The Washington Senate passed a bill Tuesday to require all “major” new publicly owned or leased buildings to be designed with all-electric energy systems in mind.
The House-originated bill (HB 1280) now goes to Gov. Jay Inslee for his signature.
The bill by Rep. Alex Ramel (D) passed the Senate 29-20, mostly along party lines. Ramel introduced the bill in 2021, when it passed the House but did not receive a Senate vote before the session ended. It sailed through the legislature unchanged this year.
As a greenhouse gas measure, the legislation requires that designers of public facilities with greater than 25,000 square feet of usable space, including schools, to consider all-electric systems and at least one renewable energy or combined heat and power system in their work. The bill also requires that these designs should include life-cycle cost analyses, the guidelines for which will be created by the Washington Department of Enterprise Services.
On Tuesday, Sen. Reuven Carlyle (D) and his chamber’s leader on environmental issues said, “We know that public leadership on this is important.”
In response, Sen. Shelly Short (R) and the GOP’s Senate leader on environmental issues, said the bill starts a slippery slope toward future actions, which she did not define or elaborate upon. “This seems like a piece that worries me as we go down the road,” Short said.
Sen. Mark Schoesler (R) framed his “no” vote as a protest against environmentalist efforts to tear down the four hydroelectric dams on the Snake River as a salmon recovery measure. He said it is wrong to require all-electric systems at the same time that hydroelectric dams are being targeted.
While breaching the dams has been discussed in the past two years — as well as off and on for the past 30 years — no solid studies or efforts have advanced beyond the speculation stage.
For years, analysts have assumed that any Russian military action against its neighbors would be preceded by a major cyber offensive against the target country and its allies, aiming to disable its electricity and other utilities, along with government, military and civilian communications networks.
Nearly a week into Russia’s invasion of Ukraine, that threat doesn’t seem to have materialized. While the U.S. Cybersecurity and Infrastructure Security Agency (CISA) has noted an outbreak of “destructive malware … affecting Ukraine and other countries in the region,” Ukraine’s infrastructure appears largely intact. President Volodymyr Zelensky and his government certainly seem to have no problems keeping their smart devices charged and connected to the internet, rallying resistance to Russian tanks and bombers.
Likewise, while CISA is currently in a “Shields Up” posture and has called for critical infrastructure operators to be vigilant, the agency still says it sees “no specific or credible cyber threats to the U.S. homeland” despite having warned in January that such attacks might be imminent. (See Utilities Warned of Cyberattacks amid Russia Tensions.)
But experts say it would be a mistake for cybersecurity professionals to label Russia’s cyber capabilities an empty threat. The fact that the country apparently has not deployed its arsenal doesn’t mean the arsenal is bare, they say, and with the invasion just days old, there is plenty of time for the country’s leadership to reconsider its strategy and bring out the big guns.
“It’s no different than any other wartime tactic; once you reveal your playbook, there’s going to be a countermeasure … attached to it,” Betsy Soehren-Jones, Fortress Information Security’s chief information officer, told ERO Insider. “You’ve got to be strategic in how you push out those playbooks, and it just hasn’t been time yet.”
Fortress CEO Alex Santos agreed with Soehren-Jones, likening the Kremlin’s cyber offensive forces to its hypersonic missiles. The world has known of the technology for years; Russia test-fired the system shortly before the invasion into Ukraine began; and the fact that Russian President Vladimir Putin has not yet used it is no guarantee that he will not do so.
Santos suggested that Russia’s strategy so far indicates a “calculation that they can take and achieve their military objectives with their traditional weapons,” rather than exposing their more advanced cyber capabilities to the eyes of foreign intelligence agencies. If the conventional attack fails to reach its goals and economic sanctions begin to bite, then Putin may decide to move more aggressively against both Ukraine and those supporting it, including the U.S., he warned.
“One of the things that Russia has historically done is … surveillance and harassment and sowing seeds of misinformation. You might say that SolarWinds was that kind of attack,” Santos said, referring to the 2021 incident in which hackers — identified by the U.S. as Russia’s Foreign Intelligence Service — planted malware in the SolarWinds Orion network management software used by thousands of organizations around the world.
“We may see sort of a gradual campaign over time of them continuing their programs of meddling [and] death by a thousand cuts kind of thing,” he continued.
