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GRID: A White House infrastructure advisory council calls for the U.S. to build a “strategic virtual reserve” of electric transformers to help speed electrification efforts. (Utility Dive)
ALSO:
EMISSIONS:
TRANSITION: The future of vice presidential candidate JD Vance’s hometown may hinge on a $500 million federal grant to help the city’s steel plant build a massive hydrogen-powered furnace to replace coal — though the company is considering abandoning the funding. (The Guardian, Politico)
OIL & GAS: Lake Charles, Louisiana, has become the locus of America’s natural gas industry, but its location between Houston and New Orleans exposes it to the brunt of climate change. (The Guardian)
ELECTRIC VEHICLES:
ELECTRIFICATION: California advocates call on Gov. Gavin Newsom to sign a bill that would allow utilities to electrify entire neighborhoods rather than replace costly natural gas lines. (Canary Media)
POLITICS: Oil industry leaders say they’re disappointed with former President Trump after he made an “incoherent” case for continued fossil fuel use at last week’s debate. (Politico)
SOLAR: Arkansas’ solar industry prepares for new net metering rules that add restrictions and reduce utility credits for newly connected solar systems to less than half of what existing system owners receive. (Arkansas Business)
OIL & GAS:
ELECTRIC VEHICLES:
MANUFACTURING: Georgia leaders hail the state’s success in attracting electric vehicle and solar panel factories as a “new industrial revolution.” (Atlanta Journal-Constitution, subscription)
WIND: Arkansas’ first three wind farms are under construction or in the planning stages. (Northwest Arkansas Democrat-Gazette, subscription)
COAL ASH: Experts call for mitigation actions after finding high levels of arsenic and radium in coal ash near a North Carolina daycare center. (WCNC)
BIOMASS: Georgia regulators consider Georgia Power’s request to purchase up to 80 MW of biomass-fired power from three plants ahead of a scheduled vote this week. (Atlanta Journal-Constitution)
COAL: The former leader of the Sierra Club’s Beyond Coal campaign discusses West Virginia officials’ attempts to prop up coal as a power source. (West Virginia Public Broadcasting)
CLIMATE:
COMMENTARY: The presidential campaign has focused on unrealistic energy policy proposals, with the idea of banning fracking likely pushing utilities back to coal and the promise of $2/gallon gasoline liable to push oil companies out of business, writes a columnist. (Houston Chronicle)
A federal grant will help four of Ohio’s largest cities collaborate on new voluntary building performance standards and a resource hub to help commercial building owners save energy and cut emissions.
Cincinnati, Cleveland, Columbus, and Dayton will use $10 million in Inflation Reduction Act funding to establish the Ohio High Performance Building Hub, which will connect building owners with technical guidance, financing solutions, incentives, training, and other support.
Clean energy advocates and city sustainability leaders hope the program will offer a new path forward in a state where buildings account for about one-fourth of greenhouse gas emissions but state lawmakers have gutted mandatory energy efficiency measures. The state ranked 44th in a recent state energy efficiency policy report card.
“All four of those cities have ambitious climate goals, and addressing existing buildings is a crucial part of that,” said Nat Ziegler, a program manager with Power a Clean Future Ohio, which is a partner on the grant. They expect lessons learned from the work and the hub can eventually help other cities and towns in Ohio and across the Midwest.
Buildings account for a significant share of greenhouse gas emissions in the four cities participating in the grant: greater than 60% for Cincinnati and from 50% to 55% for Cleveland, Columbus and Dayton. The new program will specifically target emissions from more than 421 million square feet of commercial building space among the four cities.
“This is a great way to really jump-start a lot of that work,” said Erin Beck, assistant director for Sustainable Columbus.
The hub could help building owners navigate funding under the Inflation Reduction Act, as well as through bonds issued by the Ohio Air Quality Development Agency or local port authorities or lending from green banks or more traditional financial institutions.
