Energy Exchange

Smart Meters Need Effective Electricity Pricing to Deliver Their Full Benefits

By: Beia Spiller, Economist, and Kristina Mohlin, Economist

walletSmart meters, which provide detailed electricity use data throughout the day, are a critical piece of a smarter, more resilient 21st century energy system. But they are not a cure-all for modernizing our antiquated power grid.

In Matthew Wald’s recent New York Times article, entitled “Power Savings of Smart Meters Prove Slow to Materialize,” he argues that smart meters have failed to produce measurable savings. And we agree – but not because smart meters themselves have failed. Rather, most customers with smart meters don’t have access to people-powered, or time-variant, electricity pricing, which creates opportunities to save money. This is a missed opportunity for customers, utilities, and the environment.

Time-variant pricing better reflects electricity costs

Throughout most of the country, the price paid for residential electricity is the same regardless of the time of day when it’s consumed. This arrangement is a byproduct of an earlier era, one in which electricity information was difficult to convey and the actions of individual customers was impossible to gauge in real time. In practice, electricity is actually dirtier and more expensive to produce and transmit at certain times of the day, particularly when everybody wants it – for example, at 6pm during a heat wave when customers are cooling their homes. Also, during this high-demand time, energy prices spike and electric utilities flip on expensive and dirty fossil fuel “peaker” power plants to meet energy demand. From an economic point of view, it would be more efficient for electricity used at these peak demand times to have a higher price. Read More »

Posted in Clean Energy, Electricity Pricing, Smart Grid| 6 Responses

No Easy Answers When Disposing of Oil and Gas Wastewater

We all want easy answers. And often times the harder the question, the easier we want the answer to be.

Source: Nicholas A. Tonelli Flickr

Increased natural gas use, for example, can help decrease U.S. greenhouse gas emissions as it has a lower carbon content compared to coal or oil. Natural gas also can help transition our energy mix to more renewable energy sources. This is because properly designed, gas-fired generation can respond quickly to pick up the slack if the wind suddenly dies or clouds unexpectedly roll in. But, these benefits mean nothing if the communities where gas is produced suffer air and water pollution, or if methane – a powerful global warming pollutant that is the primary ingredient in natural gas – is allowed to leak into the atmosphere unchecked.

We all should be worried about global warming and the role that sloppy oil and gas production and distribution practices contribute to the problem. But communities where oil and gas development is taking place are also worried about how oil and gas drilling is impacting their water supplies. This is a key issue and one aspect of the groundwater contamination concerns, rightfully gaining attention in these communities, is how and where toxic wastewater is disposed of that is produced along with oil and gas. But here, too, the answers don’t come easy. Read More »

Posted in Methane, Natural Gas| 1 Response

Methane Emissions Just Like Oil Spills in the Sky

Out of sight, out of mind. This certainly applies to methane emissions from the oil and gas sector.

That’s because methane, a highly potent greenhouse gas and the primary constituent of natural gas, is invisible to the naked eye.

And it’s one reason methane emissions, while a significant threat to our environment, don’t get the attention they should from policymakers or the public when compared to, say, conspicuous oil spills.

But we have the technology to make the invisible visible. As you’ll see in the video below, fugitive methane emissions look very much like an oil spill in the sky.

Read More »

Posted in Methane, Natural Gas| Leave a comment

New Development in Demand Response Ruling Signals Possible Supreme Court Review

supreme-court-545534_640Late last week, the Solicitor General signaled its intention to file cert. before the Supreme Court in the demand response Order 745 case, EPSA v. FERC. Hidden within this legalese is an important update about a significant (and already complex) case.

So what does it all mean?

First, a bit of background

Demand response pays customers to conserve energy when the electric grid is stressed. With demand response, people and technology, not power plants, help meet energy demand. This is good news for customers, who pay less for electricity, the environment, via reductions in harmful air emissions, and the electric grid, by making it more efficient.

The Federal Energy Regulatory Commission (FERC), tasked with ensuring our nation’s wholesale electricity rates are ‘just and reasonable,’ created Order 745 to ensure that those providing demand response as a service would be adequately compensated. Read More »

Posted in Clean Energy, Demand Response| 4 Responses

Illinois Legislators Pledge Support for EPA’s Proposed Carbon Regulations

illinois legislatorsWhile the Environmental Protection Agency (EPA) sorts through the more than 1.6 million comments received on its proposed Clean Power Plan (CPP), one group is stepping out to pledge its support of the landmark proposal. 53 Illinois legislators recently signed a letter urging the EPA to finalize the plan, which will set limits on carbon pollution from existing power plants for the first time ever.

Power plants currently account for nearly 40 percent of the nation’s carbon pollution and Illinois’s proposed target would result in a 33 percent reduction in the state’s carbon output by 2030. Fortunately, due to impressive state efforts to invest in clean energy over the past few years, Illinois is well-positioned to meet the challenge.

CPP is an economic opportunity

The Illinois legislators argue the CPP will help the state “achieve even greater cuts in our emissions, health benefits for all our citizens, and will spur further growth in our state’s economy.” The CPP will further the state’s transition to a clean energy economy by attracting investment in innovation, creating more jobs, and keeping electricity prices affordable. Read More »

Posted in Air Quality, Clean Energy, Climate, Energy Efficiency, Illinois, Renewable Energy| Leave a comment

New Study Confirms the Need for National Methane Policy

1At a time when the oil and gas industry claims that methane emissions from their well sites are coming down, here’s a study that adds scientific weight to the argument that emissions may actually be HIGHER than they claim.

A new study by researchers at the Cockrell School of Engineering at the University of Texas at Austin, published today in Environmental Science and Technology, took a look at two key processes in oil and gas production – pneumatic controllers and liquids unloading – and concluded that average methane emissions from pneumatic controllers are 17 percent higher than the estimates industry has been citing, and total emissions from these devices may be more than twice as high as they’ve been saying. According to the UT study, together, pneumatic controllers and liquids unloadings account for 40 percent of total methane emissions from oil and gas production.

Methane is a powerful greenhouse gas, over 80 times more potent than carbon dioxide as a global warming pollutant. Unnecessary venting and leaking of methane – the key ingredient in the natural gas that we use to heat our homes, cook our food, and power many of our industries  – waste a precious national energy resource. Colorado and a few other states are already taking steps to reduce this waste through sensible regulations that cover oil and gas producers, and within two weeks the federal Environmental Protection Agency will announce what it intends to do about this problem. This latest UT study is further evidence that methane leakage is a national problem and national regulation is urgently needed to reduce this powerful pollutant and set a level playing field for the over 6,000 oil and gas production companies in business in the United States today. Read More »

Posted in Methane, Natural Gas, Texas| Leave a comment