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November 6, 2024

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Murphy Toughens NJ Emission-reduction Goals

New Jersey Gov. Phil Murphy on Wednesday set a state goal of cutting carbon emissions to half of 2006 levels by 2030 and backed his pledge by allocating more than $33 million for purchasing medium- and heavy-duty (MHD) electric vehicles.

In signing an executive order on a Flanders landfill that a developer is converting to a solar farm, Murphy said the new goal would help the state meet is broader objective of reducing greenhouse gas emissions by 80% by 2050.

“The time for wake-up calls is frankly long passed,” he said. “And while we can’t turn back the clock, we also can’t keep hitting snooze. Now is the time for bold action.”

To help meet the new goal, Murphy said his administration would spend $13.7 million in funds from the Regional Greenhouse Gas Initiative to buy 46 electric buses, three electric trucks and one shuttle bus. The recipients include five public school districts, two private Jewish schools and six companies that provide school bus services in the state.

Murphy directed the state to return to RGGI in January 2018, seven years after his predecessor, Republican Chris Christie, pulled New Jersey out of the initiative. (See NJ Senate Ushers in Revamped Nuclear Bailout Bill.)

The New Jersey Department of Environmental Protection (DEP), which helps administer the funds, said the grants would cover the differential between a regular diesel bus and an EV. An electric bus can cost more than $310,000, or three times as much as a diesel bus, according to a report released in March by Environment New Jersey and NJPIRG, a public interest advocacy group. (See NJ Floats New Electric Bus Plan.)

Murphy said his administration will also add $20 million to the New Jersey Zero Emission Incentive Program (NJZIP), a pilot program that provides local and state governments and businesses with incentives for the purchase of MHD electric trucks. Vouchers start at $25,000 for a Class 2b truck and then go up to $100,000 for a Class 6 truck.

Pallavi Madakasira, director of clean energy for the New Jersey Economic Development Authority (NJEDA), said the agency expects to start accepting applications in the program Dec. 1.

“This is obviously not the only tool in the toolkit to achieve the goals laid out for the state,” she said at the governor’s signing event. “But it remains one of many interlocking efforts” designed to support the state’s “zero-emission transportation evolution.”

Calls for Tougher Action, Slowdown

Environmentalists welcomed the governor’s announcement. Doug O’Malley, director of Environment New Jersey, called it an “aggressive,” necessary step given the urgency highlighted by the damage caused by Hurricane Ida in September.

“Today’s announcement of $33 million in RGGI funding is a down payment when it comes to replacing dirty diesel trucks with clean electric options,” O’Malley said. “We thank the governor for setting this bold climate action mandate as he looks to his second term, and we look forward to working with the administration to fulfill this mandate through climate regulations.”

The governor’s announcement comes just over a week after he narrowly won re-election, with the help of support from environmental groups. Murphy’s announcement closely tracks the goal set out by Empower NJ, a coalition of about 60 environmental, community, faith and grassroots groups in a petition filed with the DEP in July calling for the agency to cut greenhouse gas emissions 50% below 2005 levels by 2030.

Tackling transportation emissions will be critical to the state’s carbon-reduction efforts because they constitute 42% of GHG emissions statewide. The state’s master plan, released in 2019, assumes that 75% of medium-duty trucks and 50% of heavy-duty trucks will be electric by 2050.

Empower and the Sierra Club released a join statement supporting Murphy’s move and calling for the governor to “immediately mandate this goal of 50% greenhouse gas reductions through rules and regulations.”

“This is what climate science demands,” they said. “This is an essential step forward in the fight to avert climate catastrophe.”

But the New Jersey Business & Industry Association (NJBIA), one of the state’s largest pro-business trade groups, encouraged Murphy to set more achievable goals. Raymond Cantor, the association’s vice president of government affairs, said it would take the state 15 years to cut 2006 emissions levels by the more modest target of 20%, mainly through switching from coal-fueled energy generation to natural gas fueled generation.

“It’s simply not feasible to get to 50% by the year 2030 without jeopardizing energy reliability or greatly impacting costs for all New Jerseyans,” he said. “We encourage the Murphy administration to work toward more pragmatic and realistic policies to reduce carbon, rather than the unattainable.”

Incentivizing EV Buying at the Jersey Shore

NJEDA, which administers NJZIP, approved the program’s expansion and additional funding at its monthly board meeting in Trenton on Wednesday. The pilot program started with $15 million to help fund the purchase of MHD trucks in and around Camden and Newark, and NJEDA increased it by $9.25 million in October to include municipalities around New Brunswick.

