Re/Action on Climate Protection

Low Carbon Transformation Requires a Robust Public Sector #climate

Sonoma County California has set a bold target for greenhouse gas emissions reduction: 25% below 1990 levels by 2015. To reach this target, a Community Climate Action Plan was prepared that provides a roadmap for cost-effective, targeted local action. Here is a video overview of the plan.

One of the key elements of the plan is a proposal to build a local, low carbon electricity supply, based on locally available solar, wind, geothermal, biomass, small scale hydro and wave/tidal. This local approach focuses on demand reduction through smart grid technology. Here is an overview of the low carbon portfolio. This is an actual physical replacement of the electricity supplied by the utility. This is what is required to actually reduce the carbon emissions from electricity use by over 60 percent from business as usual.

The building of new electricity supply to replace fossil fuel powered generators, along with management of the demand for electricity is the first and best step toward a low carbon future. Taking this step at a local level solves one of the main "problems" with renewables as implemented by the big utilities: the need for new transmission lines. In addition, a locally-based electricity supply integrated with Smart Grid control technology allows the integration of electric vehicles into the electricity supply using V2G.

The economics of this electricity supply are competitive with the existing utility rates, if the new facilities are publicly financed and owned. Because municipal revenue bonds can be used to finance the electricity supply elements, and public ownership removes the need for profit, the levelized cost of electricity is competitive with fossil-based central station generated electricity. This approach is equivalent to the public option for health care. It creates a robust framework for jobs, local economic stimulus and energy independence at a local level.

See more about how a company works in partnership with local governments on a public-private partnership for low carbon electricity infrastructure.

This post is prepared as part of Climate Change Blog Action Day.

Case in point: The Landfill; #Climate neutral or business as usual?

The Central Landfill in Sonoma County, CA, has been closed since 2005. The reason is that the landfill was found to be in violation of groundwater quality regulations. The County began pursuing a plan to sell off the landfill to a private operator, asserting that it did not have the funds to mitigate the groundwater problem. An environmental impact report asserted that any solution for solid waste management in the County other than reopening the landfill was "infeasible." It is unclear how this conclusion was reached, although the decision was made in 1994. Specifically, a Materials Recycling Facility including electricity generation based on recovery of organics was rejected as a potential solution.

Over the past 15 years, significant experience and technology have accumulated that enable separation of the organic fraction of municipal solid waste, and processing it into a usable energy product. Here is an example of that type of technology: ArrowBio. Other excellent digester technologies are available such as this one developed by Dr. Ruihong Zhang of UC Davis. Here's the basic layout:

 

The fate of the landfill in Sonoma County represents a perfect opportunity to exercise leadership at a local level on climate protection. The choice facing us in Sonoma County is not WHERE we bury our waste, but WHAT we bury. Do we continue to bury the organics that emit over 70,000 tons of equivalent CO2 emissions from methane in landfill gas? Or do we treat our municipal solid waste stream as a valuable resource, and go for a climate neutral solution that yields clean, green electricity?

Here's a further take on this situation: POWER ALTERNATIVE

Valero Using "Bully Pump-it" to Lie about Cap and Trade

Valero gas stations are displaying a sign on their gas pumps proclaiming that
"If Congress passes cap and trade legislation you will pay the price" and asserting that "cap and trade will cost you 77 cents or more per gallon". They then list a website URL voicesforenergy.com. There is a form on the website to send a letter to your representative saying that you oppose cap and trade because it will "place undue hardships on the oil and gas industry."

 This website cites studies from The American Petroleum Institute, The Heritage Institute and the Cato Institute, as well as a blog called MasterResource. All of these organizations deny the existence of global warming, and claim that the legislative attempts to reduce greenhouse gas emissions will destroy the economy. The website is linked to capitalconnect.com, which is a site produced by a firm called DDC Advocacy. This is a PR firm that promises to "energize supporters at a local level" and "make an impact locally with powerful grassroots campaigns."

The oil company, Valero, is assaulting its customers with lies and distortions coming from a PR firm to derail a policy that it thinks will hurt its business. It is putting its profit interests ahead of its own customers health and safety. I think this calls for a boycott of Valero. Do you approve of a business attempting to deceive its customers in order to build a constituency for a policy it doesn't like?

Governator drinks Big Transmission-laced Kool Aid

"Investments in core infrastructure" is how PG&E puts its strategy for profit growth in its 2008 annual report. High voltage, long distance transmission lines represent one of the largest elements of PG&E's proft center, and this was given a huge boost on Tuesday. Governor Transmission-ator, er, Schwarzenegger, announced that he was going to veto a bill being passed by the California Legislature that requires 33 percent of the state's electricity to come from renewables by 2020.

A key requirement of this bill was to be that the majority of this new renewable generation would be located in-state. Although the bill was changed to potentially allow new large hydroelectric dams to be built in Canada by PG&E (wow!), along with the transmission to get the electrons back to CA, the governor apparently objected to placing any requirement whatsoever on in-state generation. Schwarzenegger has instead decided that HE will dictate the 33 percent renewable standard, and remove the requirement for in-state generation.