Questions About Ukraine’s Cyber Defenses
Ukraine’s readiness in the event of a major cyber offensive is still considered an open question by many in the industry. The country seems to be holding its own against the WhisperGate and HermeticWiper malware, which cybersecurity professionals identified earlier this year and which CISA and the FBI warned about last week. Ukrainian government officials are also attempting to organize an international network of hackers to strike back against Russia in cyberspace.
But industry watchers remain concerned about Ukraine’s capacity to resist a major, well resourced operation like the ones that targeted the country’s power grid in 2015 and 2016. (See Six Russians Charged for Ukraine Cyberattacks.) Robert M. Lee, CEO of cybersecurity firm Dragos, warned in a media briefing last week that he feared the investment in needed cybersecurity improvements since then has been severely lacking.
“I’m not saying there hasn’t been good work. But that stuff isn’t related to their infrastructure. Do I think they are building up more knowledge about what to do? Sure. Do I think that their infrastructure and the defensive ability of those infrastructure companies are in any better place than they were in 2015? No, I do not,” Lee said. “I think that if Russia, as an example, wanted to take down the electric system in Ukraine, they would be much more prepared to do so than … in 2015 and 2016.”
The situation may be brighter in the U.S. Santos called NERC’s Critical Infrastructure Protection (CIP) standards “the most robust cyber regulatory construct” among any other utility sector, and NERC has been quick to reassure the public of the Electricity Information Sharing and Analysis Center’s (E-ISAC) preparedness to quickly coordinate a response to potential attacks.
“Security of the grid continues to be a key priority for NERC, the U.S. and Canadian governments, and industry,” the organization said in a statement on Monday. “The continued coordination across our industry helps ensure vigilance and allows us to respond quickly should the need arise — we know nearly 400 million North Americans are counting on us.”
New Jersey will delay its third offshore wind solicitation from September 2022 to January 2023 to allow it to incorporate proposed transmission projects now being reviewed by PJM.
PJM received 80 proposals in response to a transmission solicitation it issued last year at the request of the New Jersey Board of Public Utilities (BPU). Under PJM’s state agreement approach (SAA), New Jersey would commit to paying 100% of the cost of the transmission but could seek to allocate some costs to other generation projects that use the additional capacity. (See PJM, NJ Seek FERC OK for OSW Tx Process.)
“The updated schedule allows for the SAA process to be completed and the outcome incorporated into the third solicitation guidance documents,” the BPU said in announcing its delay Monday.
The BPU said it expects to determine later this year, which, if any, of the 80 submissions — which include “ready-to-build offshore wind transmission solutions to deliver offshore wind energy to the existing power grid” — it will approve.
N.Y. Bight Winners Invited to Participate
The delay also will give developers that won leases in the Bureau of Ocean Energy Management’s (BOEM) auction in the New York Bight last week more time to prepare bids to win offshore wind renewable energy certificates (ORECs) in the New Jersey solicitation, the BPU said. BOEM provisionally awarded leases for six projects totaling 5.6 GW of capacity off the coasts of New York and New Jersey. (See Fierce Bidding Pushes NY Bight Auction to $4.37 Billion.)
The BPU plans to award 1.2 GW in ORECs in its third solicitation, with the award targeted for the fourth quarter of 2023. In its first two solicitations in 2019 and 2021, the BPU awarded ORECs totaling 3.7 GW: 2.2 GW to Danish developer Ørsted’s Ocean Wind I and Ocean Wind II projects, and 1.5 GW to Atlantic Shores, a joint venture between EDF Renewables North America and Shell New Energies US. (See NJ Awards Two Offshore Wind Projects.)
The Atlantic Shores partnership also won one of the six New York Bight projects, agreeing to pay $780 million for a 79,351-acre lease that the companies said could provide 1.5 GW of capacity. BOEM estimated the site’s capacity at 924 MW, based on 3 MW/sq km. Ørsted said it was not involved in any of the six winning bids in the BOEM auction.
7.5 GW Target
New Jersey hopes to award a total of 7.5 GW of ORECs by 2027.
BPU President Joseph L. Fiordaliso said the shift in solicitation date to January 2023 “takes into account two exciting and important milestones in offshore wind in our region.”