The latest funds will enable NJEDA to expand the program beyond the main three urban areas currently targeted to provide incentives to EV truck and bus purchasers in and around overburdened communities in less densely populated areas. Specifically, the shift will make eligible for incentives buyers in about 50 communities located within 10 miles of the Jersey Shore, including Atlantic City, Seaside Heights and Asbury Park.

The new program rules also broaden other aspects of the program. While designating $5 million for electric trucks purchased in the shore area, the program allocates another $10 million for electric passenger transportation, such as buses, shuttle buses and passenger vans. Another $5 million will go to small businesses that purchase an electric truck.

Started in 2005, the RGGI program caps the amount of carbon dioxide emissions for each member state and requires power plants in each state to buy allowances, either through auctions or on the secondary market, for the carbon dioxide they emit. The funds are then divided among the participants, which include Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, Vermont and Virginia. (See NJ RGGI Spending Focuses on Transportation.)

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Virginia Utilities’ LMI Solar Programs Not Well Known, Board Told

Major Virginia utilities do have programs to offer assistance with solar energy to low-income customers, but they’re all but keeping them secret, the Virginia Clean Energy Advisory Board (CEAB) heard at its Nov. 3 meeting.

None of the three utilities represented at the meeting — Dominion Energy (NYSE:D), Appalachian Power and Kentucky Utilities/Old Dominion Power (NYSE:PPL) — has an active outreach program to low-income customers concerning solar energy, representatives of the companies admitted.

For example, Kentucky Utilities/Old Dominion Power’s marketing of its programs is “limited to information on the website,” Kendrick Riggs, an attorney representing the company, said in response to a question from a board member. “We do reach out to nonprofits that help customers pay their bills.”

“In my organization, we have found a lack of knowledge about programs when they’re only posted on websites, and also skepticism — they sound too good to be true,” CEAB member Susan Kruse, executive director of the Community Climate Collaborative, a policy research and advocacy group in Charlottesville, Va., said in response. “But people trust their electricity providers.”

Nevertheless, the programs are slowly getting off the ground. Nathan Frost, Dominion Energy’s director of new technology and energy conservation, cited an energy conservation and solar energy program for low income, elderly and disabled individuals that launched in the first quarter of this year. HB 2789, enacted in 2019, requires Dominion Energy and Appalachian to make up to $25 million in incentives available in a three-year program for energy conservation measures, and another $25 million in incentives for the installation of solar panels.

The panels are to be installed behind the participant’s meter and net-metered, with the solar panels and associated inverters and connecting equipment owned by the program participant. To be eligible, customers must have already participated in the energy conservation program, or in a previously existing program with HVAC-related measures. Generally, customers are eligible if they have a total household income under 80% of local median income per the Virginia Housing Development Authority, or under 60% of the state median income per the Virginia Department of Housing and Community Development, whichever is greater.

“We are going to work with the state weatherization network and solar installers,” Frost said, adding that Dominion Energy plans to start soliciting qualified installers via a request for proposals (RFP)/request for qualifications (RFQ) by the end of the month. Following a 60-day feedback period for the installers, which will help Dominion Energy learn if they are experiencing supply-chain problems due to the pandemic, the plan is to launch the program next spring.

“In our prudency filing before the SCC, we estimated that cumulative participation over the three-year pilot period would be just over 1,600 customers,” Lucy Rhodes, a spokesperson for Dominion Energy, said in an email to NetZero Insider after the CEAB meeting.

Also next year, Frost said, Dominion Energy is expecting a final order from the State Corporation Commission greenlighting the company’s shared solar program. If all goes well, that program’s official launch will come in July 2023.

Troubles Getting Projects Online, Reaching Customers

Appalachian Power serves an economically stagnant area, where baseboard heating and electric heaters in trailers are common and the load is declining, Noelle Coates, senior counsel at parent company American Electric Power (NASDAQ:AEP), told the CEAB. “We’ve had a lot of problems getting projects online,” she said about solar energy, citing “supply chain problems.”

In August, the Leatherwood solar facility came online for Appalachian Power in Henry County, Va., Teresa Hall, a spokesperson for AEP, told NetZero Insider. The 20-MW facility is in the southern part of the state, close to the North Carolina border. “Appalachian Power does not have any current plans to use the output from the facility, which is the first solar facility online in Virginia for us, for any specific plans targeting middle- or low-income Virginians,” she said. “Importantly, all of our customers — regardless of income level — benefit from this source of cost-effective, carbon neutral energy.”

