A Message to the Energy Industry: The Demise of Northern Pass 1.0

Apr 26, 2013 by  | Bio |  2 Comment »

Earlier this week, I brought a message from New Hampshire to a gathering of major players in the Northeast’s energy industry in lower Manhattan, the Platt’s Northeast Energy Markets Conference.

wall street

(photo credit: flickr/Mathew Knott)

Remember Northern Pass, that novel Northeast Utilities transmission project that would import 1,200 megawatts of large-scale hydropower from Hydro-Québec?

The project, as it was conceived and pitched to the region and the industry, Northern Pass version 1.0 if you will, is dead.

I ran through the key financial elements of the original proposal, what I called the Northern Pass gambit:

  • $1.1 billion to build a new transmission line, funded wholly by Hydro-Québec.
  • A generous “return on equity,” or guaranteed profit on project costs, of 12.56% for project developer Northeast Utilities, paid by Hydro-Québec.
  • Easy and inexpensive siting approvals for the line, which would be located solely in New Hampshire, mostly in corridors controlled by Northeast Utilities subsidiary Public Service of New Hampshire, the state’s largest and most powerful electric utility.
  • Ample profits that would cover all Northern Pass costs and much more for Hydro-Québec, which would sell its hydropower in New England’s lucrative wholesale electric market, where energy prices were, in 2008 and 2009 when Northern Pass was conceived, orders of magnitude higher than Hydro-Quebec’s costs of generating power.
  • Unlike New England-based renewable projects, no public or ratepayer subsidies.

These elements looked good to investors on paper. But they have, one by one, fallen apart, and they no longer add up. I took the audience through the Northern Pass reality:

  • Years of a stalled siting process, as Northeast Utilities tries to purchase a new route for the northernmost 40 miles of the project, where PSNH has no transmission corridor, with repeated missed deadlines for announcing the new route and restarting the federal permitting process.
  • Increasing costs – an estimated additional $100 million in project costs already, even without accounting for any new route, mitigation commitments, or any underground component.
  • Growing doubt (even more pronounced than a year ago) that Hydro-Québec can recover Northern Pass development costs and its hydropower costs (which will only increase as costly new dam projects continue in northern Québec) through energy exports, given that wholesale energy prices in New England are now much lower.
  • Opposition by the vast majority of communities affected by the project, 33 at last count, local chambers of commerce, political leaders, and a diverse, well-organized grassroots movement of residents.
  • No support from any New England environmental group.
  • Mounting risk to NU’s lucrative return on equity, with the underlying deal expiring in 2014, and any renewal subject to federal regulators’ recently more skeptical view of such incentives.

And finally, I gave the eulogy for the key financial element of Northern Pass 1.0 – the one that attracted so much interest in regional energy circles, was the project’s key distinguishing feature from New England renewable energy projects, and continues to reside within the project’s discredited and misleading media campaign: the promise that the project would not require any subsidies.

In the last several months, as CLF predicted, Northeast Utilities, Hydro-Québec, and their allies have launched a major initiative to secure out-of-market subsidies of one form or the other for Canadian hydropower.  These efforts are now raging in the legislatures of Connecticut and Rhode Island and are simmering in other New England states. CLF is deeply engaged in protecting our state Renewable Portfolio Standard laws from this incursion and in turning back any long-term deals that will supply Canadian hydropower to these states at above-market prices or in a way that threatens renewable deployment in New England.

To us and to others, the false urgency associated with these proposals seems transparently calculated to advance a “Northern Pass 2.0,” just as Northern Pass 1.0 falls apart.

