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At the Renewable Energy Finance Forum West , California Air Resources Board  (CARB) Chairman Mary Nichols urged the clean energy industry to amp up its efforts to make the state’s new economy-wide carbon cap and trade program a successful precedent for other states and the Federal government.

During her Sept. 27 keynote address in San Francisco, Nichols assured the audience that her agency has no desire to delay the state’s carbon cap and trade program. She added that the private sector must play an ongoing key role in continuing the momentum to a cleaner energy future with lower greenhouse gas emissions.

The market is on track to launch in November, Nichols said, despite the fact that some “continue to fight tooth and nail” to prevent the program from starting on time or to prevent greenhouse gas reductions.

To create a successful program that others will want to follow, Nichols said, California needs to accelerate energy-efficiency retrofitting and bring the cost of renewable and zero emissions fuels down. The state must also deliver on some new technology and financial instruments.

Should the program fail, she continued, it would deal a devastating blow to climate action. “In the face of some tough times [with current low natural gas prices], we need all of you to persist in the great work you are doing. We cannot afford to have the companies innovating and forward thinking sitting on the sidelines to wait for dust to settle.”

While she was not optimistic about the chances for a Federal cap and trade program, Nichols praised her state for forging ahead to show leadership on the issue of climate change and cap and trade. She expects the state blessed with “incredible” renewable resources and people “devoted to have California be a wonderful place to live” to stay the course regardless of what Congress does. “I don’t see that changing,” she said. Source: SNL Energy Power Daily, 9/28/12

The Department of Energy (DOE) recently met with American Public Power Association (APPA) regarding rulemaking on energy conservation standards for residential water heaters.  Based on the meetings, APPA created a survey asking utilities about their water heater load control programs.

The results from this survey will give APPA the information needed to continue working with DOE to amend the conservation standards for residential water heaters.  APPA would like to have responses to this survey no later than close of business, Friday, March 9, 2012. 

This is a great opportunity for Western customers to contribute to rules that will affect their programs into the future. Also, if you have a story to share about water heater load control at your utility, you can contact Energy Services Bulletin. You just may be the next headline story!

To accelerate the adoption of electric vehicles, the Department of Energy has made available $5 million in new funding for community-based efforts to build electric vehicle (EV) infrastructure and charging stations. The initiative also includes a partnership with Google, Inc., and more than 80 EV stakeholders to help consumers find charging stations nationwide.

Energy Secretary Steven Chu and Transportation Secretary Ray LaHood announced the initiative on a conference call recently with Colorado Governor John Hickenlooper, Tucson Mayor Bob Walkup and St. Paul Mayor Christopher Coleman – leaders of three of the nation’s nearly 100 Clean Cities Coalitions.

“The Department of Energy’s Clean Cities initiative is bringing together local governments and industry to demonstrate the benefits of advanced technology vehicles and help communities use less oil and gasoline to power their vehicles,” said Secretary Chu.

The funding and the partnership are the Obama Administration’s latest steps in its broader push to reduce U.S. oil imports by one-third by 2025.  Read more.

Source: U.S. DOE Office of Energy Efficiency and Renewable Energy, 4/19/11

Although the American Public Power Association is celebrating its 70^th year in 2010, it was the future, rather than the past that speakers focused on at the opening session of the Customer Connections Conference, Oct. 24, at the Sheraton Park Hotel in Anaheim, Calif.  

After showing a video on the history of the association, APPA General Manager Mark Crisson moved on to discuss the challenges facing the utility industry. “Public power is well positioned to address these challenges,” he told more than 225 attendees.

At APPA’s recent fall meeting, the board of directors developed the list of priorities the association will focus on in the coming months.  APPA had fall meeting a couple of weeks ago.

• Climate change and emissions regulations potentially coming from the Environmental Protection Agency topped the list. Congress is unlikely to act on any climate legislation, leaving the EPA to step into the void.  Utilities are not yet on the list of industries the EPA will be able to tell how to regulate and control emissions.  However, with almost half of the power in the United States coming from coal, the industry is experiencing a lot of uncertainty. There are series of regulations in EPA queue that will drive electric generation to gas and away from coal.
    
• New infrastructure is needed for utilities to meet their mandate for reliability, demand growth and renewables integration. Already in Midwest there are places where more wind is being generated than economically can be integrated. Siting and cost allocation issues are very contentious. There is consensus in the industry that increased Federal authority is needed on siting rules. The Federal Energy Regulatory Commission is in process to address both issues.  Most public power utilities want to own and operate their own renewable generation. APPA has made progress on getting legislation introduced in both the House and the Senate that would remove the caps on Clean Renewable Energy Bonds. Public power needs incentives that are comparable to the private sector.  Crisson said that the jury is still out on nuclear, but the low-carbon resource can help reduce emissions and provide base load to firm up renewables.

