Energy Exchange

It’s Time Our Policies Reflect The Fact That Energy And Water Are Fundamentally Intertwined

By Kate Zerrenner / Published: July 11, 2013

When I tell people that the best way to conserve energy is to conserve water, I am often faced with a confused response. I’m not surprised really. Energy and water policies are rarely discussed in the same forum. For a long time, we’ve overlooked the inextricable relationship between water and energy use. Coal, nuclear and natural gas plants use enormous amounts of water for cooling purposes. In 2005, 41% of all freshwater withdrawals in the nation was used in the thermoelectric power industry for cooling.

Connection between energy and water

The longstanding division between energy and water considerations is particularly evident in the case of energy and water management. These resources are fundamentally intertwined: Energy is used to secure, deliver, treat and distribute water, while water is used (and often degraded) to develop, process and deliver energy. Despite the inherent connection between the two sectors, energy and water planners routinely make decisions that impact one another without adequately understanding the scientific or policy complexities of the other sector. This miscommunication often hides joint opportunities for conservation to the detriment of budgets, efficiency, the environment and public health, and inhibits both sectors from fully accounting for the financial, environmental or social effects they have on each other.

This lack of collaboration between energy and water planners is especially dire considering Texas is in midst of an energy shortage that is exacerbated by the multi-year drought. Without adequate planning, we could someday have to choose between keeping our lights on and turning on the faucet. Read More »

Also posted in Climate, Energy-Water Nexus / Tagged energy, Energy-Water Nexus, Water | Read 2 Responses

Energy Capital Of The Nation Turns To Clean Energy

By Elena Craft, PhD / Published: June 27, 2013

This commentary originally appeared on EDF’s Texas Clean Air Matters Blog

Last week, the City of Houston announced that it would increase its purchase of renewable electricity to cover half of its energy use. The city will use almost 623,000 megawatt-hours of electricity from renewable sources per year—equivalent to the energy used by 55,000 residential homes annually. The purchase makes Houston the largest municipal buyer of renewable energy in the nation. While Houston’s latest renewable energy purchase may seem at odds with its reputation as an oil and gas hub, it’s exactly the sort of common-sense decision we expect from a city that’s touted as the energy capital of the nation.

Houston is in good company among other Texas cities. The City of Austin already gets 100% of its electricity from renewable sources. To make the switch, the city leveraged Austin Energy’s GreenChoice program, one of the nation’s most successful utility-sponsored and voluntary green-pricing programs. The program is part of Austin’s Climate Protection Plan, which establishes a 35 % renewable portfolio goal for Austin Energy by 2020. In San Antonio, the municipally owned CPS Energy has emerged as a leader in clean energy. Through its New Energy Economy initiative, CPS Energy is growing its network of smart meters and expanding its installed solar capacity, among many other sustainable initiatives. Today, CPS Energy uses more solar energy than any other Texas utility, while still having the lowest electric rates among the top 10 largest cities in the United States. Read More »

Also posted in Climate, Energy Efficiency, General, Renewable Energy / Read 1 Response

Demand Response: Power For The Grid Starts With The People

By Marita Mirzatuny / Published: June 24, 2013

Earlier this month, I had the opportunity to speak on a panel entitled, Resource Adequacy & Demand Response: Ensuring Texas’ Future Reliability at the 7^th Annual Platts Texas Energy Markets Conference in Houston, TX. Following fellow panelists, “Trip” Doggett, CEO of ERCOT; Milton L. Holloway, President and COO of the Center for the Commercialization of Electric Technologies; and John W. Fainter, Jr. President and CEO of the Association of Electric Companies of Texas, I spoke about EDF’s work with the Pecan Street Research Institute (Pecan Street) to test and deploy various smart grid consumer products.

One of the many cutting-edge research projects being conducted by Pecan Street is an examination of consumer behavior with regards to energy usage. Trends in the data show that giving people the ability to control their energy use, and their energy generation, generally results in cost-effective, environmentally-conscious decisions. These shrewd decisions are becoming increasingly important as Texas faces a lack of energy resources to meet the state’s increasing need for more electricity.