What would Northern Pass 2.0 look like? On the ground, whatever the “new route” New Hampshire continues to wait for, it will almost certainly look the same as Northern Pass 1.0, suffering from many of the same failings. But there will be some key differences, as the project’s underpinnings shift to accommodate a new economic reality. It will rely on public and/or ratepayer subsidies that will mean that New England will pay an above-market premium for the power or will provide an out-of-market gift of long-term energy price certainty to Hydro-Québec, in part to finance the associated transmission. In addition, many in New Hampshire’s North Country believe that the project will need to be sited on public land that is legally off-limits to circumvent the strong, ongoing efforts of the Society for the Protection of New Hampshire Forests to secure blocking conservation easements – in effect, another public subsidy for the project that will face overwhelming pushback in New Hampshire. (Clearly, Northern Pass’s dogged legislative fight to secure an ability to use eminent domain for the project, which it lost in resounding fashion in 2012, was only a preview of coming tactics.)  

As CLF has consistently said, there may be appropriate alternatives to Northern Pass that strengthen New England’s access to Canadian hydropower resources, but only if those alternatives are pursued through well-informed, fair, and transparent public processes, provide meaningful community and ratepayer benefits, displace our dirtiest energy resources, and verifiably result in carbon and other emissions reductions. It does not appear that the emerging Northern Pass 2.0 – buoyed by a set of special deals and no discernible improvements – would do anything to advance these basic common sense principles, which should guide the region’s transition to a resource mix that will power New England’s clean energy future.

With few signs that Northern Pass’s sponsors have learned lessons from their missteps so far, Northern Pass 2.0 looks to have an even tougher path in New Hampshire than the dead end road that Northern Pass 1.0 has traveled. This was a message from the Granite State that the world of energy industry insiders and analysts needed to hear.

Energy: Out with the Dirty, In with the Clean

Apr 23, 2013 by  | Bio |  2 Comment »

Come join Conservation Law Foundation and our allies THIS SATURDAY in Burlington, Vermont for a discussion on Vermont’s Energy Choices.

Vermont’s Energy Choices: Old Dirty Problems and Clean Energy Solutions
Saturday, April 27th, 1:30 PM at the Billings Auditorium at UVM in Burlington

The time is NOW to move away from dirty sources of energy such as tar sands, nuclear, oil and coal. Solutions are available now to move us away from expensive, dangerous and polluting energy.

Come hear national and international experts on the problems of dirty energy – from fracking to tar sands – and  the real-world successes of renewable power – including community based renewable power in Europe.

Throwing up our hands is not an option. Come find out how to make a clean energy future our reality.

You can sign up and more information here:  See you Saturday!

Massachusetts Fosters Electric Vehicles with New Municipal Program

Apr 22, 2013 by  | Bio |  Leave a Comment

Massachusetts Electric Vehicle Incentive Program DEP Municipal

MA DOER Commissioner Sylvia, Chelmsford Town Manager Paul Cohen, MA EOEEA Secretary Sullivan, and MA DEP Commissioner Kimmell at the Earth Day announcement in Chelmsford. (Photo credit: Emily Norton)

Today the Patrick Administration took an important step toward meaningful deployment of electric vehicles (EVs) in Massachusetts. Building on momentum from the Massachusetts Electric Vehicle Roundtable that CLF co-hosted with the Administration in March, the Patrick Administration launched a new incentive program yesterday: the Massachusetts Electric Vehicle Incentive Program for Municipalities. The Administration announced this new program on Earth Day at events in Greenfield and Chelmsford. CLF attended the announcement, and you can watch a video clip of MA Department of Environmental Protection (DEP) Commissioner Kimmell and MA Executive Office of Energy and Environmental Affairs Secretary Sullivan announcing the new program in Chelmsford here and here (pardon the occasional wind!).

Following the MA EV Roundtable in March, the Administration created the Massachusetts Electric Vehicle Initiative to promote EVs in the Commonwealth. The new incentive program, focused on helping increase use and visibility of EVs in Massachusetts towns, is a noteworthy first step for the MA EV Initiative. This program will help municipalities purchase EVs as well as fund installation of charging stations. The program offers $7,500 grants per EV and $15,000 per publicly accessible charging station to eligible communities. The program, which is administered by the MA DEP,  has $2.5 million available for these grants.

