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November 5, 2024

VC Firm Sees Key Role for Tech in Clean Food Systems

Investor interest is growing in the U.S. for climate-smart agriculture (CSA) systems that reduce food loss and the emissions associated with it, according to Hans Tung, managing partner at GGV Capital.

CSA enables companies to predict supply and demand so they can avoid food waste, Tung said Wednesday during a Center for Strategic and International Studies panel on food technology.

The U.S. Department of Agriculture estimates that up to 40% of the U.S. food supply is wasted, and EPA estimates that the annual greenhouse gas emissions from that waste is equal to the annual emissions of 42 coal-fired power plants.

GGV has a history of investing in climate-tech, with its smart food systems investments totaling $4 billion last year.

U.S. food-tech companies saw $16.6 billion in total funding in 2021, according to Tung. “There’s no question there will be more investments coming to this area, because there are a lot more teams that are doing good things in this space.”

In 2017, GGV invested in Bowery Farming, a company that Tung said “is extremely impressive at taking vertical farming technologies and making them commercially viable.”

Tung described Bowery as a “unicorn,” a term used in VC investing for a startup valued at more than $1 billion. The New York-based company secured $300 million in funding in May, bringing its total value to $2.3 billion, according to a press statement. The challenge, Tung said, is to make Bowery’s business model commercially viable in more places.

Bowery is the largest indoor vertical farming company in the U.S., according to Chief Marketing Officer Katie Seawell. It has two operating farms in New Jersey and one in Maryland.

“We are taking non-arable land and turning it into highly productive farmable land,” she said during the panel discussion. “We are typically refurbishing warehouses, stacking crops floor to ceiling; and we use LED light to mimic the spectrum of the sun.”

Technology is at the core of the company’s growing process, which integrates sensors, machine vision, robotics and data into operations. The company’s proprietary farming design “constantly” monitors crop needs to “unlock quality, yield and flavor in a way that … is next-level in terms of produce,” Seawell said.

Bowery’s business model focuses on building local, vertical farms that will network and scale, which Seawell says reduces food-miles and, therefore, transportation emissions. In addition, the company’s operations help address food waste by reducing the time from harvest to store to between 48 and 72 hours, which extends produce shelf life for retailers and customers, she said.

The company’s ability to use data to map demand in the marketplace will become “more precise,” Seawell said. Retailers will no longer “have a glut of produce or food,” which “reduces food waste and, ultimately, carbon emissions.”

Global Initiative

The agricultural sector needs “more tools” to lower the cost of addressing climate change, according to David Livingston, senior adviser in the Office of the U.S. Special Presidential Envoy for Climate.

“The only way to do that is by investing more in innovation,” he said during the panel discussion.

Livingston is part of the team behind the Agriculture Innovation Mission for Climate (AIM4C) officially launched in November by the U.S. and the United Arab Emirates during the U.N. Climate Change Conference in Glasgow, Scotland (COP26). The initiative launched with 33 countries and 48 nongovernmental partners to mobilize a $4 billion investment in global agriculture innovation.

AIM4C recognizes “that the agriculture sector has been neglected in climate conversations,” Livingston said. “If we’re successful with this [five-year] initiative, when you think about climate-tech, you’ll think not just about solar panels, wind farms and Teslas, but you will also think about the food-tech and ag-tech of the future.”

The initiative aims to drive more government spending to food-tech.

During AIM4C’s first ministerial meeting last month, its partners committed to doubling the original funding commitment to $8 billion before the next climate change conference (COP27) in Sharm el-Sheikh, Egypt, this fall. The initiative also announced new focus areas for public-private partnership that include methane, small farm solutions, emerging technologies and nature-based solutions.

Mass. Net-zero Building Code Proposal Faces Barrage of Criticism

Massachusetts Gov. Charlie Baker’s administration is facing widespread criticism over its proposed net-zero building energy code, with frustrated state representatives, town officials and environmental advocates saying that it doesn’t go far enough.

Proposed updates to the current “stretch” energy code and a new specialized net-zero opt-in option that, along with the states’ base building code, would make up the options for municipalities to adopt once they’re in place, were required by the climate law passed in 2021.

“What we are proposing today would have a significant impact on both our greenhouse gas emissions as well as the cost for residents in these buildings,” said Patrick Woodcock, commissioner of the Department of Energy Resources (DOER), in announcing the straw proposal in February. But the administration’s plan has been criticized by Democrats in the state legislature. (See Mass. Legislators Call for Fossil Fuel Ban in Net-zero Building Code.)

And as DOER held a series of public hearings over the last few weeks, local elected officials piled on, too.

Central to the criticism is that the proposed specialized opt-in code, designed to be the most aggressive option municipalities can adopt, does not allow cities or towns to mandate that all new construction be fossil-fuel free.

Instead, it would require that new buildings that still use fossil fuels be “prewired” for electrification and have rooftop solar when feasible.

The opt-in code should “allow municipalities like Cambridge and Lexington and others that are ready to do so to require fossil-fuel free, all-electric net-zero buildings,” said Quinton Zondervan, a member of the Cambridge City Council.

“We’re not asking the state to impose that requirement on municipalities,” Zondervan said. “We’re asking simply for the permission to require it… in our own municipalities, using our own political processes to make those decisions and to move forward in the way we think is necessary to safeguard the climate and our future.”

Stretchcode (MA DOER) Content.jpgThe three types of building energy codes that municipalities could adopt under Massachusetts’ new proposal. | MA DOER

A commonly cited document at the hearings was the latest U.N. Intergovernmental Panel on Climate Change report, the most urgent iteration of the series yet, which calls for immediate and ambitious action to combat climate change.

