Energy Exchange

FERC approves pipeline despite concern over controversial business arrangement

Last week, the Federal Energy Regulatory Commission (FERC) approved the proposed Spire STL Pipeline. Blessings for the controversial 66-mile project come even though St. Louis already enjoys excess capacity from other pipelines, and despite the fact that the only customer of the pipeline, Spire Missouri, does not actually have any growth in customer demand. It is estimated that the project will cost ratepayers $30 million annually over the next twenty years.

The proceeding reveals much about how the agency assesses the legally-required “market need” for new pipelines when both buyer and seller in the contract used to demonstrate that market need are two different arms of the same company. These so-called affiliate transactions are a growing trend as retail gas utilities seek new revenue to offset stagnating demand.

The risk with these types of transactions is that we could end up with expensive new pipelines that aren’t needed. What’s more, these deals are specifically engineered to shift financial responsibility for these costly projects away from private shareholders and onto retail ratepayers (i.e., the public). They can also lock utility customers into decades-long gas contracts at precisely the time when competitive alternatives – from renewables to energy storage – are transforming the market. Spire presents a textbook example of these concerns.

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Also posted in Utility Business Models / Comments are closed

As L.A. temperatures rise, so does interest in cleaner air and cleaner energy

This blog was co-authored by Annie Cory, Princeton Environmental Institute (PEI) Intern for EDF's Oil & Gas Program

Just like many cities that have experienced record high temperatures in 2018, Los Angeles was hit with a heat wave of record proportions in early July, with temperatures topping 113 degrees in several parts of the county. As air conditioners across the region struggled to keep up, the heat pushed our energy grid over the brink, with blackouts leaving at least 80,000 Angelinos sweltering without electricity.

Such elevated temperatures are not typical for Los Angeles. Yet weather events like these are becoming both more frequent, and more intense. Burning more fossil fuels, of course, only compounds the warming problem.

To put a dent in the causes and impacts of man-made climate change, cities, states and nations will need to implement a portfolio of solutions aimed at cutting carbon across the board and boosting the resiliency of our energy grid. By increasing the share of renewable energy used to power our homes and businesses, and incentivizing technology like battery storage while expanding focus on energy conservation, the threat of blackouts can be greatly diminished during hot summer days.

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Also posted in Air Quality, California, Clean Energy, Climate, Community Solar, Energy Equity, Energy Storage, Methane, Renewable Energy, Solar Energy / Comments are closed

On pollution facts, don’t be fooled by rhetoric of oil and gas trade groups

Once again, a trade group funded by the oil and gas industry is trying to distort the facts on the industry’s pollution.

In a recent blog post, Texans for Natural Gas cherry picked government data in an attempt to argue against the need for policies that protect public health and the environment.

Posts like this – which take select pieces of data in order to make broad generalizations about industry’s progress toward reducing pollution – often fail to tell the whole story about the harmful emissions that warm the planet, jeopardize public health, and result in the massive waste of U.S. energy resources.

When reading industry-sponsored pollution assessments, there are a few crucial things to keep in mind.

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Also posted in Air Quality, BLM Methane, Methane / Comments are closed

The race to reduce emissions: Five takeaways from OGCI venture day

The day before the World Gas Conference – one of the energy industry’s largest – 10 companies competed for USD $20 million to fund solutions with the power to disrupt how methane is managed, measured, and reduced.

The money was provided by Oil and Gas Climate Investments, the billion-dollar investment fund tied to the Oil and Gas Climate Initiative (OGCI) – a consortium of 10 oil and gas companies sharing knowledge and resources to cut the greenhouse gas footprint of their industry.

OGCI’s investment team and technical experts from member companies provided expertise and consumer-driven insights to select the 10 companies competing at Venture Day from nearly 60 applicants. The goal was to highlight companies and concepts that aren’t just innovative, but scalable and disruptive – something BP CEO and OGCI Chair Bob Dudley made clear: “If a person in the field with a hard hat turning the valves doesn’t get it, it won’t work.”

Not only was Venture Day a moment to showcase how high-tech can be high-impact (despite the companies in the room, it felt more Silicon Valley than Houston), it also represented a noticeable shift in the philosophy around industry investment in the methane space. In what OGCI CEO Pratima Rangarajan dubbed “the year of methane,” Venture Day signaled an inflection point for increased transparency, enhanced coordination, and global vision.

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Also posted in General, Methane / Comments are closed

California sets new standards for natural gas storage sites

Data visualization shows the methane plume from the Aliso Canyon gas leak in red.

Three years ago, a blowout at the Aliso Canyon natural gas storage facility forced thousands of nearby families to evacuate their homes and leaked over 100,000 tons of methane and other harmful pollutants into the atmosphere. The facility’s operator, Southern California Gas, wasn’t prepared for the scope or scale of the disaster that unfolded over four months.

The disaster demonstrated the risks of under-regulated natural gas storage sites, as well as the importance of not being over-reliant on natural gas. Regulators in California and across the country realized the need for better oversight and management.

As a result, California’s Division of Oil, Gas and Geothermal Resources (DOGGR) recently finalized new rules for managing the risky, industrial enterprise of underground gas storage. These rules are a foray into an underdeveloped policy space, and are the product of collaboration with stakeholders including national laboratories, the environmental community, and the federal government.

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Also posted in Aliso Canyon, California, General, Methane / Comments are closed

How the conversation changed at this year’s World Gas Conference

For years, conversations at major oil and gas industry conferences focused on one thing: the shale revolution. Excitement about the surge in economical new supply of unconventionally produced oil and gas was palpable, as panelists spoke of the potential for shale to transform everything from the geopolitics of American energy supply to the price of hydrocarbons. With such an unexpected and seismic change, a supply side story carried the day, with a focus on “below ground” drivers of energy abundance.

But today, the shale revolution is simply the new normal and the conversation has changed. “Above ground” factors like increasing competition from renewables, greenhouse gas emissions, and social license to operate will affect demand for natural gas for years. How industry confronts such challenges – both in the United States and internationally – will have a lot to do with industry’s longevity in putting resources to productive use in a changing world demanding cleaner energy.

At last week’s World Gas Conference in Washington, DC, difficult questions swirled about whether industry has done enough to earn society’s trust and prove natural gas has a constructive role to play in the transition to a low carbon economy. The biggest buzz of all surrounded one key issue: methane emissions, a core strategic challenge for the oil and gas industry.

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Also posted in Methane / Comments are closed