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  • BLM’s Proposal To Reduce Methane – Why It Matters For America

    By Jon Goldstein

    13133084873_52c4fb062d_zThe west is rightly known for mountain views and desert vistas. Many of these landscapes are managed by the U.S. Department of Interior’s Bureau of Land Management (BLM) on behalf of all Americans. But something else is a major part of the region as well – tens of thousands of oil and gas wells and their associated infrastructure.

    More than 90 percent of oil and gas production on BLM lands comes from the Western U.S. The tax and royalty revenue generated by this production is used to fund local infrastructure needs –schools, roads and other improvements — in rural and tribal communities. But due to outdated policies (they have not been significantly revised in 30 years), too much of our natural gas has been going to waste.  That means these communities, and American taxpayers in general, are losing out.

    In fact, in 2013, oil and gas companies threw away $330 million worth of the public’s gas according to a recent report – shortchanging the communities that rely on the revenue from these resources most.

    A Big Step Forward

    Just last month, in an effort to more responsibly manage this public resource, the BLM began a process to update these three-decades-old oil and gas policies. Now, the public has a chance to have a voice in this process as well. Once adopted, BLM’s proposal will make significant reductions in the amount of methane that the industry is currently allowed to flare, leak, or vent into the atmosphere in massive quantities.

    The proposal is a positive step for taxpayers, air quality, and our climate. Because natural gas essentially is methane, delivering gas to market (instead of the atmosphere) delivers significant royalty payments back to American taxpayers. According to a recent report, without action, the public could lose out on $800 million over the next decade as a result of wasteful venting and flaring practices. These efforts also will significantly reduce emissions of methane, a potent greenhouse gas responsible for about a quarter of global warming we are experiencing today.

    Covering Existing Sources

    One aspect of the proposal that’s particularly powerful is its commitment to address pollution and waste occurring now. The BLM’s proposed rules will set an important precedent for the Environmental Protection Agency who so far has declined to regulate existing oil and gas wells. The BLM rule targets new as well as existing sources, the wells and equipment in use today that are contributing to the more than 7 million metric tons of methane pollution emitted by the industry nationwide each year.

    BLM’s proposal is a strong step toward better management of our energy resources and tackling the issue of climate change. But there’s room for improvement. Over the next two months, BLM will solicit public comments on the proposal and we encourage the agency to consider these key elements as they finalize their rules:

    1. More frequent leak inspections. Requiring operators to check their facilities for leaks on a quarterly basis will make a big dent in industry’s emissions. Colorado and Wyoming have successfully enacted similar policies on leak inspections, setting a strong precedent for BLM to level the playing field.
    1. Limit the waste of federal resources due to gas flaring. The BLM proposal places a presumptive ban on venting and some restrictions on flaring of natural gas from oil wells. But the rule should make gas capture planning mandatory and binding and should place time limits on the wasteful practice.

    BLM can and should act to limit methane waste and pollution from federal and tribal lands. In fact 80 percent of Westerners support commonsense rules that can cut oil and gas waste on publically owned lands. Fortunately, those voices can be heard in coming weeks as the BLM accepts public comment on the proposal and in hearings across the west. We’ll be there and we hope you will join us to fight for better climate protections, reduced waste, and cleaner air.

    Photo source: Earthworks

    Read more »
  • Moms Know What’s Best: How Time-of-Use Electricity Pricing can Benefit California Families

    By Jamie Fine

    mcaf listenedCalifornia’s “big three” utilities, at the behest of state regulators, are in the process of examining and improving how they price electricity, including something called time-of-use (TOU) electricity pricing. This option – which rewards people who shift some of their electricity use to times of day when clean energy is abundant and electricity is cheaper – can help California families create safer communities while saving money on their utility bills. Mom’s Clean Air Force California mom Linda Hutchins-Knowles agrees, and recently wrote this opinion piece in the San Jose Mercury News encouraging others to adopt TOU.

    Linda, like many moms, wears multiple hats. As a mother, she wants to help leave her children a safer, more sustainable word. As an advocate, she supports increasing our use of clean energy over dirty fossil fuels to help clean our air and environment as a whole. Finally, as a consumer, she wants to do these things without breaking the bank.


