Weekly Post: Oct. 18-24

REGULATIONS

  • THE CARBON RULE IS LAW
    EPA Carbon Rule Hits the Federal Register: Is Now Federal Law
    This past week in energy (at least in the U.S. and in Georgia) was punctuated by what happened toward the end of the week: EPA’s carbon rule for power plants (aka, the Clean Power Plan) was posted on the Federal Register and, thus, becomes federal law. Before the CFR could hit the final HTML button to post it electronically, 24 states and a coal mining company filed lawsuits challenging the rule’s legality. Georgia, one of the 24 states filing suit, has the support of Georgia’s Environmental Protection Division in its challenge to EPA. In the days leading up to the rule’s publication, EPA’s chief air regulator, Janet McCabe, expressed confidence that the rule would withstand the legal challenges. Time will tell—albeit a very long time. While I can’t attest to all the legal grounds on which these lawsuits are being filed, from what I understand about 111(d), states traditionally have had a significant role in developing and implementing the standards for sources, and I’m not sure EPA maintained that role for states when they came up with this rule. EPA has a Clean Power Plan website where you can peruse through the technical details and EPA’s promotion of the rule. Legalities aside, my own assessment of the rule is that it’s just bad energy policy. You can read my editorial at Insider Advantage’s James Magazine, starting on page 10.
    Though states have filed suit, the timing of this CFR publication more than likely circumvents any court action prior to the Paris talks. Politics matters. So does timing.

Gattie Note: Sarcasm aside, the legal and regulatory compliance challenges the power generation sector must deal with are beyond description. This new rule promises to add considerably to those challenges.

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CLIMATE CHANGE

  • Bogged Down in Bonn
    In a lead-up to the Paris talks scheduled to begin at the end of next month (November 2015), a pre-conference gathering was held in Bonn, Germany to develop draft agreements for the upcoming UNFCCC climate talks. It’s formally referenced as the eleventh part of the second session of the Ad Hoc Working Group on the Durban Platform for Enhanced Action (ADP). You can access the group’s work here and read the advanced unedited versions of their draft agreement. These pre-game talks struggled as developing countries sensed what is happening. What began as a discussion on energy and climate change shifted to a discussion on economic development. The reality of it is that the nations of the world are focused on improving the condition of, and opportunities for, their own people through developing their own economies, and they know full well that the Paris talks on limiting the consumption of traditional energy resources such as coal, natural gas and petroleum threatens their capacity to do so. A recent article in the Wall Street Journal touches on this. Meanwhile, back in the U.S. political arena, President Obama jabbed at Republicans and their climate change platform, calling it a ‘tired’ argument. The Grist published a critique of the Republicans’ energy policies, referring to them as ‘dirty”. No surprise there.

Gattie Note: The Republicans need a tenable position on climate change if they want to avoid it becoming a litmus test during the general election. If conservatives want the White House, a sound, rational position on climate issues would be helpful. In the meantime, the Paris climate talks have the potential to move the U.S. energy needle even further away from traditional fuels such as coal and gas. Keep in mind: This ain’t Las Vegas—What happens in Paris, doesn’t stay in Paris—it comes back here.

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POLITICAL

Gattie Note: President Obama has been committed to addressing climate change issues from the beginning. While I don’t question his commitment at all, it’s hard to not read this as a political move leading up to Paris. But, that’s the nature of the beast, because all politics is local…or…in the case of climate issues…global…

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RENEWABLES

  • Utility-Scale Solar vs. DG Solar Rooftop
    The Brattle Group’s Peter Fox-Penner was on E&ETV’s OnPoint with Monica Trauzzi to talk about Brattle’s study on the comparative costs of utility-scale vs. rooftop solar PV. Brattle’s Study was released back in July of 2015 and it concludes that utility-scale solar PV is significantly more cost-effective than rooftop PV. The study was done in the Xcel Energy service area in Colorado and the key findings are:
    (1) Generation costs from a 300 MW system is about half the cost per kWh from an equivalent 300 MW arrangement of 5 kW rooftops.
    (2) The same 300 MW utility-scale system offset carbon emissions 50% more than the rooftop system.

Gattie Note: Utility-scale seems to have the simple and proven advantage of economy of scale compared with its third-generation distributed cousin. This won’t be welcome news for DG supporters but it continues to lend support to the advantages of large PV systems as the better economic and environmental option.

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  • India: Renewables & the Environment vs. Coal & Economic Development
    As I’ve posted before, India is looking to be the next country to step onto the world economic stage, with China being the most recent arrival. India has made grand proposals regarding renewables, saying they will add 14.4 GW (that’s, Gigawatts) of renewables by 2020 with it split about 50/50 between solar and wind. India is also one of the most vocal in expressing the need for traditional fuels to drive its economic goals and it has a significant percentage of its population that is currently living in poor conditions. When I was in India this past spring, former chairman of Microsoft India, Ravi Venkatesan, wrote a guest editorial for the Chennai Times. His point was that India needs job makers not just jobs. He was calling for entrepreneurship, but in his opening paragraph he noted that 700 million of India’s people live without dignity. India’s overall population is about 1.25 billion, so this represents 56% of its population. Prime Minister Modi’s challenge is daunting and his resistance to halting or reducing coal and gas is understandable. A recent article in E&E News brings to light some of the more acute challenges when poverty and economic dreams clash with the false hope of a renewables-only power generation system. Here, the small village of Dharnai, India was home to a solar experiment by Greenpeace, who originally hailed the village as the future of clean energy in India. Apparently, little pre-planning was done to evaluate the disparate demands between the rich, who had appliances, and the poor, who primarily just wanted lighting. Consequently, the microgrid experiment failed miserably as demand exceeded supply within days. The primary issue was that the microgrid was stand-alone and not connected to a centralized grid for back-up. The problem was so bad that the day the system was dedicated, protesters showed up with signs saying: “We want real electricity, not fake electricity”; real electricity being grid electricity. What followed was nothing short of electricity rationing and, eventually, a 100-kW transformer was hauled in to connect the village to the central grid. During my time in India power outages were common and the power is generated by coal and gas. If India has trouble dispatching electricity from traditional fuels and matching supply with demand, how will they transition to intermittent renewables, which can’t be dispatched?
    In closing, M.V. Ramana, a physicist at Princeton had this to say: “I strongly encourage [microgrids] for urban, upper classes of people who can afford it,” he said. “But [I would] not do it on the backs of people who are poor and who can’t afford these experiments.”