When CEAB Chair Hannah Coman asked whether Appalachian Power had a marketing program for low-income customers for solar power, Coates responded, “We need to [study] how our customers receive their information and target it.” Coman suggested that the board would like “an annual check-in” for Appalachian Power.

Lack of information about solar power programs that may be available to them is far from the only barrier facing low- and moderate-income utility customers. Riggs noted that 55% of the electric customers of Kentucky Utilities/Old Dominion Power in Wise County, where most of its Virginia customers are, have a household income under $50,000 a year. In answer to a question from CEAB member Sam Brumberg, Riggs said, “Low-income customers often lack the funds for net metering. The largest problem is the housing stock — it needs more insulation.”

No organizations representing LMI customers spoke at the meeting, The Coalition on Community Solar Access, and Appalachian Voices did not respond to requests for comment.

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California, Quebec, New Zealand Pledge Cooperation on Climate, Carbon Markets

The state of California entered an agreement with the governments of Quebec and New Zealand on Tuesday to work together on carbon markets and other climate action.

The joint declaration was signed during the 26th U.N. Climate Change Conference of the Parties (COP26) in Glasgow, Scotland.

The declaration states the three governments’ intention to share their experiences in the fight against climate change. It calls for exploring a future alignment of the governments’ cap-and-trade programs through discussions of program features such as cap setting, auctions, allocation and market rules.

The agreement was signed by Liane Randolph, chairwoman of the California Air Resources Board (CARB), on behalf of the state; Benoit Charette, Quebec minister of the environment and the fight against climate change; and James Shaw, New Zealand’s minister for climate change.

The three governments have been exchanging technical information on greenhouse gas reduction strategies for several years, CARB said in a release. The intent of the declaration is to strengthen the collaboration.

“Cooperation between jurisdictions on climate action is absolutely essential to addressing the climate crisis,” Randolph said in a statement. “We look forward to aligning our respective climate programs where possible and strengthening and amplifying the impact of these programs in the process.”

Charette said in a statement that the three governments share a belief in carbon markets “as an effective economic instrument to reduce greenhouse gas emissions.”

“In signing this declaration today, we are formalizing several years of sharing information, experiences and best practices about our respective cap-and-trade systems and are looking forward to working even more closely together,” Charette said.

Net-zero Transition

The joint declaration affirms the three government’s intention to support full implementation of the Paris Agreement.

It states their intent to transition to net-zero GHG emissions, while creating jobs and helping people affected by the shift toward a carbon-neutral economy.

One of the goals of the joint declaration is to promote the environmental integrity of carbon pricing instruments to reduce GHG emissions worldwide.

California’s cap-and-trade program has been in place since 2013. In 2014, the state linked its cap-and-trade program with Quebec’s system through the Western Climate Initiative.

New Zealand launched an “emissions trading scheme” in 2008, adding a cap to the program last year.

California’s emissions-trading program is the fourth largest in the world, behind the programs of China, the European Union and the Republic of Korea, according to the Center for Climate and Energy Solutions, an environmental policy think tank.

CARB describes its cap-and-trade program as a key element of the state’s GHG-reduction strategy. The program sets a limit on major sources of emissions in the state, with the cap decreasing each year.

GHG allowances may be purchased, but the minimum price for allowances at auction increases each year while the number of annual allowances is reduced. This creates “a steady and sustained carbon price signal to prompt action to reduce GHG emissions,” according to CARB.

Carbon-pricing Commitment

The signing of the joint declaration on Tuesday came a day after Quebec’s Benoit was joined by Juan Carlos Jobet, Chile’s minister of energy, to invite governments to endorse the Glasgow Declaration on Carbon Pricing in the Americas.

The declaration is an initiative of the Carbon Pricing in the Americas platform, which was launched in 2018 and is co-chaired by Quebec and Chile.

National and subnational governments across the Americas may participate in the initiative. By doing so, they declare their support for the Paris Climate Agreement and commit to developing carbon pricing instruments as a way to reduce greenhouse gas emissions.

“The Glasgow Declaration … makes increasing the price of carbon the linchpin of the changes required by the Paris Agreement,” Jobet said in a release. “Given the seriousness of the problem, there is an urgent need to massively reduce emissions, and, in this regard, the decade ahead is crucial.”

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New Jersey Requires Warehouses to Be Solar-ready

New Jersey Gov. Phil Murphy signed two bills into law on Monday: one requiring that new warehouses be built ready for the installation of solar energy systems, and the other mandating builders to provide customers with an option to use low-carbon concrete for new construction.