“With 80 proposals for transmission solutions submitted in response to the SAA solicitation, adjusting our timeline to allow for the selection of the optimal transmission solution will inform our next solicitation for offshore wind projects,” he said. “Coupled with the new lease areas in the New York Bight, developers will now have ample time to put together thoughtful and cost-effective proposals.”
The BPU launched its SAA project to solicit ideas on how to upgrade the grid to allow for integration of wind energy, how to extend the onshore grid to bring it closer to offshore wind generators and what upgrades are needed on interconnections between offshore substations to create an offshore grid, or “backbone.”
The bidders include a subsidiary of Consolidated Edison (NYSE:ED), which submitted a proposal for a 2.4-GW transmission “backbone.” PSEG, which owns a 25% share of Ocean Wind I, said it has submitted several proposals with Ørsted for offshore transmission, collectively named Coastal Wind Link. (See NJ Wind Port Draws Offshore Heavy Hitters.)
A month after filing a cost-allocation method for its long-range projects, MISO is on the hunt for a better approach to funding major transmission builds.
During a cost-allocation committee meeting Monday, the RTO opened the floor to stakeholder input on a new funding mechanism for the next round of long-range projects.
Staff have repeatedly said the separate-but-equal postage stamp rate divided between MISO Midwest and MISO South is meant to be temporary. The RTO has filed for FERC approval to use that design for the first two collections of projects from its long-range plan. (See MISO Finalizes Long-range Tx Cost Sharing Plan.)
MISO’s Jeremiah Doner said the grid operator is committed to applying a more permanent, “granular” cost allocation for future long-range projects.
“We want to have something with longevity in place,” Doner told stakeholders during the meeting.
Michigan Public Service Commissioner Dan Scripps, who chaired the committee, said the discussion on additional benefit metrics and quantifying them will continue well into 2023.
MISO envisions a new cost allocation for the third and fourth cycles of its multiyear long-range transmission plan. The planning will occur in four parts, with the first two focusing on the RTO’s Midwestern footprint and more immediate needs. (See MISO Long-range Tx Plan Overlaps with SPP Study.)
The third planning cycle will include transmission needs in MISO South. The fourth and final cycle will include MISO’s Midwest and South regions and solutions to increase transfer capability between the subregions.
The RTO will complete its first cycle of long-range projects in June and begin studying prospective projects in the second cycle in late spring or summer.
“We’re going to have to spend some time on what granularity means from a benefits perspective,” Doner said of cost-allocation talks for the third and fourth project batches.
He predicted that defining new reliability benefits will probably be most challenging. He said it’s easy to define reliability that satisfies NERC requirements, but it’s harder to pin down reliability that benefits regions, hardens the grid and leaves the system better positioned for extreme weather events.
Some stakeholders asked how the RTO will reconcile different allocations in the two halves of the long-range planning effort. Staff said cost-allocation methods morph over time.
“It’s a fair question. It’s a little hard to answer that from where we sit today,” Doner said.
Stakeholders are already advocating for a wider range of benefits in a new allocation design.
“If we’re really going to have a more granular cost allocation in place, we need to quantify more benefits,” Sustainable FERC Project’s Lauren Azar said. “As we’ve said ad nauseum, our current benefit metrics only identify a narrow slice of the benefits. So, there are a lot of free riders on our system.”
Currently, long-range cost allocation project benefits must support state or federal energy policies; address NERC issues and show reliability benefits across multiple zones; and demonstrate multiple types of economic value across multiple pricing zones with at least an overall 1:1 benefit-to-cost ratio over the first 20 years of service.
Several stakeholders said transfer capability could be a good resilience measure because the ability to flow power has been crucial during past winter storms. They also revived the debate on whether new generation should bear a portion of new transmission costs.
MISO will hold another cost-allocation workshop April 26.
“We’ve got some work ahead of us,” Scripps said, closing the meeting.
A group of large electricity consumers opposes National Grid’s (NYSE:NGG) petition to New York state regulators to allow development of and cost recovery for 19 transmission upgrade projects (Case Nos. 20-E-0197 and 20-E-0380).
National Grid subsidiary Niagara Mohawk Power’s November 2021 petition to the Public Service Commission included a 2030 Regional Plan and also sought approval of cost deferrals and surcharge recoveries from its approximately 1.6 million electric customers.
