The Time is Right for Affordable Heat

Jan 17, 2013 by  | Bio |  Leave a Comment

Vermont is poised to take a big bite out of the high cost and pollution of heating our homes and businesses. Slashing a full one-quarter of both lies within our reach.

Over the past decade, the cost Vermonters pay for staying warm has more than doubled. This strains our pocketbooks, our environment, our health and our security. Watching our dollars go up in smoke drains our economy.

What can we do? Building on the enormous success of our electric efficiency efforts, we can improve the heating efficiency of our homes and businesses in a similar manner. While some efforts have begun, most of the savings opportunity remains on the table. Throughout Vermont, heating efficiency has saved the average homeowner about $1,000 a year.  (See a recent editorial here).

A new report of Vermont’s Thermal Efficiency Task Force provides a strong roadmap for jumpstarting heating efficiency and renewable heat for our homes and businesses. The Task Force recommendations show how Vermont can stretch its heating dollars farther and provide over $1.4 billion in direct savings. That’s $1.4 billion that is not going up in smoke, literally leaking out of our homes and businesses.

Affordable heat means lowering bills. Every year Vermont struggles to fund low income heating assistance (LIHEAP). With affordable heat, Vermont can reduce the funds needed and can use LIHEAP dollars to help more Vermonters. Cutting fuel use by one-quarter means that for every four homes that are weatherized, help is available for one additional family.

Affordable heat reduces pollution. Every gallon of fossil fuel we don’t burn means less pollution. Whether we are adding solar to our roofs or insulating/weatherizing our homes we leave a lasting positive legacy for our children by taking seriously our responsibility to tackle climate change and reduce pollution.

The long and short of it is that Vermont — and Vermonters — can’t afford to keep wasting energy, wasting money and wasting clean air. Vermont’s commitment to affordable heat is our ticket to more comfortable homes and businesses, and a thriving and affordable clean energy economy.

The Dicey Economics of Hosting a Nuclear Plant

Jan 16, 2013 by  | Bio |  1 Comment »

photo courtesy of topher76@flickr.com

This past week has shown Vermont first-hand the high cost of nuclear power. Hosting a plant in your state is clearly a high-stakes bargain.

Vermont went to Court in Manhattan this week before a three judge panel at the United States Court of Appeals. (Read more here and here). It had fifteen minutes for its lawyer to explain to the judges why the decision of the District Court blocking the actions of the Vermont Legislature should be reversed. A tough task.

With clarity and nimbleness, Vermont proved it was up to the task. Its lawyer, Attorney David Frederick, an experienced appellate lawyer who argued a case last week before the United States Supreme Court, explained that Vermont has every right to determine Vermont Yankee’s fate. And doing so does not impinge on the federal government’s oversight of radiological issues.

In a nutshell, there were three points.

First the United States Supreme Court case from 1983 that let stand a California law enacting a moratorium on nuclear plants would allow the Vermont law. If a state can ban all nuclear plants, it can certainly allow the Legislature to determine the fate of one plant.

Second, the lease on Vermont Yankee expired and like a landlord, Vermont can simply refuse to renew the lease. Period. Any tenant knows this. Vermont is hosting this plant and can say it wants the property used for another purpose.

Third, Vermont has huge skin in the game and economic exposure from Vermont Yankee. If Entergy, the owner of Vermont Yankee, goes bankrupt or simply chooses to walk away, Vermonters are left holding the bag for what Conservation Law Foundation has described as the nuclear equivalent of junk car in its backyard. This possibility is more likely following recent reports that Vermont Yankee is not pulling its weight and that Entergy would be better off closing the plant.

The stakes are high. Apart from hosting this plant, Entergy is seeking to recoup over $4 million in legal fees, and now has four law firms working to push every legal angle possible. Times change. When Vermont first approved the Vermont Yankee facility in the 1970s, there was a hearing for three days before the Vermont Public Service Board. Clearly nuclear power and hosting plants is more expensive and time consuming than ever.