In the face of the report’s urgency, critics see the Baker administration’s proposal as a half measure.

“What I’m seeing so far in the straw proposal is really weak right now, and we can’t wait for incremental, little by little movement to get there, said Alanna Nelson, an elected member of the town planning board in Marian, Mass. “We’ve been doing that for the past 10 years, but we need to move faster.”

Most of the feedback DOER received at the hearings was critical.

Even Michael Ossing, a Marlborough city councilor who said he supports the gradual, “piecemeal” approach taken by the Baker administration, acknowledged that there should be a way for municipalities to move faster.

He asked DOER to consider adding a “no new fossil-fuel energy” option to the code for communities to experiment with on a trial basis.

Five towns in Massachusetts — Acton, Arlington, Brookline, Concord and Lexington — have filed home rule petitions asking to prohibit gas and oil hookups in new buildings.

“While I ultimately think this is the end goal, the immediacy of it is what’s troubling to me,” Ossing said. “Having towns that want to participate … and be a trial balloon for lessons learned is something I think would be a fair approach and something I hope DOER would consider.”

Another of the major criticisms of the new code proposal is that it doesn’t include new requirements for renovations or additions.

“Having a renovation that has base and minimum energy code requirements put to it really just punts the energy consumption of that building for another 10 years,” said Chris Larkum, who runs a residential energy consulting company in Dartmouth, Mass. “It feels counterproductive for the intention of this code.”

The public comment process put on by the state was not immune to the frustration.

“I’m at wits end with the state, and I’m very upset about this process. And I’m upset that there aren’t more people here able to speak about this,” said Jeanne Cahill, an environmental scientist from Northboro.

DOER recently extended the deadline for written public comment to Friday, March 18.

The department will publish full code language later this spring and hold more hearings this summer.

Lawmakers Pass Wash. Buildings Emissions Bill

The Washington Senate on Tuesday voted 28-21 along partisan lines to approve a bill designed to trim the carbon footprints of roughly 50,000 buildings in the state.

The amended Senate Bill 5722, introduced by Sen. Joe Nguyen (D), passed the House last Thursday along mostly partisan lines. It now goes to Gov. Jay Inslee for his signature. 

Nguyen’s bill calls for the state’s Department of Commerce to develop and implement standards for reducing carbon emissions from “Tier 2” buildings by Dec. 31, 2030. Tier 2 buildings include multifamily residential, non-residential, dormitory, hotel and motel areas ranging from 20,000 to 50,000 square feet. A 2019 law already addresses the carbon footprints of “Tier 1” buildings greater than 50,000 square feet, which number about 10,000 in the state.

Under SB 5722, the Commerce Department must draft standards for Tier 1 structures by Dec. 1, 2023, and inform affected building owners of new requirements by July 1, 2025. Building owners will be required to submit their compliance plans to the agency by July 1, 2027; every five years thereafter they must file updated reports detailing relevant energy management plans, operations and maintenance plans, and energy use analysis.

Building owners who fail to submit documentation of their compliance will face penalties of 30 cents per square foot, with some exceptions made for financial hardship. The bill also provides for establishment of a program to provide early adopters with base incentive payments of 85 cents/square foot — excluding parking and unconditioned spaces.

Owners complying with the requirements after 2030 will be eligible for incentives of 30 cents/square foot, to be administered by participating gas and electric utilities.

Republican opponents of SB 5722 did not say Tuesday why they voted against the bill.

However, Republicans and some business interests have previously voiced concerns about rent control measures being required for building owners to be eligible for the incentives. The final version of the bill eliminated that requirement and allows the Commerce Department to establish “enhanced” incentives for multifamily building owners “willing to commit to antidisplacement provisions.”

The Commerce Department will fine-tune the standards and submit a report to the legislature in 2029.

Buildings account for 27% of Washington’s carbon emissions, the second-largest emitter behind transportation at 45%. In 2018, Washington’s carbon emissions totaled 99.57 million metric tons (MMT). A 2008 law set emission goals of 50 MMT by 2030, 27 MMT by 2040 and 5 MMT by 2050.

Robert Mullin contributed to this article.

House Committee Debates EVs as Response to Russia

A congressional hearing on building out a domestic supply chain for electric vehicles turned into a battleground Tuesday as Democrats and Republicans debated sharply different strategies for responding to the Russian invasion of Ukraine and the dizzying increases in gas prices Americans are facing at the pump as a result.

As President Biden announced a ban on the import of Russian oil — a move both parties support — Democrats on the House Energy and Commerce Subcommittee on Energy saw the crisis as yet another reason to move the nation toward clean energy, while Republicans wanted to double down on oil and gas production. Average gas prices across the U.S. stand at $4.25/gallon, according to AAA.

“This crisis is a stark reminder: To protect our economy over the long term, we need to become energy independent,” Biden said in his speech on the import ban. “Loosening environmental regulations or pulling back clean energy investment will not lower energy prices for families, but transforming our economy to run on electric vehicles powered by clean energy, with tax credits to help American families winterize their homes and use less energy, that will help.”

Speaking at the subcommittee hearing, Rep. Frank Pallone (D-N.J.), chair of the full committee, echoed the president, saying, “The lesson from Russia’s invasion of Ukraine is not that we need to drill more. America is already the largest oil and natural gas producer in the world, and that has not protected us from global oil shocks. … EV investments will not lower prices a ton for all consumers today, but neither will Republican efforts to force open more public lands to drilling.”