But “it is not clear that all, or even many or any, of the proposed projects truly are needed at this time,” Multiple Intervenors (MI), an ad hoc group of more than 50 large commercial, industrial and institutional energy consumers, said Monday. MI was party to a recently concluded electric and gas rate proceeding for Niagara Mohawk.
None of the 19 projects was included in the $3 billion electric capital expenditures in a three-year rate plan approved in January, the group noted.
“Thus, the proposed projects either were not subjected to the typical scrutiny attendant in rate proceedings or, perhaps in certain instances, were subjected to such scrutiny and ultimately excluded from the long list of proposed projects used to justify the utility’s negotiated level of capital expenditures,” MI said.
National Grid argued in its petition that “each of the company’s Phase 1 solutions were designed after assessing existing reliability-based transmission projects – those projects already requiring upgrades to address condition issues, enhance storm resiliency, or improve operational performance – to minimize the cost to unbottle renewable energy,”
Under the New York Public Service Commission’s new transmission planning rules, Phase 1 projects are traditional utility investments that address system reliability or resilience issues, while Phase 2 projects are primarily intended to facilitate the state’s environmental targets. (See New York Adopts Groundbreaking Tx Investment Rules.) National Grid said it assessed existing reliability-based projects based on their ability to improve renewable energy deliverability as designed or improve deliverability if redesigned.
The table summarizes the capital investment, including cost of removal, and operating cost estimates, incremental right of way requirements and improvements to the import/export capability (headroom) of each region. | National Grid
MI countered that the proposed projects would expose customers to near-term and long-term rate impacts.
“The impacts that would flow from the proposed authorizations should not be evaluated in a vacuum,” MI said.
In addition to the more than $3 billion in budgeted electric capital expenditures approved through fiscal year 2025, the commission previously has authorized tens of billions of dollars in customer collections for various clean energy programs and initiatives, and wholesale energy prices have jumped substantially in 2022, MI said.
“Because customer funds are far from limitless, and rising energy costs have significant, negative impacts on economic activity, the commission needs to ensure that Niagara Mohawk’s electric rates are shielded from capital expenditures that are not truly necessary for safe and reliable electric service,” MI said.
The group also opposes the approval of cost deferrals and surcharge recoveries, saying there is no clear urgency to start and complete all of the upgrades proposed now during a major expansion of Niagara Mohawk’s normal electric capital expenditures budget and while large-scale renewable generation development is occurring at a slower pace than previously had been anticipated.
“Quite simply, the commission needs to proceed very cautiously, else future electric rates and prices will become less affordable for customers and even less competitive with other regions, thereby harming state and local economies that still are reeling from the effects of the COVID-19 pandemic,” MI said.
National Grid said the 2030 Regional Plan “represents timely solutions to excessive renewable energy curtailments or ‘bottling,’ which leads to the undesirable effect of chilling generation investments, increasing energy prices and continuing to rely on the generation commitment and dispatch of fossil-fueled resources.”
The Alliance for Clean Energy New York (ACE-NY) supports National Grid’s petition, noting that the utility deems several of the Phase 1 upgrades as needed to enable further upgrades that will alleviate constraints threatening renewable development.
“Indeed, Grid points to the high-execution risk that Phase 1 upgrades pose to subsequent Phase 2 upgrades if Phase 1 upgrades are not approved” in a timely manner in certain areas of the state, ACE-NY said. “National Grid emphasizes it has staged the deployment of both Phase 1 and Phase 2 projects to provide benefits in the time frames needed for current and planned renewable generation development.”
The California Public Utilities Commission established biomethane procurement goals for the first time Thursday to help reduce methane emissions from landfills, dairies and natural gas use.
The decision requires gas utilities to substitute a portion of natural gas with biomethane, mostly derived from landfills, which emitted 21% of methane statewide in 2019, according to the most recent figures from the California Air Resources Board (CARB).
Methane is a more potent greenhouse gas than carbon dioxide, though it is shorter-lived in the atmosphere. Burning biomethane results in open-air emissions.
“Tackling methane and other short-lived climate pollutants is critical given our climate crisis,” Commissioner Clifford Rechtschaffen, the lead commissioner in the proceeding, said in statement. “This decision will reduce emissions from some of the state’s leading methane sources.”