    Moms Know What’s Best: How Time-of-Use Electricity Pricing can Benefit California Families
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    This is where TOU electricity pricing comes in. As Linda notes, Californians will soon have the opportunity to adopt TOU when Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric transition all residential customer to this program in 2019 – with the option to opt-out for those who prefer tiered rates (the option currently in place for these customers). This will improve the resiliency of the electric grid and optimize the use of California’s growing clean energy resources. To illustrate how, she uses the example of California’s ample and growing solar power resources. The state currently produces so much solar energy, sometimes it produces more than it can use. Under TOU, electricity will cost less when this resources is abundant, incentivizing people to use energy during that time.

    To get the most out of this tool, Linda rightly illuminates that just as California families and residents are diverse, their electricity pricing options should reflect their different needs. This is why she calls for utilities to create options that fit for tech-savvy Bay Area and Silicon Valley customers and people who already use tools to manage their energy use like smart thermostats.

    These options, paired with effort from the utilities to empower all of their customers – including elderly and low-income Californians – by studying how their bills may be impacted, will ensure this program is successful for everyone. Environmental Defense Fund will also be busy in the coming months advocating for a menu of varied pricing options. Ensuring the utilities inspire the use of new technologies and empower those who already use energy management technologies (like smart thermostats) to shift their use will also be part of our strategy.

    In the meantime, if you live in California, why not listen to a mom and consider jumping on the TOU train now? Simply contact Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric today to sign up.

    This post originally appeared on our California Dream 2.0 blog.

    Read more »
  • New Report Confirms FirstEnergy’s $4-Billion Boondoggle

    By Dick Munson

    ieefa fe reportFirstEnergy’s plea to keep four aging power plants alive will cost Ohio customers almost $4 billion, according to a new study out today by the Institute for Energy Economics and Financial Analysis (IEEFA). The proposal is currently in front of the Public Utilities Commission of Ohio (PUCO).

    The report, entitled A $4 Billion Bailout in the Buckeye State, outlines in clear terms how the utility giant hopes to force Ohioans to subsidize the continued operation of its outdated power plants, put customers on the hook for those plants’ escalating costs, and ensure future profits for FirstEnergy executives and shareholders.

    FirstEnergy executives know economics are not on their side

    Specifically, FirstEnergy’s Ohio utilities have proposed what they call a Retail Rate Stability Rider (otherwise known as a “bailout”) through which the costs and risks of three coal-fired plants (named Sammis, Clifty Creek, and Kyger Creek) and one nuclear reactor (named Davis-Besse) would be passed on to the utility’s captive customers. According to the IEEFA report,

    These plants were all spun off to a deregulated affiliate created in 2000, when FirstEnergy expected that it would be able to earn substantial profits by selling energy and capacity into the competitive wholesale PJM markets. However, FirstEnergy clearly does not believe that the units are currently profitable. Nor does it believe that expected market conditions will make the units profitable in the coming years.”

    In other words, FirstEnergy once embraced competition, thinking it could make lots of money selling power into regional markets. The corporation instead made lots of bad business decisions, like doubling down on coal investments. Not only are several of its generators no longer profitable, but they will remain uneconomic for years to come. FirstEnergy executives, says the report, “recognize this reality, which is why their proposal aims to transfer costs and risks to consumers.”

    That is, the utility’s well-paid executives realize market forces are aligned against them. Consider, for instance, “the precipitous recent decline in natural gas prices and the decline in the cost of generating power at natural gas-fired power plants.” Other headwinds include the dramatic drop in renewable-energy installation costs and the flat growth in electricity demand because customers are cutting their waste by increasing efficiency.

    Moreover, the report points out how FirstEnergy’s power plants are old – and getting increasingly expensive to operate. As generators age, their maintenance costs rise, they need additional capital investments, and their performance degrades. Utility executives recognize these facts, too, and they’d prefer shifting those rising costs to their customers.

    Report findings reinforce high costs and big risks

    The report also addresses the cost implications of the bailout. FirstEnergy claims its subsidies eventually will produce $561 million in benefits, yet IEEFA notes the utility has failed to make public its calculations and economic assumptions. Based on testimony before the PUCO, FirstEnergy is assuming natural gas prices will rise significantly, allowing their now-uneconomic power plants to better compete. As mentioned above, gas prices have been falling because new exploration and drilling technologies have increased supplies substantially. There is no sign of low natural gas prices going away.

    Using more realistic assumptions, IEEFA calculates the subsidies will result in extra charges – at the hefty price of $4 billion – rather than benefits. This staggering cost mirrors the $3.9 billion predictions of the Ohio Consumers’ Counsel.