With July just around the corner, the summer heat is ramping up in Texas, and the Electric Reliability Council of Texas (ERCOT) is preparing for extreme temperatures to push the electric grid to its limits. State regulators and ERCOT stakeholders are urgently seeking a solution to the looming Texas Energy Crunch. The Public Utility Commission of Texas (PUC) has already raised the maximum price in the electricity market a number of times, but this is a band-aid for the problem, not a long-term solution. Read More »

Also posted in Demand Response, General, Grid Modernization, Utility Business Models / Comments are closed

Environmental Accomplishments And Missed Opportunities From The 83rd Texas Legislative Session

By EDF Blogs / Published: May 31, 2013

This blog post is co-authored by Marita Mirzatuny and Kate Zerrenner.

In addition to passing tax cuts and making pecan pie the official state pie of Texas, the 83^rd Legislature heard numerous energy-related bills. As a solution to our Texas Energy Crunch efforts, EDF supported 13 bills that would have provided relief to Texas’ resource adequacy problems; in other words, the issues Texas faces as a result of increasing energy demand, scorching temperatures and a record drought. Among those bills (which we review on page 13 of our ‘State of the Texas Energy Crunch’ report) are a few, highlighted below, that made some – albeit not enough – progress.

Energy Legislation

A big success this session was the passage of Senate Bill (SB) 385 by Chairman John Carona. SB 385, or the Property Assessed Clean Energy (PACE) bill, clears some of the hurdles that prohibit commercial and industrial properties from taking advantage of new financing for energy improvements. PACE allows property owners to pay for water and energy efficiency upgrades or renewable energy improvements with loans, which are then repaid through an annual charge on their property tax bill. For more on this legislation, please see our recent blog post covering PACE in Texas.

Chairman Carona’s demand response bill, SB 1351, passed and was referred to State Affairs in the House. Demand response (DR) initiatives allow customers to voluntarily reduce peak electricity use and receive a payment for doing so in response to a signal from their utilities. Additionally, Chairman Rafael Anchía introduced the companion bill, House Bill (HB) 2194. HB 2194 allows for customer, or demand-side resources (DSR), from “residential, commercial, and industrial customers to participate in all energy markets” and specifies that DSR “must be designed and implemented in a manner to increase market efficiency, competition, and customer benefits.” This bill clears the way for demand response, renewable energy, and energy efficiency to become important players in the market.

SB 1280, by Senator Kirk Watson, passed out of the Business and Commerce Committee with a seven to two vote. This bill, regarding Texas’ reserve margin for the electric grid, requires that power regions (such as the Electric Reliability Council of Texas, or ERCOT) estimate the available generation at any given time, the expected peak demand (demand at the hottest part of the day when the most energy is being used) and the amount of reserve energy needed to ensure a reliable electricity supply. SB 1280 also directs the use of voluntary load participation programs (think demand response) with at least 20 percent of peak energy demand coming from each of the residential, commercial and industrial sectors.

Senator José Rodríguez’s net metering bill, SB 1239, successfully passed out of the Business and Commerce committee. Texas is one of only seven states where customers are not guaranteed fair compensation for the electricity they provide to the grid. SB 1239 clarifies that all retail electric providers, municipal utilities and cooperatives must buy back extra electricity from residential customers along with churches and schools at a reasonable, market-based value. For example, Los Angeles implemented the largest solar buyback program in the nation earlier this year, paying customers 17 cents a kilowatt hour for excess energy produced.

In the House, HB 303 by Representative Eddie Rodriguez called for a new renewable energy goal – to supply 35 percent of energy demand with clean energy by 2020, with at least two percent coming from solar. This marks an important precedent for the clean energy standards introduced in state legislatures around the country. Additionally, Representative Rafael Anchía authored HB 2196, a bill that addresses payments to customers for renewable energy and other demand-side contributions to the electric grid.

While it’s great that some of the bills gained some traction, only SB 385 made its way to the Governor’s desk. With a hotter than average summer approaching, possibly worse than 2011, electric reliability is not a guarantee and these bills would have provided solutions to help address our energy issues. Already Texas is receiving national attention for our impeding energy shortages.

