Monthly Archives: September 2017

Americans speak up for clean cars at EPA public hearing

A public hearing today on EPA Administrator Scott Pruitt’s effort to reverse America’s Clean Car Standards drew widespread support for keeping the protections in place.

I got the chance to join more than a hundred people who signed up to testify at the Washington, D.C. hearing – and they overwhelmingly spoke in favor of the Clean Car Standards and praised the benefits they provide for climate security and economic prosperity for our communities and families. (You can read my full testimony here.)

The American public stands to lose vital benefits if the Clean Cars Standards are reversed

The Clean Car Standards are already at work reducing climate pollution, driving innovative new technologies, improving our energy security, and saving American families money at the gas pump. But last month, the Trump Administration announced formal steps to begin reconsidering the existing standards for cars and passenger trucks for model years 2022 to 2025 – which could stop that progress.

Under the standards already in place, people who buy a new car or truck in 2025 would save thousands of dollars on fuel over the lifetime of those vehicles. In total, EPA projects that consumers would save more than $1 trillion because of the standards.

The 86 percent of Americans who finance their vehicle with a five-year loan are expected to immediately realize the cost savings from cleaner, more efficient vehicles. This is true even with recent lower gas prices.

Meanwhile, the Clean Car standards would reduce America’s oil consumption by two million barrels per day by 2025 – more than we import from any single country other than Canada. According to Ret. Lt. General Richard Zilmer:

Over-reliance on oil ties our nation to far-flung conflicts, sends our troops into harm’s way, and endangers them once they’re in conflict zones. Ensuring that the cars and trucks we drive every day go farther on every gallon of gas makes our nation stronger.

The Clean Car program would also eliminate an estimated six billion metric tons of carbon pollution over the life of the vehicles subject to the standards, which is more than a year’s worth of U.S. carbon emissions.

We’re making progress faster and cheaper than expected

EPA’s recent rigorous evaluation of the existing standards found that technologies are developing more quickly and at even lower costs than EPA originally projected – making the standards for the later model years appropriate and even more feasible than was first thought.

Per vehicle compliance costs are significantly lower than those projected in 2012 ($252 lower for cars and $197 lower for trucks as compared to 2012 projections).

 

 

Both the U.S. and world automotive markets are moving forward

Reopening the final Clean Car Standards will create uncertainty, slow innovation and hurt U.S. economic leadership.

Auto manufacturers have strongly recovered from the 2008 recession while increasing vehicle efficiency and cutting pollution

During the height of the economic recession in 2008, the American auto industry was on the verge of collapse. This prompted the Obama Administration to develop a bailout package for the industry, which provided the boost the industry needed to help rebound.

Last year, drivers in the United States bought more cars than ever before – roughly 70 percent more vehicles than during the recession – as fuel economy rose to its highest levels yet.

In total, the auto industry has added nearly 700,000 direct jobs since the recession – supporting several million indirect jobs throughout the economy. Auto manufacturing jobs account for 40 percent of all net jobs added in U.S. manufacturing since the recession.

In a letter supporting EPA’s proposal to reaffirm the Phase 2 standards, the United Auto Workers (UAW) noted:

UAW members know firsthand that Corporate Average Fuel Economy (CAFE) and greenhouse gas (GHG) standards have spurred investments in new products that employ tens of thousands of our members.

Today, the auto industry directly employs millions of Americans and employment at auto dealerships is at its highest level ever. Automakers have recognized this strong financial performance in recent annual reports:

Our solid business results included record profits and an increased worldwide market share. Overall, we achieved our sixth consecutive year of both profit and positive operating-related cash flow, which enabled us to distribute $2.5 billion to our shareholders and grow our regular dividend by 20 percent. – Ford 2015 Annual report, Letter from Executive Chairman William Clay Ford, Jr.

