Energy Exchange

DOE Panel Offers Consensus Guidelines For Extracting Natural Gas Safely

Natural gas plays an important role in our nation’s economy, and has the potential to help reduce greenhouse gas pollution, bolster energy security, and reinvigorate domestic manufacturing.  Unfortunately, these potential benefits are jeopardized by inconsistent and often poor natural gas production practices, leading to real threats to public health and the environment, that understandably engender community opposition to natural gas production. 

To say the natural gas industry has a credibility problem is an understatement.  If the recent spate of critical articles in the New York Times escaped your attention, than perhaps you saw this recent bit on the Colbert Report, which demonstrates, among other things, that the general public has little understanding for the complex issues surrounding shale gas development, and the industry has been doing little to engage them in a serious way.  The Colbert bit is funny, but the need to get the shale gas issue right is no joke.

In March, President Obama directed Energy Secretary Steven Chu to appoint a group of energy and environmental experts to study the issue.  EDF President (and my boss) Fred Krupp was appointed to the panel.  During 90 days of intensive investigation and deliberation, the panel, chaired by MIT professor John Deutch, held a series of public hearings. They heard from industry officials, environmental leaders, federal and state regulators, scientists and others.  They visited well sites to see drilling and production first hand.   They held a public meeting in southern Pennsylvania to hear directly from people who are living with intensive shale gas development – both the good and the bad.  Supporters and opponents packed the auditorium and told stories about how the shale gas boom had affected them. For some, it had provided an economic lifeline. For others, it had made life a nightmare. 

And today, after much study and deliberation, the committee has issued a report with some very specific recommendations which, if implemented, could materially reduce the risks to public health and environment from shale gas development and begin to build public trust. 

The report calls for increased oversight: robust enforcement practices and modernized rules to safeguard communities and improve communication between state and federal regulators. The report makes it clear that “effective and capable regulation is essential to protect the public interest. The challenges of protecting human health and the environment in light of the anticipated rapid expansion of shale gas production require the joint efforts of federal and state regulators. This means that resources dedicated to oversight of the industry must be sufficient to do the job and there is adequate regulatory staff at the state and federal level with the technical expertise to issue, inspect and enforce regulations.”

The report also makes clear that regulation alone will not be enough.  It calls for the full public disclosure of all chemicals used in the process of hydraulic fracturing.  It calls for gathering the data necessary to determine whether, and to what degree natural gas provides greenhouse gas benefits when substituted for coal or oil in energy production or transportation.  It recommends that the industry get its own house in order by organizing itself to identify and share best practices across the industry with a relentless focus on continuous improvement in reducing air and water pollution and other environmental harms. 

These recommendations won’t solve all problems, and there is much work to be done simply to make these recommendations a reality, but today’s report is an important step in getting beyond the comedy bits and headlines to focus on those measures that can make a material difference in improving public health and the environment.

Also posted in Natural Gas / Read 2 Responses

Is Government Getting Out Of The Clean Energy Business?

Source: Front Page Magazine

Tuesday’s debt deal makes one thing clear:  whatever it is that you may want government to spend money on, there will likely be less money to go around in the future.  That said, I think it’s time to rethink government’s role in the clean energy marketplace.  Whether or not it has money to spend, governments at all levels can do a lot to build a robust American market for clean energy.  Here are some suggested ways forward:

First, engage the private sector.  Our government is highly skilled and effective when it comes to enabling clean energy research, which in turn leads to high-risk investments in emerging clean technologies, but it cannot pay for everything.  This is not the era of the New Deal, and we’re not China.  We are, however, a nation of innovators with the ability to mobilize private capital second to none.  So let’s get innovators, entrepreneurs and regulators in a room together and begin to work on projects that establish what economists have been telling us for years:  clean energy and efficiency will make and save money.  In some places, government can be a convener – for example, cities across the country (and the world) could work with their real estate and banking communities to aggregate efficiency upgrades at a scale large enough to attract major investment from institutional investors and other sources of capital.  Government could basically be a source of data and the initial step in drawing parties together to help broker deals