Vermont is right to begin extracting itself from this nuclear legacy. Unfortunately, that is proving to be not so easy.

You Say ‘Food Waste,’ I Say ‘Renewable Energy’: New DEP Regs Create Pathway for Anaerobic Digestion

Jan 11, 2013 by  | Bio |  1 Comment »

Burying our garbage in landfills is a waste of resources, but it’s also a convenient way to get rid of stuff we don’t need or want. If there were clear alternatives to trashing our resources, would we use them? The Massachusetts Department of Environmental Protection (DEP) believes the answer is yes.

The DEP has finalized new rules that provide a permitting pathway for operations that process source separated materials – stuff like food waste or recyclable plastics that are not mixed with other wastes in the general trash stream. Source separated materials are distinguished from “waste”, so qualifying facilities will not be permitted as solid waste facilities. Previously a facility that sought to collect discarded material for recycling or some other reuse was considered a solid waste facility. This created barriers to the productive use of materials like food waste. The new regulations are a good step toward better management of our discarded materials.

Under the new rules, finalized November 23, DEP has created three size-based categories:

  1. Small facilities (no permit required)
  2. General permit facilities (certain activities permitted by-right)
  3. Facilities that will require a new Recycling, Composting, and Conversion (RCC) permit



The good news is that these rules create a permitting pathway for anaerobic digestion (AD) facilities. AD is a process in which organic material, like food waste, is processed in an airtight container to create a gas similar to natural gas (high in methane). AD facilities can use the gas to fuel energy generators to create electricity and heat that can be used onsite or sold in the energy market.

AD facilities, if properly sited and appropriately operated, offer a win-win by managing food waste and generating a renewable gas for energy production. Rather than putting our food waste into a landfill where it does more harm than good, the energy in the food can be efficiency recovered for productive use.

“But what about composting?” you may be asking. DEP’s goals, as stated in the current draft Solid Waste Master Plan, include diverting 350,000 tons of organic waste per year from landfills. Some of this will be accomplished by AD facilities, but some diversion will be accomplished by composting. The new rules clarify which operations are permitted by DEP and which are permitted by the Department of Agricultural Resources (DAR).

Whether we create high quality fertilizers and soil amendments through composting, or energy and fertilizer through AD, we will be diverting organic material from landfill disposal. DEP’s new rules are a step in the right direction to better manage our resources for economic advantage and environmental gain.

Vermont Yankee – Worth More Dead than Alive

Jan 2, 2013 by  | Bio |  Leave a Comment

Photo courtesy of Andy Hares @ flickr.com

The financial world is waking up to what a drag Vermont Yankee really is. The tired, old and leaking nuclear plant in Vermont is not carrying its weight. Financial analysts report that Vermont Yankee is economically vulnerable and a retirement announcement would boost stock prices for its parent, Entergy.

You can read the UBS Investment Research report “Re-assessing Cash Flows from the Nukes” here. It states:

 

“Notably, we believe both its NY Fitzpatrick and Vermont Yankee plants are at risk of retirement given their small size; while potentially negative to sentiment, an announcement to retire the units would likely drive positive FCF revisions.”

Clearly it is past time to close this plant.

Analysts today dropped the projected price target for Entergy’s stock. They see high debt and little cash coming in. Not good news for any investment.

It is good the financial world is waking up to what Vermonters have known for years. Vermont Yankee is not a good deal. It hasn’t been for years. It is expensive and financially risky. Conservation Law Foundation submitted testimony to the Public Service Board on the lousy economics of allowing Vermont Yankee to continue to operate. It does not have enough money for decommissioning, low energy prices mean it is not making money and any problems would saddle Vermont with big problems. You can read CLF’s testimony here.

These are not problems we need. Nuclear power was once touted as too cheap to meter. That has never been true. Now it is too expensive to even keep operating. Thank goodness financial markets are waking up to this fact.

