September 3rd, 2019 · Comments Off on Dominion Virginia Energy’s Electrifying Bus Announcement: Thoughts on this potentially game changing move
Last Friday, Dominion Virginia Energy announced a major electric school bus (EV Bus) program: to replace 100% of the diesel school buses (roughly 13,000), in its service area, by 2030 with EV Buses. This is a potentially game changing initiative that could rapidly drive down EV Bus prices and open the door for rapid moves elsewhere in the country. (An analogy: could this do, via economies of scale and setting up a real market, for EV Buses what Germany (principally) did for solar panels?)
The Dominion program merits excitement … but it also raises some questions. This post will
overview EV bus benefits,
outline the Dominion Program
ask questions and provide some thoughts.
EV Buses are (ever so much) better than diesel buses
Utility service performance (batteries for grid stability and backup)
Satisfaction with bus services
Reduced
Air pollution — local to global
Noise pollution
Bus service costs
Total energy costs (not just for school system)
Wow, we can boost educational outcomes, have healthier people and planet, reduce noice, improve electrical grid performance, increase customer (user) satisfaction … all for a lower cost. Why aren’t all our buses electric?
With all these benefits, the fundamental challenge is what so many ‘energy smart’ options face: significantly upfront costs with lower total ownership costs. In other words, even though the buses’ cost to own (CtO) is lower, the cost to buy (CtB) is higher. And, that sticker price is hard to swallow.
Exacerbating this ‘green-eye shade’ challenge are numerous system and process challenges like slow decision-making processes in the face of rapid technological change (EV buses weren’t a real option even a few years ago) and conservative (bureaucratic) approaches leery of taking risks. With that in mind, the cost hurdle is one that few have chosen to leap. Dominion’s proposal takes this upfront cost challenge on directly — and removes it from local school district decision-making.
And, one of the true game changing potentials of the Dominion plan isn’t ‘just’ the buses in Virginia but that such a substantial program, over a decade-long period, will create enough of a market to get serious manufacturers building electric school buses and the large number will rapidly drive down per unit costs (and thus reduce, significantly, that upfront purchase challenge).
Dominion Virginia Announced Plan
Dominion’s plan is ambitious — in timing and scope. In short, over a ten-year period, Dominion is proposing to upgrade/and or replace 13,000 diesel school buses in its Virginia territory with electric school buses — and pay 100% of the “cost to upgrade from diesel to electric“. This fast-tracked program plans to have 50 electric buses on the road by the end of 2020, 200 buses per year for the next five, and well over 1,000 per year for the rest of the 2020s. Dominion will cover initial costs out of its cash reserves and seek rate base adjustments to cover additional costs in the future (peaking at $1/month per customer).
Announced just before Labor Day, Dominion is opening applications September 5th and closing applications for initial 50-bus demonstration project by early October.
Dominion is offering to cover 100% of the incremental cost for the electric buses along with any/all necessary infrastructure upgrades (such charging and vehicle-to-grid infrastructure). School systems will save money through reduced energy and maintenance costs. It appears Dominion will retain ownership of the battery systems and the ability to leverage bus batteries — when they are not in use for transportation — for grid services.
Issues / Questions / Concerns / Considerations
As a long-time proponent of electrifying school buses (whether as plug-in hybrids or, more recently, straight EV), this announcement had/has me jumping and cheering from the bleachers. Wow. Could change the game in seriously tangible way in Virginia and across the nation!
As a long-time observer (and, well, dissatisfied customer) of Dominion Energy and its climate denial ways, skilled leveraging of The Virginia Way for excess profits, gaming of ‘green’ with (extremely) low quality Renewable Energy Credits (RECs), efforts to undermine distributed clean-energy and clean energy options , slow-rolling of offshore wind, etc …, alarm bells are ringing. Is this too good to be true? What is hidden in the fine print? The following are some initial thoughts, reflections, comments that will — hopefully — be considered by government officials, citizens’ groups, third-party organizations, and Dominion in the plan’s evolution and execution.
Will EV buses run on clean electrons? Dominion Virginia’s energy mix is heavily fossil-fuels: coal and, increasingly, fossil gas (where Dominion makes money off the fossil gas, the transportation of the fossil gas, and the electrons from burning the gas). While an EV running off this mix is far better than a diesel on local air pollution and likely better in regional/global pollution than a diesel bus, those calling for EV buses with climate pollution and carbon (and methane leakage) pollution reduction in mind know that the situation would be much better if the buses were running off clean (solar, wind, hydro, nuclear) electrons. Dominion, as with the pipelines, is fighting hard to lock-in long-term polluting gas electricity projects on the backs of their ratepayers. Will Dominion leverage a 13,000 bus program for increased carbon-intensive electron sales? Or, will involved school districts (and Governor Northam and/or a Democratic Party-controlled legislature in 2020) secure commitments for Dominion to assure clean electrons for the clean buses?