At yesterday’s Earth Day launch for this program, Secretary Sullivan noted that increased deployment of EVs is an essential step toward meeting the climate commitments contained in the MA Global Warming Solutions Act (GWSA). Increased EV deployment is indeed an important step if the Commonwealth is to meet its mandatory greenhouse gas emission (GHG) reduction targets, and CLF is pleased to see the Commonwealth taking initiative with this measure. At the same time, the big picture for GHG reductions in Massachusetts still requires significant progress that can only be achieved through markedly stepped up action. The Administration has not met the GWSA’s deadlines for adopting and implementing regulations to reduce GHGs commensurate with the requirements of the GWSA across all sectors – including transportation. While steps to promote EVs will help move the needle, the newly announced Initiative must complement, rather than serve as a substitute for, much more expansive action that is urgently needed across the transportation sector and beyond.

The Commonwealth’s press release following the launch indicated that this program “is the first of what the state plans will be other state incentive programs to increase electric vehicle deployment and ease their use.” CLF is pleased that the Patrick Administration is taking its commitment to fostering meaningful deployment of EVs in Massachusetts seriously, applauds the Commonwealth for this important first effort, and is optimistic for meaningful next steps for the MA EV Initiative. We hope that the successful launch of this program will help fuel a broader effort to reduce GHGs and ‘green up’ all of our transportation options!

Accomplishing Good Things Quietly: CLF On New England’s Electricity Grid

Apr 18, 2013 by  | Bio |  1 Comment »

As New England’s leading environmental organization, CLF has more than 60 staff people who work every day for healthy communities, clean water, and to reduce carbon emissions that cause climate change.

Sometimes we win big victories that make headlines, like when my colleague, Shanna Cleveland, won a major victory in federal court that required the permanent shuttering of the Salem Harbor coal-fired power plant. You can see more about Shanna’s victory here; and you can learn more about CLF’s coal-free New England program, here.

Other times, CLF’s work is much quieter, and behind the scenes, in obscure forums that no one has ever heard of. And CLF sometimes accomplishes good things very quietly.

I recently participated in one of these quiet victories. CLF is an active, voting participant in the New England Independent System Operator (ISO-NE), the operator of the regional electricity system. You can read more about CLF’s work with ISO-NE here. Very few environmental organizations participate in this important forum and, of the few that do, CLF is by far the most active.

One of the things that the ISO is most concerned about is the “system reliability” of New England’s electricity grid. System reliability basically means that when you or I turn a light switch, the lights actually go on. No one wants to see power outages or blackouts, and the ISO’s concern with system reliability is sensible.

One of the things the ISO has been doing of late to improve New England’s “system reliability” is to encourage the owners of gas-powered electricity-generating plants to install dual-fuel capability that would allow those plants to burn oil during periods of natural gas shortage – that is, allow those plants to be more reliable. Part of the ISO’s plan was to make sure that, when such a gas shortage arose, these power-plant owners could and would get compensated properly for burning oil, which costs much more than natural gas.

Of course, burning oil to make electricity is also much, much more polluting than burning natural gas. And the way the ISO was going to structure this new system would have provided no reason for generators to burn gas when gas was actually available – because those generators would be fully compensated regardless of which fuel they burned.

CLF reluctantly accepts that some of these generators will burn oil on those very, very rare occasions (at most a few times a year) when cleaner fuels truly are not available. (Of course, an even better idea is to reduce demand by efforts like turning down electricity use in places like factories and large stores; and CLF has long worked to promote programs that pay for and encourage such “demand response” efforts.) And such burning of oil is always limited by the air-pollution permits (under the Clean Air Act) of the generators. At the same time, CLF wanted to make sure that ISO rules would never allow compensation to an electricity generator for burning a dirtier fuel when a much cleaner fuel actually is available (which is nearly always).

None of the ISO experts realized the potential danger of the ISO’s proposed rule change at the time it was being discussed. None of the electricity generators pushed to prevent the originally proposed rule change from going through. Why would they? They were going to get fully compensated for burning a dirty fuel even when a cleaner fuel was available!