Existing building energy codes “apply primarily to new construction and major renovations, which is great. But most buildings already exist, right?” said Amanda Webb, an assistant professor of architectural engineering at the University of Cincinnati, which was the lead recipient of an earlier $2.9 million grant focused on developing technical guidance for the voluntary standards.
Work under both Department of Energy grants focuses on “coming up with a way to help really deliver the benefits of energy efficiency to existing buildings at scale,” Webb said.
The standards will differ from more general guidelines such as the U.S. Green Building Council’s LEED program, which largely emphasize new construction and a broader range of sustainability measures than energy use and emissions.
Cities will use the technical guidance from the work by Webb’s group and results from outreach to develop standards, rather than codes. The difference is codes are mandatory, with penalties for violations, whereas standards are not.
“The approach that we’re taking with this is definitely much more of a carrot approach” than a stick, said Robert McCracken, who heads up energy management for the Office of Environment & Sustainability in Cincinnati, which is the lead partner on the project.
The reasons are largely legal, as well as political. Over the past decade, leadership in the Ohio General Assembly has generally opposed imposing requirements to cut pollution, and a bill for utilities to provide voluntary energy efficiency programs still has not passed.
As a legal matter, cities generally can’t adopt building codes stricter than those established by the Ohio Board of Building Standards. However, the board doesn’t have authority to set requirements for benchmarking emissions or performance standards for existing buildings. The cities’ grant application said the board confirmed that a delegation of authority won’t be needed, as long as they don’t adopt new construction codes.
Energy efficiency provides its own incentives for building owners, because “it saves money,” said Oliver Kroner, who heads up Cincinnati’s Office of Environment & Sustainability. “People are generally aligned with the [city’s] climate commitments. But there’s sometimes the gap with what you want to do and how to get there.”
Lower costs for building owners can also let them charge lower rents, which can attract tenants. “We frequently receive inquiries from companies who are considering relocating, and they’re interested in the climate effort here,” Kroner said.
Ziegler said many of their organization’s 50 local government members also have shown interest in getting help for cutting building emissions. The independent hub to be set up under the new grant will really help building owners with the “nuts and bolts” for meeting their city’s building performance standards, they said.
Columbus is the only one of the four cities with a benchmarking policy right now, and the plan calls for the others to adopt their own versions as well. Benchmarking will be key for letting the cities track progress in reducing energy use. Based on existing commercial building stock in each city, the team members estimate cutting energy use 45% by 2050, the grant application materials said.
Beck said the Columbus benchmarking program has “been very successful,” noting the city has worked with building owners to help them comply. Audits done as part of the process have also identified “low hanging fruit” for adding energy efficiency through LED lighting, thermostat adjustments and so on, she noted.
Equity concerns also factor into the choice of standards versus codes. Businesses in historically disinvested communities already face a variety of financial and other challenges.
“We want this to be a benefit rather than yet another burden that’s imposed on them,” Ziegler said.
Webb’s team is also exploring how building performance standards could be tailored up front to address concerns about affordability. Possibilities could include a metric to reflect greater equity needs or measures to ensure tenants as well as owners benefit from savings.
“We have other grants that are focused on workforce development,” Kroner said, adding his hope that many people from underserved communities will be able to work in jobs to help buildings meet building performance standards once they’re adopted.
As work by Webb’s group continues, the four cities and others will gear up for outreach efforts and other work so they’re ready to adopt standards. “There’s going to be a lot of education and outreach in the beginning,” McCracken said.