Second, lead by example and cut waste.  From energy needed to fuel our troops on the front lines to the air conditioning used for government officials in Washington and state and local capitols – there’s a huge amount of money to be saved and strategic advantage to be won by running our government’s own energy use more effectively.  In fact, EDF’s Climate Corps Public Sector is currently engaging in this type of exercise in its efforts to reduce the New York City Housing Authority’s (NYCHA) energy use by more than 45 percent.  These types of energy efficiency efforts should appeal to all sides of the political aisle:  government will do more with less; we’ll send less money overseas for imported oil; we’ll pioneer new technologies through smart energy applications; and Americans will be put to work upgrading government buildings with less wasteful technology.  If there’s a role for money here, it’s to finance upfront costs that get replenished out of energy savings – possibly a mix of private and public capital. 

Finally, open the energy marketplace to truly fair competition.  America’s utilities are governed by an arcane mix of rules that get in the way of innovation and tend to favor traditional fossil fuels.  Our grid is a long way from a smart grid.  Don’t even get me started on subsidies for oil and coal companies.  Rules that shape the energy market and grid are set at the federal, regional and state levels.  It’s time for a national effort to make it easier for households and businesses to use renewable sources of energy like solar and wind, as well as enable drivers to plug in their electric cars.  Homes and businesses should be able to sell extra solar electricity into the grid easily and without limit.  There should be a simple way to aggregate the benefits of efficiency; for example, consumers should be able to sell saved energy to compete with new power plants and this cleaner energy should be valued by regulators on par with new supply.  Consumers should be able to charge electric cars at off-peak times, which could end up costing as little as about three cents a mile to operate.  We can have all this – if we get the rules right at Public Utility Commissions (PUCs) across the country.

The role of government would change.  It would become a source of data, culled from public sources like demographics and building department filings.  It would help ensure that information is disclosed, like the SEC requires disclosure of information to investors on the stock market.  It would change the rules to remove barriers to clean-energy investment inherent in our current electric grids and markets.  It would use its bully pulpit not to harangue, but to create the negotiating table around which unlikely partners come together.  It would enforce rules clearly and consistently to protect health and environment. It would use its own buildings, agencies, vehicles and supply chain to test and develop technologies – to be out front and demonstrate what works.  And where possible, it could be a source of grants or loans, but that role would be overshadowed by the value of the vibrant private energy market that it would support by doing all of these other described duties. 

If the government commits to moving ahead in this way, America will leap ahead in the clean energy sector – and we’ll be moving so fast that its citizens will barely have time to lament the relatively smaller amount of government spending.

Also posted in Energy Efficiency, Grid Modernization, Renewable Energy / Read 1 Response

New Report: Commercial Building Energy Efficiency = Jobs

Source: Architecture 2030

Blog Post By: Jackie Roberts, EDF’s Director of Sustainable Technologies, National Climate Campaign

The President’s Better Buildings Initiative proposes to make American businesses more energy efficient through a series of new initiatives including newly designed tax incentives for building efficiency, better financing opportunities for commercial retrofits, a “Race to Green” for state and municipal governments that streamline regulations and attract private investment for retrofit projects, a “Better Buildings Challenge” to CEOs and University Presidents, and, finally, new training for commercial building technology workers.  An analysis released today, conducted by the Political Economy Research Institute (PERI) of the University of Massachusetts at Amherst, showed that more than 114,000 new jobs, many of which would come from the hard-hit construction industry, would be created through the Better Buildings Initiative. 

Insights into which firms will benefit, and where those jobs may be located, can be found in Duke University’s value chain analyses of three energy efficiency strategies for buildings:  high efficiency windows and glass, smart grid, and LED lighting.  If HOME STAR legislation is also passed, the firms involved in residential re-insulation and electric heat pump hot water heaters will also benefit. 