But CLF noticed the problem, and was willing to push for a change. As of this writing, I am cautiously optimistic that our proposed change will be approved by the ISO (and later by the Federal Energy Regulatory Commission, or FERC, that oversees and must approve ISO rule changes). The change that CLF pushed for would allow electricity generators to get compensated for burning a higher-priced, dirtier fuel only on those very rare occasions when cleaner, cheaper fuel is truly not available.

Ratepayers benefit because we are assuring the use of the lower-cost fuel whenever possible. And the environment benefits because we are assuring the use of the cleaner fuel whenever possible.

As I say: this was certainly a small victory. But if we are going to be able to address the threat of climate change successfully, it will take hundreds of victories in a variety of forums. Some of those will be big wins, like Shanna’s federal court victory in the Salem Harbor case. And others will be small, incremental steps in obscure forums like the ISO.

Northeast Utilities Still Can’t Reveal “New Route” for Northern Pass

Apr 2, 2013 by  | Bio |  Leave a Comment

Northeast Utilities (NU) tells investors and the public that it is will announce a new northernmost route for its Northern Pass transmission project by a certain date. The date arrives. A “project update” appears on the website of NU subsidiary and project developer Northern Pass Transmission LLC, saying that it isn’t ready to announce the new route just yet.

What's behind the curtain, Northern Pass? (photo credit: flickr/Nick Sherman)

What’s behind the curtain, Northern Pass? (photo credit: flickr/Nick Sherman)

Sound familiar? It happened at the end of 2012. As reported in the Caledonian Record, it happened again last week, a mere month after NU said – in writing to investors and the Securities and Exchange Commission – that it would announce a new route by the end of March. This is the fourth self-imposed deadline that Northern Pass’s developer has failed to meet since last summer. You’d be forgiven if you started asking yourself whether Northern Pass’s route is the transmission equivalent of vaporware.

For whatever reason, NU has repeatedly misled the public and its investors about the Northern Pass project, and not just the project’s schedule.

Securities regulators should take note of this pattern of behavior and insist on honesty and transparency from NU, just as Massachusetts Attorney General Martha Coakley did when NU recently balked at revealing its CEO’s 2012 compensation package. As we’ve said before, investors, the public, and our energy future depend on accurate information and forthright disclosures from energy companies. That’s not what we’re getting from NU on Northern Pass.

Going to Church in the Senate: The Ministry of Responding to Climate Change

Mar 25, 2013 by  | Bio |  6 Comment »

Senator Sheldon Whitehouse has made a number of passionate speeches throughout the week regarding climate change impacts and the dire need to address climate change. He is establishing himself as a courageous leader on the single most important issue facing this country – the reality of a changing climate and our moral, economic, and human obligation to respond to the threat we continue to blindly build. He will not let his colleagues (or the country) forget the seriousness of this issue and the need to respond to it.

Interestingly and importantly, this past week, Senator Whitehouse spoke with strong references to Pope Francis and his call to Catholics to care for Creation – a connection we rarely hear in the Senate. In fact, a more common theme these days, among congressmen and clergymen alike, has been to invoke the Bible to justify a do-nothing approach to climate change, arguing that the idea that we can irreparably harm our environment runs contrary to scripture.

As a Roman Catholic myself, I can confidently say that the Church’s call to advance social justice on the one hand (i.e., protecting the poor, caring for the Earth and its creatures) and protect human life (i.e., opposing abortion, birth control, etc..) on the other hand, creates a conflict for voters that has often been exploited and manipulated by the dominant political parties in the United States. Indeed, there even have been a number of masses I have attended during election years past when I have been made to feel that a candidate’s position on abortion is the only deciding factor when voting. This isn’t because the Church asked me to vote one way or the other, but it was because “life” was only viewed through the single issue of abortion, and not the global lense that would allow one to consider the disproportionate impact that our continued reliance on fossil fuels, and our steadfast refusal to respond to climate change is already having on the poorest of the poor and on Earth’s natural systems.