    By looking at the economics of coal-fired power plants in other parts of the country, the report offers further evidence that FirstEnergy’s proposal is risky. The market for merchant, coal-fired power plants is essentially in free fall. According to the study,

    Dynegy bought the Danskammer plant in Newburgh, N.Y. (along with a partial share of the Roseton plant) for $900 million in 2001. When the plant was resold in 2013, its value had plummeted to $3.5 million. Dominion Resources sold its 1600 megawatt Brayton Point coal plant in Southeastern Massachusetts for an estimated $55 million in 2013, shortly after spending $1 billion to complete capital upgrades on the plant. One month after acquiring the plant, the new owner announced a decision to retire Brayton Point in 2017.”

    The same market forces that have reduced the value of these coal plants also apply to Sammis, Clifty Creek, and Kyger. FirstEnergy’s solution: transfer the costs and risks of those plants to customers.

    The report makes several other important and telling points:

    • FirstEnergy claims its proposed deal would promote resource diversity, when it actually would merely subsidize the continued operation of uneconomic generating units and expose customers to significant risks. The intention of resource diversity is to reduce risk.
    • The bailout is a piece of FirstEnergy’s larger strategy to “re-regulate” (what we have called “re-monopolize”) some of its struggling power plants by shifting the costs and risks of those plants to ratepayers, while guaranteeing a 10.38 percent return on equity each year for FirstEnergy and its shareholders on the plants in question. Higher returns mean bigger bonuses for executives and larger dividends for stockholders.
    • The FirstEnergy proposal is “a bad deal for Ohio customers:” It would lock Ohio into subsidizing the continued operation of aging and uneconomic power plants, while hindering opportunities for lower cost and cleaner energy resources that could provide jobs and significant economic benefits for the state.

    Any which way you look at it, the subsidy plea only favors FirstEnergy – and leaves Ohioans to shoulder the brunt of the deal. Here’s hoping the PUCO commissioners read the report carefully.

    Read more »
  • Protect The West from Oil & Gas Climate Pollution
    The Department of Interior's Bureau of Land Management (BLM) has proposed a rule putting strict limits on this pollution--and we have a limited amount of time to show our support.
    Read more »
  • UN agency’s new efficiency standard takes first step on aircraft carbon emissions
    Read more »
  • California Finalizes Important Emergency Rules in Response to Aliso Canyon Disaster
    Read more »
  • International action on aviation emissions: What's at stake in ICAO

    By Annie Petsonk

    If international aviation were a country, it would be a top ten emitter of carbon dioxide (CO2), on par with Germany or the United Kingdom. And it’s expected to grow enormously: with more than 50,000 new large aircraft slated to take to the skies, its emissions are expected to triple or quadruple by 2040.

    In Paris in December 2015, the world hailed the success of the UN Framework Convention on Climate Change (UNFCCC) in adopting the first broadly applicable instrument to start driving carbon pollution down, with a goal of limiting warming to 1.5-2° C.

    But Paris didn’t cover pollution from flights between countries. Why not? Because in 1997, aviation lobbied for, and got, the UNFCCC to defer these to another UN body, the International Civil Aviation Organization (ICAO).

    ICAO talked about the issue for fifteen years until 2013, when, with Europe poised to enforce a cap on emissions of inbound/outbound flights, ICAO pledged to act by 2016. Quiet talks are now underway on:

    1. An ICAO CO2 standard for aircraft – akin to a miles-per-gallon standard for cars. In Montreal next week, possibly as early as Monday, February 8, 2016, a technical group is expected to agree a recommendation for this standard.
    1. A cap on international aviation’s total CO2 emissions at 2020 levels. ICAO is slated to vote in September 2016, on the cap and a market-based measure (MBM) to help airlines implement it.

    Here’s what’s at stake:

    Caption

    Source: Environmental Defense Fund

    Without any new rules, international aviation’s carbon pollution is expected to skyrocket (top red line). Better air traffic control can trim some pollution (top red wedge). An ambitious CO2 standard would mean fewer emissions per passenger-mile, further slowing the sector’s emissions growth (blue wedge). But because the industry’s overall emissions are expected to far outstrip these per-trip efficiency gains, there’s still a huge gap (green triangle) – at least 6-8 billion tonnes – to get to the goal of an emissions cap at 2020 levels (red horizontal line), or even more ambitious goals along the lines of the Paris agreement (red dashed line).

    The real prize is the market-based measure to cap aviation emissions and drive pollution down, not up.

    Learn more at edf.org/aviation.