This Holiday, New Hampshire Will Buy a $128 Million Lump of Coal

Dec 18, 2012 by  | Bio |  Leave a Comment

photo credit: TimothyJ/flickr

Today, the New Hampshire Public Utilities Commission takes up PSNH’s request to charge its customers 9.54 cents per kilowatt hour for electric energy service in 2013. In a op-ed published this week, long-time CLF friends Ken Colburn and Rick Russman explain why New Hampshire’s crisis of escalating PSNH rates – and how New Hampshire policymakers resolve it – may be the defining economic issue for New Hampshire’s new class of leaders next year.

With PSNH’s rates to be by far the highest in the state and almost three cents higher than those of its sister utility NSTAR in Massachusetts, New Hampshire is dealing with an untenable situation: small businesses and residents are subsidizing PSNH’s above-market costs to operate and maintain dirty, inefficient, and uneconomic coal plants, to the tune of $128 million.* The average residential customer will pay $212 extra in 2013 for the dirtiest energy in the region.

To put $128 million in perspective, in 2011 New Hampshire invested less than a seventh of that amount, a mere $17.6 million, in electric energy efficiency programs – an energy solution that is lowering rates, reducing pollution, avoiding expensive new transmission projects, and creating jobs.

New Hampshire energy users are in effect giving this money away to keep alive New Hampshire’s biggest sources of toxic and greenhouse gas pollution (even though PSNH projects they will only operate at around 25% of their capacity in 2013) and to pay dividends to PSNH’s owner, New England mega-utility Northeast Utilities. And the situation will only get worse with time as PSNH customers join the thousands who have already picked an alternative energy supplier, leaving a shrinking base of customers to bear the heavy costs of PSNH’s coal fleet. (If you’re still a PSNH customer, you should definitely make the switch before the new year begins and PSNH’s new rates kick in.)

The blame for this economic and environmental travesty lies squarely with PSNH’s self-serving failure to plan for the future.

Yet PSNH is already trying to make the case that it needs a “fix” from the New Hampshire legislature to protect its coal plants, its 10% profit margin guarantee, and its protection from cleaner, cheaper competition. What’s even more bizarre – and indicative of its refusal to approach these issues honestly – is that PSNH is pinning its skyrocketing rates on the very factors that have reduced electric rates for everyone else in New England – namely, investments in energy efficiency and environmental protection and the increasing use of natural gas and competitive renewable energy sources. PSNH’s foolhardy but lucrative investments in its outdated power plants – for which it fought tooth and nail over the last decade – are the culprit, not environmental requirements that apply to all power plants in New Hampshire and across the region.

Please take a moment to read the op-ed and share widely with friends, neighbors, and especially your new representatives in Concord. For the good of the state’s economic and environmental health, they need to hear from you!

*  The math: PSNH customers will pay a 2.85 cent “premium” for every kilowatt hour over and above PSNH affiliate NSTAR’s market-based rates, and PSNH is projecting that it will sell more than 4 billion kilowatt hours of power to its remaining customers in 2013. The average household in New Hampshire uses 7,428 kilowatt hours per year.

PSNH's Merrimack Station

Distributed Generation Standard Contracts Act: A Success in Three Parts

Dec 13, 2012 by  | Bio |  Leave a Comment

On June 26, 2011, Governor Chafee signed into law the “Distributed Generation Standard Contracts Act.”  The bill had passed both houses of the General Assembly unanimously. The “distributed generation” in the title of the law refers to small, local renewable energy projects.

The new law was designed to do three things: (1) increase the number of small renewable energy projects that are built in Rhode Island; by (2) making it easier, quicker, and cheaper for developers of these projects to get contracts to sell their electricity to Rhode Island’s dominant utility, National Grid; and (3) get those renewable energy projects distributed into more of Rhode Island’s cities and towns.

Not every law passed by the General Assembly works out the way it was meant to, but the Distributed Generation Standard Contracts Act has been phenomenally successful in accomplishing each of its three goals.