Rapidity at odds with responsible government decision-making
Announced publicly on 30 August, Dominion is opening applications for the program on 5 September and will close “in early October”. For such a major project, with such significant implications, with almost none of the school districts having considered it seriously, this is incredibly fast track — and enough of a fast track that government entities are likely to be at a real disadvantage in negotiating and dealing with Dominion on how to move the program ahead.
While a serious advocate for EV buses as ‘the right choice’ and wishing accelerated action on climate change, this six-week period between announcement and end of applications is too tight. On first blush, it seems designed to have Dominion in the driver’s seat moving too fast for reasoned and reasonable oversight and due diligence on the part of government agencies and decision-makers. It should be extended … perhaps just by 45 days or so … while, on the government side, the Governor’s office should rapidly convene a specialist’s task force to delve into details and work with local communities and Dominion to identify and resolve potential(ly contentious) issues.
Request for Proposal / vendor selection
The Dominion proposal puts essentially all substantive decision-making with Dominion Energy staff. Are school districts/government agencies comfortable that a potentially opaque Dominion process will select their school bus manufacturer for decades to come? The battery provider? The V2G (vehicle-to-grid) technology? What is the appropriate set of roles and relationships in what will be perhaps the most significant public-private partnership in the Commonwealth for the decade (plus) to come? How will government officials (facilities’ directors? transportation officials? contract specialists? others …) play a role in these processes?
Prioritization of grid? District needs?
Dominion’s proposal has an initial plan for 50 buses to be in operation before the end of 2020. School systems will have to apply to be part of the program and “the final decision being evaluated on the locational benefit the batteries will bring to Dominion Energy’s electric system.” Honestly, there is logic for this. Yet, the “electric system” benefits are only a (small) part of the true benefit equation. How do school district priorities (and enthusiasm, willingness to pay part of the costs, …) play into the equation? Environmental justice issues?
True fiscal implications? There is much uncertain, at this time, as to the actual financial implications. Here are two thoughts/issue areas.
What are school districts giving up in the bargain?
There is a huge bargain for school districts here: Dominion will cover 100% of the extra costs for EV buses (both the buses and V2G infrastructure) and the school district’s will have significantly lower bus operating costs with better performing students. YEAH!
However, there are business reasons for Dominion to propose this program (beyond the massive one of transferring transportation energy use from oil firms (not Dominion revenue) to electrons (Dominion’s business) and government decision-makers should have a sense of those ‘reasons’ before this project goes forward and how those impact local government/the school districts. For example:
Many large electricity consumers have significant ‘demand charges’. Batteries, behind the grid, can be used to manage electricity demands from the grid and lower this costs. Since Dominion will own the batteries, this financial benefit won’t be there.
Amid heavy demand periods, places that can reduce their demand on the grid (by reducing energy usage, running generators, or using stored electrons) can generate significant revenue.
Batteries, hooked to the grid, can provide significant ‘grid services’ — such as maintaining/improving the grid quality and this service has a calculable (commercially viable) value. Again, since Dominion will own the batteries, this potential financial benefit stream won’t be there.
Batteries can be used for arbitrage: buying electrons when cheap and plentiful, and selling them back when more valuable. Again, since Dominion will own the batteries, this potential financial benefit stream won’t be there.
Batteries can be used to enhance the value of on-site (renewable energy) generation, potentially reducing costs by using those on-site electrons to run operations rather than buying from Dominion. Again, since Dominion will own the batteries, this potential financial benefit stream won’t be there.
There are serious value streams here … there is a bottom-line financial set of reasons that an electric bus program is attractive to Dominion. Those reasons don’t preclude this from being a smart ‘win-win-win-win’ for students, community budgets, pollution reductions, and Dominion stockholders. It just is incumbent on government decision-makers to understand the full context of the deal before running after something with decades of implications.
Actual financial requirements from rate-payers:
Dominion is taking the initial $26M out of its cash reserves (from excess profits) for a 50-bus demonstration project. (Note: for a separate post, the first year program should be bigger than 50 buses … perhaps 3-5 times larger, with rapid ramping of the program in the years to come.) Stated is a projected required for a $1/month service charge to support the program over the long-term. With about 2.6M customers in the relevant service areas, this translates into about $30M a year in additional charges. With a plan for 13,000 buses over a ten year period, perhaps in the range of over $2B (uncertain how fast, far prices will fall) in total acquisition costs just for the buses (perhaps another $100M or more for charging infrastructure), is this an honest figure (based on Dominion’s assessment of value streams to “the electric system”) or will there be a call for significantly higher charges once the program is locked in and well underway?