ELECTRIC VEHICLES: The first electric U.S. Post Office trucks are on the road in Georgia and already winning praise from drivers who prefer them to the previous hot, noisy and inefficient combustion vehicles. (Associated Press)
ALSO:
UTILITIES:
CLEAN ENERGY: Texas’ plans to build solar, wind and battery projects over the next year and a half dwarf those of any other state, including second-place California. (Canary Media)
HYDROGEN: Utilities in Florida, Georgia, Louisiana and Texas are converting existing power plants and building new ones to blend hydrogen with natural gas in an attempt to decarbonize their emissions. (Power Engineering)
CLIMATE:
SOLAR: High interest rates, labor shortages, and foreign competition are jeopardizing the buildout of a domestic solar supply chain, industry leaders say. (Utility Dive)
ELECTRIFICATION: Colorado officials look to regulations, rebates and marketing to prod restaurants to convert from natural gas to electric stoves. (CPR)
GEOTHERMAL: Well tests determine an enhanced geothermal generating station in southwestern Utah is the most productive of its kind in history. (Utility Dive)
COMMENTARY: A professor says the bipartisan permitting bill in Congress is a “Faustian bargain” that expedites fossil fuel development but does little to help clean energy. (Bulletin of the Atomic Scientists)
GRID: Experts warn Houston’s experience with Hurricane Beryl this summer — widespread power outages followed by a dangerous heat wave — is an “absolute certainty” to affect other parts of the U.S. that are unprepared for such a scenario. (Washington Post)
ALSO: An analysis finds power outages cost Texas consumers $35,685 for every megawatt-hour of load that goes unserved, although state regulatory staff say their own research shows the figure is somewhat lower. (Utility Dive)
STORAGE:
SOLAR:
CLEAN ENERGY: Texas’ plans to build solar, wind and battery projects over the next year and a half dwarf those of any other state, including second-place California. (Canary Media)
BIOMASS: Critics claim Georgia Power’s plan to purchase 80 MW from three wood-burning power plants is too expensive compared to other alternatives, but utility officials say the move is an attempt to diversify its power sources and boost the state’s forestry sector. (Capitol Beat News Service, WABE)
OIL & GAS: A Virginia gas utility plans to expand into new areas now that it can purchase natural gas from the Mountain Valley Pipeline. (Cardinal News)
HYDROGEN:
POLITICS: Congress passes a Texas representative’s bill to change how federal officials collect royalties for oil and gas leases on public lands, essentially relieving companies from handing over hundreds of millions of dollars in advances. (Houston Chronicle)
UTILITIES: North Carolina regulatory staff support reducing Dominion Power’s requested rate increase by half, with a final decision expected by November. (S&P Global)
COMMENTARY:
OIL & GAS: The number of climate lawsuits filed globally against top fossil fuel companies has nearly tripled since 2015, with the majority coming from U.S. cities and states. (The Guardian)
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ELECTRIC VEHICLES:
CLEAN ENERGY:
WIND: Many East Coast states are relying on planned offshore wind projects to meet their renewable power goals, but recent GE Vernova blade failures worry some observers, like the fishing community, about the safety and reliability of the components. (New York Times)
COAL: Pittsburgh-area environmental justice activists say discussion around a federal plan to block the U.S. Steel-Nippon Steel merger ignores their concerns around coal-related air pollution. (EHN)
BIOFUELS: The fledgling sustainable aviation fuels industry faces high expectations and big questions as it gathers for a national summit in St. Paul this week. (Star Tribune)
CLEAN ENERGY: Michigan regulators have until Dec. 1 to recommend adjustments to the state’s clean energy standard to accommodate the Upper Peninsula region, where a sparser population and high energy costs add to the challenge of achieving 100% clean energy by 2040. (Grist/Interlochen Public Radio)
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ELECTRIC VEHICLES:
GRID:
BUILDINGS: An Indiana contractor is building a passive home and plans an environmental resilience training center on the same property. (Indiana Public Media)
BIOFUELS: The fledgling sustainable aviation fuels industry faces high expectations and big questions as it gathers for a national summit in St. Paul this week. (Star Tribune)
PIPELINES: Iowa Republican lawmakers suing state regulators over their approval of the Summit Carbon Solutions pipeline call the project an attack on landowners’ “God-given” Fifth Amendment rights. (Iowa Capital Dispatch)
CARBON CAPTURE: A new Kansas State study shows how natural fertilizer and no-till farming methods can improve soil health and sequester more carbon. (Kansas Reflector)
California policymakers are searching for ways to rein in the cost of expanding the state’s power grid, which is necessary to combat climate change. Experts warn they’re missing an opportunity that’s right in front of them — taking advantage of the growing number of clean energy technologies owned by utility customers.