2016 was the best year in its history of more than 130 years. — Daimler 2016 Annual Report, Chairman’s Letter

[Fiat Chrysler] closed 2016 with another record financial performance … all of our segments were profitable and showed improvement over the prior year. – FCA 2016 Annual Report, Letter from the Chairman and the CEO

As so many testified today, Americans want to move forward on clean cars.

At EDF, we’re committed to holding Administrator Pruitt accountable if he recklessly rolls back these common sense standards. We hope you’ll join us and take action for Clean Cars.

Posted in Cars and Pollution, Economics, Greenhouse Gas Emissions, Jobs, News, Policy / Comments are closed

New report: Yes, we can have both clean air and reliable electricity

A new report by M.J. Bradley & Associates – based on an extensive review of data, literature, and case studies – shows that coal-fired power plants are retiring primarily due to low natural gas prices, and that the ongoing trend towards a cleaner energy resource mix is happening without compromising the reliability of our electric grid.

The report follows a highly-publicized order by Secretary of Energy Rick Perry for a review of the nation’s electricity markets and reliability. Perry wanted to determine whether clean air safeguards and policies encouraging clean energy are causing premature retirements of coal-fired power plants and threatening grid reliability.

The Department of Energy (DOE) just released that long-anticipated review — a baseload study that actually confirms that cheap natural gas has been the major driver behind coal retirements.

Now the M.J Bradley report affirms that finding, and offers even more evidence to support it and demonstrate that electric reliability remains strong.

The M.J Bradley report confirms conclusions by multiple studies which demonstrate that, of the three main factors responsible for the majority of the decline in coal generation, the increased competition from cheap natural gas has been by far the major contributor – accounting for 49 percent of the decline.

The two other factors are reduced demand for electricity – accounting for 26 percent – and increased growth in renewable energy – accounting for only 18 percent.

Several case studies featured in the M.J. Bradley report offer further proof that coal retirements are driven by economic factors – specifically low natural gas prices:

For example, PSEG President and COO Bill Levis – referring to the shutdown of Hudson Generating Station — said, “the sustained low prices of natural gas have put economic pressure on these plants for some time.PSEG Senior Director of Operations Bill Thompson also pointed to economic reasons, not environmental regulations, as basis for the decision to retire the plant.

Florida Power & Light (FPL) cited economics and customer savings as the primary reasons for its plans to shut down three coal units. According to FPL, the retirements of Cedar Bay and Indiantown are expected to save its customers an estimated $199 million. FPL President and CEO Eric Silagy said the decision to retire the plants is part of a “forward-looking strategy of smart investments that improve the efficiency of our system, reduce our fuel consumption, prevent emissions and cut costs for our customers.” Retirement of FPL’s St. John River Power Park would add another $183 million in customer savings.

According to the M.J. Bradley report, the overall decline in U.S. coal generation is primarily due to reduced utilization of coal-fired power plants, rather than retirements of those facilities.

Most recently retired facilities were older, smaller units that were inefficient and relatively expensive to operate. On average, coal units that announced plans to retire between 2010 and 2015 were 57 years old – well past their original expected life span of 40 years.

Meanwhile, existing coal plant utilization has declined from 73 percent capacity factor in 2008 to 53 percent in 2016. At the same time, the utilization of cheaper natural gas combined-cycle plants has increased from 40 percent capacity factor to 56 percent.

As a result, M.J. Bradley estimates that less than twenty percent of the overall decline in coal generation over the past six years can be attributed to coal plant retirements, with reduced utilization of the remaining fleet accounting for the rest of the decline.

Implications of coal retirements for electric grid reliability

As coal plants retire and are replaced by newer, cleaner resources, there have been concerns about potential impacts on the reliability of our electric grid. (Those concerns were also the topic of DOE’s baseload study.)

M.J. Bradley examined the implications of coal retirements and the evolving resource mix, looking at extensive existing research including their own reliability report released earlier this year.

These studies conclude that electric reliability remains strong.

These studies also found that flexible approaches to grid management, and new technologies such as electric storage, are providing additional tools to support and ensure grid reliability.