The two bills were among more than 50 bills that Murphy signed into law as the New Jersey Legislature began its fall session. The legislature took a break for the summer and the run-up to the Nov. 2 election in which Murphy and all state legislative seats, in both the Assembly and the Senate, were on the ballot.

Murphy was narrowly re-elected, and Monday’s bill signing sends a clear signal that the governor will likely continue his ambitious climate policies, putting the state on a path to a completely decarbonized grid by 2050. (See: NJ’s Murphy Expected to Stay the Course on Clean Energy Policies).

Passed in the spring, both bills would have become law automatically once the legislature returned to work even if Murphy had not signed them.

The solar bill (A3352) requires warehouse developers to ensure that at least 40% of the area of a new warehouse roof is available and structurally ready to support solar photovoltaic or thermal systems. The area is calculated after the space taken up by skylights, occupied roof decks, vegetative roof areas and other uses is removed from the calculation.

New Jersey, like other states, has seen a surge in demand for warehouse space, triggered by the COVID-19 pandemic and the resulting dramatic shift in consumer behavior from in-person to online shopping. The demand for space for fulfillment centers and smaller warehouses to serve as launchpads for last-mile deliveries has been driven in New Jersey, in part, by the presence of the Port of New York and New Jersey, the third largest port on the East Coast.

The second bill signed by Murphy (S3091) encourages the use of concrete that is created under controlled conditions — known as “unit concrete” — and is certified as “generating at least 50% less carbon dioxide emissions” in its production. Unlike regular concrete, which is delivered wet to a construction site and dries on the job, unit concrete is prefabricated and delivered in ready-to-use form, often as pavers or concrete blocks.

The bill addresses what some analysts see as a key generator of greenhouse gases, and one that is important to any effort to cut those emissions because of its prevalence in daily life. A May 2020 report by consultant McKinsey and Co. concluded that the cement industry is responsible for about a quarter of all industrial CO2 emissions worldwide and 7% of all emissions globally. Cement is a major component of concrete.

Clean Energy up for Vote

The Sierra Club’s New Jersey Chapter welcomed the solar signing. Acting Director Taylor McFarland said the legislation will help the state “improve its solar energy capacity” and help fight climate change.

But McFarland said the bill promoting the use of low-carbon concrete is “not enough,” calling the industry “environmentally destructive from cradle to grave.” Cement manufacturing “emits a host of air pollutants” and a high level of carbon dioxide, she said.

Another bill in the legislature (A5223) also promotes the use of low-carbon concrete but has yet to advance. The proposed legislation would require state agencies taking bids for construction “to apply a low embodied carbon discount rate to the price of bids.” The discount would reduce the price of the bid by up to 5%, and developers would be eligible for a corporate tax credit to offset the discount price.

The fall session, which runs through mid-January, is expected to include discussion of several other bills related to climate change. On Monday, the Senate Environment and Energy Committee will vote on newly introduced legislation (S4077) that would create a three-year pilot program to examine the potential benefits and problems of wider adoption of electric school buses. (See: NJ Floats New Electric Bus Plan.)

The committee also will consider A2360, a bill that would require electric utilities to charge residential rates, but nothing higher, for customers charging electric vehicles at home.

The Sierra Club is looking for the passage of a bill (S2484) that would establish an Office of Clean Energy Equity within the New Jersey Board of Public Utilities. The office would be responsible for overseeing the “equity deployment of clean energy” in low-income, minority communities.

Other pending legislation that could be taken up includes a bill (A4899) that would expand the state’s electric vehicle incentive programs to include motorcycles. Another (S3665) would require manufacturers of EVs to establish and implement battery recycling plans.

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Maine Can Help Decarbonize Industrial Pellet Shipping, Consultant Says

Maine has the forest industry and ports it needs to participate in the global industrial wood pellet market, and it’s positioned to lower the fuel’s shipping footprint, said consultant William Strauss.

The U.S. is the biggest industrial pellet fuel (IPF) exporter in the world, reaching 7 million metric tons in 2020, said Strauss, who is president of FutureMetrics. But he says shipping is the largest contributor to the carbon footprint of delivered IPF, if the pellets are carbon neutral in combustion.

U.S. exports originate largely from the Southeast, giving Maine’s ports a “a huge shipping distance advantage,” he said Tuesday during an Environmental and Energy Technology Council of Maine webinar.

As of 2017, ports in Savannah, Ga., and Norfolk, Va., were responsible for more than half of IPF exports in the Southeast, according to Oak Ridge National Laboratory. For shipping to the U.K., the biggest importer of U.S. pellet fuel, Maine’s three major deepwater ports could cut between 500 and 1,000 miles off the transportation carbon footprint from those Southern ports.