But Republicans at the hearing countered that talking about EVs amid the current crisis was irrelevant and called on Biden to quickly boost domestic oil and gas production by lifting restrictions on permitting for pipelines and for drilling on federal land. “It is time we stand up to [Russian] aggression and help our allies in Europe fight back by flooding the global market with affordable and reliable American energy,” said Rep. Fred Upton (R-Mich.), the subcommittee’s ranking member.

Committee Ranking Member Cathy McMorris Rodgers (R-Wash.) called Democrats’ support for the U.S. EV market a “command-and-control approach … central to a radical agenda to dismantle America’s tremendous energy systems,” which would ultimately play into Russian President Vladimir Putin’s hands. “We must come together and say ‘no’ to Putin … and say ‘yes’ to flipping the switch on domestic production of oil and cleaner American natural gas.”

Witnesses at the hearing also presented opposing views on the expansion of EVs and charging infrastructure.

Thomas Pyle, president of the Institute for Energy Research, said he supports energy freedom and the right of Americans to choose EVs but opposes government mandates on energy technologies and fuels. Pyle pointed to EPA’s recent update of fuel efficiency standards for light-duty vehicles to 40 mpg by 2026 as “a de facto electric vehicle mandate. To meet the standard, about 17% of vehicles sold by model year 2026 will have to be electric,” he said. (See EPA Rules Will Slash Vehicle Emissions, Rev up EV Market by 2026.)

He also argued that the U.S. should learn from Europe’s “rushing to green,” which had left it overly dependent on Russian oil.

“This invasion was a huge wake-up call,” Pyle said. “It took, unfortunately, this for Europe to recognize that they were moving too fast; they weren’t investing in diversification of their supplies.”

‘Massive Customer Demand’

Industry speakers, however, maintained that vehicle electrification is increasingly market- and customer-driven.

Bob Holycross, vice president for sustainability, environment and safety engineering at Ford Motor Co., said his company’s $50 billion investment in EVs over the next five years is not about “rushing to green. These are products that customers are demanding, and we need to provide that bridge for them to help with the access and affordability.”

The company recently announced it was creating distinct units for its EV and internal combustion engine businesses. In response to high demand for the F-150 Lightning, the electric version of the company’s popular pickup, Ford is doubling production of the truck at its plant in Dearborn, Mich., he said. “Massive customer demand … validates that this is the right direction to move.”

The investments by major companies like Ford and the $7.5 billion for a nationwide EV charging network in the Infrastructure Investment and Jobs Act are providing momentum for the domestic supply chain, according to Natalie King, CEO of Dunamis Energy Partners of Detroit.

Branching out from her company’s core energy efficiency contracting business, King has started an EV charger manufacturing subsidiary, Dunamis Discharge, which she described as “probably the first African-American-[owned] electric vehicle manufacturer in this country.”

The company will be producing Level 2 chargers that meet federal “Buy America” standards at its plant in Detroit beginning this summer, King said, with DC fast-chargers to follow in early 2023. She expects to create 150 jobs at the plant with “workforce development efforts [focused] on underrepresented, economically disadvantaged Detroit communities.”

In response to a question from Pallone, King also said that domestic manufacturing of EV charging hardware and software will help to ensure to system cybersecurity.

With American-made projects, “we do have the ability to secure … our network software,” King said. “If we have the control over how we create, how we engineer and how we design and how we maintain our network software through our EV infrastructure, then we now have the ability to control cyberattacks [and] hacking from outside influences, like a dominating China,” she said.

State and Regional Initiatives

State policies are also driving EV adoption and the buildout of charging infrastructure, Cassandra Powers, senior managing director at the National Association of State Energy Officials, said as she reeled off a long list of state and regional initiatives.

A Southeast Regional Electric Vehicle Information Exchange is bringing together Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina and Tennessee, as well as Puerto Rico and the Virgin Islands “to support  infrastructure planning, policy development and program implementation, with a focus on rural and underserved areas,” Powers said. Tennessee is also working on putting 50 DC fast-chargers on highways across the state, while Florida is also “prioritizing DC fast-charger investments along key corridors and also among evacuation routes in underserved areas,” she said.

Powers said a holistic approach is needed to ensure EV chargers are sited across urban, suburban and rural communities, as well as disadvantaged neighborhoods. “There’s also a need to coordinate impending infrastructure buildout with enhanced transmission, distribution and generation planning,” she said.

California Faces Third Straight Drought Year

California should expect a third year of drought after two nearly rainless winter months, the state Department of Water Resources (DWR) said following its latest survey of Sierra Nevada snowpack.

Low reservoir levels will limit hydropower generation this summer, and extremely dry conditions could worsen wildfires, which burned close to 7 million acres in the past two fire seasons combined.

“With only one month left in California’s wet season and no major storms in the forecast, Californians should plan for a third year of drought conditions,” DWR Director Karla Nemeth said in a statement last week. “A significantly below-average snowpack combined with already low reservoir levels make it critical that all Californians step up and conserve water every day to help the state meet the challenges of severe drought.”

The third snow survey of the season — conducted at Phillips Station, an alpine meadow near Lake Tahoe — showed snowpack there was 68% of average for March 1. Statewide, the snowpack was 63% of average for the date, the department said.

Heavy rains throughout the state in December had raised hopes of avoiding a third consecutive dry year. The snowpack on Jan. 1 at Phillips Station was 202% of average, and statewide snowpack was 154% of average. But an absence of new precipitation combined with early season snowmelt made those figures plumet.

“As the world continues to warm, precipitation is pushing toward extremes,” Jeremy Hill, manager of DWR’s Hydrology and Flood Operations Branch, said in the statement. “Even when we see large storms producing a lot of snow early in the season, all it takes is a few dry weeks to put us below average.”