I hope that by choosing the name Francis, our new Pope has done more than signal a concern for the poor and the environment. I hope that by choosing this name, and by being a former student and teacher of chemistry, Pope Francis’ mission will be to remind Catholics everywhere that they can believe in the science of climate change, advocate for the protection of all creation, and for social justice and the poor, and still be a good Catholic. Indeed, without such advocacy “justice will be unachievable.” http://conservation.catholic.org/u_s_bishops.htm

St. Francis of Assisi preached the duty of men to protect and enjoy nature as both the stewards of God’s creation and as creatures ourselves. On November 29, 1979, Pope John Paul II declared St. Francis to be the Patron of Ecology. During the World Environment Day 1982, Pope John Paul II said that St. Francis’ love and care for creation was a challenge for contemporary Catholics and a reminder “not to behave like dissident predators where nature is concerned, but to assume responsibility for it, taking all care so that everything stays healthy and integrated, so as to offer a welcoming and friendly environment even to those who succeed us.”

It would be truly inspirational if the Church would begin to pray during its Prayers of the Faithful that our political leaders make the right choices when it comes to caring for our natural world; and then, perhaps, Catholics would learn as much about the ministry of our new Pope during mass as they might from the Senate floor.

Clean Energy Being Derailed by Messy Process in Connecticut?

Mar 22, 2013 by  | Bio |  2 Comment »

On a sloppy March 19, while our changing climate threw a late winter storm of ice, snow, hail, sleet and rain at New England, a legislative hearing room in Hartford Connecticut was the focus of regional energy policy attention. The  Energy and Technology Committee of the Connecticut Legislature was holding a hearing on a bill to revise the Renewable Energy Portfolio standard of Connecticut – the Nutmeg State’s piece of the regional effort that has inspired a rising tide of wind and solar energy development across New England.

The bill before the committee that day, which bears the spine tingling and exciting name of “SB 1138 – An Act Concerning Connecticut’s Clean Energy Goals” was a complex piece of legislation making a whole series of changes to the important law that is Connecticut’s part of a successful regional effort to build new clean energy facilities.

An odd and disturbing subtext was this: at the very same moment that the hearing was going on the Connecticut Department of Environmental Protection (DEEP) announced and released online a study of the very program being revised by the proposed law.  This meant that as DEEP Commissioner Dan Esty was introducing and explaining a law to change a critical energy and environmental program his Department was releasing a draft study, which would go through two months of public process, to decide whether to make the very kind of changes that the bill he was introducing would make. This is very similar to a group of kids playing baseball in front of plate glass window while promising to have a really focused conversation about where (and where not) was a safe place to play ball, vowing to do so right after their game ended.

To be fair, there is a real urgency to one part of the bill: the provision that would enable Connecticut to move quickly, perhaps in cooperation with other states, to enter into long-term contracts with windfarms and take advantage of the limited extension of the federal renewable energy incentives that (unless Congress changes its mind yet again) only apply to projects that are in construction by the end of 2013 – a deadline that seems like a long ways away, unless you are trying to build a large facility like a windfarm, in which case you understand that getting contracts in place as soon as possible is needed to have shovels in the ground and construction underway by the end of the year.

But another topic was the main focus of the hearing: the proposal to allow large Canadian hydroelectricity to participate in the program, a change long sought by Canadian provinces who seek to import money in exchange for power – and a change long opposed by those who wanted to keep the program focused on building new wind and solar resources for New England.

The hearing brought forth a flood of testimony. While there were over 100 pieces of written and in-person testimony presented to the committee it appears that only the state-owned Hydro Quebec utility, who would likely handsomely benefit if the bill became law, and Northeast Utilities, who are trying to build the infamous Northern Pass transmission line to bring that power to market, testified in favor of the very controversial change in eligibility benefiting large Canadian hydropower.