Industrial pellets are used to replace coal in utility-scale, pulverized coal boilers, with the global market shipping 25 million metric tons in 2021. The carbon neutrality of the fuel’s combustion is dependent on basic sustainability with forest growth rates.

“Behind the industrial pellet sector is a stringent and rigorous third-party auditing system that proves sustainability,” Strauss said. “That means that you’re never harvesting at a rate that’s any greater than the growth rate.”

While sustainability requirements limit how much forest resources can be used as IPF, Strauss says the market will see significant growth in the coming years.

If it grows as projected, he said the global IPF market will need 22.5 billion metric tons per year of new production capacity by 2027. Changes in Maine’s forest industry make IPF an important option for the state’s $8-billion forest products sector.

Demand for pulp chips and low-grade biomass has disappeared or is drying up, and both of those forestry residues are good for pellet fuel, Strauss said.

Currently, all IPF in the U.S. is exported, as no coal plants in the country use the alternative fuel. Carbon policy is going to change that, Strauss said.

There are 498 operating coal-fired power plants with 50 MW or more generating capacity in the U.S., and many are in areas where industrial pellets are already produced. Of the group, 39 units are less than 15 years old and average 555 MW each, Strauss said.

“If those units are shut down or natural gas takes over and they lose their value as a generating station, there’s a cost associated with that,” he said. Those 39 units, he added, have a strong potential for pellet fuel use.

If coal plant owners in the U.S. do begin to convert facilities to co-fire pellets, Strauss estimates the domestic IPF demand could reach 5.2 million metric tons by 2027.

Carbon-negative IPF

The potential for the U.S. to build out a fleet of coal plants that co-fire IPF could lie in a bioenergy carbon capture and storage (BECCS) pilot at the Drax power plant in North Yorkshire, England.

Four of the six coal boilers at the Drax facility were converted to biomass, and Drax Group is working with Mitsubishi Heavy Industries to understand negative emissions technology at the plant.

Using existing pipeline infrastructure, the companies plan to store carbon dioxide from the biomass units permanently under the North Sea.

“Think of it as the trees doing the work of absorption but regrowing constantly,” Strauss said. “You have a constant renewing supply of carbon emissions that are actually being captured and not returned to the atmosphere.”

If the fuel used in the biomass units isn’t harvested faster than the forest growth rate, the sequestration process would make the units carbon-negative.

Drax Group hopes to have BECCS running on two of the four biomass generating units by 2030, with initial construction starting in 2024 and the first unit operational in 2027.

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NARUC: Pandemic Response Shows Value of Planning

The COVID-19 pandemic has been both an important test of regulated utilities’ emergency mechanisms and a lesson in the importance of early preparedness, members of the National Association of Regulated Utility Commissioners’ Emergency Preparedness, Recovery and Resiliency (EPRR) Task Force said at the organization’s annual meeting on Monday.

“I think it’s amazing how resilient all of the state commissions were, in how they pretty much turned on a dime. The staff, and particularly our IT staff, deserve an amazing kudos for everything they did to keep us going and get us all virtual,” said Washington Utilities and Transportation Commissioner Ann Rendahl, chair of the task force’s Subcommittee on COVID-19. “But without the prior planning, you can’t have that full response.”

Report Focuses on Industry Response

Rendahl’s presentation included highlights of a report issued by NARUC last month on “Lessons Learned from the Ongoing Response to the COVID-19 Crisis.” Her subcommittee compiled the report with input from commissioners from 13 states; stakeholders from the electricity, natural gas, water and telecommunications industries, as well as generator manufacturers; the Department of Energy; and consumer advocates.

The report examines the response of utilities, suppliers and regulators on multiple issues, including implementing remote workforce postures and cybersecurity protections; public policy, such as disconnection moratoria and aid for vulnerable populations; and acquiring protective equipment.

However, Rendahl placed the greatest emphasis on the recommendations that state utility commissions “update their emergency preparedness plans to include a comprehensive pandemic response,” reminding attendees that this attitude will help in any future emergency situations.

“I would encourage all of you … [to] go back and look at [your emergency planning] … and see if you can think about all the different places where maybe you might need … some future planning for how we might address a similar long-term situation where you’re not all in the office,” Rendahl said. “Or it might be you don’t have a cyber element to your plan, or you’re not fully prepared for some significant weather event.”