The state has a mandate, under Senate Bill 1383 passed in 2014, to reduce short-lived climate pollutants such as methane by 40% below 2013 levels through 2030.
Senate Bill 1440, adopted in 2018, required the CPUC to “consider adopting specific biomethane procurement targets or goals for each gas corporation so that each … procures a proportionate share … of biomethane annually.” The state’s two largest gas corporations under CPUC jurisdiction are Southern California Gas and Pacific Gas and Electric.
The CPUC decision requires gas companies to purchase a total of 18 Bcf of biomethane annually by 2025 — potentially diverting 8 million tons of organic waste from landfills each year. Most of the waste would come from compost and the chipping and grinding of trees and other vegetation, the CPUC said.
The decision also establishes a midterm goal of procuring 73 Bcf of biomethane per year by 2030, representing about 12% of residential and small-business gas use. Utilities must secure a percentage of the total based on their proportionate share of the market.
Biomethane from dairies is already incentivized under other state programs, so it can be used only to fulfill the 2030 target after a gas utility procures enough biomethane from landfills to meet the 2025 target, the CPUC said. The decision limited dairy biomethane to 4% of the total for the 2030 goal. Dairies emitted 54% of methane in California in 2019, CARB said.
State law requires landfills to capture or destroy methane, including through burning the gas to break it down, but they continue to emit large quantities of methane.
A recent NASA study found that 30 large “super emitter” landfills produce about 40% of the total point-source emissions detected in a survey of more than 300,000 industrial facilities, dairies and landfills.
FERC on Monday conditionally approved Duke Energy Progress’ (NYSE:DUK) proposed changes to its supply contract with the North Carolina Eastern Municipal Power Agency (NCEMPA) but ordered the two parties to negotiate over how the pact should be changed to reflect the latter’s use of batteries to shave its demand charges (ER22-682).
NCEMPA, which serves 32 cities and towns with municipal electric distribution systems, asked FERC in 2019 to issue an order declaring that its “full requirements” power purchase agreement with Duke permitted it to use battery storage to reduce the munis’ load during the peak hour each month that is used to determine capacity charges. FERC granted NCEMPA’s request in September 2020 (EL20-15), a ruling that was upheld by the D.C. Circuit Court of Appeals in January. (See DC Circuit Upholds FERC on Duke-Muni Battery Dispute.)
The capacity charge — based on NCEMPA’s pro rata share of the demand on Duke’s system during the one-hour coincident peak (CP) — is intended to cover Duke’s fixed costs and provide a return on its infrastructure investments.
New Contract Sought
DEP responded to the commission’s 2020 order by seeking to reopen the PPA, telling FERC that a revised rate design was needed because of statements by NCEMPA members announcing their intention to procure enough storage to reduce or eliminate their capacity charges “by superficially reducing or eliminating their demand only during the single CP hour of the month.” Since December 2020, NCEMPA and its members have issued solicitations for almost 150 MW of battery storage, DEP said.
The company said NCEMPA’s peak shaving was shifting capacity costs to four other wholesale requirements customers and that DEP’s retail customers also could be harmed because they pay a portion of the fixed costs.
DEP’s revised PPA would replace the current 12-CP methodology with a process that compares NCEMPA’s CP demand with its monthly non-coincident peak (NCP). In any month in which NCEMPA’s NCP exceeds its CP by 200 MW or more, the difference between the CP and the NCP minus 200 MW would be added back to the CP for setting demand charges.
The company told FERC the amended PPA is needed because “DEP’s system planning can no longer merely assume that the monthly coincident peak is the appropriate proxy for each customer’s use of the system.
“DEP’s limited visibility into NCEMPA’s intended time and magnitude of load management and demand cost mitigation measures creates real-time operational problems in so far as DEP must ramp (expensive and carbon-intensive) generation to meet NCEMPA’s anticipated load only to have NCEMPA members deploy demand cost mitigation measures, creating temporary and artificial load reductions to which DEP must quickly respond in real time,” it said, adding that the operational challenges will increase as it integrates more solar onto its system.
The company also proposed to change the nearly one-year notice period for proposed changes to the PPA. It currently gives the parties 60 days to reach an agreement on an amendment; if they are unable to agree, a 240-day informal dispute resolution process follows. DEP proposed shortening the notice and negotiation period from 300 days to 60 days, saying the current contract allows one party to “effectively hold the change hostage for almost a full year.”