Previous renewable energy laws in Rhode Island have worked the way they were intended: to get National Grid to buy more and more of its electricity each year from clean, renewable energy sources. But Rhode Island’s previous renewable energy laws also had a significant flaw: they worked very well for big projects, like Deepwater Wind’s proposed offshore wind farm, but they worked less well for small projects (like a town that wants to set up a single wind turbine at its town hall, as Portsmouth did). That is because under the prior laws, developers would have to hire a small army of lawyers to negotiate an excruciatingly long, detailed contract with Grid, setting forth everything from the price of the electricity to delivery schedule. (For example, the contract that Deepwater filed with the Public Utilities Commission on December 10, 2009 ran 62 pages in length!)  Hiring lawyers to negotiate a 62-page contract was just too time-consuming and expensive for a developer who had a small project.

The new law fixed that problem. As the name of the law suggests, it provided for a “standard contract” for developers of small projects. The standard contract was short, written in plain English, and easy to understand. In addition, the law provided for a standard price to be paid, and established a mechanism for setting a fair price for each different type of project – wind, solar, and so forth. These prices were designed to be high enough to get projects actually built, but low enough to protect electricity rate-payers.

And that is exactly how the new law has worked. In the 15 months since the bill was signed into law, National Grid has held three separate sign-up periods. To date, 18 separate projects have been signed up.  Each of these 18 separate projects will be built right here in Rhode Island. Thus, Rhode Islanders will directly enjoy the environmental and economic-development benefits of these projects. The main purpose of the new law, to get more local renewable energy projects built, has been accomplished – in spades.

The developer of each of these 18 projects got a simple, standard contract to sign, and will receive a set price for the electricity produced.  Thus, another one of the law’s purposes has been accomplished.

The projects themselves are located in Providence, East Providence, Portsmouth, Lincoln, Westerly, Bristol, West Greenwich, East Greenwich, Hopkinton, Middletown, Cumberland, North Kingstown, North Smithfield, and West Warwick.  This geographical distribution of new renewable energy projects was a third purpose of the law.

Rhode Island’s new Distributed Generation Standard Contracts Act has been so successful that it is becoming a model for the rest of the country. Renewable energy advocates in New York and Iowa are hoping to replicate the Rhode Island law in their states. The California Public Utilities Commission has circulated the Rhode Island law to its in-house legal staff. A group of Oregon legislators is poised to introduce a bill in the coming legislative session modeled after the successful Rhode Island law.

The Distributed Generation Standard Contracts Act is a classic win-win. It addresses the problem of climate change by reducing the carbon emissions that cause climate change. And it helps the Rhode Island economy by facilitating local development of renewable energy projects.

This is a law that Rhode Islanders can be proud of. Its enactment reflects well on our legislators (who passed it unanimously) and on Governor Chafee (who signed it into law). The law has been administered carefully and diligently by our Office of Energy Resources. And National Grid, which receives an economic incentive when projects start producing power, has worked conscientiously with developers to help developers succeed.

Bright Energy Forecast: Saving Electricity, Reducing Pollution, Saving Money

Dec 12, 2012 by  | Bio |  Leave a Comment

For decades Conservation Law Foundation has pushed for more energy efficiency, which continues to be the lowest cost, cleanest and most reliable way to meet power needs. More energy efficiency means fewer dirty coal plants, fewer monstrous transmission lines, and more money in our pockets. We all win.

The operators of the New England Power grid, the ISO-New England, released their energy-efficiency forecast. The news is pretty remarkable.  It shows the real effect of our commitment to energy efficiency. You can read the report here.

In states like Vermont, efficiency will more than offset expected growth and allow older and dirtier supplies to step aside.

 

By comparison New Hampshire, which has not invested as much in efficiency, continues to grow its power use and continues to pay too much for ever more polluting power supplies.

