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Tam Hunt: Federal Efforts on Climate Change Are a Travesty

True mitigation merits aggressive action at the state and local levels

By Tam Hunt |

“We’ve ensured a role for coal,” said Rep. Rick Boucher, D-W.Va., regarding the federal climate change “mitigation” bill that recently passed the House of Representatives. I’m forced to use quotation marks around “mitigation” because this “deal with the devil,” as Ted Nordhaus of the Breakthrough Institute described it, confirmed my worst suspicions: Even under a progressive and popular president, the chances of an effective federal climate change mitigation bill passing through Congress is minimal to none.

Tam Hunt
Tam Hunt

This is the case because the primary requirement of any federal approach to climate change mitigation is that it phase out coal — quickly. Coal power is the largest source of greenhouse gas emissions in the United States and no attempt to reduce net emissions will succeed if coal emissions are not reduced. And yet, the federal bill (Waxman/Markey) will, according to the Environmental Protection Agency’s recent analysis, actually allow an expansion of coal emissions until 2020.

The federal bill is, in short, a travesty that highlights the need to shift from any federal focus on climate mitigation to aggressive state and local action. (To be fair, President Obama’s recently passed tax credits and R&D funding for energy efficiency and renewable energy, totaling about $80 billion over the next couple of years and up to $150 billion over 10 years, will do far more than any faux cap-and-trade system. These funds are on their way to every state and represent an order of magnitude or two higher level of funding than under President Bush. I’ve written in the past about a carbon tax as a better approach than cap and trade, and I still feel that a carbon tax would be far more effective than cap and trade — particularly a faux cap and trade).

Even at the state and local level, it’s a mixed bag, but there are many promising efforts, as I’ve also written about in numerous previous columns. The enormity of the twin crises — climate change and peak oil — have only become worse, despite a lull in the past year in terms of oil and gas prices. These twin crises demand rapid change on the ground. Luckily, some states are taking action in addition to finding the right rhetoric. Ironically, the nation’s leader in renewable energy is now Texas, which has more than triple the installed wind power of California, the wind power leader for two decades. As of early 2009, Texas had almost 8,000 megawatts of wind power online, compared with California’s 2,500 megawatts. Perhaps even more surprisingly, relatively small Iowa also has surpassed California in wind-power capacity!

Twenty-nine states now have a renewable energy requirement of some sort in place. But a little known fact is that most — perhaps all — of these “mandates” have a major catch: Renewable energy projects must be as cheap or cheaper than the fossil fuel alternatives.

For example, in California, with one of the most ambitious mandates, the investor-owned utilities must achieve 20 percent renewable energy by 2010 — but only if these renewable energy resources can be brought online without costing ratepayers a set amount above the “market price” cost of electricity from a new natural gas power plant (the “above market” fund is about $800 million through 2012, which amounts to a tiny subsidy for these renewable energy projects, and much of which is already exhausted by existing contracts). So if the utilities can show that they can’t procure renewable energy within the relatively small “above market” fund, their renewable energy obligation at that point melts away. Sacramento is considering increasing this “mandate” to 33 percent by 2020 — but it probably will include similar loopholes, and perhaps others.

These cost-effectiveness requirements are generally good for ratepayers in the short term — but in the midterm and long term, ratepayers stand to save more money through vigorous investments in renewable energy technologies even if these investments result in short-term relatively small rate increases. (For example, a recent draft report from the California Public Utilities Commission found that achieving the 33 percent renewable energy standard by 2020 will cost ratepayers 7.1 percent above business as usual; but the report also suggests that ratepayers may save money over the longer term because of “market transformation” of the renewable energy market.)

As with the federal situation, all is not lost at the state and local level — while California has been almost stagnant in the past seven years regarding new in-state renewable energy projects, there is cause for optimism because of the sheer number of projects expected to come online in the next few years. But nothing is ever easy. The large majority of these new projects require major new transmission lines to be completed — and there’s almost nothing more difficult than building new transmission lines.

For renewable energy projects, there are generally at least a few neighbors in opposition. For new transmission lines there are usually hundreds of neighbors in opposition — and as transmission lines become longer and longer, to transfer power from huge wind and solar projects to population centers, it’s likely to get even more difficult to build these new lines. I fully support large renewable energy projects, in principle, but also respect the choice of those who prefer small or medium-scale projects. These problems, however, highlight the difficulty in relying solely or primarily on large utility-scale projects.