It is painfully obvious that Schwarzenegger has been drinking the "We need more transmission to develop renewable electricity" Kool Aid. Why? From a technical standpoint, this argument is patently false. Communities in California have already embarked on the development of massively distributed, renewable generation portfolios (See the Sonoma County Community Climate Action Plan). These portofolios consist of local generation resources that largely do not require new transmission. So, politically, the remaining possibility is that the Governor has decided to help the utilities out, and enable them to "outsource" electricity generation, along with the massive requirement for new transmission to remote resource areas.

A chance for a tremendous stimulus to local electricity generation projects, and the technology to support them, was missed, in favor of enabling the utilities to increase profits at the expense of the ratepayers.

PG&E uses heft to stall low carbon electricity in California

Good story in the San Luis Obispo New Times on the PG&E's attempt to use the initiative process to scuttle any community's attempt to take control of its own energy future. An unintended consequence of this initiative might be to deprive any community of the ability to use municipal revenue bonds to finance any type of infrastructure, without a costly vote. This would include sewer plants, water systems and solid waste processing facilities. These facilities, since they generate revenue from rates or use fees, can be financed by tax exempt bonds that don't require an election for a municipal government to issue.

PG&E pushes vote to limit public power

Couched as a measure to protect taxpayers, a proposed ballot initiative could thwart nonprofit utilities

Sex, Climate Change and Sempra

Interesting story out of California has been developing this week. Mike Duvall, 72nd district assemblyman, was caught on an open mike discussing his extramarital affairs. Duvall was vice chairman of the Assembly Utilities and Commerce Committee. He resigned on Wednesday, this week. One of the women he was allegedly having an affair with was a lobbyist. The reporting from OC Weekly, based on Duvall's comments, identified the probable companion of Duvall as Heidi DeJong Barsuglia, a lobbyist working for Sempra Energy. Sempra Energy is the parent company of San Diego Gas and Electric, the investor-owned-utility serving San Diego and environs. The Utilities and Commerce Committee works on legislation regulating the utilities, and in particular, has been debating AB 64, the new renewable portfolio standard for the state of California which would require 33 percent of electricity delivered by the utilities to be generated by renewables by 2020. Sempra is opposed to this bill, and in May, a month after Mr. Duvall had met Ms. Barsuglia, he went on record as opposing this bill, also. Sempra Energy is primarily a natural gas company, as they also own Southern California Gas, Sempra LNG and Sempra Pipelines and Storage. In 2008, 8 percent of their electricity was generated by renewables, 12 percent coal and 54 percent natural gas. They had the highest 2007 GHG emission intensity (806 lb/MWh) of the "Big Three" utilities in CA, and the lowest percentage renewables (8%) in their fuel mix. Another tawdry tale of how sex, money and power even trump public safety and energy security in dealing with the problem of reducing anthropogenic greenhouse gas emissions.

Community Choice Aggregation and Climate Protection

In states that have a deregulated electricity market, "aggregators" can operate within an unbundled utility structure to enable ratepayers to get better rates. Community Choice Aggregation (AKA municipal aggregation or CCA) enables a local government entity to "aggregate" or group together the loads of the electricity customers in its jurisdiction and negotiate directly with electricity suppliers. This right of local governments gives a community the ability to take over control of its electric supply by enabling competition with the incumbent utility. CCA has been adopted by statute in 5 states. There are two aggregations currently serving over 700,000 customers in Ohio (NOPEC) and Massachusetts (Cape Light Compact). California has also adopted a Community Choice law (AB 117). Even though the retail electricity market was shut down in the State of California, communities can still take advantage of the power of aggregation, in a significantly lower risk environment than a fully deregulated market. Marin County has formed Marin Energy Authority, San Joaquin Valley Power Authority has been formed by Kings River Conservation District, and San Francisco has passed ordinances and developed an implementation plan for a CCA. Community Choice Aggregation enables customers in restructured (deregulated) electricity markets to adopt a "public/private hybrid" model for their electricity supply. A CCA differs from a municipal utility district in that the incumbent utility (PG&E, SDG&E or Con Ed) still owns and operates the distribution poles and wires, and does meter reading and billing. The CCA establishes a competitive bidding process wherein electricity suppliers bid against the offer being provided by the incumbent utility. If a supplier can satisfy the local requirements for renewables, and provide a rate better than the utility, the CCA may select that bidder to supply its electricity. All risks of providing the electricity lie with the supplier. In addition, the CCA may issue municipal revenue bonds against the revenue from electricity sales. This very safe investment can provide long term, low cost financing which can be used to build power supply resources. This powerful financial tool enables the CCA to engage "design, build, operate and maintain" (DBOM) suppliers who can construct a wide array of local renewable resources. The public entity finances and owns the generation, or demand side technology (demand response), giving the electricity the low cost from public ownership. The electricity generation resources are operated and maintained by the electricity supplier. Finally, the incumbent utility provides the distribution infrastructure, meter reading and billing. This is the public-private hybrid model referred to earlier. For communities who wish to take control of and transform their electricity supply, CCA provides a powerful tool. It allows communities to create jobs, energy security and low cost, low carbon electricity.