To be clear, the benefits in terms of street-level pollution reduction (diesel fumes and noise) likely have a benefit of over $12 per household per year in any event, but some sense of ‘true’ long-term fiscal implications are worth understanding before locking in any form of long-term commitment.
Why is Dominion understating payoffs?
Here is a scratching the head issue space. While Dominion does discuss many benefit streams (reduced carbon emissions, grid services, reduced energy costs and maintenance costs, improved safety), any serious student of the implications of moving from diesel to electric will understand that there is a significant understatement of value streams. Not mentioned, for example, are:
Reduced asthma rates, cancer risks, and other health issues —
Improved customer satisfaction (note: that is in the short kick-off video)
Now, an honest accounting of societal value would put those first two bullets (improved health and student performance) well above district maintenance savings. They are, bluntly, ‘big deal’ items and should be part of ‘selling’ the program. (“Your child will be healthier … test scores will go up … graduation rates ill improve …” All truthful, high-value items.)
Why wouldn’t Dominion wish to make the strongest case as to “why”?
Some concluding thoughts
Let’s be clear: YEAH! A week ago, few outside Dominion had any idea of how major and potentially game-changing this proposal would be. The benefits of electric buses are huge … for the ratepayers, the students, the communities, for the planet, for … Even if school districts were not to, over a decade period, save a penny, an accelerated move to all electric buses would be the right thing to do.
And, having Dominion making profits from doing the right thing is, well, something to applaud — even with a standing ovation. As per above, there are reasons for alarms bells and concerns.
However, as per the questions and issues above, thoughtful and responsible governance should mean going into this with eyes wide open … and working hard (and fast) to gain understanding of real implications across the board to foster a program that delivers for the common good while allowing business to profit reasonably from their competent management and execution of such a program.
August 29th, 2019 · Comments Off on Mobilizing momentum for cleaner, cheaper school busing (Electric School Buses, Fairfax County, VA, edition)
The Wheels on the Electric School Bus Go Round and Round — with less pollution (MOF leaders, School Board Member Pat Hynes, and School Board candidate Karl Fritsch are on the Electric School Bus campaign bus) (Photo: A Siegel)
Up front, electric school buses have become the right choice for school system capital investment programs now, because they provide:
Improved performance (better acceleration, quieter, smoother) that contributes to
Improved student (and driver and community) health due to
Significantly reduced pollution (at street, regional, and global levels) with
Much lower ownership costs.
While the benefits are clear, there are bureaucratic obstacles (driving change is hard — though the school staff is clearly interested in exploring EV buses) and, even more importantly, a financing challenge found across the clean energy/efficiency world: while ownership costs are far lower, the upfront costs are higher. This last is perhaps the key challenge: how to secure financing to cover those higher upfront costs and use long term savings to pay off the loan. Many electric bus manufacturers have such financing programs (such as Proterra, Virginia’s preferred electric bus provider, and BYD, the world’s largest electric bus manufacturer). With over 1,600 buses, FCPS should be able to secure such a financing package if it were to commit to a serious program of electrifying the bus fleet.
While the speakers are well worth listening to (see video, below) in full, some key points/highlights.
MOF Fairfax’s Julie Kimmel opened the event and laid out some of the key truths:
Diesel buses are a threat to children’s health … and to the larger environment.
Real-world experience shows significant cost savings through using electric buses — perhaps as much as $175,000 in savings over the 15 year life cycle of a normal bus.
School Board Member Pat Hynes spoke strongly about the value of electric buses and the necessity for moving forward and that the School Board wants this logical next step to adding solar to school rooftops. Hynes spoke to a just forming Joint Environmental Task Force (JET), where the School Board and County Supervisors will coordinate for best paths forward — EV buses as a logical item for the JET to tackle.
Hynes’ key concern: that upfront cost and how to finance it.
EV buses cost three times as much to buy as diesel buses. As a public entity, we have to be good stewards of public resources and that upfront cost is a barrier that we can’t cross alone.
Hynes spoke of working with Dominion Power to see if and how they might engage to help leap that upfront capital cost challenge.
Delegate Keam demonstrated his off-the-cuff ability to communicate powerfully, discussing how he had seen Moms Demand Action in Richmond earlier in the day battling for gun-sense action over Republican opposition, and then being in the room with Mothers Out Front Fairfax on electric vehicles. “We all know that when mothers get involved, things get done.”