Community-scale energy is thriving in parts of the United States. This is one of the truly encouraging trends in the past few years. What I call the Danish Model for wind power has been successfully transferred to the United States, with Minnesota taking the lead. The Danish Model focuses on numerous medium-scale wind projects dotted around the landscape, in rural and urban environments. Feed-in tariffs play a large role in the Danish Model, as does local ownership of projects. Hawaii and Vermont; Gainesville, Fla.; Ontario, Canada; and other jurisdictions also are exploring robust feed-in tariffs. The trend is promising.

California is slowly bringing the Danish Model to life on the West Coast, with a limited feed-in tariff now in place (AB 1969). The PUC has proposed expanding this to 10 megawatts, from the current limit of 1.5 megawatts per project. Pricing is key for community-scale projects and the current “market price” offered can work for wind, landfill gas and biomass projects, but it’s quite challenging for solar projects to be economical at this level. AB 1106, carried by (Assemblyman Felipe Fuentes), D-Los Angeles, is very encouraging, however, because it will provide better pricing for renewable energy projects five megawatts and below (as low as 250 kilowatts). I encourage all interested parties to submit a letter to Fuentes and other key members of the Legislature expressing support for this highly important bill.

California also has significant incentives in place for net-metered community-scale projects, including the Self-Generation Incentive program (wind, fuel cells and advanced storage) and the California Solar Initiative.

The SGIP program provides up to $1.80/watt for wind projects. Project size is capped at five megawatts per project. The CSI provides a declining rebate for solar projects, for smaller projects, and a performance-based incentive payment, for larger projects, that also declines over time. Incentives are about $1.90/watt or 22 c/kWh, depending on the utility territory. When we add federal tax credits — soon to be available as a cash grant that doesn’t require any tax liability — much of a community-scale wind project can be paid for upon completion of the project. Solar incentives aren’t quite as favorable because solar still costs considerably more than wind power, but costs are declining for solar even faster than the state incentives are declining.

I recently switched from nonprofit policy advocate to private sector consultant and renewable energy project developer. My new company is now part of the energy revolution that must happen. I’ll continue these columns because I want to spread the knowledge necessary to replicate the models I’m using for my projects; there’s more than enough community energy potential around California, other states and other nations, to keep hundreds of small companies such as mine busy for decades.

We need this scale of effort to solve the twin crises we’re facing. Stay tuned for more details on the community-energy model my company and other similar companies are developing. It just may be the case that the community energy model will achieve the emissions reductions federal efforts are seeking — and failing to find.

— Tam Hunt is president of Community Renewable Solutions LLC, and a lecturer in climate change law and policy at UCSB’s Bren School of Environmental Science & Management. This article also appears at RenewableEnergyWorld.com.




comments powered by Disqus

» on 07.02.09 @ 07:06 AM

“I recently switched from nonprofit policy advocate to private sector consultant and renewable energy project developer. My new company is now part of the energy revolution that must happen”

Oh no, Tam is now a corporate dude. I guess now we have to figure in “conflict of interest” when reading his posts.

» on 07.02.09 @ 09:11 AM

Everything’s a crisis with you fear mongering environmentalists and it must be great for business huh Tam? If your business is environmental science. Everybody else has to suffer. All of my friends are already seeking employment.
Coal is the cheapest most widely used most practical form of stored solar energy. Coal is also the only possible way of making your stupid electric cars practical you fool. Without coal there is no possible way for cars to meet the required CAFE standards - you think there’s going to be enough solar and wind production by 2012 to meet the required increase in the electrical grid that is going to power all of these cars we will be forced to buy? Who is going to be able to afford to run them? Especially after the economic destruction wrought by the Global Warming cult? Go back to college Tam and study engineering instead of pie-in-the-sky Utopian Dreamworld Environmental science.