Pennsylvania Public Utility Commissioner Gladys Brown Dutrieuille, chair of the EPRR Task Force’s Black Sky Subcommittee, said this view applied equally to her group, which is responsible for developing resources to support NARUC members in the event of a catastrophic, multiregional event affecting multiple critical infrastructure sectors. Citing the example of Puerto Rico’s mass outages following Hurricane Maria in 2017, she urged regulators to reach out proactively to federal and state officials, as well as utilities, to ensure a smooth chain of command in a crisis.

“You don’t want to start handing out your business cards on a tarmac when you’re meeting the people [coming] in to help you deal with the event,” Dutrieuille said. “You want to know those people in advance; you want to know who you can call … to be prepared for all this. … You don’t plan for a black sky event in the middle of the response.”

Task Force Publishes Federal Funding Guidebook

Task force members also plugged the Federal Funding Opportunities Guidebook, issued this week in response to the passage of the Infrastructure Investment and Jobs Act on Friday. (See Energy Groups Quick to Praise Infrastructure Bill Passage.) The guidebook is intended to help state commissioners identify and prioritize programs that are eligible for funding from the $1.2 trillion in the bill.

The task force’s Federal Funding Opportunities and Construction Standards Subcommittee produced the guidebook. Mississippi Public Service Commissioner Brandon Presley, chair of the subcommittee, said that he expects the work of parsing the bill’s language and determining its long-term implications to be an ongoing effort.

“Mainly the focus of our subcommittee has been on, what are those pots of dollars that … can be drawn upon for this effort?” Presley said. “All of that changed Friday night when the infrastructure bill passed … but I think our work will continue, in at least updating our guidebook on the different elements that are in the infrastructure bill.”

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NARUC Panel Examines Pathways to Net Zero

A trio of experts on Monday presented various perspectives on reaching net-zero emissions: a macro view of the whole country; a micro view of one city; and the third on policies at both the state and federal levels.

Expanding the supply of clean electricity is a linchpin in all net-zero paths, Jesse Jenkins, assistant professor of mechanical and aerospace engineering at Princeton University, said at the National Association of Regulatory Utility Commissioners’ annual meeting in Louisville, Ky.

“The share of electricity from carbon-free sources roughly doubles from about 37% today to 70 to 85% by 2030 and reaches 98 to 100% by 2050,” Jenkins said.

Princeton’s Andlinger Center for Energy and the Environment in October released the final version of a comprehensive study on reaching net-zero greenhouse gas emissions, which was first published in draft form at the end of last year. (See Net Zero Price Tag: $2.5 Trillion.)

The study looked at five different ways to reach net zero, “not because any of these are favorite pathways or we want to privilege these in particular, but because they help us try to explore some of the different choices and trade-offs that we might have to face,” Jenkins said. The scenarios are high electrification; less-high electrification; high biomass; constrained renewable energy; and 100% renewable energy.

The transformation of the energy sector will require “about a tripling of our high-voltage transmission grid … so we need to finance and mobilize about $2.5 trillion of additional capital in the 2020s alone,” Jenkins said.

The study’s research focused on carbon storage locations outside of the West, and Wyoming Public Service Commissioner Mary Throne “wondered how you identified those locations. Was it pipeline-related?”

The study looked at the largest basins, and there are many locations for geologic storage scattered throughout the country in different locations, Jenkins said.

“One of the key challenges is how much you can inject per well, which then determines the cost of injection, because if you can only inject half as much per well, you have to build twice as many wells at twice the cost,” Jenkins said. “So we focused on creating a supply chain of sites based on geologic estimates of the injectivity rates that could be achieved in different basins.”

LA100

Jaquelin Cochran, director of grid planning and analysis at the National Renewable Energy Laboratory, has been helping Los Angeles and its Department of Water and Power (LADWP) create a first-of-its-kind study, LA100, to analyze potential pathways the city can take to achieve 100% renewable energy.

While LADWP is electrically connected to the rest of the West, it is not a member of CAISO, so it must ensure it is always self-sufficient and supplying local demand for electricity no matter what else is happening in the West, Cochran said. “This makes achieving the 100% renewable energy target especially difficult.”

The study’s layers of detail allowed city planners to see how much new electric demand from electrifying transportation and buildings might be flexible, Cochran said. For example, demand from residential and commercial buildings could remain fairly flat through 2045, with growth offset by improvements to energy efficiency, she said.

“Instead we see that the main cause for growth in peak demand is due to the electric vehicles,” Cochran said. “Today in L.A. peak demand for electricity occurs in the afternoon. In the future the timing could vary based on when the electric vehicle charging takes place, so when we assume more access to workplace charging, the peak demand occurs early afternoon.”