While Keam discussed climate issues and the need for serious action, the most striking (to me, at least) was the powerful relationship of electric school buses to his family’s experience. As he summarized in a note to me,
I have two kids who attend public schools right here in Vienna, and when they were small, they both took school buses everyday. They both also suffer from various allergies and asthma, so it was hard for them at times to sit on a bus that emits diesel fuel emissions and other toxics into the air. Converting school buses from fossil fuels to electric power will not only help our environment, but also our children’s health.
Providence (Fairfax County) School Board candidate Karl Frisch has laid out his support for electric buses, as part of his Green New Deal for FCPS, since the beginning of his candidacy. Karl highlighted that an EV bus program would create an economic development opportunity — with a major County/FCPS purchase, part of the terms could be setting up infrastructure in the County to support EV buses throughout the mid-Atlantic region. Karl powerfully stated a truth about the climate crisis and political responsibility. As he summarized it in a note to me,
I am incredibly grateful that students and parents are leading the fight against climate change in Fairfax County. We can’t wait on Washington to get the job done — not while Trump and his fossil fuel friends are in office. Instead, every level of government must do its part to address this humanity-threatening crisis. On the school board, I will make electrifying our buses and greening our schools a top priority.
MOF Fairfax leader Bobby Monacella closed out the event with a thoughtful and passionate relating of electric buses to being a mother and demonstrating, in a tangible way, to her teenage daughter her understanding of climate risks for her daughter’s generation (for today’s FCPS students) and that she is acting to help reduce those risks.
“…made us realize we simply can’t buy one more diesel school bus because it locks us into 15 years of fossil fuel emissions and our kids future can’t afford that. Here is something we can do to show that we understand the dire consequences of climate change and that we’re working with them to have a livable future. It’s such a concrete way to show them. The buses are right in front of them every day. It’s a great teachable moment for sustainability but it’s also a show of support and caring their future.”
The initial phase of the electric school bus deployment aims to have 50 buses fully operational within Dominion Energy’s Virginia service territory by the end of 2020 – all without any change in prices paid by customers. Phase two of the project, with state approval, would expand the program to bring 1,000 electric school buses online by 2025.
And, to have 100% of the school buses within Dominion territory electric by 2030.
August 26th, 2019 · Comments Off on Climate Hawk announces in Iowa Senate race
A “Climate hawk is [someone] … who work[s] for aggressive steps regarding climate change and clean energy.” Such as, Jay Inslee is a climate Hawk.
A Climate Hawk is also a way to describe someone who comes to understanding climate change implications and the necessity for action through a national security lens.
A Climate Hawk understands that climate change is a threat to our safety and security. Climate Hawks favor taking aggressive action to neutralize the threat. Many Climate Hawks are environmentalists, but one does not need to be an environmentalist to be a Climate Hawk.
Republicans are afraid to ever stand up to Donald Trump.
And, DC Democrats aren’t bold enough to confront the climate crisis, the health-care industry, and Wall Street.
Franken understands how the climate crisis is hitting Iowa (with 100, 500, and 1000 year floods happening with unnerving frequency destroying homes and devastating crops; weather weirding creating great uncertainty in (and damage to) Iowa’s farming economy) and embraces how Iowa could truly be ground zero for boosting the economy through aggressive climate action (from exporting wind electricity; to compensating farmers for sequestering carbon; to leveraging Iowa engineering and manufacturing resources for creating and building tomorrow’s energy solutions; to …).
Franken also understands how catastrophic climate change threatens national security. As Deputy Commander of African Command, Franken saw national security implications in real-time — from worsened droughts fostering conflicts (and threats like Somali piracy) to disrupted agricultural economies helping to drive increased refugee flows (such as into Europe). He has learned from experts, like the CNA Military Advisory Board, and considered the strategic risks from unchecked climate chaos … while gaining appreciation of how national security can be strengthened through climate solutions like better built and more resilient infrastructure with distributed clean energy systems and enhanced energy efficiency.
I just had to google "Mike Franken" to see if he's real.
He's real! This guy is a retired 3-star Admiral, from rural Iowa, postgrad degree in physics, took courses at MIT & Brookings Institute. What!? I mean, that's a resume.
I know you agree that our mission to defeat climate change must continue to be central to our national discussion — and must be the top priority for our next president. But I’ve concluded that my role in that effort will not be as a candidate to be our next president. pic.twitter.com/Kp8WejuVJy
Unlike many others who have or will soon drop out, Jay Inslee advanced an important cause and enhanced his personal reputation by running. He should feel good about himself.
Just want to say @JayInslee is a fantastic governor who has made progress on so many issues – wages, health care, paid leave and of course, climate. I am grateful for his fight on climate and other issues and look forward to all he will do as Governor.