California ended its legislative session last month unable to pass a proposed legislative package to address rising electricity rates for customers of Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric, which serve about three-quarters of the state’s residents.
Lawmakers also failed to pass several bills aimed at boosting the role battery-backed rooftop solar systems, electric vehicles, and electric heat pumps and water heaters can play in balancing the power that’s available on the grid.
Replacing fossil-fueled vehicles with EVs, and gas heating systems with heat pumps, will increase statewide electricity demand, requiring utilities to invest billions of dollars to upgrade their grids. But those same technologies can shift when they use power to avoid the handful of hours per year when demand spikes. That’s important, because the cost of building power grids is largely determined by the size of those spikes — and in turn is a core driver of California’s energy affordability crisis.
If the state can use distributed energy resources to shave a bit of demand from grid peaks, it stands to save big. One example: In an April report, consultancy Brattle Group projected that virtual power plants, which can shift when EVs and electric appliances draw from the grid or tap into customer solar and battery systems, could provide more than 15 percent of the state’s peak grid demand by 2035. That would amount to around $550 million per year in consumer savings.
About $500 million of that would flow directly to the customers who own the devices, which could help defray the cost of buying EVs and heat pumps, two technologies that need to be rapidly adopted to meet climate goals. But because tapping into those devices would cost less than making large-scale investments, utilities — and by extension all of their customers — would save about $50 million per year by 2035, Brattle found.
“California’s affordability challenges are years in the making and are worsened by climate-driven impacts like heat waves and wildfires,” said Edson Perez, who leads trade group Advanced Energy United’s legislative and political engagement in California. “However, there are critical steps we can take now: optimizing our existing grid, maximizing the cost-effectiveness of essential grid upgrades, and fully leveraging available technologies like distributed energy resources.”
But as it stands, California isn’t putting the full weight of policy support behind these types of distributed energy programs.
Pilot programs have petered out, seen their budgets clawed back, or have been outright canceled. The scale of demand-side resources operating in the state has actually declined over the past decade, even as the state’s grid stresses have increased. And efforts to create statewide targets for distributed energy — like those that helped spur California’s rooftop-solar and home-battery leadership — have failed to gain traction, including a proposed bill in the state’s just-concluded legislative session.
Advocates say it’s time for the state to change that — especially since there’s an expiration date for capturing the value of DERs. Without policies to encourage utilities and customers to work together to realize the grid benefits of these technologies, utilities will simply build expensive, centralized infrastructure to meet rising electricity demand. Once that money is spent, potential savings can’t be realized, undermining the economic case for VPPs.
Unfortunately, utilities have clear incentives to discount the potential of VPPs as a money-saving tool, because they earn guaranteed rates of profit on capital investments like grid buildouts, but don’t for alternatives like VPPs. Plus, they’re held responsible for failing to keep pace with growing power demand — and are loath to rely on decentralized assets owned by customers in place of tried-and-true grid investments.
This utility reluctance may well explain why a roster of bills aimed at enlisting DERs to combat rising grid costs stalled in this year’s regular legislative session.
SB 1305 proposed requiring the California Public Utilities Commission to determine targets for utilities to “procure generation from cost-effective virtual power plants,” and then mandate that the utilities meet them.
Similar targets for rooftop solar and batteries have been valuable for boosting early-stage deployments in California, said Cliff Staton, head of government affairs and community relations at Renew Home, the company formed by the merger of Google Nest’s smart-thermostat energy-shifting service Nest Renew and California-based residential demand-response aggregator Ohmconnect.