» on 07.02.09 @ 10:23 AM

Hate to pile on Tam, but you seem to need constant reminding that your renewable energy sources are not base load compatible. Coal is a base load fuel and relatively cheap and plentiful. Its exploitation is perfect for lowering our overall fuel costs which will liberate capital for expansion of other base load fuels like nuclear and geo-thermal. I know, you and the rest of the AGW zealots view any fuel with carbon in it is death to mankind, but you are wrong, in a big way, and when the science and engineering prove that you are going to feel very foolish for having sold the public snake oil. I still commend your efforts at developing scavenging supplies like wind and solar. These two sources (particularly solar) will help us conserve base load fuels, but they are NOT replacements and if you keep selling that you are going to find yourself along with a lot of other well intentioned people on the wrong side of the equation, not a place to be when people start getting hungry, losing their liberty and watching everything they’ve known turn to dust. Our western civilization is built on and exists on cheap plentiful BASE LOAD energy supplies. Replacing them with scavenging is a death warrant to our way of life. You might think our way of life needs to change but I guaranty you, you are part of a very small and not well defended population. Most people who buy your snake oil will turn on you in a heartbeat if you tell them they have to adapt a more austere life style. Remember, progress has two directions. If I were you I would unhitch myself from the current “progressive” camp since they have obviously thrown their gear lever in reverse.

» on 07.02.09 @ 11:07 AM

AN50, I believe I’ve responded previously to your comments about renewables and baseload power. Here it is again:

1) Many renewables, such as geothermal, biomass, landfill gas, waste to energy, and small hydro are baseload. Geothermal power already provides 5% of all Californians’ electricity (a little known fact).

2) Variable renewables like wind and solar can often provide power during peak demand, particularly on the coast. Each CA utility has a time of delivery adjustment factor that allows peak renewable energy supplies to receive much higher payments b/c this power is much more valuable to the market and to consumers (it’s as high as 3 times the base market price in Edison territory)

3) California and the rest of the US is far from needing any “back up” supplies due to variable renewables like wind and solar. This is the case because CA, for example, has only 2.5% wind and less than 0.5% solar at this time. We can, according to many studies, reach 15-20% before significant back up capacity is required for these variable renewables. This will be a decade or two away (unfortunately). Most states, including CA, require 15-17% “resource adequacy” supplies to be onhand to mitigate variability of all resources, including nuclear and coal, which can cause havoc on a system b/c plants are so big that if one plant (which can be 1,000 MW or more) has an unplanned outage supplies must be available to fill in for this outage. These kinds of outages happen pretty frequently.

4) Variable renewables like wind and solar can be “backed up” in many ways if required. These technologies can include natural gas (the default option in CA, which uses only 20% coal, and 45% natural gas, 15% nuclear, 10% large hydro and about 10% other renewables), pumped hydro storage (used extensively around the US), compressed air energy storage, batteries, fuel cells, etc.

5) Geographic dispersion and grid interconnection can help mitigate variability to a large degree. See a recent Int’l Energy Agency report on this topic:

http://www.google.com/url?sa=t&source=web&ct=res&cd=1&url=http://www.iea.org/textbase/papers/2005/variability.pdf&ei=2uhMSr8BhuqxA7eUvLoF&usg=AFQjCNHI_KRL7-yYGibdCYd1PwejAs7qvA&sig2=4MxxYgqXVT4L2sx6uJ-m1A

Nations like Denmark have over 25% wind power penetration and plan to go to 50%. This is possible because they are interconnected to other grids such as Sweden and Germany. Similarly, CA is interconnected to the Western Electricity Coordinating Council grid (WECC) and ultimately to the entire North American grid. This wide geographic area can help mitigate variability b/c if wind or solar is not working at a given time in one location it will generally be working in another location, allowing balancing.

Long answer short: many many studies have looked at this issue and concluded that the total cost of mitigating variability, even at 20-30% penetration of variable renewables, amounts to about 10% additional cost. This is a pittance.

» on 07.02.09 @ 01:46 PM

I would hate to be backstage if Tam ever tried to peddle this B.S. in public. Unless of course, I had a tomato sauce business.

» on 07.02.09 @ 02:21 PM

Tam reminds me of Molly ‘one note’ Ivins.  Same column every time with minor rewording. And generally wrong.