CLF’s testimony on Bill 1138 criticized that change in the law as disrupting a very successful renewable energy program, as did the testimony of business leaders and labor unions and many, many others. Our testimony graphically illustrated the ever-rising progress of wind power in New England as RPS-inspired projects came on line and fed clean power into the regional grid.Rise of wind energy in NE 2009-13

Some members of the committee, including Rep. Brian Becker, actively raised the question of whether the urgent portion of the bill that would allow Connecticut to move forward with procurement of wind and solar this year, in tandem with other states, could be severed from the other controversial portions of the bill that could be reviewed and discussed separately. No real response was ever given to this very legitimate concern.

In the aftermath of the hearing some of the environmental and business groups who testified delivered a letter to the legislative leadership summarizing the situation and, extraordinarily, officials in Massachusetts state government expressed concern about the bill – telling reporters that:

Massachusetts has taken the lead, working very closely with other New England states, in putting together a regional procurement plan for renewable energy. While we embrace a wide range of clean energy initiatives, we have serious concerns about how Connecticut’s proposed changes to its renewable portfolio standard will affect the region’s renewable market

Undeterred by this criticism and controversy and ignoring the clear issues of good government and process, as well as the need to foster business development through clear and consistent rules adopted after careful process, the Committee met and considered a very slightly revised version of the bill on March 20 in a meeting recorded in an online video.  Eight members of the Committee expressed real concern about the deep and systematic changes being made to a critical clean energy program. They, once again, aired the idea of severing the one small provision that needed to be moved rapidly, considering the rest of the bill after the study, already underway, was completed. Again, they did not get a public response.  The final vote of 16-8 shows who on the Committee stood where.  It is indeed striking not one of the 16 who voted “yea” was willing to defend their vote.

All signs point to the bill continuing to move ahead at a very rapid clip – in fact it may come to the floor of the legislature for a vote as soon as March 27 – when new gun laws being considered in the wake of the Newtown tragedy will be absorbing public interest.

If you live in Connecticut, or know someone who does, please use our action alert to urge the legislative leadership to stop the rush towards changing this important energy and environmental program.  Instead, very specific and timely action to join with other states to enter into long term contracts with new windfarms is needed and the rest of the changes to the renewable energy program should be carefully studied and considered.

Up in Smoke: Incinerating Waste in RI a Threat to Economy, Environment

Mar 22, 2013 by  | Bio |  2 Comment »

On Wednesday, March 20, 2013, I testified at the Rhode Island General Assembly, at a hearing of the Environment Committee, against Bill S-728, which would remove a long-standing statutory ban on the Rhode Island Resource Recovery Corporation (RIRRC) putting incineration into its long-range plan.

At the hearing, a staff person from RIRRC testified that there are two reasons why it had asked that this bill be introduced:

  • To allow RIRRC “to discuss and look at” incineration; and
  • So that RIRRC “has all the tools in its tool-kit.”

Neither reason stands up to scrutiny.

As for allowing RIRRC “to discuss and look at incineration,” RIRRC is already doing that. In fact, at the very same hearing on March 20, RIRRC Executive Director Mike McConnell gave a long and detailed (and excellent) PowerPoint presentation that showed that RIRRC has extensively examined and studied incinerators elsewhere in New England and, indeed, all over the country. As Director McConnell testified, RIRRC’s extensive examination of incineration all over the country revealed that incineration of municipal waste is uneconomic and polluting. The point is that existing law already allows RIRRC to think about, look at, and study incineration – as it has been doing for years. S-728 does not permit study; instead, S-728 permits RIRRC to put incineration into its plan. This makes no sense, as actual incineration is banned elsewhere in the RIRRC statute. It simply makes no sense to enact a statute permitting the RIRRC to put into its long-range plan a method of handling trash that is expressly prohibited elsewhere in the very same statute!