In the words of the ISO New England, the energy efficiency forecast shows the states’ investment in energy efficiency is having a significant impact on electric energy consumption and peak demand. About $260 million in transmission expenses have already been deferred for New England customers. (p.23).

That’s $260 million in our pockets.

What’s also important is that these are very conservative numbers: if states like Massachusetts and Rhode Island meet their goals for helping customers to save energy and money the reductions in energy use will exceed what the ISO is presenting.

This report shows that investments in electricity efficiency are really paying off – we need to apply the lessons from that sector to other areas, like ensuring we use natural gas and oil very efficiently as well, saving customers money while reducing pollution and fuel imports.

More savings are available. Some states are not making as large investments in energy efficiency as others. New Hampshire for example is causing its citizens to experience unnecessarily high costs.

It is good to see the bright payoff from what are only the beginnings of our efficiency investments.

 

 

 

 

The Pursuit of Clean, Renewable Energy: The “North Atlantic” Right Way

Dec 12, 2012 by  | Bio |  5 Comment »

Yesterday, the North Atlantic right whale was only an historical symbol of one consequence associated with the relentless and unsustainable pursuit of energy.  Today, it is also a new symbol of renewable energy done the right way.  The agreement CLF is announcing today reflects support for the pursuit of renewable energy and also demonstrates that real leadership to change how we pursue energy can come from industry itself.

The pursuit of cheap energy from the 17th century forward hasn’t exactly been what one would call sustainable. From the time the first right whale was killed for its oil to today’s efforts to take and refine oil from the Canadian tar sands, our industries have drawn down limited resources with little regard for the environmental consequences. In fact, the right whale stands as a particularly distressing symbol of our history of exploitation.

The North Atlantic right whale was so-named because it was considered by whalers to be the “right” whale to kill. It was slow, swam close to shore, and was easy to harvest – accommodatingly floating to the surface with a head full of oil after it has been killed. Between the 17th and 19th centuries, the North Atlantic right whale, an animal that according to Herman Melville’s 1851 reflections in Moby Dick “would yield you some 500 gallons of oil or more” in just its lip and tongue, was hunted to the brink of extinction. The relentless pursuit of this limited resource in such an unsustainable way is the reason that today the North Atlantic right whale is considered critically endangered, with fewer than 500 animals remaining.

Despite the right whale’s lesson, our reliance on oil continues. According to the United States Energy Information Administration, the United States consumed a total of 6.87 billion barrels (18.83 million barrels per day) in 2011. Our reliance on exhaustible, limited fossil-fuel resources is causing climate change and setting into motion a series of unavoidable consequences, but still we drill for oil – albeit no longer in the head of a whale.

So while today’s landmark North Atlantic right whale agreement is a collection of voluntary measures designed to provide further protections for the North Atlantic right whale, primarily by reducing or avoiding sound impacts from exploratory activities that developers use to determine where to build wind farms, it is also so much more than that.

The offshore wind developers party to this agreement – Deepwater Wind, NRG Bluewater, and Energy Management, Inc. (owner of Cape Wind) – are willing to go above and beyond because they recognized that more could be done to protect North Atlantic right whales in the pursuit of energy. These developers’ willingness, and indeed enthusiasm, for protecting the whales reflects a new way of thinking – a 180-degree turnaround from the way other companies viewed energy generation over the last century and a half.  Instead of treating the natural world as an adversary to be exploited and consumed, these companies recognize that we can accommodate natural systems (like the whales’ migratory patterns and feeding grounds), that we can avoid extracting limited resources, that we don’t have to burn fuels that exacerbate climate change, and that we can still produce the energy to fuel modern society. Now that’s the right way.

Why We Need to Repair and Maximize the Efficiency of Our Existing Natural Gas System Before Looking to Expand

Dec 7, 2012 by  | Bio |  Leave a Comment

As the exuberance for “cheap, domestic” natural gas has heightened, so has pressure to build new pipelines and power plants.  Often lost in the frenzy, however, is the sobering reality that our existing natural gas infrastructure is in need of some serious care and attention.  A recent study highlighted the fact that the pipelines that deliver gas to our homes and businesses are riddled with thousands of leaks.  A large number of those leaks can be blamed on a system that still includes significant amounts of cast iron–some of which dates back to the 1830s.