» on 07.02.09 @ 03:28 PM

Thanks for the reply Tam, but you haven’t mentioned anything about your fast track to eliminate coal Tam. What’s that all about? A rush to increase energy prices (increasing the cost of EVERYTHING for everyone) in an already seriously depressed economy? Not too many are against additional alternate energy supplements but in due time. Stop hurting people in your misguided attempts to save the planet from a dubious crisis… the economic crisis and geopolitical crisis will surely get us sooner than whatever long term Global Warming crisis you are exploiting. Save the world, not the planet. The rush to poverty that you are promoting is the worst possible thing for the environment, because if you haven’t noticed in your small self centered world - poverty stricken nations don’t give a rip about the environment, their very day to day survival is the focus. “Emerging nations” like China are exempt while we pay the price to save the planet as they outpace us in the destruction of it.

» on 07.02.09 @ 03:35 PM

Judging by the comments, there is some rough water ahead on deciding on a reasonable path for future energy and getting broad public support for the process.  In a report by Dr. Steve Koonin (BP 2007) there was a chart showing world energy use with the US running 2-3 times the rest of the world in primary energy use per capita.  Some of the best studies since have concluded that this rate is just not sustainable with the bulk of our energy coming from coal and oil.  The question is not if we will make a transition but by when.  The reason the Prius is doing so well is that society was offered a good quality fuel efficient transportation option at a reasonable price.  As manufacturing efficiency improves and more options reach the market, these vehicles will become more affordable.  Through aggressive development and Innovation by industry along with support from government we will have to implement more efficient ways to generate and use energy.  Although we can’t agree on the answers, I think Tam is asking the right questions.  It’s always tough being one of the first ones out of the foxhole.

» on 07.02.09 @ 06:27 PM

I got a question for ya Tam since you like to comment on your own articles. How do you explain that climate change is also happening on Pluto, Jupiter and Mars? Those Martians burning too much coal too? Let’s see, what do all the planets have in common? Cars? No, Factories? No, Power plants? no, Oh duh, the SUN!

http://www.timesonline.co.uk/tol/news/uk/article1720024.ece

Here’s another one - how come there were three ice ages and associated warming, cooling cycles before the industrial age? Cars? No, Factories? No, Power plants? no, hmmm….

» on 07.02.09 @ 06:27 PM

Mr. Hunt makes some good points. The bill that came out of the House is far from
perfect.

But there’s an old saying that you have to be able to crawl before you can run.

Let’s be honest for a moment. Although Al Gore whispered in his ears about Climate
Change and Energy Independence for eight years, Bill Clinton never had the courage - nor the votes in Congress - to ever do anything significant about it.

Then, for another eight years, we had a Cheney-Bush government, which would not
even acknowledge that Climate Change might be real, or that Energy Independence
was nothing more than trying to drill national parks in Alaska, or relieve Iraq of its
oil.

So, yes, if Climate Change may be progressing as fast as some scientists fear, future
historians will look back and wonder why it took us so long to get untracked.

But Mr. Hunt should remember that the perfect is the enemy of the good. Some kind
of Energy Reform legislation and incentives, right now, is better than a great bill, if
it takes another decade to get one.

Once the private sector (apart from the Oil-gas and Coal industries) realize how
much they could make by providing more energy efficient homes, buildings, vehicles first to America, then to the whole world, they will call of their Republican
Rush Limbaugh attack dogs faster than the blink of an eye.

So Mr. Hunt might be better served helping figure out how to get this flawed, but
useful bill through the Senate, to the president’s desk, then gear up to make sure
it’s successful - a necessary key ingredient to making it easier to pass the next,
better bill, and to getting venture capitalists to start investing big private dollars
into “clean/green” energy.

» on 07.02.09 @ 06:30 PM

» on 07.03.09 @ 12:30 PM

Tam’s right on the ‘base load’ argument.  In fact, the more different types of electrical sources, the more flexible and able to be balanced.

Relative to the intermittency of wind and solar, let’s not forget companies like Edison have so-called “gas peaking plants” all over the place to respond to changes in demand. Those very flexible sources can be used to respond to changes in supply as well.

» on 07.03.09 @ 02:38 PM

Thank you Tam for your in-depth report on the climate change bill and community-based energy options. I also appreciate your taking the time to respond to legitimate questions posed in comments. 

I’d like to remind “Sand Flea,” “stop dreaming,” “Booo” and other anonymous writers that the dripping sarcasm and personal attacks do nothing to advance your viewpoint or make anyone reading your comments take you seriously—so why bother?  If you really disagree with what Tam is saying, try using thoughtful, respectful arguments to make your case.

