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Posts Tagged ‘clean energy’

EPA’s Proposed Greenhouse Gas Rules: Not Radical But Radically Pragmatic

June 16th, 2014


As expected, the Environmental Protection Agency’s (EPA) recent proposal to regulate power plant emissions sparked some mild hysteria on the left and the right. The right says the proposed rules will usher in an economic catastrophe. The left says they are just shy of salvation for the climate. You would think the EPA’s proposed greenhouse gas rules were a radical approach to a tough problem – and you’d be half right.  Climate change is a very tough problem – but the EPA’s proposed solutions are far from radical.

In reality, the state-based approach taken by the agency is perhaps the most practical solution yet proposed to address climate change. That’s because it leaves it up to the states and utilities, who best understand their markets, to sit in the driver’s seat and use existing technologies and strategies to write their own emissions plans that maintain the affordability and reliability of their electricity.  It’s a novel, practical approach. This is not just the view from Washington, D.C. Editorials across coal and oil country echoed the same sentiments. Read the rest of this entry »

Natural Gas Offers an Opportunity for Success, Not a Guarantee

December 12th, 2013


Remember that movie “The Jerk”, in which Steve Martin plays a monumental idiot who stumbles into a fortune, and then blows it all on things like a giant stuffed camel and a private nightclub in his basement? Ultimately, Martin’s character is rescued by family members who prudently invested the money he’d occasionally sent them—providing both a happy ending and a life lesson about responsible resource management.

Technological developments like hydraulic fracturing have suddenly given the U.S. access to a fortune in natural gas, which is already providing opportunities for economic growth. And recent studies like those being conducted by Environmental Defense Fund further support the tremendous environmental opportunities presented by natural gas, including climate change mitigation. But opportunity alone does not guarantee success. A certain amount of planning and public support can help ensure we maximize the benefits of this resource, and avoid being… jerks.

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EPA’s New RFS Proposal Turns Clarity Into Confusion

December 4th, 2013


Consistency. Certainty. Clear expectations.

These are critical elements of any successful regulatory policy implementation. The Environmental Protection Agency’s proposed rule on the Renewable Fuels Standard (RFS) could unravel them all.

In only 6 years, the RFS has driven billions of dollars in private capital toward the development of low-carbon advanced biofuels, and propelled these fuels out of the lab and into the market. This level of investment in emerging technologies requires long-term regulatory and market certainty, and the RFS has provided just that.  It has also provided a consistent idea of what is expected of regulated industries.

The RFS was carefully designed to encourage production of increasing amounts of biofuels, without making demands of industry that are not technologically feasible. A perfect example of this flexibility is EPA’s statutory authority to reduce volumetric requirements for cellulosic biofuels annually, to reflect anticipated production.  EPA has used this authority multiple times in cases where production has lagged behind the volumes envisioned by the statute.

But EPA’s proposed rule uses a new and very…creative…interpretation of the RFS statute to expand this authority and reduce the required blending levels of a fuel that is in abundant supply. EPA’s interpretation has struck many as counter-intuitive at best, and inconsistent with the law at worst. As market analyst Ben Salisbury explained in a recent Third Way briefing, the RFS offers little certainty to investors if it is implemented in such an unpredictable way. According to Salisbury, “…that has a chilling effect on not just biofuels but all environmental control investments.”

If inconsistent rulemaking has a chilling effect on investment, then legislative adjustments might as well be a meat locker. The odds of passing thoughtful and productive legislative adjustments to the RFS are about as high as getting Congress to gently reopen Obamacare. And if the existing law were simply “eliminated”, it’s difficult to envision some new and improved renewable fuels bill getting signed in the Rose Garden any time soon.

The bottom line is that the RFS has performed as it was intended to. Most importantly, it has driven investment toward technologies that offer exceptional greenhouse gas emissions reductions compared to petroleum fuels, and that are now starting to enter the market. Creating instability, either by regulation or legislation, will only halt this progress at a critical juncture.  By continuing to implement the RFS consistently, EPA can provide the certainty investors need to maintain this level of support and help drive further innovation in critically-needed advanced fuels.

This piece was originially published via National Journal

Why China Isn’t Ready for Electric Vehicles

November 12th, 2013


By 2020, auto analysts expect more than 2 million electric vehicles to be sold every year. That’s a huge leap from the 113,000 electric vehicles that were sold in 2012. It’s also why China has set its sights on trying to win this “new energy vehicle” sector by 2020.

China’s track record is formidable. It launched successful bids to compete in wind turbines, solar panels and personal electronics. However, there are a number of structural problems in how the government and economy work that make it unlikely that a Chinese competitor to Tesla, the Chevy Volt or even the Toyota Prius will emerge any time soon.

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EPA’s New Emissions Regulations Follow the Electricity Market

September 23rd, 2013


There has been a lot of overheated political rhetoric from the right and the left about the EPA’s emissions standards for new power plants. If you strip that away, however, you’ll find that the new rule is really codifying what’s already happening in the utility sector. Thanks in part to the lower emissions and lower cost of natural gas, this is already benefiting public health, the environment, and the economy.

The bottom line is that for all of the build-up about the new standards, energy sector insiders know that low natural gas prices, the growth of renewables, and little demand growth are already reshaping electric generation. As an AEP spokeswoman acknowledged on September 20 in National Journal, “We have no current plans to build any new coal-fueled power plants both because we don’t need additional generation, and it would be difficult to make an economic case for coal with today’s low natural-gas prices.” The new regulations marry these market trends with intensive stakeholder input from the private sector. The result is a clear roadmap for new electricity generation in the United States.

While administrative actions never carry the democratic appeal of a Congressionally mandated solution, Congress has been unable to agree on a path forward. The Supreme Court required the EPA act, and the regulatory revamping was inevitable.

It would be great if Congress could develop and pass bipartisan legislation to accomplish the same goals as the EPA. That’s extremely unlikely in the current political environment.  There’s a lot Congress could do—that’s bipartisan and does not cost much if anything—to create new opportunities in coal states and to ensure we maintain fuel diversity in our electricity fleet. This includes helping the private sector accelerating the development of carbon capture and storage technologies and removing the regulatory uncertainty that surrounds it.

Remember, even the EPA’s new source regulatory decision had to be court-ordered. The regulatory uncertainty for utilities has been a killer, most will tell you, and the business climate has suffered. This is a step forward, both for the environment and the business climate. It had to happen, and it finally did.

This piece was originally published via National Journal.

Learning from Germany’s Clean Energy Missteps

September 20th, 2013


American clean energy advocates like to tout the latest European energy accomplishments as proof that the United States is falling behind. Clean energy provides 25 percent of Germany’s energy demand! Germany has the greatest share of wind and solar among the G20 countries!

These are important accomplishments, to be sure. But this rapid growth has come at a cost: the highest energy prices in Europe. Are there ways we can achieve the milestones that Germany has reached while avoiding the economic downside of high costs? A new report by the respected German newspaper Der Spiegel provides some hard truths, and a look at three important lessons for us in the United States:

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