The study also highlighted the public health benefits associated with decreasing the amount of fine particulate matter in the air.

“All scenarios in our study achieve 6 to 8% reduction of fine particulate matter concentrations in the air, mostly because of the adoption of electric vehicles,” Cochran said.

The study forecasts $1.5 billion in public health savings in 2045 alone and “that all communities will share in the benefits of the clean energy transition, most notably because of these health benefits, but also from improving equity and participation,” Cochran said.

Accelerating Decarbonization

Susan Tierney, senior adviser at Analysis Group, provided a policy-oriented view of these pathways and how to bring them to fruition based on her work on the recently released National Academies of Sciences, Engineering and Medicine report, “Accelerating Decarbonization in the United States.”

“In order for this to be a sustainable change, decarbonization has to rely on a much more equitable transition, not just for communities that are moving from a fossil economy, but also for communities that have been really left out of and have borne the brunt of both energy access issues and frontline pollution concerns,” Tierney said.

“One of the things that we identified as being critical to accomplishing decarbonization in an affordable fashion in the long run is to transfer equipment at the end of its useful life to electric stock, and we know for local gas distribution companies, this is going to be very challenging,” Tierney said. “I know that many of you state regulators are looking at this with your different local gas companies to figure out how you can support electrification without leaving some of your poorest gas consumers on the system and bearing more and more cost.”

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OMS, Monitor Revive MISO Demand Curve Debate

LOUISVILLE, Ky. — The Organization of MISO States and the Independent Market Monitor on Monday resuscitated a longstanding debate over whether the RTO should adopt a sloped demand curve in its capacity auctions.

During a meeting in conjunction with the National Association of Regulatory Utility Commissioners’ annual meeting, OMS President Julie Fedorchak said the topic was “worth bringing forward again.” She noted the landscape has changed in the years since the Monitor first recommended MISO adopt a sloped demand curve.

Fedorchak said a demand curve could possibly help the footprint place more value on resource adequacy. MISO employs a vertical demand curve in its capacity auction that prioritizes reliability over economics.

Monitor David Patton said the RTO neglects the demand side of its capacity market with its focus on the supply side. He said the demand for capacity must represent the value consumers are willing to pay for.

Patton said should MISO alter the curve; most regulated utilities won’t be forced into rate increases because they carry excess capacity. He said the utilities and merchant generation that relies on the capacity market’s price signals will likely benefit from increased compensation.

“This has the benefit of being far more equitable for the regulated utilities, which carry the reliability [responsibility] for the [MISO] North and the South [regions],” Patton said.

Competitive suppliers, on the other hand, will pay more for capacity, he said.

The grid operator has resisted a sloped demand curve ever since its unsuccessful attempt in 2016 to conduct separate, three-year forward capacity auctions using the curve only for the footprint’s deregulated areas. The RTO is currently preoccupied with establishing four seasonal capacity auctions paired with availability-based resource accreditations; the plan does not call for changes to the auction’s demand curve design. (See Last-minute Unease over MISO’s Seasonal Accreditation.)

Patton said had MISO used a sloped demand curve in its 2021/22 Planning Resource Auction, it would have cleared capacity at $172.86/MW-day in the Midwest and $28.31/MW-day in the South. This year, MISO South (Arkansas, Louisiana, Mississippi and Texas) cleared at an all-time low of $0.01/MW-day while Midwestern zones 1-7 (Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Montana and Wisconsin) cleared at $5/MW-day. (See MISO Capacity Auction Values South Capacity at a Penny.)

The Monitor has said analyses show that MISO’s capacity market is not providing revenues to keep coal and nuclear resources afloat, which are needed for reliability while the footprint decarbonizes.

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MISO Members Retain Incumbent Directors

MISO’s membership has reelected three incumbents to the Board of Directors, eschewing an opportunity to introduce new faces.

Directors Nancy Lange, Mark Johnson and Phyllis Currie were up for reelection this year. They will begin their new three-year terms on Jan. 1.

Currie and Johnson joined the board in 2016 and were reelected in 2019. Lange was elected to the board after some controversy in 2018 because of her immediate past position as chair of the Minnesota Public Utilities Commission. (See MISO Elects Lange to Board; Keeps 2 Incumbents.)

“These experienced industry leaders will continue to guide us toward implementing the changes needed to meet the reliability imperative,” MISO CEO John Bear said in a press release. “The expertise and institutional knowledge of our returning directors will be instrumental to helping us manage some of the issues facing our industry. Their diverse backgrounds and understanding of our organizational goals will help accelerate our plans for the future.”