And if you respond to this, use your real name to show that you stand behind your words.

» on 07.03.09 @ 02:54 PM

Deb, the dripping sarcasm, attacks and other forms of acidic speech deliver the passion these commenter’s feel toward the subject. As one of the top bad boys in this area (my apologies to the Editor), I would not want it to stop. There is a place for the toned down, PC, un-passioned response, but God help us if that place becomes the one place where a person can flush their frustration out in all its passion, the internet. BTW- have yet to offer you a rant on your most recent piece. Better cover yer ears, girl. Peace, and cheers!

» on 07.07.09 @ 12:58 PM

Yes Tam you did reply, sort of, which is the same as this reply, sort of. Look I’m glad you alternative energy guys are finally waking up to the enormous potential geo-thermal offers. Of course as with any energy supply system it has its risks both short term and long term. But imagine the nearly inexhaustible supply of thermal energy we could tap from our own planet core! As a base load supply geo thermal offers some of the longest lasting supply bases we could develop. So why has it not been exploited so far? Extraction costs are the primary reason, along with some fairly significant geological questions and problems that have yet to be addressed. Fortunately, modern oil extraction techniques are proving very useful for geo thermal as well, so all you oil extraction companies have a great future in supplying the world with yet another energy paradigm. There is no question, Tam, that solar will be one of the most important energy conservation systems in the world in the next 50 years. Conservation? You mean supply don’t you AN50? Nope, solar as a base supply is not steady state and don’t give me that BS about offsetting the variability with a smart grid. I do not deny that it is possible but your 10% added cost is bunk and our efforts should always be toward cheaper energy not more expensive. I don’t get it and maybe a good liberal like you can explain to me why we want to reverse the trend of cheaper more abundant energy. Everything our modern world has offered us in the way of freedom from drudgery and sustainability would rapidly disappear as energy became more expensive and scarce. And who Tam really pays the price for that. Certainly not the almighty white liberal elitist. Nope, the very poor, downtrodden, ethnic minorities you libs love to be so compassionate about are the very people who will pay the highest price for your ruinous expensive energy systems. Let Holland explore that paradigm and see how it works out for them first before you rush in, like most European socialist worshipers, and just blindly except anything they do as better than anything you can do. Indeed it may actually work for Amsterdam on a small scale with a wealthy country, but just extrapolating that to a country as large and way more diverse as ours and you could be running into trouble.

So what should be our strategy?

1) Develop every source of petroleum we can now.

2) Develop a massive LNG infrastructure to exploit huge reserves of natural gas.

3) Begin massive development of our enormous coal supplies.

4) Build nukes like there is no tomorrow, massive numbers of them.

5) Develop Geo thermal on a massive scale, improving the technology for extraction and distribution so that this source can both ensure long term supply and allow us to throttle back on our use of other finite sources like nukes and fossil fuels.

6) Develop a massive campaign to cover the thousands of square miles of commercial roof tops with solar PV panels. This source will become the largest energy supply for peak demand in the world allowing all base load supplies to be throttled back and conserved (that’s why it is a conservation source). However having those base load supplies already developed and used and for the most part paid for means we can keep the overall system costs way down and ensure that we have lots of energy ready for use whenever we want it.

Once the base load supplies have converted to a nuke/geo paradigm then our carbon stocks (petro, NG, coal) can be conserved for transportation fuel only. With enough energy to meet world demand in excess we can then move to bolster our carbon stocks by converting bio generated supplies along with CO2 sequestering. Really, there isn’t much about the above strategy that is different than most except the order of events and a lack of carbon fear that the AGW nuts have fostered. When you Tam and others like Publius above get over your insane devotion to the new AGW religion and realize that carbon based fuel is not only our best hope but also the fuel source for all living matter on our planet and that it is here to stay, then we can move forward with a sensible and cost relieving energy development strategy. Once you drop the fear of Carbon based fuels everything becomes much clearer and quite a bit easier.

Anyway, cheers!

» on 07.20.09 @ 03:09 PM

Tam, this subject has come under attack - my interest is high and we want rapid change.

Your arrogance turns off the reader.

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