Energy Exchange

Utility 2.0: New York Draws Lessons on Utility Regulation from Across the Pond

By EDF Blogs / Published: December 8, 2014

By: Gavin Purchas, Acting Director, Idea Bank, and Elizabeth B. Stein, Attorney

When the New York Public Service Commission (Commission) opened its historic “Reforming the Energy Vision” (REV) proceeding earlier this year, it recognized that the way utility companies have been regulated is out of sync with innovations in technology, business realities, and evolving customer needs, including the need to reduce harmful pollution. In order for utility companies to become part of the solution, the Commission has made it clear that everything is up for grabs – even the basic regulatory paradigm governing how utility companies do business in New York.

Luckily, the Commission won’t have to completely reinvent the wheel since a new regulatory paradigm from the United Kingdom could serve as a potential model. This regulatory approach is known as RIIO and is based on the following formulation: Revenues = Incentives + Innovation + Outputs. RIIO was developed by the UK regulatory body, Office of Gas and Electricity Markets, after the country recognized that its previous framework – while extremely effective at achieving cost reductions – stymied innovation. RIIO includes several elements that may be useful in the New York setting, including: Read More »

Also posted in Clean Energy, Demand Response, Utility Business Models / Read 3 Responses

EDF Co-Hosts International Green Bank Summit on Catalyzing Private Sector Capital for Clean Energy

By Victor A. Rojas / Published: November 20, 2014

In order to fund the transition to a low-carbon economy at a pace rapid enough to prevent runaway climate change, the International Energy Authority has estimated that an annual $1 trillion will be required globally. What policies or mechanisms can be used to facilitate private capital engagement on so grand a scale?: Green banks, which are government-created financial institutions that use attractive interest rates and other incentives to leverage money from the private sector to fund clean energy projects.

Earlier this week, EDF co-hosted the first day of the two-day, second annual International Green Bank Summit in our New York City headquarters, bringing together green bank stakeholders from around the world. The summit focused on how green banks can better leverage limited amounts of public capital to engage and accelerate the deployment of private capital into essential energy efficiency, renewable energy, and climate change mitigation initiatives.

Green banks are catalysts

With one dollar of public finance leveraging about three dollars of private capital, global green banks have catalyzed nearly $20 billion dollars to date in clean energy projects around the world and expect to raise more than $40 billion over the next five years. So far, only a handful of countries have developed green banks. Read More »

Also posted in Clean Energy, Energy Efficiency, Energy Financing, Renewable Energy / Tagged Green banks | Read 1 Response

Utility 2.0: “REVolutionizing” the Use of Distributed Energy Resources

By John Finnigan / Published: October 27, 2014

New York opened its “Reforming the Energy Vision” (REV) proceeding earlier this year to re-examine the utility business model. As part of this proceeding, state regulators will also look into removing market barriers preventing greater deployment of distributed energy resources (DER), which are smaller-scale clean energy resources, such as energy efficiency, energy storage, and local, on-site generation.

In recent years, DERs have made great strides due to market reforms, advanced technologies, and declining costs. Despite these advances, DERs serve less than 1% of national electricity demand as the existing utility business model and regulatory policies still favor traditional electricity distribution from a centralized grid.

Though the REV proceeding is in its early stages, the Department of Public Service Staff (Staff) has provided guidance recommendations for eliminating these market barriers. Using the Staff’s filings, EDF has drafted a white paper that compiles a Top 20 list of the changes required before we will see greater use of DERs. If adopted, these recommendations would result in a sea change for incorporating DERs into New York’s electric system and would provide a template for other states to follow. Read More »

Also posted in Clean Energy, Energy Efficiency, Grid Modernization, Utility Business Models / Read 1 Response

New York Green Bank’s First Deals Underscore State’s Commitment to Clean Energy Future

By Abbey Brown / Published: October 23, 2014

Clean energy finance is thriving in New York State. This week, Governor Cuomo announced the New York Green Bank’s first set of deals, totaling an impressive $800 million in clean energy investments across the state. The projects funded by this investment will yield an impressive annual reduction of 575,000 tons of carbon dioxide emissions, roughly equivalent to removing 120,000 cars from the road or planting 15 million trees per year. This move helps cement New York’s role as a leading state in the clean energy economy.

By offering attractive interest rates and other incentives to stimulate interest from the private sector, green banks encourage investment in clean energy projects that may otherwise have difficulty obtaining private financing. Ideally, these initial deals then set the stage for an active and self-sustaining market in renewable energy and energy efficiency finance.

And the NY Green Bank is starting off swinging: its initial investment of $200 million catalyzed $600 million more in investment from prominent financial institutions, such as Bank of America Merrill Lynch and Deutsche Bank. Read More »

Also posted in Clean Energy, Energy Financing / Read 1 Response

Utility 2.0: New York State Envisions New Platform Giving Equal Priority to Clean Energy Solutions

By Elizabeth B. Stein / Published: October 15, 2014

New York’s “Reforming the Energy Vision” (REV) proceeding aims to reform the state’s long-standing electricity system to lay the groundwork for a cleaner and more efficient grid that allows for more customer choice and competition from third-party energy services companies. Forming the centerpiece of this 21^st-century vision is a platform that would smoothly integrate innovative energy services and solutions into the existing grid, allowing them to compete on equal footing with electricity from centralized power plants.

Currently, the electric industry comprises three functions: generation, transmission, and distribution. Generation refers to making electricity, traditionally from large, centralized power plants. Transmission refers to sending that electricity along high-voltage wires to substations closer to electricity customers. Distribution refers to delivering the power from the substations to homes and businesses. In its recent straw proposal, the Department of Public Service Staff (Staff) recommends splitting the distribution function into two parts, one performing the traditional delivery service and the other serving as the Distribution System Platform Provider (DSP), to grant equal priority to energy solutions that are not centralized, such as on-site, distributed generation and energy efficiency. Read More »

Also posted in Clean Energy, Demand Response, Electricity Pricing, Energy Efficiency, Grid Modernization, Utility Business Models / Read 2 Responses

NYC Mayor Launches Energy Efficiency Program Modeled After NYC Clean Heat

By Abbey Brown / Published: September 22, 2014

Source: Kevin Case Flickr

Over the weekend, New York City Mayor de Blasio unveiled an ambitious plan to address energy use in the city’s buildings, called NYC Built to Last. Through this plan, NYC is committing to reduce its emissions by 80 percent below 2005 levels by 2050. This makes NYC the largest city in the world to commit to a goal like this. Representing three quarters of the city’s greenhouse gas emissions, New York City buildings must play a central role in any effective climate action plan, and Mayor de Blasio knows this.

A key component of this plan is the ‘retrofit accelerator,’ a program modeled on the successful NYC Clean Heat program. Retrofit accelerator aims to upgrade 20,000 private buildings, making up 15 percent of citywide built square footage. Of these buildings, 40 percent of them will be low-income housing.

EDF partnered with the City to create NYC Clean Heat, which forged a diverse coalition of financial, real estate, and non-profit communities to launch a $100 million financing program to help phase out dirty heating oils. Last week, the City announced the program met its goal of reducing soot pollution from heating oil in NYC by 50 percent. The program helped 4,000 buildings – half of them affordable housing – convert to cleaner, more efficient heating fuels. Read More »

Also posted in Air Quality, Clean Energy, Climate, Energy Efficiency / Read 2 Responses