NCEMPA protested, saying Duke’s proposal would penalize the development of distributed energy resources and that it violates cost-causation principles because the 200-MW threshold is arbitrary. It also complained that DEP would apply a cost allocation method that deviates from the conventional 12-CP method only to NCEMPA.
Ruling
FERC voted 4-1 to conditionally approve the revised PPA, effective March 1 and subject to refund pending settlement judge procedures.
The commission noted it has “previously accepted modification to a 12-CP methodology where the applicant sought to address cost shifting due to load-control measures.”
“Here, DEP has presented arguments that its current demand allocation method may fail to appropriately align costs with beneficiaries given the changing operational conditions on DEP’s system,” FERC said. “We find these arguments persuasive.”
The commission also dismissed NCEMPA’s argument that the revised PPA is unduly discriminatory, saying, “DEP’s departure from the 12-CP methodology … is not novel.
“Each of DEP’s wholesale customers has negotiated unique terms in their respective agreements based on their individual circumstances,” it said.
But the commission said it wasn’t convinced that DEP’s adjusted capacity charge calculation and 200-MW threshold are just and reasonable. It also said DEP’s proposal to modify its notice provisions from 300 to 60 days is “not adequately supported.” NCEMPA said it would consider some reduction in the duration of the informal process but that 60 days was too short for it to secure the necessary governing board consideration and approval.
Dissent from Clements
Dissenting was Commissioner Allison Clements, who said the commission should have rejected DEP’s proposal without prejudice and that the majority’s order “sets too low a bar for the filing party’s proposed rate to become effective as the hearing process moves forward.”
Clements said DEP failed to demonstrate how its rate proposal reflects its transmission planning. She also questioned why DEP doesn’t use NCP demands in allocating costs for all DEP customers.
“At minimum, a five-month suspension period is warranted in this case,” she said. “To the extent that the hearing process stretches beyond the 15-month refund period, NCEMPA risks being subjected to unjust and unreasonable or unduly discriminatory charges without any recourse.”
A new draft study evaluating ways to decarbonize New England’s power sector finds multiple advantages for carbon pricing, but also significant tradeoffs that underscore the tough choices facing policymakers.
The draft of the Pathways Study, commissioned by ISO-NE and written by the consulting firm Analysis Group over the last year, was presented to the NEPOOL Participants Committee on Tuesday.
It looked at four policy approaches: a status quo scenario in which the New England states continue their unilateral clean energy policies; a forward clean energy market (FCEM) to compensate non-emitting resources; a net carbon pricing plan to price emissions from generators; and a hybrid approach which combines the latter two.
In theory, all four approaches can achieve “substantial” levels of decarbonization, the draft report says, but they come with unique challenges and costs.
The differences between the policy approaches laid out in the study | Analysis Group
Net carbon pricing would be cost-effective, a standard which the report says the other solutions fall short of. It would “create price signals that incent all substitutions that can reduce emissions,” it says.
Carbon pricing would also result in the lowest social cost, a 28% decrease from the cost of the status quo. Importantly, however, it wouldn’t be the cheapest option for consumers; that prize goes to the hybrid plan, which would reduce customer payments, unlike the others.
Carbon pricing would also be the most feasible approach to develop, the report says, because policymakers have more experience creating that type of design than something like the FCEM.
“While there is experience with market-based systems for environmental attributes … the FCEM would involve certain policy design elements that have not been used previously and would likely require significant time and effort to develop,” the report says.
However, carbon pricing is less well-suited to coordinating individual state policies and clean energy targets.
ISO-NE has been a supporter of carbon pricing but has struggled to find consensus in the stakeholder process and particularly among state policymakers. (See ISO-NE: States Must Lead on Carbon Pricing)
NESCOE, representing the New England states, has opposed the concept of incremental carbon pricing administered by the grid operator, arguing in 2020 comments to FERC that “consumers could be exposed to costs exceeding several billions of dollars each year.”
The distribution of locational marginal prices under each of the possible policy solutions | Analysis Group
The hybrid approach involves combining a carbon price sufficient to provide revenue adequacy for existing clean energy resources (like the Millstone nuclear plant, used as an example in the report) with an FCEM that provides incremental compensation only to new clean energy resources. It’s a “completely novel” approach and the report raises questions about its feasibility for that reason.