  APPA recently released a study identifying challenges of a large-scale switch from coal to gas.  The cost of changing over the entire coal-fired fleet could cost $750 billion. Even the likelier scenario of converting 25 percent is very costly. The study has initiated a dialogue with EPA about challenges of transporting and storing natural gas and retrofitting power plants for the fuel.

• Pending financial regulation legislation creates potentially gives the Commodities Futures Trading Commission (CFTC) jurisdiction over financial products in regional transmission organizations (RTOs) and independent system operators (ISOs). APPA is concerned that the CFTC doesn’t understand utility industry.
• Public power utilities must now meet mandatory reliability standards.  APPA is working with the National Energy Regulatory Commission (NERC) to develop the standards.Cyber security is an issue of great concern to Congress. Crisson warned that the House Grid Act could include distribution, which would interfere with NERC-FERC process. APPA is closely involved on this since if the industry doesn’t act, Congress will.
• Workforce development continues to be an issue but APPA members are dealing in creative ways.
• Demand-side initiatives should be pursued and integrated into resource planning. These measures are a good way to develop customer relations, to explain why changes are important to customers as well as the power provider.  Members need a strategy for demand-side initiatives, or someone else will step in. You can work with third party providers.
• APPA members have adapted to restructured markets, but the market bias does not work well for the public power model. Developing meaningful RTO performance metrics will help, but it is unclear how effective markets will be in providing for new demand.

Future outlook

Crisson identified several trends going forward that the industry will have to grapple with:

• Upward pressure on energy costs. Increasingly expensive to access oil and gas.
• Transition to low carbon economy. Public power will be impacted no matter how rules proceed.
• Technology will play an expanded role. We will need to be smart about how we employ it. It can enhance customer service.
• Relationship with customers is more important than ever. They need to understand why PP is doing what they are and get their support.

However, he noted several reasons why public power has the advantage over investor-owned utilities in negotiating these challenges.  As nonprofit entities, the utilities can aggressively pursue energy-efficiency strategies that are best for the customers without worrying about satisfying investors. Public power can also do 100-percent debt financing for building infrastructure.

 Equally important are the utilities’ strong customer relationships. Compared with IOUs, customers are more likely to trust that their cooperatives will do the best thing for the consumers.

The tradition of service, reliability and financial integrity is one of public power’s greatest assets. “And that is why I am confident we can meet this mission,” Crisson concluded.

Joani Matranga, Western Regional Representative, Colorado Governor’s Energy Office

The bad news is that Colorado’s energy efficiency rating according to ACEEE slipped to 19^th in the nation. The good news is that states are leading the way to develop a clean energy economy.

While the issue of climate change is a non-starter with the public, we can get most of the way toward reducing greenhouse gas emissions with energy efficiency policies, which have more public support. The Colorado Governor’s Energy Office (GEO) has written a climate action plan that will be coming out soon. Energy efficiency is a key part of the plan.

Over the last four years, the state has passed more than 50 energy-related legislations. Those policies and programs got a big boost from the $180 million in Recovery funds GEO received.

Broad renewable energy deployment is still hampered by lack of information, capital and services. GEO’s RechargeColorado program is the one stop shop to get information to commercial and residential energy users. Starting Oct. 27 Recharge Colorado will launch a marketing blitz to push out the program’s available funding. There is a lot of money left for appliances and insulation, and for renewable energy systems, as well.

To address the financing issues, GEO is working with the Colorado Housing and Finance Authority to offer retrofitting loans to small businesses. Green Business Loans are available for starting up manufacturing operations to produce energy efficiency and renewable energy equipment. Homeowners can access Clean Energy Financing for homeowners to fund energy efficiency and renewable energy projects. Qualified Energy Conservation Bonds are available to fund projects of $50 million or more. The state legislature has approved the Property Assessed Clean Energy (PACE) program, but it is on hold at the Federal level.

Many Recovery-funded services have been launched and are going strong. Energy performance contracting is successfully helping schools and public buildings improve energy efficiency where bond issues can’t be passed. GEO is working with local entities to tighten building codes. Although new home starts in the state are flat, Energy Star for Homes has been going well. The Main Street Efficiency program is building capacity in local communities to improve energy efficiency in rural areas. Also, an Industrial Challenge is calling on the state’s 100 largest energy users to reduce their consumption this year.

GEO has released the Renewable Energy Development Infrastructure Report listing strategies for the electric sector. A key finding is that energy efficiency can help utilities avoid building new generation.