Job creation is no mystery for the business world:  it begins and ends with new customers.  Every policy initiative that pushes more customers to U.S. firms identified in these value chain studies is critical.  Hopefully, the Better Building Initiative is followed by a commitment to broader policy that puts us on a path to a low carbon economy.  Broad policy creates customers for the many firms involved in the value chains for hundreds of climate solutions – whether renewables, energy efficiency, transportation, agricultural, industrial or other innovations.  And, at the end of the day, customers = jobs.

Also posted in Energy Efficiency, Jobs / Read 1 Response

Put My Tax Dollars Into A Growth Market, Please

Guest Blog Post By: Jackie Roberts, EDF’s Director of Sustainable Technologies, National Climate Campaign

Two efforts to repeal tax breaks for oil and gas companies – Senate Bill S.940 and the Administration’s budget proposals to eliminate subsidies in FY 2010, FY 2011, and FY 2012 budgets – should receive bipartisan support for no other reason than re-directing those subsidies can be an engine of job creation.  University of Massachusetts at Amherst economic researchers developed employment estimates for various energy sources, including energy efficiency strategies.  Their data show that investments in energy efficiency creates 2.5 to four times more jobs than that for oil and gas development and renewables create 2.5 to three times more jobs than that for oil and gas development.

These jobs are dispersed throughout the U.S. as shown with our LessCarbonMoreJobs mapping, and bring particular benefits to the hard hit Midwest manufacturing regions.

Large government subsidies might, just might, be justified if “Big Oil” was using profits to invest record amounts in transitioning to clean energy.  But, that is far from the case.  A Center for American Progress analysis of Big Oil investments reveals that the big five oil companies invested just four percent of their total 2008 profits in renewable and alternative energy ventures.  There are no signs that this level of investment has increased at all in the past several years. 

Clean energy will be a major new market – by some estimates the market for renewables alone will range from $1.7 trillion per year to $2.3 trillion by 2020, depending on different government policy scenarios.  Having already slipped from first to third in terms of investments in this sector, the U.S. needs to play catch up.  Government dollars should be used to help the U.S. transition to clean energy and to do so in a way that we have significant market share in as many clean energy solutions as possible.  First mover advantages are critical with new markets and worth every penny we can devote to creating strong clean energy innovation and manufacturing here in the U.S.  Such investments will also translate into cheap, homegrown energy sources in the medium- to long-term – the supposed purpose of the oil and gas subsidies.  Put my tax dollars into a growth market, please.

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

Some Bad Ideas We Can All Agree On

Source: Bellona

EDF believes that, done right, carbon capture and sequestration (CCS) can be a safe and effective tool for reducing greenhouse gas emissions.  We also think it will be a necessary tool – especially for natural gas, which is poised to make up an increasing share of our national energy portfolio.

The environmental community doesn’t have a monolithic view of CCS, though.  Some groups are skeptical about its need.  Others have concerns about whether it can really work.  Fair enough!  We welcome debate and opportunities to learn from each other.

There are certain things, though, on which we can all agree.  More than 50 organizations recently came together to express our unanimous opposition to a couple of very bad ideas about how CCS projects should be treated – ideas that could lead to sloppy projects and put public health and the environment at risk.

The first is so-called “liability relief.”  Believe it or not, on the one-year anniversary of the Deepwater Horizon oil-spill disaster, some in the coal and utility industries continue to call for a “Get Out of Jail Free” card for CCS projects.  They are basically saying that once a CCS project is sealed up, operators shouldn’t be held responsible if carbon dioxide (CO2) starts to leak or if displace formation fluids pollute ground water.  We believe this is a set-up for dangerous short cuts in project planning and implementation.  It boggles my mind that, at the same time Congress is struggling to lift liability caps for offshore drilling, anyone would entertain the idea of taking steps that would reduce incentives to properly manage CCS projects.