The agency said the snowpack would not be enough to fill the state’s reservoirs, which supply water for residential and agricultural use during California’s dry months and generate thousands of megawatts of electricity to help meet summer peak demand.

DWR’s State Water Project is the fourth largest power producer in California; hydroelectric generation historically supplies about 14% of peak summer capacity.

The state’s two largest hydropower-producing reservoirs were below half-full on Sunday. Lake Shasta stood at 37% of capacity and Lake Oroville at 46%. In an average year, Lake Shasta would be about twice as full by now, and Lake Oroville would have 28% more water.

The power plant at Lake Shasta, operated by the U.S. Bureau of Reclamation, has a nameplate capacity of about 700 MW, though actual production has diminished significantly over the past two years.

DWR’s 644-MW Edward C. Hyatt Powerplant at Oroville Dam has fared even worse. It shut down for the first time in its history on Aug. 5 because the lake had dropped to critically low levels. After the December storms, the plant restarted one generating unit to supply electricity to CAISO’s grid.

A two-decade drought in the Southwest has strained Colorado River supplies, with Lake Mead behind Hoover Dam and Lake Powell behind Glen Canyon Dam dropping so low that hydropower generation could cease. (See Western ‘Megadrought’ Curtails Hydropower and Western Drought Puts Hoover Dam Hydropower at Risk.)

In 2020 and 2021, California saw two of its driest years ever. Snow water content in California peaked at 60% of normal in 2021 after a similarly dry winter the year before, CAISO said. The ongoing drought reduced hydropower by 1,000 MW in 2021, the California Public Utilities Commission and California Energy Commission said last summer.

Since the rolling blackouts of summer 2020, CAISO and the CPUC have been working to install batteries to store solar power for summer evening peak hours. More than 2,000 MW of battery capacity were added by the end of 2021 with another 2,000 MW expected to come online this year, the ISO said.

Cyberattacks More Likely as Russo-Ukrainian War Continues

With Russia’s invasion of Ukraine dragging on, the escalation of the conflict into major cyberattacks is growing ever more likely, experts warned Friday in a webinar hosted by SANS — and the war could reach places cyber professionals never anticipated.

The attack by Russian forces against Ukraine’s Zaporizhzhia nuclear power plant served as the backdrop for the group’s discussion, as it was occurring at the same time as the webinar. Fighting began near the plant on Thursday, sparking warnings about radiation leaks that were only heightened when a building at the facility caught fire during the shooting. Russian troops have since brought the plant’s staff under their control and cut off internet access to the site. The International Atomic Energy Agency said Sunday that it was “extremely concerned” about the potential for “undue pressure” on operators at the facility.

Though the Zaporizhzhia situation involved a physical attack rather than one in cyberspace, Robert M. Lee, CEO of cybersecurity firm Dragos, used the fighting to illustrate the unpredictable nature of warfare. He pointed out that “targeting a nuclear power plant is a war crime [and] insane under any discussion”; nevertheless, Russia did so anyway. The lesson for cyber professionals is that attackers don’t necessarily share their victim’s assessment of what infrastructure — be it schools, hospitals or nuclear plants — should be beyond the pale when it comes to legitimate targets.

“One of the things that I’ve said in my classes over the years … is [that] we get to control pretty much everything on the defensive side. We get to … define the layout, define the scale, define the plan … we get everything,” Lee said. “Defense is doable, and defense has the upper hand in many ways, [but] one thing you don’t get to decide is if the adversary thinks you’re a good target or not.”

Not Just a Problem for Ukraine

Targets in a potential Russian cyberoffensive could include critical infrastructure not just in Ukraine, but in its allies’ territories. Panelists reminded listeners that such an offensive would not be out of character for Russia’s military intelligence service, which has been linked to attacks against Ukraine’s power grid in 2015 and 2016, in addition to the NotPetya malware that spread beyond its targets in Ukraine to companies around the world, including in the U.S. (See Six Russians Charged for Ukraine Cyberattacks.)

The fact that Russia has long been known to have this capability has left many experts confused as to why they haven’t been deployed in the current conflict. (See Experts Warn Cyberwar Still Possible.) Paul N. Stockton, former assistant secretary of defense for homeland defense, said U.S. officials had assumed that weakening an enemy’s infrastructure would be top priority for Russia in any conflict and saw Ukraine as a “laboratory” for testing its latest disruptive tools.

“We have a dog that did not bark in the night here. It’s very peculiar from my perspective that we haven’t seen large-scale, sophisticated cyberattacks in conjunction with the physical attacks that have been underway,” Stockton said. “A key component of new generation warfare, as it’s been described by Russian military documents, is to employ devastating cyberattacks early in a conflict to disrupt the adversary’s command-and-control and potentially critical infrastructure essential to the functioning of the victim nation.”

Experts have speculated that Russia has held back its most sophisticated cyber capabilities so far because the country’s leaders feel they can prevail against Ukraine without exposing their most potent weapons to foreign intelligence. Stockton and his fellow panelists agreed that this is the most likely explanation, but there is no guarantee this condition will continue — particularly if Russia’s conventional forces seem unable to get the job done and President Vladimir Putin seeks to avoid an embarrassing military defeat.

Prior Preparation Essential

In light of the unpredictable situation, Stockton said U.S. critical infrastructure operators should be prepared for a potential strike to weaken the U.S. and divert attention from Ukraine. First, he said, in the event of a large-scale attack, utilities should immediately “stop downloading software updates from the cloud,” a reference to Russia’s hacked version of the SolarWinds Orion cloud management software that was spread to thousands of organizations worldwide through a compromised update server.