One other issue found with the FCEM and hybrid approaches is storage “churning,” in which battery owners “consume otherwise-curtailed variable renewable energy and earn net revenues through energy losses,” the report says. The conditions leading to that inefficiency would be caused by frequent and large negative LMPs, which occur in those two scenarios.
In effect, the storage resources would be being paid to generate clean energy credits for clean energy resources even though the energy wouldn’t be replacing carbon-intensive generation.
Another advantage the report finds for carbon pricing is that it would provide incentives for fossil fuel generators to reduce their carbon-intensity when it’s cost-effective to do so, although the scope for those emissions reductions is “limited given current technologies,” it finds.
The Massachusetts Commission on Clean Heat is on an “aggressive” timeline to produce a preliminary recommendation for capping greenhouse gas emissions from heating fuels, according to a top state environmental official.
As part of its mandate, the commission must quickly identify policies to inform the still-undetermined building sector emissions sublimit in the state’s forthcoming 2025/2030 Clean Energy and Climate Plan (CECP), Judy Chang, undersecretary of Energy and Climate Solutions at the Executive Office of Energy and Environmental Affairs (EEA), said during a commission public meeting Tuesday.
Massachusetts’ 2021 climate law calls for EEA to establish emissions limits and sectoral sublimits by July 1 along with a plan to achieve the limits. Over the next month, Chang said, the commission will identify policies, programs, initiatives and incentives that would achieve a building sector sublimit and an economy-wide emission-reduction target of 50% below 1990 levels by 2030.
After the commission makes its preliminary policy recommendations, it will refine them into a final report for Gov. Charlie Baker in November.
The 22-member commission has held four meetings since its launch in mid-January and is now “deliberating on some of the suggestions that they might have and exchanging ideas with each other,” Chang said.
Commission meetings, however, are closed to the public. EEA is conducting stakeholder engagement on the commission’s work through three public information sessions.
“We want public input, but I also wanted the commission members to have … the flexibility and the freedom to debate, and it’s through that process that we get the most productive and efficient outcome,” Chang said.
EEA will share information on the commission’s work during a public meeting on March 24. Another public meeting is scheduled for April 14 to give stakeholders a combined update on the commission and the 2025/2030 CECP.
Informing the CECP
EEA Secretary Kathleen Theoharides released an interim 2030 CECP in December 2020 as an update to the state’s existing climate plan at the time. The statutory requirements for the interim update changed in late March 2021, when Gov. Baker signed the state’s next-generation climate policy into law.
Under the law, a 2025/2030 CECP must be completed this summer with statewide limits and at least six sectoral sublimits that are accompanied by plans to achieve each limit. Another update with 2050 sublimits and related plans is due next January.
The clean heat commission’s work on the building sector is one of many public processes underway in Massachusetts to support development of the CECP.
As they relate to heating fuels, those public processes are giving “conflicting signals,” Martyn Roetter, a director at the Neighborhood Association of the Back Bay in Boston, said in comments to EEA during the public meeting Tuesday. He asked the commission to consider how the various initiatives and proposals will provide “consistent and coherent” guidance on fossil fuels.
At the city level, Roetter said, Boston has enacted a stringent emissions ordinance for large buildings. The state, on the other hand, has released a draft net-zero buildings code for municipalities to adopt that “includes the option in new construction to use fossil fuels,” he said. (See Mass. Legislators Call for Fossil Fuel Ban in Net-zero Building Code.)
In that context, he added, Massachusetts Attorney General Maura Healey determined in 2020 that towns are bound by state law to allow new fossil-fuel hookups.
And new recommendations from the state’s gas utilities under the Department of Public Utilities’ investigation of the role of those utilities in decarbonization “sets the stage for the indefinite, continued use of large, extensive networks of pipelines,” he said.
National Grid (NYSE:NGG), Eversource Energy (NYSE:ES), Liberty Utilities and Unitil (NYSE:UTL) released initial proposals in mid-February for their long-term climate plans in that docket (20-80). The utilities’ proposals, while not identical, all include recommendations for hybrid heat pump/natural gas installations and decarbonization of gas networks over time through blending with renewable natural gas or hydrogen.