The second bad idea might be even more perplexing than the first – and we’re especially disappointed that it’s coming from the good folks at the Environmental Protection Agency (EPA).  Our environmental watchdogs at the agency are considering a proposal to exempt CCS projects from hazardous waste requirements under the Resource Conservation and Recovery Act, our nation’s landmark law that keeps us safe from the most toxic substances.  If CO2 streams at CCS projects get this exemption, it will eliminate important protections for clean-ups and remediation and for public participation.

EDF is helping lead the charge against these bad ideas – meeting with members of Congress and agency officials, sounding the alarm with the media, and working with other environmental groups to present a united front.  For more details, read our letter to the Administration, and stay tuned to the Energy Exchange.

Posted in Washington, DC / Comments are closed

Thinking Long Term On America’s Energy Future

On Wednesday, President Obama, speaking at Georgetown University, set out a multi-pronged approach to boosting America’s energy security.  We agree that America “cannot keep going from shock to trance on the issue of energy security, rushing to propose action when gas prices rise, then hitting the snooze button when they fall again.”  President Obama’s goals to leverage alternative fuels, increase efficiency, and invest in smart grid technology, advanced vehicles, high speed rail, and public transit are critical steps toward a truly clean energy economy.

The core objectives of our Energy Program are to help accelerate the deployment of large-scale, clean technologies into the nation’s energy system and remake the market for efficiency and innovation.  Our goal is to reduce the environmental impact of energy production, delivery, and use.  Why?  Because investments in clean technology will bring about the clean energy revolution we need by greatly reducing our use of dirty fuels and improving air quality and, thus, the health of millions of Americans – especially children and the elderly. 

We can improve our energy independence and end the economic hardships imposed on American families by spiking energy costs while preserving our air, land, and water for future generations.

As important as the energy, environmental, and public health outcomes are, this revolution also benefits our economy and creates jobs.  American workers have tremendous opportunities related to energy efficient and clean technologies, which are creating well-paying jobs and helping companies compete in the global market.  

One of EDF’s main areas of focus is on smart grid technology.  President Obama’s Advanced Research Projects Agency-Energy (ARPA-E) funds projects that will help modernize our antiquated electricity system.  A smarter grid can adjust demand, reducing the need to build costly, new power plants.  It will enable extensive new wind and solar energy to integrate into an upgraded grid so that we can rely far more on clean, renewable, home-grown energy.  The result:  less environmental damage, more jobs, and a more efficient, reliable, and resilient electricity system.  A smart grid will also facilitate the switch to electric vehicles, making it possible to “smart charge” them at night so they can be ready the next morning for commuters who will no longer be paying for gasoline.

Another key point that the President made was on responsible development practices for natural gas.  Natural gas can play a significant role in achieving our clean energy future – but it needs to be developed safely and in an environmentally sound manner.  Protecting citizens’ health and the environment will require that we “get it right from the start.”  That means putting rules in place to guarantee that our water and land are protected from contamination and ensuring that leakage of harmful air pollution is minimized.

The President’s call for increased transparency in the use of hydraulic fracturing chemicals is a necessity.  The natural gas industry is engaged in a public perception war that it is not winning.  Participating in the development of transparency within the industry is the first step necessary in attempting to rebuild public trust.  A balance between creating a sustainable market for business and ensuring the health and safety of the public should not be a source of division, but instead our common ground. 

While Congress is negotiating the federal budget, members would do well to recognize the essential need to make long-term investments in a 21st century clean energy economy that will reduce America’s dependence on foreign oil and put Americans back to work.

EDF commends the President for his willingness to look to the future.  If we can do that, we will all benefit from a stronger economy, energy security, and a cleaner environment that protects our public health and maintains our quality of life.

Also posted in Climate, Energy Efficiency, Grid Modernization, Natural Gas, Renewable Energy / Read 1 Response