the first phase of $500 million planned to be invested in ports, manufacturing and supply chain infrastructure; it introduces a first-of-its-kind “meshed ready” offshore transmission configuration, as required by the Public Service Commission in January. (See NYPSC Mandates Meshed Offshore Tx Grids.)

Officials will award evaluation points for proposals that repurpose downstate fossil-based generation infrastructure or use energy storage to enhance future system reliability.

In accord with the New York Buy American Act, the solicitation sets a minimum U.S. iron and steel purchase requirement for all projects awarded and requires developers to provide opportunities for U.S.-based steel suppliers to participate in the growing OSW industry.

NYSERDA will hold a webinar on August 23 to address eligibility criteria, submission requirements, the proposal evaluation process, contract commitments, and the post-award process and agreement.

July 27, 2022

FERC Allows MISO to Exclude Tx Projects from Competition

FERC said Tuesday MISO can exclude certain transmission projects from competitive bidding eligibility, characterizing the change as a “reasonable adjustment to the MISO competitive transmission process.”

The commission said it was appropriate for MISO to assign projects to incumbent transmission owners when at least 80% of their total cost are upgrades to a TO’s existing facilities (ER22-1955).

The ruling will apply to associated upgrades in the four tranches of MISO’s long-range transmission plan (LRTP). MISO’s Board of Directors approved the first LRTP portfolio on Monday, the same day the order was considered effective. (See MISO Board Approves $10B in Long-range Tx Projects.)

MISO in May filed a request to change its competitive transmission process by skipping over competitive bidding’s “short segments and conductor only” work in its larger grid-expansion efforts.

FERC said the grid operator’s proposal is similar to that already approved for SPP. It said the exclusion will allow MISO to “better balance the expansion of competitive transmission opportunities with administrative efficiency, as well as to reduce uncertainty about which transmission projects are eligible for consideration pursuant to that process.”

MISO’s planning team has said some upgrade-heavy, smaller projects will be necessary to accommodate the long-range projects and are not suited for competition.

Some MISO stakeholders protested at FERC, saying the RTO should separate a project’s upgrade work from new transmission facilities, regardless of cost.

A MISO consumer alliance comprised of the Coalition of MISO Transmission Customers, the Resale Power Group of Iowa, the Wisconsin Industrial Energy Group, the Iowa Office of Consumer Advocate and the Citizens Utility Board of Wisconsin said MISO failed to describe the impact the proposal would have on the LRTP portfolio, the process it plans to use to determine exempted upgrades and the associated cost consequences to consumers by precluding competition. The alliance pointed out that ratepayers tend to save about 15 to 20% in transmission costs when projects are competitively bid.

FERC held that a project upgrading an existing transmission facility doesn’t result in a new transmission facility.

Stakeholders earlier this year expressed displeasure that MISO filed for tariff changes to its competitive transmission rules without first consulting the stakeholder community. However, the commission accepted staff’s explanation that they discovered potential smaller, associated projects late in its LRTP development and filed quickly so as not to hold up the portfolio.

The grid operator’s TOs said the revision is necessary to “enable the efficient, timely processing of needed LRTP projects that MISO has identified and to avoid delays and other inefficiencies that would otherwise result.”