More than 90 companies, state and local governments, universities and other organizations have pledged to cut their greenhouse gas emissions 50% by 2030 as part of the Department of Energy’s newly launched Better Climate Challenge.
“You’ve committed to cut your operational greenhouse gas emissions at least in half in 10 years,” said Secretary Jennifer Granholm, during a virtual kick-off event on Monday. “That means everything within the fences — the heating, the cooling, ventilation, lighting for buildings, the cars, trucks in fleets, the electricity you use and more.”
Challenge participants — which range from major corporations such as General Electric, Harley-Davidson and IKEA to small towns, such as Glen Falls, N.Y. — pledged to reduce their scope 1 and 2 GHG emissions by at least 50% within 10 years. They are also expected to establish organizational plans with benchmarks, including ambitious energy efficiency goals, “typically 20%,” according to a fact sheet on the challenge.
But beyond the emission reductions, the initiative is also aimed at unleashing the kind of “big collective action” needed to combat global climate change, Granholm said. Challenge participants have committed to “sharing the details and the data to demonstrate how you [cut emissions],” she said.
Gina McCarthy, White House National Climate Advisor | DOE
The goal, she said is “to figure out what works, what actually needs work [and] what that tells us about the way going forward.”
The initiative is an extension of the DOE’s Better Building Challenge, a decade-long effort to improve the energy efficiency of residential and commercial buildings via public-private partnerships and information sharing, Granholm said.
The challenge is yet another part of the Biden administration’s goal of cutting the country’s carbon emissions in half by 2030, the U.S. commitment to the global community as part of the UN Paris climate agreement. Biden’s executive order on federal procurement has also committed the government to “lead by example” by cutting emissions from its buildings in half by 2030.
National Climate Advisor Gina McCarthy said climate action has become a brand differentiator for consumers and voters. “Your constituents in state and local government, your customers in the private sector are all looking to leading the way, and you are standing tall by making sure they know what your values are.”
Secretary of Housing and Urban Development Marcia Fudge, who noted the participants in the challenge include seven affordable housing organizations, said disadvantaged communities are especially vulnerable to the impacts of climate change.
“HUD funds billions of dollars in disaster recovery work in cities and towns devastated by natural disasters,” Fudge said. “We see the impacts firsthand, and the years it takes to rebuild after these climate events. The more we can do now on the climate mitigation front, the less we will have to spend on rebuilding our communities.”
Advancing Equity
The need for urgent, collective action on climate change was underlined Monday by a new report from the UN Intergovernmental Panel on Climate Change, warning that the catastrophic impacts of global warming — floods, drought, heat waves — were fast outpacing the world’s ability to adapt to or mitigate them. (See IPCC Climate Report: ‘Half Measures No Longer an Option.’)
Marcia Fudge, Secretary of Housing and Urban Developement | DOE
“Environmental health and human health are interlinked; we see climate change as the greatest environmental health threat of this century,” said Jon Utech, senior director of the Office for a Healthy Environment at the nonprofit Cleveland Clinic, another challenge participant. “It’s already having a dramatic impact on the health of our patients and the communities we serve. We see taking on this challenge as a major health initiative.”
Like Utech, other executives speaking at the launch event focused on the opportunities they are seeing and actions they are taking for decarbonization in their industries or sectors. Traci Forrester, executive vice president for environment and sustainability at steel maker Cleveland-Cliffs, framed the challenge as another step toward decarbonization of heavy industry in the U.S.
Cleveland-Cliffs is rolling out a “closed-loop, steel recycling program where all of our hot metal contains 28% recycled steel,” she said. The company — the Largest Flat‑Rolled Steel Producer in North America — is also working with DOE to “evaluate potential future use of carbon capture technology for steel mills.”
Echoing HUD Secretary Fudge, Maurilio León, CEO of the Tenderloin Neighborhood Development Corporation in San Francisco, spoke of decarbonization as a path toward equity for low-income communities that historically have had little access to energy efficiency or clean energy technologies.
“Currently, 80% of the community that we serve earns less than $15,000 a year,” he said. “By building quality, energy-efficiency homes, we can advance equity in a real way by supporting low-income families to spend less on utility costs and more on other basic essentials, such as food, medicine, health care.”