Next he advised that any attacks against U.S. industrial control systems should be considered part of a sustained campaign, not “one and done.” In other words, while an initial attack might target gas pipelines or water utilities rather than the power grid, that does not mean that cyber professionals at electric utilities can relax; they might still be targeted in subsequent waves.

Finally, though it may be a bitter pill for hardworking security staff to swallow, utilities must assume that their systems are already compromised and that the adversaries are inside. If this assumption is not part of the planning process, it may be hard to fully eliminate any intruders.

“They’re going to be training inside our systems, exploiting persistent access,” Stockton said. “And that, I want to emphasize, not only applies to the initial attacks, but efforts to restore functionality. It’s going to be utterly unlike dealing with hurricanes or other natural incidents; they’re going to be inside our restoration efforts.”

Overheard at the 2022 Texas Energy Summit

AUSTIN, Texas — The Texas Energy Summit continued its focus on the Texas Emissions Reduction Plan as it gathered in person for the first time since the February 2021 winter storm that nearly collapsed the ERCOT grid.

The summit organizers from the Texas A&M Engineering Experiment Station’s Energy Systems Laboratory have long emphasized a focus on energy management. However, the lead panel addressed — what else, after last year’s storm? — increasing the ERCOT grid’s resilience.

Moderator Evan Smith, the Texas Tribune’s CEO, noted the grid didn’t collapse during last month’s winter storm, which was considerably less severe than the previous year’s storm. (See ERCOT Breezes Through Latest Winter Storm.)

“Problem solved. Panel over. Do we really have to increase resiliency?” he asked his panel. “Isn’t everything okay, based on what happened a couple of weeks ago?”

“We know we’re making progress,” said Caitlin Smith, senior regulatory director for Jupiter Power, an energy storage resource consultant. “Things are changing in Texas. Our generation and our demand is changing. You have to constantly be working on it. I don’t think there’s ever going to be a point where everything is fixed and we’re done.”

Virginia Palacios, executive director of Commission Shift, which seeks to reform natural gas regulator Texas Railroad Commission, noted the most recent storm was only the seventh coldest in the last 12 years.

“It got cold, and the grid held up. That’s not something that should be celebrated,” Evans responded.

Still, this winter’s weather activity resulted in reduced gas production in West Texas, Palacios said.

“There are gas facilities that are not winterized. If we had a severe storm, we could expect more outages,” she said. “So, there’s a chink in the armor.”

State Sen. Jose Menendez (D) agreed, referencing ERCOT interim CEO Brad Jones’ recent comment that natural gas production declines might point to the grid’s continuing vulnerability because of its reliance on gas generation.

“That was not [U.S. Rep. Alexandria Ocasio-Cortez] saying the quiet part out loud,” Menendez said. “Gas is a weather-dependent resource. We still see signs of problems on the horizon.

“At the end of the day, there’s no free lunch. Do you pay to keep the lights on? How much do we pay?” he asked. “Building more gas plants … that would all be on the backs of the consumers. That’s why we should focus on energy efficiency and demand response. How can we do more on the demand side, so we don’t need as much generation as quickly as we think.”

“We know what the problem is. The problem is expectations on different resources,” Smith said. “We expected gas to be there, and then it wasn’t.”

Speakers Address Ukraine Conflict

While the conference was focused on clean energy and air, the specter of Russia’s invasion of Ukraine hung over the proceedings.

“Air quality is really in the DNA of this summit. … Obviously, these are extraordinary times,” said Stoic Energy President Doug Lewin, who helped coordinate the event. “There can be discussions about how our oil and gas sector can support our allies abroad … but we ought to be thinking about our allies abroad and Ukrainians that are suffering so deeply right now.”

Smith opened the summit with an update on the state’s recent primaries and its political outlook, but the first question he fielded from the audience was about oil politics.

“Well, [Texas does] benefit from higher oil prices, right?” Smith said. “Prices over $100 a barrel tend to be good for the economy and good for the state’s bank account, but I don’t think anybody wants to profit off of Russian tyranny.”

“We’re seeing this really huge crisis that even I am having trouble sort of wrapping my brain around,” said Amy Myers Jaffe, research professor and managing director of the Climate Policy Lab at Tufts University’s Fletcher School in Massachusetts.

Jaffe, who recently published her latest book, Energy’s Digital Future, referred to the global energy markets’ “mega crisis,” with gas and oil prices both rising to levels not seen for years.

“We’re really in a very tenuous situation with a very fragile market,” she said. “Gas prices are at historic highs, and we know from history that these kinds of crises end — especially when its oil-related — with a global recession. That is how prices come down.”

But Jaffe also pointed to a bright side: “We know each time this happens, we get new technologies, new energy efficiency, new government policies that lower demand.”

Solutions Offered to Improve Air Quality

Participating in a panel discussion on replacing Texas’ highest polluting power plants with cleaner and more reliable resources, Daniel Cohan, an associate professor at Rice University, said any replacement resources will have to come from Texas, given much of the state’s isolation from the rest of the country’s grid.

“The replacements for the polluting power gird will have to come from Texas. … That’s not true anywhere else on the continent,” he said, noting that most of the state’s power capacity is more than 30 years old. “We keep them because they ‘keep the lights on.’ Maybe they’re killing us, but you can count on them. Except when they’re not actually there for us, such as during the February storm.”

“The gas plant existing isn’t the problem,” Cohan said. “The problem is how much it’s used.”

Several speakers offered up virtual power plants as being among the new, enabling technologies that could eventually replace conventional resources. Virtual power plants rely on aggregated rooftop solar customers or community distributed solar, often with battery storage.