Federal grants have been a great source of direct funding for cities and counties developing their own sustainability plans. For 52 rural communities, 18 community energy coordinators have been hired. Most of these are nonprofits that provide technical assistance to rural communities. People are more open to addressing water, waste and energy issues.

The city of Boulder received a $25 million Energy Efficiency Community Block Grant to partner with Denver and Garfield counties to replicate programs that upgrade building efficiency. Another $5 million EECBG went to Eagle to do the same with Pitkin and Gunnison counties.

Going forward, the state of the economy continues to drive change. People are also relatively concerned for the environment, the governor has shown leadership and public/private partnerships have been very productive.

However, to reach GEO goals, the qualified workforce needs to grow. Rural cooperatives are still trying to figure out how the goals fit into their mission.

Even so, the conversation has advanced a lot in just a few years.

Utility DSM in Colorado: Past, Present and Future
Paul C. Caldara, P.E., Colorado Department of Regulatory

The CUE Exchange opened with Paul Caldara of the Colorado Public Utility Commission, delivering a keynote address on utility demand-side management in Colo.

Caldara, a 20-year veteran of the utility industry, joined PUC’s advisory staff about the same time as House Bill 07-1037 was passed. The bill requires investor-owned gas utilities in the state to make rules for DSM programs. Electric utilities must litigate their programs with the PUC.

Each year, utilities file a DSM report with PUC that goes into the annual report the commission files with the Colorado General Assembly. In 2009, each dollar spent on DSM at gas utilities yielded $1.33 in benefits to ratepayers. For electric utilities, the ratio is a dollar spent for $4.00 benefit.

PUC still has many questions regarding what can be considered DSM.  Does it include rate design, reducing distribution system energy loss by increasing distribution conductor size, or is it any measure that increases generator efficiency? Will strategies, smart grid and other technologies that give consumers immediate feedback on their consumption be considered DSM or displace it? “There are a lot of questions,” Caldara said, “but no answers, yet.”

To answer these questions, PUC gathers information through dockets, at least 31 of which have been related to DSM, demand response or smart grid this year. The dockets are searchable online—see Caldara’s presentation (to be posted on the CUE Exchange agenda page) for the numbers.

Caldara concluded by telling attendees that events like the CUE Exchange are invaluable for collecting information—for sharing ideas, giving each other feedback on programs and meeting partners. “And the most important sharing takes place after 5 o’clock,” he said.

It’s not too late to participate in the Federal Energy Regulatory Commission’s (FERC) voluntary demand response (DR) survey.  FERC has extended its original July 31 deadline to Aug. 20 specifically to get more input from public power utilities.

The survey is collecting information on utilities’ demand response programs, including implementation of smart grid initiatives and time-of-use rates. According to Michele Suddleson of the American Public Power Association (APPA), many policy makers use the survey results to gauge how quickly various sectors of the industry are moving to implement DR. Given the strong national focus on these issues, it is important to show that the public power sector is actively pursuing demand response solutions. 

Please download the survey form (pdf) and e-mail your responses to FERC by close of business, Friday Aug. 20. FERC provides answers to frequently asked questions (FAQ) from previous surveys on its website, or you can direct your questions to 1-888-585-9232 between 9:00 a.m. and 6:00 p.m. Eastern Time, Monday through Friday. Help Public power show its success in the area or demand response!

The Home Star Energy Retrofit Act cleared a major hurdle today when the House of Representatives passed the bill 246 to 161. The bill would authorize $5.7 billion over two years to provide rebates for homeowners to make energy-efficiency improvements. An additional $600 million would be available to states for programs to make mobile homes more energy-efficient. Some 3 million households would be expected to take advantage of the program.

There are two components to the bill:

• The Silver Star program offers rebates of between $1,000 and $1,500 for each improvement installed, or $250 per appliance. Benefits do not exceed $3,000 or 50 percent of total project costs. Covered measures under Silver Star include air sealing; attic, wall and crawl space insulation; duct sealing; window and door replacement, furnaces, air conditioners, heat pumps, water heaters and appliances.
• The Gold Star program provides $3,000 to consumers who conduct whole-house energy analyses and install technology that improves their overall home energy efficiency by 20 percent. They could receive an additional $1,000 rebate for each additional 5 percent improvement, to a maximum of $8,000. The rebate is limited to 50 percent of the total project cost.

The Home Star initiative differs from the tax credit in last year’s economic stimulus bill that paid up to $1,500 for energy-efficiency improvements. That tax credit expires at the end of this year.

President Obama called Home Star a common sense bill that will create jobs, save consumers money and strengthen the economy. Supporters say it would create almost 170,000 jobs in the construction industry and reduce home energy costs by almost $10 billion over 10 years.