PG&E CEO calls dealing with public power "adversity" admits gas price vulnerability

From PG&E 2008 Annual Report, Letter to Shareholders from Peter Darbee: "Last year’s adversities ran from horribly costly and disruptive winter storms to radical swings in natural gas prices, aggressive new forays by public power activists, paralysis in the credit markets, and the astonishing reversal of fortune in the economy." The shareholders letter also hints at PG&E's longer term profit strategy: "Returns on new capital investments in PG&E’s asset base were the predominant force behind last year’s core earnings growth." From a 2007 presentation to investors: (Slide 24 PG&E Corporation Preparing for the Future) Core Growth Opportunities •Electric resource requirements •Pipelines to access gas supplies •Storage opportunities for emerging LNG supply sources •Electric transmission growth to reach renewable resources

Got Monopoly? Why electric utilities are bad for climate protection in California

The breakup of the monopoly utilities was supposed to have begun in the 1980's with the passage of PURPA. This landmark legislation separated the generation of electricity from the transmission and distribution. The purpose of this was to enable competition in the electricity generation sector. It has been a generally accepted principle that allowing electricity suppliers to compete for customers would result in cheaper, greener electricity. However, in California, this went horribly wrong in 2000 and 2001. The "energy crisis" caused by Enron and others resulted in a return of the monopoly investor owned utilities, PG&E, SDG&E and Southern California Edison to full vertically integrated monopoly status. These companies are responsible, within their service territories, for both electricity procurement and transmission and distribution. They are subject to the regulatory authority of the CPUC and the legislature. For the customers in their service territories, they are they only game in town. As the pressure ramps up to reduce the carbon impact of electricity, there is a disincentive for the utilities to develop small scale renewables. The reason is simple: they make money on transmission. Locating small scale generation near to the load that does not require new transmission will not enable them to increase revenues year after year. Agressive rollout of demand response, reducing transmission needs. Further, the utilities want to stay in the drivers seat on the rollout of new renewable capacity, owning it or controlling it if possible. The 33 percent renewable portfolio standard that is proposed for California, along with the emission cap that comes into force in 2020, creates enormous pressure to build new renewable generation. To the extent that utilities can derive revenue from these new sources, they can build their revenue base beyond simply transmission and distribution. The bottom line is that, in the state of California and elsewhere, large scale rapid development of new renewable capacity is slowed and made much more expensive by the monopoly utilities. Their focus on large scale, expensive new resources, requiring major new transmission facilities will result in higher rates for California customers as well as a much higher carbon impact. The most cost effective way to transform the electricity supply to a minimum cost, minimum carbon portfolio is to reduce demand, and locate publicly owned and financed resources close to the load.

Got Monopoly? Why electric utilities are bad for climate protection in California

The breakup of the monopoly utilities was supposed to have begun in the 1980's with the passage of PURPA. This landmark legislation separated the generation of electricity from the transmission and distribution. The purpose of this was to enable competition in the electricity generation sector. It has been a generally accepted principle that allowing electricity suppliers to compete for customers would result in cheaper, greener electricity. However, in California, this went horribly wrong in 2000 and 2001. The "energy crisis" caused by Enron and others resulted in a return of the monopoly investor owned utilities, PG&E, SDG&E and Southern California Edison to full vertically integrated monopoly status. These companies are responsible, within their service territories, for both electricity procurement and transmission and distribution. They are subject to the regulatory authority of the CPUC and the legislature. For the customers in their service territories, they are they only game in town. As the pressure ramps up to reduce the carbon impact of electricity, there is a disincentive for the utilities to develop small scale renewables. The reason is simple: they make money on transmission. Locating small scale generation near to the load that does not require new transmission will not enable them to increase revenues year after year. Agressive rollout of demand response, reducing transmission needs. Further, the utilities want to stay in the drivers seat on the rollout of new renewable capacity, owning it or controlling it if possible. The 33 percent renewable portfolio standard that is proposed for California, along with the emission cap that comes into force in 2020, creates enormous pressure to build new renewable generation. To the extent that utilities can derive revenue from these new sources, they can build their revenue base beyond simply transmission and distribution. The bottom line is that, in the state of California and elsewhere, large scale rapid development of new renewable capacity is slowed and made much more expensive by the monopoly utilities. Their focus on large scale, expensive new resources, requiring major new transmission facilities will result in higher rates for California customers as well as a much higher carbon impact. The most cost effective way to transform the electricity supply to a minimum cost, minimum carbon portfolio is to reduce demand, and locate publicly owned and financed resources close to the load.