Source: www.lavacacountytaxpayers.org

Water Legislation

At the last minute, the House and Senate, after much back door negotiating and out front wrangling, approved a plan to fund the State Water Plan. HB 4, by Chairman Allan Ritter, set up two funding accounts to pay for water projects. These accounts must be approved by voters, because the bills would amend Texas’ Constitution to allow the plan to be initially funded with a portion of the Rainy Day Fund. Read More »

Also posted in Demand Response, Energy Efficiency, Renewable Energy / Comments are closed

Texas Picks Up The Clean Energy PACE

By Kate Zerrenner / Published: May 23, 2013

Chairman John Carona’s Property Assessed Clean Energy (PACE) bill, Senate Bill 385 (SB 385), which was sponsored by Chairman Jim Keffer in the House, is headed to the Texas Governor’s desk! Building upon successful legislation passed in 2009 to authorize “PACE districts” in Texas, SB 385 clears some of the hurdles that prevent commercial and industrial properties from taking advantage of new financing for water and energy conservation efforts.

PACE is an innovative, market-based approach that helps alleviate the steep, upfront costs property that owners generally incur for water and energy improvements by using loans that are seamlessly repaid through an additional charge on their property tax bills. The loan is then attached to the property, rather than the owner, and can be transferred if the property is sold. PACE loans can be issued by city or county financing districts or financial institutions, such as banks. Property owners who participate will start saving money on their utility bills each month as a result of water conservation, energy efficiency and/or renewable energy improvements, while repaying the loan annually when they file their taxes. In other words, they will see net gains despite increased property taxes. The program is entirely voluntary.

In 2009, Governor Perry signed House Bill 1937 (HB 1937) by Mike Villarreal, which established PACE districts in Texas for the first time. Although cities and counties across the state began the process of setting up PACE districts, the entire process was derailed when the Federal Housing Finance Agency (FHFA) created an obstacle for residential PACE programs. FHFA expressed concerns about the senior lien—that is, if a homeowner with a PACE loan defaults, the repayment of the PACE obligation would take priority over settling the mortgage. There were also some structural concerns which would have “required the Texas legislature to amend or replace the existing statute.” This new bill, SB 385, addresses the structural problems and applies to commercial and industrial (rather than residential) property owners, thus removing the senior lien concern from the equation. Read More »

Also posted in Energy Efficiency, On-bill repayment / Tagged PACE, Property Assessed Clean Energy | Comments are closed

Texas Legislature Update: Chapter 313 And Texas Wind Production

By Marita Mirzatuny / Published: May 16, 2013

Source: Texas A&M AgriLife Research and Extension Center

This week, the Texas Senate will likely debate House Bill (HB) 3390, introduced by Representative Harvey Hilderbran and sponsored by Senator Bob Deuell. This bill, which passed in the House and out of the Economic Development Senate Committee on May 14^th, reauthorizes Chapter 313 of the Texas Tax Code – commonly known as the Texas Economic Development Act. Chapter 313 is an economic development program that allows companies to apply for a temporary reduction in property taxes in exchange for a major capital investment commitment.

Chapter 313 has helped put Texans to work and grow rural economies. Wind energy is among the industries that take advantage of this program and, in the process, has attracted around $24 billion in wind energy investments to 56 counties throughout the lone star state – $15 billion of which was a direct result of Chapter 313. Wind energy projects create new jobs and employ meteorologists, surveyors, structural engineers, assembly workers, electrical workers, construction workers, lawyers, bankers, technicians and local service jobs associated with increased growth.

However, Chapter 313 is set to expire in 2014. If the Texas Senate does not renew this crucial bill as is (with renewable energy projects included), then the state stands to lose its competitive advantage in attracting wind and solar development to the state – potentially losing projects to the 34 other states offering clean energy incentives. Some states don’t impose a property tax on wind projects at all.

Furthermore, including renewables in Chapter 313 helps growing school districts’ tax bases, which benefit from the substantial investment that wind energy projects bring to their communities. The expected 30+ year life span of these projects makes them lucrative municipal assets. Additionally, landowners in rural Texas receive lease payments for each turbine installed on their property. These infusions of capital help farmers and ranchers support their land, particularly during times of extreme drought. 95 percent of land used for wind turbines can still be used for agricultural purposes, allowing farmers and ranchers to benefit from a second harvest – of wind.

Also posted in Renewable Energy / Read 5 Responses