In order to understand that conclusion, consider two factors that are used to assess reliability:

  • Resource adequacy, which considers the availability of resources to meet future demand, and is assessed using metrics such as reserve margins
  • Operational reliability, which considers the ability of grid operators to run the system in real-time in a secure way to balance supply and demand – and is defined in terms of Essential Reliability Services, such as frequency and voltage support and ramping capability.

As many studies have already indicated, “baseload” is an outdated term used historically to describe the way resources were being used on the grid – not to describe the above factors that are needed to maintain grid reliability.

Here is what M.J. Bradley’s report and other assessments tell us about the implications of the evolving resource mix for grid reliability:

There are no signs of deteriorating reliability on the grid today, and studies indicate continued growth in clean resources is fully compatible with continued reliability

In its 2017 State of Reliability report, the North American Electric Reliability Corporation (NERC) found that over the past five years the trends in planning reserve margins were stable while other reliability metrics were either improving, stable, or inconclusive.

NERC’s report also found that bulk power system resiliency to severe weather continues to improve.

According to a report by grid operator PJM, which has recently experienced both significant coal retirements and new deployment of clean energy resources:

[T]he expected near-term resource portfolio is among the highest-performing portfolios and is well equipped to provide the generator reliability attributes.

DOE’s own baseload study acknowledges that electric reliability remains strong.  A wide range of literature further indicates that high renewable penetration futures are possible without compromising grid reliability.

Cleaner resources and new technologies being brought online help strengthen reliability

Studies show that technologies being added to the system have, in combination, most if not all the reliability attributes provided by retiring coal-fired generation and other resources exiting the system.

In fact, the evolving resource mix that includes retirement of aging capacity and addition of new gas-fired and renewable capacity can increase system reliability from a number of perspectives. For instance, available data indicates that forced and planned outage rates for renewable and natural gas technologies can be less than half of those for coal.

Studies also highlight the valuable reliability services that emerging new technologies, such as electric storage, can provide. Renewable resources and emerging technologies also help hedge against fuel supply and price volatility, contributing to resource diversity and increased resilience.

Clean energy resources have demonstrated their ability to support reliable electric service at times of severe stress on the grid.

In the 2014 polar vortex, for example, frozen coal stockpiles led to coal generation outages – so wind and demand response resources were increasingly relied upon to help maintain reliability.

And just last year, close to 100 megawatts of electric storage was successfully deployed in less than six months to address reliability concerns stemming from the Aliso Canyon natural gas storage leak in California.

Regulators and grid operators can leverage the reliability attributes of clean resources and new technologies through improved market design

A 2016 report by DOE found that cleaner resources and emerging new technologies are creating options and opportunities, providing a new toolbox for maintaining reliability in the modern power system.

The Federal Energy Regulatory Commission (FERC) has long recognized the valuable grid services that emerging new technologies could provide – from its order on demand response to its order on frequency regulation compensation, FERC recognized the value of fast and accurate response resources in cost-effectively meeting grid reliability needs. More recently, FERC’s ancillary service reforms recognize that, with advances in technologies, variable energy resources such as wind are increasingly capable of providing reliability services such as reactive power.

Grid operators are also recognizing the valuable contributions of cleaner resources and emerging new technologies, as well as the importance of flexibility to a modern, nimble, dynamic and robust grid. For instance, both the California Independent System Operator and the Midcontinent Independent System Operator (MISO) have created ramp products, and MISO also has a dispatchable intermittent resource program.

It will be increasingly important for regulators, system planners, and grid operators to continue assessing grid reliability needs, and leveraging the capabilities of new technologies and technological advancements, in the future. It is also important to continue market design and system operation and coordination efforts to support the emerging needs of a modern 21st century electric grid.

The facts show clearly that we shouldn’t accept fearmongering that threatens our clean air safeguards. Instead, working together, America can have clean, healthy air and affordable, reliable electricity.

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