Using a suburb north of Houston as an example, Jaffe said, “Imagine if everyone in The Woodlands had rooftop solar and also had something the size of the washing machine in their garage that stores that electricity. Say the developer of this [distributed energy resource] system gives everybody a battery 30% larger than their electrical use.

“Then, when it’s not sunny or there is a surge in demand for heat, we aggregate that 30% of everybody’s batteries. That’s why it’s called a virtual power plant,” Jaffe said. She said a similar system in Western Australia prone to massive brownouts proved to be a “very robust” solution.

Closer to home, Jaffe said California’s experience after the Aliso Canyon natural gas blowout in 2015 fed the states’ optimism to pursue a 100% renewable energy goal. Developers offered to replace the natural gas capacity with solar energy and batteries. They installed 104 MW of solar and battery storage in a matter of months.

“And it’s still operating and it’s still working today,” Jaffe said.

“The cleanest energy is the kilowatt-hour you don’t use,” pointed out Keri Macklin, vice president of strategic energy management and carbon consulting for CLEAResult. She said placing a price on carbon has proven to quickly transition power companies from coal usage.

“It’s making it economically unfeasible for those coal plants to continue to run. That’s the cleanest and fastest way to do it,” Macklin said. “Politically, it may be more difficult, but it’s a very quick way to make the renewable energy more profitable.”

DOE Focused on Clean Energy

The Department of Energy’s Kelly Speakes-Backman made a virtual appearance at the summit to explain how the Biden administration intends to put the nation on an “irreversible path to clean energy.”

As the DOE’s principal deputy assistant secretary for the Office of Energy Efficiency and Renewable Energy, Speakes-Backman oversees the agency’s $2.8 billion portfolio of research, development, demonstration and deployment activities in energy efficiency, renewable energy and sustainable transportation.

“Secretary [Jennifer] Granholm likes to say that DOE is America’s solutions agency because we never back away from a challenge and because of how the many technologies and areas of society that our work actually impacts,” she said. “For decades, we’ve already been investing in these innovative renewable energy and efficiency and transportation technologies. But now it’s time to recognize and realize those returns on our investment by getting those solutions into the marketplace at scale as quickly as possible.”

Speakes-Backman said no single technology or solution will help the federal government reach its goal of a net-zero economy by 2050. Instead, it will take a coordinated effort in a wide variety of areas, with a strong emphasis on deploying technologies that are close to commercialization.

DOE has established five programmatic priorities: 1) decarbonizing the grid; 2) decarbonizing transportation; 3) decarbonizing the industrial sector; 4) reducing buildings’ carbon footprint; and 5) decarbonizing the agricultural sector.

The agency is relying on collaboration with the National Labs, federal agencies, the public sector and “our state local partners,” Speakes-Backman said, “because we know that we can only build a clean energy future if we’re going to be bringing these communities and workers along with us.”

DOE’s success will rely on investments in a diverse, STEM workforce “to provide a pathway forward for communities of workers who risked their lives to produce fossil fuels,” she said.

“We know that we have to build a clean energy economy in a way that’s going to benefit all Americans,” Speakes-Backman said. “We have to address the environmental injustice that disproportionately affected communities of color, low-income communities, indigenous communities and rural communities. We’re deeply committed to making sure that it’s embedded in all of our work.”

State Rep Pushes Tx Legislation

Before the 2021 February winter storm waylaid his best-laid plans, State Rep. Drew Darby (R) was pushing a bill that would have shortened the deliberation process for ERCOT economic projects and mandated a biennial ISO report identifying “critical designation” transmission infrastructure projects.

Darby’s bill (HB1607) never made it out of the House, lost in the wave of legislation addressing fixes to ERCOT’s governance and its system following the storm. However, he promises the bill will be back for the 88th Texas legislature in January.

“As a policy matter, I believe we’re still going to need to have this discussion as we move forward in the next session,” Darby, who was first elected in 2006, said. “It takes anywhere from eight to 10 months to actually put in a wind farm, but the evaluation process takes eight to 10 years.”

Virginia Palacios Beth Garza 2022-03-02 (RTO Insider LLC) Alt FI.jpg

Commission Shift’s Virginia Palacios chats with R Street Institute’s Beth Garza. | © RTO Insider LLC

Darby, a native West Texan, knows the importance of transmission infrastructure. He saw the 2005 Competitive Renewable Energy Zone (CREZ) initiative invest $6.9 billion in 3,600 miles of new, high-voltage transmission lines and pave the way for Texas’ renewable energy boom.

“There was no power generation at the end of [CREZ lines],” Darby said. “I questioned spending that many resources to provide access to power generation when there was no proposed power generation or a single plan. The master plan was … if you build it, they will come. By gosh, we did build it, and they have come.”

With the wind farms, and now the solar facilities, congestion has increased on the ERCOT system. Carrie Bivens, the grid operator’s Independent Market Monitor, said real-time congestion rent — the impact of one additional MW on a constraint — was $2.1 billion last year, up from $1.4 billion the year before. The system incurred $300 million during just one day of the February winter storm.

“It’s growing year over year. … There is a lot of congestion throughout Texas,” Bivens said.

ERCOT has had 16 generic transmission constraints at one time. Seven of those were in South Texas’ Rio Grande Valley, which are being addressed in a PUC-directed project and a $1.28 billion 345-kV line approved by the grid operator’s board. (See Texas PUC Directs Tx Construction in Valley, “Board Approves $1.28B Tx Project,” ERCOT Board of Directors Briefs: Dec. 10, 2021.)

“We have a lot of land [in West Texas], a lot of solar and certainly wind farms. That has created an extraordinary opportunity for my region and Texas, but it comes with challenges that are impeding additional growth for power generation,” Darby said. “Let’s look at these projects in an expedient manner and move them quickly.”