    Read more »
  • Moms Know What’s Best: How Time-of-Use Electricity Pricing can Benefit California Families

    By Jamie Fine

    mcaf listenedCalifornia’s “big three” utilities, at the behest of state regulators, are in the process of examining and improving how they price electricity, including something called time-of-use (TOU) electricity pricing. This option – which rewards people who shift some of their electricity use to times of day when clean energy is abundant and electricity is cheaper – can help California families create safer communities while saving money on their utility bills. Mom’s Clean Air Force California mom Linda Hutchins-Knowles agrees, and recently wrote this opinion piece in the San Jose Mercury News encouraging others to adopt TOU.

    Linda, like many moms, wears multiple hats. As a mother, she wants to help leave her children a safer, more sustainable word. As an advocate, she supports increasing our use of clean energy over dirty fossil fuels to help clean our air and environment as a whole. Finally, as a consumer, she wants to do these things without breaking the bank.

    This is where TOU electricity pricing comes in. As Linda notes, Californians will soon have the opportunity to adopt TOU when Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric transition all residential customer to this program in 2019 – with the option to opt-out for those who prefer tiered rates (the option currently in place for these customers). This will improve the resiliency of the electric grid and optimize the use of California’s growing clean energy resources. To illustrate how, she uses the example of California’s ample and growing solar power resources. The state currently produces so much solar energy, sometimes it produces more than it can use. Under TOU, electricity will cost less when this resources is abundant, incentivizing people to use energy during that time.

    To get the most out of this tool, Linda rightly illuminates that just as California families and residents are diverse, their electricity pricing options should reflect their different needs. This is why she calls for utilities to create options that fit for tech-savvy Bay Area and Silicon Valley customers and people who already use tools to manage their energy use like smart thermostats.

    These options, paired with effort from the utilities to empower all of their customers – including elderly and low-income Californians – by studying how their bills may be impacted, will ensure this program is successful for everyone. Environmental Defense Fund will also be busy in the coming months advocating for a menu of varied pricing options. Ensuring the utilities inspire the use of new technologies and empower those who already use energy management technologies (like smart thermostats) to shift their use will also be part of our strategy.

    In the meantime, if you live in California, why not listen to a mom and consider jumping on the TOU train now? Simply contact Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric today to sign up.

    Read more »
  • Debunking Silly Arguments for Utility Protectionism

    By Dick Munson

    2008_Weak_&_Strong_Arguments_BRYANS.jpegOhio utilities FirstEnergy and AEP, as readers of this blog know too well, want the Buckeye State to bail out their uneconomic power plants. Combined, their proposals before the Public Utilities Commission of Ohio (PUCO) would run Ohioans nearly $6 billion in increased costs. We understand where the companies’ greedy desire for subsidies comes from, but the arguments for them have become downright silly.

    Let’s review why FirstEnergy and AEP’s bailout justifications don’t hold up:


    Debunking silly arguments for utility protectionism
    Click To Tweet


    • The power giants say their subsidies will be good for customers by providing certainty about future electricity rates. The only certainty is those same customers will need to pay an extra $130 per year so the companies can enjoy bonuses and dividends.
    • They also argue the bailouts will be good for Ohio’s businesses. Yet industrialists, which are major electricity consumers, say the utilities’ income-guarantee plans “will make it more difficult for […] Ohio manufacturers to remain competitive in the global markets.”
    • They claim the bailouts will save Ohioans money in the long run. According to a state agency, they will actually cost Ohio almost $6 billion.
    • FirstEnergy and AEP also say the lights will go out if they have to close their power plants. Reliability, no doubt, is an important issue. That’s why the responsibility is in the hands of the regional grid operator, which can manage electricity across a wide area, not the regulators of an individual state. The regional regulator, in fact, says Ohio has lots of excess capacity and reliability is not an issue. Even the Public Utilities Commission chairman warned the utilities to stop scaring Ohioans. Viewing reliability from another perspective, the regional power market ensures power plants that are needed are paid for their electric capacity. In other words, unnecessary units don’t make the cut. The only reason FirstEnergy and AEP are seeking subsidies is their generators are expensive and not needed.
    • FirstEnergy and AEP say regulators need to protect their financial health. Last time we checked, the regulators’ job is to protect the public interest – and to care more about fair customer bills than utility credit ratings.
    • FirstEnergy complains Ohioans should not rely upon out-of-state power, forgetting electrons don’t really care about state boundaries. Once they’re on the regional grid, there’s no telling where they’ll end up. Plus, there are other Ohio-based generators willing to meet energy demand (like Dynegy, which has offered alternative plans).