As for allowing RIRRC “to have all tools in its tool-kit,” this is simply incorrect. It is the job of the General Assembly to determine and announce the public policy of the state. The General Assembly has done so with regard to incineration. The General Assembly has made an express, explicit determination that incineration at the landfill is banned, in part, because of “the myriad of over four hundred (400) toxic pollutants including lead, mercury, dioxins and acid gasses known to be emitted by solid waste incinerators [and] the known and unknown threats posed by solid waste incinerators to the health and safety of Rhode Islanders, particularly children . . . .” (R. I. Gen. Laws § 23-19-3(15).) As I testified at the hearing on Wednesday, it is simply not true that the RIRRC must have all tools in its tool-kit. The General Assembly, in its role of determining public policy, has decided that certain dangerous and polluting tools will not be in the RIRRC’s tool-kit.

In my Senate testimony on Wednesday, I also referred to the fact that Harrisburg, Pennsylvania, was driven into bankruptcy solely because of its “put-or-pay” contract with an incinerator operator. This is a link to an article (one of many) on that subject. The subtitle of the article sums it up nicely: “Harrisburg’s waste to energy to bankruptcy saga.”

We all know that Rhode Island’s economy is worse than that of many other states; one thing Rhode Island does not need is to court financial disaster be enabling incineration of municipal waste.

It has long been the public policy of Rhode Island that municipal waste shall not be incinerated. The main lesson from Wednesday’s hearing was that no sensible reason has been advanced for permitting RIRRC to put incineration into its long-range plan.

The short of it is that RIRRC should not put into its long-range, statutorily-mandated plan a disposal method that is expressly prohibited elsewhere in the very same statute.

CLF Proposes Clean Energy Incentive for Electric Vehicle Purchases

Mar 21, 2013 by  | Bio |  Leave a Comment

Government officials, industry representatives, and environmental advocates agree: it’s time to increase the number of electric vehicles (EVs) on the road in Massachusetts. EVs emit significantly less carbon dioxide, carbon monoxide, and other pollutants into the air we breathe. Yet the market for EVs in Massachusetts is currently small, due largely to higher price tags, lack of incentives and little infrastructure. Thankfully, the enthusiasm at the recent Massachusetts Electric Vehicle Roundtable indicates that we are poised to do more for EVs in Massachusetts.

Earlier this month at the MA EV Roundtable, I described a new idea for encouraging EV purchasing in the Commonwealth that CLF has developed with Sonia Hamel of Hamel Environmental Consulting. The Clean Energy Bundle Incentive would provide purchasers of EVs free renewable electricity for charging their EVs at home. To achieve this, the state would purchase bulk renewable electricity and distribute it to interested customers as free energy. The state could ensure that the renewable energy, or the funds used to purchase the renewable energy, flows from existing Massachusetts renewable programs and efforts like the Renewable Energy Portfolio Standards (RPS). The state could choose to distribute the energy as either a direct rebate, in the form of a debit card, or as part of a contract. While the amount could be adjusted, we think that $2,000 is in the right ballpark for an amount to distribute per customer.

Bundling free, clean energy with the purchase of an EV stands out as an excellent option to incent EV purchases in Massachusetts. CLF believes that purchasing incentives are key to meaningful deployment of EVs in Massachusetts, and  we favor incentives that set new energy use paradigms, increase market alignment, and are educational for consumers. The Clean Energy Bundle Incentive achieves all three of these goals.

CLF believes the Clean Energy Bundle Incentive will be an effective incentive in the current EV market, and is bolstered by a study by McKinsey and PlanNYC on EVs in New York City. That report found that due to the still-fledgling market of EVs, lack of infrastructure, and small number of potential purchasers, incentives should target “early adopters,” a group committed to investing in green technology and being recognized for their investment. The Clean Energy Bundle Incentive targets these “early adopters” by doubling their investment in green technology, as their EV will run on renewable energy.

While the Clean Energy Bundle Incentive is a new concept for EVs, the idea has been piloted in the realm of natural gas vehicles. Honda is currently offering a $3,000 debit card for use at any Clean Energy brand gas station with the purchase of a Honda Civic Natural Gas, which gives the average owner about three years worth of fuel.

If you are interested in learning more about the Clean Energy Bundle Incentive or joining our advocacy efforts, I encourage you to contact me at jrushlow[at]clf.org.

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