“If you set the targets, you begin to provide the certainty to the industry that if you invest, there will be a return for your investment over time,” Staton said.
An early version of SB 1305 set hard percentage targets for VPP procurements by 2028 and by 2035. Those percentages were stripped from the bill later in the session, leaving the final targets up to CPUC discretion. The bill failed to clear a key legislative committee anyway.
Another bill that died in committee, AB 2891, would have expanded options for VPPs to capture the value of the peak load reductions they can provide. The legislation would have ordered the California Energy Commission to create methods for VPPs to reduce how much generation capacity each utility in the state must secure to meet peak grid demands in future years.
Only a handful of California’s community choice aggregators — the public entities that supply power to an increasing number of customers of the state’s major utilities — are using this approach today. But those CCAs have been able to start paying customers with solar and batteries for the value they can provide by reducing reliance on increasingly expensive contracts with centralized grid resources — mostly fossil-gas-fired power plants.
For more than a decade, state laws have called on the CPUC to create programs that reward customers for the energy and grid values provided by their solar panels, backup batteries, electric vehicles, and remote-controllable devices like smart thermostats and water heaters.
But these efforts have been plagued by an on-again, off-again approach from regulators and utilities. The California Energy Commission set a goal in 2023 of achieving 7 gigawatts of load flexibility from VPPs and other customer-owned resources by 2030; two of the CEC’s key contributions to that effort saw their budgets slashed this year.
Meanwhile, many of the programs launched by the CPUC over the past decade have stalled out due to overly complicated structures, or had their budgets reduced or canceled due to concerns over their cost-effectiveness.
The CPUC and the California Independent System Operator (CAISO), the entity responsible for managing California’s transmission grid and energy markets, argue that these programs have failed to perform as promised. Relying on them more would run the risk of eroding rather than improving grid reliability, they say.
But the companies engaging in these VPP programs — smart-thermostat providers like Renew Home and ecobee; solar and battery installers like sonnen, Sunrun, Sunnova, and Tesla; and demand-response providers like AutoGrid, CPower, Enel X, and Voltus — argue that overly complex and restrictive rules and compensation structures are to blame.
Adding to these challenges for would-be VPP providers is the declining value of rooftop solar. Major changes in California’s net-metering policies over the past two years have slashed the value of customer-owned solar systems, slowing the growth of the state’s leading rooftop solar market.
That’s a problem for VPP providers and advocates who see rooftop solar as an important way to help meet demand from households and businesses with EVs and heat pumps — and to charge up batteries with clean electricity that VPP programs can tap into later.
A host of bills were proposed to reset state policy to restore more value to customer-owned solar during this year’s legislative session. But only one — SB 1374, which restores compensation for schools that install solar — made it through.
California’s new rooftop solar regime does reward customers for adding batteries to store surplus solar power during the day and discharge it in evenings, when the grid faces its greatest and most costly stresses.
But solar and battery advocacy groups argue that those rewards haven’t counterbalanced the broader erosion of rooftop solar values — and that the VPP opportunities that have emerged in the state can’t yet be trusted to make up the remaining difference.
“It’s important for customers to find value in the investment they’ve made, and to help the grid and lower cost for all consumers,” said Meghan Nutting, executive vice president of government and regulatory affairs at Sunnova. “One of the problems with VPP programs so far is that it’s really tough to talk about that value proposition up front because programs are so short, you can’t count on them, or the funding isn’t there.”
At the same time, California policies that encourage people to buy other distributed energy resources — namely EVs and heat pumps — are under threat from rising electricity rates, which are eroding the benefits of switching from fossil fuels.
A controversial policy enacted this year to reduce the per-kilowatt-hour rates paid by customers of the state’s big three utilities in exchange for higher fixed costs may or may not ease that pressure. But both opponents and supporters of the policy agree that shifting the balance of fixed and variable electricity costs does little to address the underlying problems.