Explosions in Philadelphia and Allentown, Pennsylvania in 2011 as well as a 2009 explosion in Gloucester, MA were traced to aging cast iron.  Coupled with the massive San Bruno explosion, the issue spurred the U.S. Department of Transportation to issue a “Call to Action” urging regulators and pipeline operators to accelerate the repair and replacement of high risk pipe.  Given this sense of urgency, the estimated timelines for replacement seem interminably long:

  •  81% of the remaining cast iron is buried in only 10 states:
State
Miles of
Cast/Wrought
Iron Mains (2011)
New Jersey
5,138
New York
4,541
Massachusetts
3,901
Pennsylvania
3,260
Michigan
3,153
Illinois
1,832
Connecticut
1,509
Maryland
1,422
Alabama
1,416
Missouri
1,180
  • Of these states, seven have implemented programs with deadlines for complete replacement:
  • New Jersey – 2035; New York – 2090; Pennsylvania – 2111; Michigan – 2040; Illinois – 2031; Alabama – 2040; Connecticut – 2080; Missouri – 2059.

Really? Decades to get the job done, at best?  And about a century to fully “modernize” pipes in some states? Sad, but true.

Though public safety is the primary driver behind pipe replacement and repair, whether the natural gas industry ultimately delivers on its claims for being less damaging to the climate than oil or coal depends on how well natural gas infrastructure addresses leaks.  In addition, those who are clamoring to blindly forge ahead expanding new natural gas infrastructure before we’ve fully assessed the condition of our current system would do well to remember the lessons that New England has already learned so well about the financial and environmental benefits of looking to efficiency first.  Not only is investment in new pipelines and power plants expensive, but it comes with serious and lasting environmental consequences whose costs are too often discounted or ignored.  Why not maximize opportunities for operating the existing natural gas system more efficiently first, before building (and paying for) more?

Despite the fact that we know natural gas prices are predictably volatile, several states have begun to take action to lock energy customers into long-term commitments to buy natural gas-fired power, thus locking them into paying for the fuel even when the price spikes.  For example, here in Massachusetts, one legislator has championed the idea of providing 10-20 year long term contracts for a new natural gas plant.  The problem with signing a long-term contract for electricity from gas is that while customers benefit when the cost of gas is low, they suffer when the price spikes, as it inevitably does.  That’s notably different from long-term contracts for renewable energy which typically have a guaranteed, fixed price.

Proposals for new massive interstate pipelines are in the works as well.  Spectra, a Houston-based natural gas pipeline company is proposing a $500 million expansion for Massachusetts. And all the lines on the map for proposed expansions of pipeline leading from the Marcellus Shale to the Northeast rival the Griswold Family Christmas lights display.

Before we spend billions on new infrastructure chasing the next gold rush, we must repair and rebuild our existing infrastructure and examine the tried and true tool of efficiency.   A recent study on the potential for natural gas efficiency in Massachusetts showed that efficiency could reduce winter electric demand enough to support the increased use of gas on the system without building new infrastructure:

The Benefits of Energy Efficiency

From Jonathan Peress's presentation at the Restructuring Roundtable on June 15, 2012

 

But there is a risk that regulators will not fully take these very real benefits into account as they review and approve the latest energy efficiency plans.  Indeed, traditional energy efficiency naysayers are using the low price of gas as an excuse to call for reduced investment in efficiency.

The bottom line is that natural gas does have a role in our energy future, but it  is one that must be carefully managed and minimized over time if we are to have any hope of averting climate catastrophe.  In the meantime, before we jump to expand new natural gas infrastructure, we need to look closely at what we already have in the ground and apply the lessons we’ve learned about efficiency.

 

 

 

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