Gattie Note: I couldn’t agree more. Developing countries seem to be forever placed in either-or false choices between environmental stewardship and economic development. History teaches us that environmental stewardship is enhanced through economic postscarcity. The U.S. could help by continuing research and development in carbon capture and storage, which, when mature, would afford countries such as India the luxury of developing their economies without the externalities associated with coal combustion.

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  • Clean, Inexhaustible, and Free Energy Remains Elusive
    Hydropower permitting takes up to 10 years, solar PV is an ecological risk that blots nature & farms, wind turbines kill birds, and bioenergy isn’t less carbon intensive than fossils. Industry really needs to pick up the pace and get us our free, inexhaustible, zero-risk, carbon-free government energy. Joking aside: We need renewable energy to work for us. However, providing 24/7 energy to society requires smart people, hard work and innovative engineering. Nature doesn’t just hand us free stuff whenever we want it.

Gattie Note: The article on wind turbines killing birds is a stretch. I included it more for its drama than anything else. Personally, I love the idea of wind turbines and really wish we could plant those things in Georgia. However, my tongue-in-cheek point here is that there will always be risks associated with every human endeavor. If we wait for that zero-risk energy resource and accompanying zero-risk technology, we’ll be waiting until the sun goes down for the last time.

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  • A Little Closer to Home
    There was a nice article in Greentech Media earlier this month on the maturing solar market in Georgia and how the state’s utility model is facilitating a valuable service to customers in the solar space. This reflects a productive working relationship between Georgia Power, the Public Service Commission, and the solar industry that ultimately does what they’re supposed to do—provide services that benefit the citizens of Georgia.

Gattie Note: A special thanks to GPSC Commissioner Tim Echols, a real champion of solar, and Georgia Power for cultivating the environment for this to develop.

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NUCLEAR

  • TVA, DOE and China
    TVA’s Watts Bar Unit 2 was approved to start operating, which represents the first U.S. reactor the NRC has authorized since 1996. This single 1,050 MW nuclear unit has the capacity to service 650,000 homes…not people…homes. And, of course, zero emissions. At the same time, China is making increasingly greater strides in developing its nuclear fleet. And guess who it is partnering with—the U.S. Department of Energy. China is partnering with U.S. DOE on a Next-Gen nuclear reactor program focused on salt-cooled and salt-fueled reactors. According to Xu Hongjie, director of China’s molten-salt reactor program at Shanghai Institute, China is further along in its advanced reactor program than any country in the world. According to Forbes writer James Conca (1,2), China is fast-tracking its next generation nuclear efforts and plans on investing US$100 billion to build seven new reactors in the next 15 years, including some in partnership with Bill Gates.

Gattie Note: I’ll say this over and over and over: I’m at a loss as to the resistance to nuclear in the U.S. The most energy-dense resource we can harness for power generation, with zero emissions, yet solar and wind are getting the promotion from environmentalists and the federal government.

(1) http://www.forbes.com/sites/jamesconca/2015/10/22/china-shows-how-to-build-nuclear-reactors-fast-and-cheap/
(2) http://www.forbes.com/sites/jamesconca/2015/10/02/bill-gates-forges-nuclear-deal-with-china/

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OFF THE GRID

  • Got Regulations?
    The entire electronic Code of Federal Regulations is accessible, and looking over it will give you a sense of how thorough nearly every aspect of an American activity is regulated. For example, if you manufacture reciprocating internal combustion engines (RICE) and you’re wondering what notifications you must submit to EPA and when you must submit them, you can just check right in with Section 63.6650 of Table 8 to Subpart Zzzz of Part 63 of Subchapter C of Chapter 1 of Title 40–Protection of the Environment, and there you go, Bob’s your uncle. If you don’t have any specific questions, you can just choose a year and enjoy the 70,000-plus page ride through government regulation.

Gattie Note: This is really overwhelming when you take the time to do a fly-by of the CFR. My guess is that Washington, Adams, Jefferson, Madison and whoever those elusive other 4 fathers are, would roll over in their continental graves if they knew we had such highly regulated country and that it was the centralized federal government in charge. Don’t misunderstand my point–some federal regulations are fundamentally necessary, as are other state regulations. I only offer this as an information item sprinkled with a little editorial commentary.

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  • We Will Not Divest
    MIT refused to kowtow and kiss the ring of activists who have been demanding that universities divest their fossil-fuel stocks. MIT’s position is that to do so would be incompatible with their strategy of working with industry to actually solve problems. Instead, the world-renowned institute will develop a 5-year plan to cut its own emissions. Imagine that: Stepping up to directly address an issue through personal accountability.
    GO BEAVERS!

Gattie Note: OK, I got sarcastic. No apologies.

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…ilyh…

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