Programs that enlist those exact same distributed energy resources to ease grid stresses have a much clearer value proposition, on the other hand.
About half of the electricity bills of customers of California’s three big utilities is made up of fixed costs like grid investments. A majority of those investments are tied to building a grid robust enough to supply power not just for average needs, but during the few hours per year when electricity use peaks.
Those peaks are getting bigger as California’s climate goals encourage more EVs and heat pumps to come online, and the costs of dealing with that have only just begun to be built into utilities’ broader grid investment plans. A series of studies ordered by the CPUC found that adding demand from EVs and heat pumps to the grid could increase ratepayer costs by more than $50 billion by 2035 — or, depending on the approach taken, costs could be contained to less than half of that over the same timespan.
One key variable in those distinct cost forecasts is whether EVs can be programmed or incentivized to avoid charging all at once and overwhelming the grid. “Smart charging” programs that encourage EV owners to shift when they charge their cars could save California ratepayers tens of billions of dollars over the coming decade.
With the right policies and technologies in place, big new grid demands like EVs could actually become valuable resources for energy in their own right. SB 59, a bill that passed in this year’s legislative session after failing to make it last year, orders state agencies to study the proper role for regulation that could require automakers to enable their EVs to support “vehicle-to-grid” charging — sending power from EV batteries back to homes, buildings, or the grid at large.
The challenge for utilities and regulators is finding the right mix of approaches that can allow them to take advantage of EVs, heat pumps, residential solar and batteries, and other distributed resources such that they avoid either overbuilding or underbuilding the grid, said Merrian Borgeson, policy director for California climate and energy at the environmental nonprofit Natural Resources Defense Council.
“We have to be really careful with any new investment — but we do need to make new investments,” she said. “If we pull back too far on energizing loads like electric homes or EV trucks, we miss out on getting those loads connected.”
GRID: Clean energy advocates and solar companies partner to draft model utility rules and legislation to help states deploy virtual power plants, which could reduce the cost of the clean energy transition by maximizing the benefits of solar, storage, and other distributed energy technologies. (Canary Media)
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POLITICS:
SOLAR: The Biden administration has been stuck playing “whac-a-mole” with Chinese solar companies, industry insiders say, as they deliberately overproduce components and shift manufacturing to other countries to avoid U.S. tariffs. (The Guardian)
CLIMATE: As G20 leaders meet today to discuss the global response to climate change, advocates say member countries, including the U.S., are ignoring their commitments to phase out fossil fuels. (The Guardian)
CLEAN ENERGY: A federal green bank aims to channel $500 million to community financial institutions to fund solar arrays, renewable energy apprenticeships, electrified public transit, and more in rural areas, with priority for projects in Appalachia. (Grist)
OIL & GAS: Experts say the lack of communication to neighboring residents about a fire at a large Louisiana refinery is an example of the embedded culture of secrecy around chemical plants and refineries in “Cancer Alley.” (Guardian)
COAL:
CLEAN ENERGY: A federal green bank aims to channel $500 million to more than 75 community financial institutions to fund solar arrays, renewable energy apprenticeships, electrified public transit, and more in rural areas, with priority for projects in Appalachia. (Grist)
OIL & GAS: Experts say the lack of communication to neighboring residents about a fire at a large Louisiana refinery is an example of the embedded culture of secrecy around chemical plants and refineries in “Cancer Alley.” (Guardian)
ELECTRIC VEHICLES:
PIPELINES: A panel of federal judges seems skeptical of a lawsuit by environmental groups to reverse regulators’ 2023 approval of two pipelines to supply a liquified natural gas terminal in Louisiana. (Courthouse News Service)
STORAGE: Texas ranks just behind California for development of grid-scale battery systems, with 4,832 MW deployed in total. (Reuters)
GRID:
HYDROGEN: A West Virginia economic development board approves a forgivable $10 million loan for a hydrogen project. (Charleston Gazette-Mail)
UTILITIES:
CLIMATE:
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