    AEP does say it’s willing to support a few hundred megawatts of solar and wind power, but its requested subsidies would ensure dirty power plants continue operating and spewing more than a few thousand megawatts worth of pollution.

    Their strongest – although unspoken – argument seems to be political influence. The powerful utilities have made generous campaign contributions and hired trusted advisors to key elected officials, but the proposed “deals” are bad for business, reliability, customers, and the environment.

    The PUCO should see right through these silly arguments and reject FirstEnergy and AEP’s requests for subsidies.

    Photo source: Wikimedia/Joan Bryans

    Read more »
  • What EPA Should Consider on Their Final “Fracking” Assessment

    By Nichole Saunders

    iStock_000058110200_Large (2)Questions about if and how hydraulic fracturing activities (or “fracking” to some) can contaminate drinking water have been top-of-mind for many since the practice started getting widespread public attention about a decade ago. Recognizing the validity of those concerns, EPA undertook a study to see how the full ‘hydraulic fracturing water cycle’ – which includes water withdrawals, chemical use and mixing, well injection, waste water management and disposal — could potentially impact our drinking water resources. In a EPA draft assessment released last fall, the agency summarized its results, saying researchers “did not find evidence that [fracking] mechanisms have led to widespread, systemic impacts on drinking water resources.”

    EPA’s draft assessment synthesized valuable information and explored a number of key areas of concern. But EDF didn’t agree with the way EPA summarized its findings. And it turns out, after hearing from EDF and other experts across the country, neither do EPA’s advising scientists.

    Now, through ongoing review by the Science Advisory Board, the agency is getting feedback, yet again, from dozens of concerned parties (including EDF) with vested interest in making sure EPA gets this assessment right.  Here are three things to keep in mind.

    “No evidence” does not mean no problem

    The error of EPA’s main takeaway is it attempts to reach a uniform conclusion about a set of activities and impacts that are far from uniform.

    Impacts that are not “widespread” or “systemic” are still impacts – even if they are outliers, infrequent, rare, localized, or poorly understood.  These impacts matter, and they should not be ignored even if they do not happen at every site and do not happen all the time.

    In attempting to reach a broad conclusion, the Agency has developed a message that is unclear at best and misleading at worst.  The statement must be modified – or it risks supporting the notion that these practices are conclusively and inherently “safe” – drowning out 1,000 pages of research and years of work, and discounting a number of confirmed and potential impacts cited in the new report.  No interests are served by translating years of work into a one-sentence summary that does little to advance our understanding of today’s operations and their potential impacts on communities.

    Expose data gaps—so we can close them

    We can’t expect one report to answer every question about the impacts of hydraulic fracturing activities, and the agency should not let this report be the final word on the matter. A lot of additional research is clearly needed, and EPA should use this assessment – and what the agency learned in compiling it – to emphasize priority research needs that could support more definitive answers in the future.

    Burying uncertainties, limitations, and unknowns deep in the pages of this report isn’t helpful.  EPA is in a powerful position to use this experience, and its authority, to develop and recommend a research agenda that can have a real impact on the way we understand and address risks from hydraulic fracturing activities in the future. We need the agency to clearly explain what the important research needs are as well as the key questions that must be answered to allow for a better review in the future.

    An honest answer is the best answer

    The public is looking for a straight answer from EPA on what to worry about, what not to worry about, and why – and the current message has done little to address that need.

    EPA should send a clear and direct message about the key takeaways from their research:

    • Hydraulic fracturing activities can – and do – impact the environment and communities, even if incidents don’t happen at every site, all the time
    • Because impacts do occur, they must be acknowledged, studied, and addressed
    • Further research is needed to fill the gaps that hindered this analysis to allow for more robust conclusions in the future

    It may not be short and “sweet” like the original summary, but it’s what the public deserves.

    What’s Next

    EPA has drafted a good report that will serve as a great resource and springboard for future research. But it needs some key improvements, and that’s what we’re continuing to advocate for at the Science Advisory Board as they continue their review of the draft this spring.

    We’re also advocating for timely finalization of SAB’s review and EPA’s report before its value is diminished with the passage of time. Swiftly improving and finalizing this initial EPA Assessment is necessary to improve the way we understand and manage risks associated with hydraulic fracturing. It’s time to turn our collective attention to what matters most: gathering new data, conducting new research, and putting smart policies and practices in place to reduce these risks and protect public health and the environment.

     

     

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