MISO’s reliability imperative refers to its commitment to plan and make changes to maintain reliability as the resource mix shifts toward clean energy.

The board consists of nine independent directors and its CEO. Directors are limited to serving three, three-year terms.

Despite MISO retaining search firm Russell Reynolds and interviewing a slate of 20 non-incumbent candidates, the Nominating Committee decided against introducing any new members to the board. The committee was comprised of MISO directors and stakeholders Stacy Herbert, representing transmission owners, and Indiana Utility Regulatory Commissioner Sarah Freeman.

MISO’s month-long board elections require a minimum 25% participation rate among its nearly 140 voting-eligible members to achieve quorum. Members can vote for, against or abstain from selecting any of the candidates. Candidates must earn a majority of quorum votes to be installed.

Board members also voted unanimously in September to elect Todd Raba as board chair. He will replace current chair Currie in January.

“This is the only professional engagement I have, so I look forward to dedicating all of my professional attention to this,” Raba said during MISO’s September Board Week. Raba was previously CEO of GridPoint and Berkshire Hathaway’s MidAmerican Energy and Johns Manville companies.

The board will meet next in Orlando, Fla., Dec. 7-9, marking MISO’s first in-person public meetings since the coronavirus pandemic spread in early 2020.

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FERC Accepts Key Tariff Revisions to SEEM

FERC on Monday accepted revisions to four Southeast Energy Exchange Market (SEEM) utilities’ tariffs that implement the special transmission service used to deliver the market’s energy transactions.

The commission found the revisions to be just and reasonable and not unduly discriminatory or preferential. It ordered Duke Energy (NYSE:DUK), Southern Co. (NYSE:SO), Dominion Energy (NYSE:D) and PPL (NYSE:PPL) subsidiary LG&E and KU Energy to make a compliance filing within 30 days of the order and to make an informational filing at least 30 days before SEEM’s projected start-up next year (ER21-1115).

The market was established “by operation of law” when FERC failed to take action within 60 days after prospective SEEM members responded to the commission’s latest deficiency letter. The commissioners deadlocked 2-2 “as to the lawfulness of the change,” allowing the measure to take effect in accordance with Section 205 of the Federal Power Act. (See SEEM to Move Ahead, Minus FERC Approval.)

FERC Chair Richard Glick, who had opposed the market’s creation, sided with Commissioners James Danly and Mark Christie to create a 3-1 decision. He said the parties’ filings, unlike the SEEM agreement, do not apply Mobile-Sierra provisions that would limit FERC’s authority to require changes.

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FERC Commissioner Allison Clements

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Commissioner Allison Clements dissented from the decision with a 13-page statement, saying the parties’ transmission tariffs fail to allow open access to the market and provide for rates that have not been shown to be just and reasonable. She said the order sets up a market exchange platform that fails to satisfy FERC Order 888’s open-access requirements by incorporating the non-firm energy exchange transmission service (NFEETS) integral to SEEM.

“The same infirmities that render the broader [SEEM] proposal unduly discriminatory and not just and reasonable also mean that it cannot lawfully be incorporated into the relevant utilities’ [tariffs] in this proceeding,” she wrote. “Incorporating NFEETS into [tariffs] integrates the [SEEM] proposal’s flaws into the relevant utilities’ transmission service offerings.”

SEEM participants say the market is open to all entities that “own or otherwise control a source within the territory and/or is contractually obligated to serve a sink within the territory.” Participants must sign an agreement and arrange to take NFEETS, a zero-cost transmission service through unused transmission capacity for 15-minute energy exchanges, from each participating transmission provider.

However, prospective participants must also have executed enabling agreements with three counterparties that participate in the market.

Clements said the requirements “impose unlawful barriers” to potential participants “because current participants may collude to exclude prospective participants by refusing to enter into enabling agreements.”

Protesters argued that under FERC’s open-access requirements, SEEM is a “loose power pool” and should be subject to a pool-wide tariff rather than establishing NFEETS for each transmission provider’s system.

The commission’s majority disagreed, saying precedent shows that free, non-firm transmission to facilitate intra-hour transactions does not constitute a loose power pool. It said the SEEM agreement allows for such service for unused transmission capacity and thus entails no opportunity costs.

“NFEETS is the lowest-priority transmission service, cannot be used to satisfy reliability obligations of [SEEM] participants and does not replace existing transmission service,” the majority said.