NRC Cites Ohio’s Davis-Besse Nuclear Power Plant

The Nuclear Regulatory Commission last week cited Ohio’s Davis-Besse nuclear power plant for improper maintenance of its very large emergency diesel generators (EDGs), which are used only when the reactor fails and the plant is cut off from outside grid power.

The EDGs must start immediately and be able to produce full power in as quickly as 10 seconds in order to enable emergency pumps and other equipment to continuously cool the reactor’s nuclear core to prevent it from overheating.

NRC determined that plant engineers installed improper replacement parts that prevented the plants’ two EDGs to immediately start during routine testing. Along with a lack of maintenance of other components essential to the production of power, it was enough to be a safety violation, rather than a minor infraction.

The citation — on top of an earlier NRC finding that Davis-Besse violated cybersecurity protocols — puts the plant under increased inspections in the coming months. The commission does not specify the severity of cybersecurity violations or the level of the citation it issues in such cases.

Davis-Besse, operated by a FirstEnergy subsidiary until it emerged from federal bankruptcy protection in early 2020, is today owned by Energy Harbor, a closely held company that does not respond to media inquiries. The plant is currently shut down for refueling, according to NRC.

UN Climate Report Hits Home Across US

Last week’s report from the U.N. Intergovernmental Panel on Climate Change (IPCC) hit home across the U.S. as dozens of news outlets published stories on how their regions are being affected.

The 3,675-page report said that climate threats have increased significantly since the U.N. reported in 2014 that climate change was having a “relatively small” effect on human health. (See IPCC Climate Report: ‘Half Measures No Longer an Option’.) The coverage of the new report makes clear that the impacts of climate change are being felt in every region of the U.S.

Here’s a roundup:

Florida & Gulf Coast 

The Miami Herald noted that although the report had a global focus, “Florida was repeatedly used as an example of a place where the impacts of climate change were already being felt, both economically and environmentally.” It cited “tidal flooding from higher sea levels, even on perfectly sunny days; … hotter days and nights; more harmful algal blooms and mosquito-borne illnesses; stronger and wetter hurricanes; and less productive crops, livestock and fisheries.”

Minn Storm Erosion (WCCO) FI.jpgErosion from storms in 2017-18 forced a $16 million reconstruction of the Lakewalk along Lake Superior in Duluth, Minn. | WCCO

The IPCC noted that tidal flooding resulted in the loss of $465 million in real estate value in the Miami-Dade market between 2005 and 2016 and contributed to “climate gentrification,” the displacement of poor residents in higher elevations.

An Associated Press story on the report focused on the Gulf Coast, citing the devastation of Hurricane Laura in 2020 and Hurricane Ida in 2021 and the more than 50 inches of rain that hit the Texas coast in Hurricane Harvey in 2017 — a storm cited as a case study in the IPCC report.

Republican legislators in Gulf Coast states have been more willing to support adaption to climate change, such as higher roads and sea walls, than efforts to reduce greenhouse gas emissions, it said. On March 1, the Republican-controlled Florida House of Representatives rejected the inclusion of clean-energy measures in a bill to address sea level rise and flooding.

The Tampa Bay area is considered one of the most vulnerable places in the U.S. for storm surges. The city of Miami Beach has spent more than $500 million on a system to pump water off the island, and Miami could spend potentially billions on its own effort to address sea level rise and limit saltwater intrusion into freshwater supplies.

Climate scientist Daniel Babin lamented last week that warmer winters in Louisiana mean fewer days qualify as “gumbo weather” — temperatures below 50 degrees Fahrenheit.

A more serious threat: “Coastal Louisiana residents are already on the frontlines of more intense hurricanes, rising seas, flood-inducing rain showers and extreme heatwaves due to climate change,” the U.S. Geological Survey said. By the end of the century, temperatures in Louisiana could be an average of 12 degrees higher, a recipe for even worse storms.

West & Southwest

The San Francisco Examiner noted that “record droughts, scorching wildfires, rising seas and blistering heat waves have become benchmarks of this new normal” in the Bay Area.

Although San Francisco announced a plan last year to reach net-zero emissions by 2040, the Examiner said the city’s “ability to persuade nearly a million residents to wean off fossil fuels swiftly has yet to be seen. Despite bans on natural gas in new buildings and the city’s investment in programs like CleanPowerSF [a community choice aggregation program to increase use of renewable energy], many San Franciscans still depend heavily on fossil fuels to power their homes, cars and offices.”

On the positive side, the Examiner cited the Crissy Field wetlands restoration project, which converted a former military base back to a tidal marsh.

In the Southwest, the last two decades have been the driest in the last 1,200 years, and spring rainfall could drop by another 20% by the end of the century, with river flows falling 50% by 2100. Reductions in water runoff has increased the salinity of Pyramid Lake in Nevada, reducing fish biodiversity.

Further north, a lack of snow is threatening northern Washington’s cross country ski trails.

Midwest

In Iowa, scientists say warming winters have allowed the Asian Tiger mosquito — which can transmit diseases like dengue fever — to set up residence in three counties after emigrating to the U.S. from Southeast Asia over 30 years ago. Elsewhere in the Midwest, there is concern that climate change will result in more invasive plants, pests and pathogens.

And researchers in Wisconsin last week reported that the state’s average nighttime low temperature rose between 4 and 7 F between 1950 and 2020.

Although the Great Lakes region is not currently prone to wildfires, rising seas or drought, it is facing worsening rainstorms. In southeast Michigan, the Great Lakes Water Authority has estimated it will cost as much as $20 billion to build stormwater infrastructure capable of avoiding the kind of floods that damaged tens of thousands of homes last summer.

In Duluth, Minn., erosion from storms in 2017 and 2018 forced a $16 million reconstruction of the Lakewalk along Lake Superior. Meanwhile, some Minnesota towns have begun the use of pervious pavement to reduce stormwater runoff.

New England

Hanover, N.H., has decided to end its annual Occom Pond Party — where thousands of participants celebrated on the frozen pond with ice castles and snow sculptures — because of unpredictable weather that had resulted in cancellations or postponements for seven consecutive years.

Asian Tiger mosquito browntail moths (US Center for Disease Control and Prevention, Maine Center for Disease Control Prevention) Content.jpgClimate change is bringing insects such as the Asian Tiger mosquito and browntail moth caterpillars to northern climes. | U.S. Center for Disease Control and Prevention, Maine Center for Disease Control & Prevention

New Hampshire is also seeing increasing flooding and, for the first time, the southern pine beetle — previously known in Central America and the southern U.S. — which can kill pine trees.

In Maine, 2021 saw the worst infestation yet of browntail moths, which can kill hardwood trees and shrubs and whose hairs can cause breathing problems and poison ivy-like skin rashes.

A recent Vermont Public Radio-PBS poll found 58% of residents surveyed expect climate change to have a “major” impact on the state over the next 30 years. Already some ski slopes are at risk from a lack of snow.

Mid-Atlantic & Carolinas

In North Carolina, increasing temperatures mean alligators could expand their footprint further inland, away from the  swampy coastal areas they now call home. On the barrier islands of the Outer Banks, there is concern over homes falling into the ocean because of beach erosion.

Alligator-(North Carolina Wildlife Resources Commission) Content.jpgAlligators, like this 12-foot 700-plus-pound specimen, could expand their footprint further inland due to climate change. | North Carolina Wildlife Resources Commission

In Charleston, S.C., officials are considering an 8-mile-long seawall to protect the historic city from hurricane surges and higher tides. The South Carolina Office of Resilience, formed following severe floods between 2015 and 2018, is developing a hazards report for the state. Planning for a rail yard addition at the state Ports Authority’s Leatherman Terminal in North Charleston is taking into account a future of sea level rise.

New Jersey officials have recorded more than 90 forest fires in 2021 — this before its normal fire season begins in mid-March.

Meanwhile the U.S. Government Accountability Office reported last week that nearly one-third of the hazardous chemical facilities in the country are at risk from climate-driven floods, storms and wildfires.

And a new study in the journal Nature found that climate threats “can compound existing stresses on the revenues and expenditures of local governments, revealing potential risks to fiscal stability.”

California Governor Swaps Energy Officials

California Gov. Gavin Newsom continued changing up the state’s energy leadership last week by appointing Energy Commission (CEC) member Karen Douglas as his senior advisor on energy and naming Douglas advisor Kourtney Vaccaro, a former CEC chief counsel, to fill the vacant commission seat.

Karen Douglas (CEC) FI.jpgGov. Gavin Newsom named CEC Commissioner Karen Douglas as his senior advisor on energy. | CEC

The changes followed a similar switchover at the California Public Utilities Commission (CPUC) late last year, when then-CPUC President Marybel Batjer decided to leave two years into her seven-year term and the governor named Alice Reynolds, then his senior energy advisor, to take Batjer’s place.

The changes continue a trend in which Newsom has appointed senior staff, instead of outsiders, to fill seats on the CEC and CPUC daises.

Little more than a year ago, Newsom named new members to the three bodies that govern state energy policy —  CAISO, the CPUC and the CEC — and reappointed a sitting member of the ISO’s Board of Governors.

The governor picked CEC Deputy Director Siva Gunda, a high-ranking staff member, as a CEC commissioner after former Commissioner Janea Scott left to take a post at the U.S. Department of the Interior in the Biden Administration.

Newsom chose then-CEC General Counsel Darcie Houck, a former CPUC administrative law judge, to fill an open spot on the CPUC after he selected former CPUC Commissioner Liane Randolph to head the California Air Resources Board.

Newsom also named Jan Schori, a longtime NERC trustee and former CEO of the Sacramento Municipal Utility District, to fill a seat on the CAISO board left vacant when former Chair David Olsen decided to retire at the end of November.

Kourtney Vaccar (CEC) Content.jpgKourtney Vaccaro is the state’s newest energy commissioner. | CEC

The latest appointments of Douglas and Vaccaro come as the CEC, the CPUC and CAISO are trying to head off energy shortfalls this summer as the state transitions from fossil fuels to renewables. The rolling blackouts of August 2020 led to calls for better synchronization among the three entities, which forecast energy demand, order utility procurement and run the state’s grid, respectively.

The CPUC has struggled to prevent utility equipment from sparking wildfires and is currently attempting to control rate increases for customers of the state’s three large investor-owned utilities. The CEC grants more than $130 million a year for research and development of projects to decarbonize the transportation and building sectors, and to promote renewable energy and energy efficiency.

Douglas has served on the CEC since 2008. She was previously director of the Environmental Defense Fund’s California Climate Initiative. Douglas earned a law degree from Stanford University and a master’s degree in environmental policy from the University of Colorado, Boulder. Her new role does not require state Senate confirmation.

Vaccaro has served as Douglas’ adviser at the CEC since 2019. Her prior positions at the commission from 2009 to 2019 included chief counsel and assistant executive director of compliance assistance and enforcement. Her appointment requires Senate confirmation.

Neither Douglas nor Vaccaro was available for comment Monday.