And, good to see that candidate after candidate is thanking / praising Inslee publicly.
Thank you @JayInslee for fighting every day to make sure that climate change remains a primary focus of this election. Climate change is real and it's a crisis—and I will keep fighting alongside you to take bold action before it is too late.
Few leaders have done more to shine a light on the climate crisis than @JayInslee. His voice will be missed in this primary but I know he will continue this fight.
Congratulations to @JayInslee on his impactful campaign to bring the climate crisis to the forefront of the national conversation. There is no more important issue facing humanity. Together we will work to pass a Green New Deal and create millions of jobs.
Governor @JayInslee made the climate crisis the centerpiece of his campaign and our nation is better because of it. Thank you for the bold ideas you brought to this race Governor.
.@JayInslee is a visionary leader and a friend. We all owe him a debt of gratitude for his wisdom, his commitment, and his basic goodness. Thank you. We will continue the fight against climate change.
MJB (May Jay Be) listened to by the Democratic Party and the eventual nominee … and MJB our “Climate Tsar” (whether as Secretary of Energy, EPA Advisor, in a new Cabinet position, or …) in the next Administration because his climate plan(s) is(are) truly substantive, truly good, actually to the scale of the crisis, and doable.
What I pledge, is to BLJ: Be Like Jay and battle for societal moves to Act on Climate with the seriousness and alacrity required.
So early to bed, early to rise, work like hell, and organize. Together, we will continue the fight to defeat the climate crisis.
These four words are core touchstones en route a prosperous, climate-friendly future.
As clean electrons continue to plunge in price, everywhere, momentum toward clean(er) electricity grids continues to mount around the world. Coal has nearly disappeared from the UK’s electricity grid while likely to do so across Europe by 2030. Projections for coal demand in China and India continue to plummet with each passing year. In the United States, despite Donald Trump’s and the GOP’s diligent efforts to prop up more expensive and polluting coal, coal plants continue to shut down as coal’s share of US electrons continues to fall. While meriting policies to accelerate, the reality is that globally electrons are cleaner with every passing day.
As technology has advanced with plunging battery prices, electric buses truly represent an opportunity to deliver significantly improved performance while saving greenbacks by going green. In short, EV buses
Perform better
with faster acceleration and braking; less vibration; less noise
Local: no local air pollution; greatly reduced noise
Regional/Global: greatly reduced pollutants and potentially essentially 100% clean if the electrons are clean (nuclear and renewable)
Save money
Greatly reduced fuel costs
Lower maintenance costs
with, for example, no fluids other than for windshields)
While most of the public attention has been on electric cars (Tesla, anyone), moves to electrify bus fleets offer the opportunity for achieving significant public benefits rapidly.
One particularly ripe arena is school buses where the public health benefits are particularly strong as youth are far more vulnerable to diesel pollutants and the 24 million youth riding buses have no choice but to have this exposure for perhaps 100s of hours per year. Health impacts from diesel pollution exposure include reduced lung function, increased risk of pneumonia, increased blood pressure, long-term cancer risks, reduced cognitive function, … What parent, what educator, what public official would consciously choose — if a viable other option existed — to inflect these costs and risks on children?
Until now, writ large, there wasn’t a ‘viable’ other option in many cases — most bus routes bring kids from where bicycling or walking isn’t a good option; parents driving their children leads to even more pollution (especially as the buses are still running) and increased road congestion; etc … While electric buses weren’t much more than a niche option, in the past, the situation has radically change. Improved technology, increased options, falling prices, increased operating experience and innovative financing opportunities are all coalescing to not just make electric school buses a viable option — but also far more preferable option on cost, quality of service, and environmental impact grounds.
With over 1600 school buses, the Fairfax County Public Schools (FCPS) has the second-largest school bus fleet in the nation (after New York City). With the recent RFP (request for proposal) to put solar on 130 County buildings (majority of these schools), the County is taking steps to clean up its electrons. The school bus fleet represents a ripe opportunity for Fairfax to take a leap forward to ‘electrify everything’. With this in mind, a group of FCPS mothers organized Mothers Out Front Fairfax County earlier this year and have made electrifying the FCPS bus fleet the centerpiece of their efforts. They have met with FCPS facilities staff, School Board Members, and others (such as Dominion Energy staff involved in their projected electric charger program) in their effort to build momentum toward electrifying the FCPS bus fleet. Interest is mounting — even as challenges requiring addressing are being identified. And, it isn’t just interest — support is growing as evidenced by an event this evening.
This evening, from 6-7 pm at the Patrick Henry Library in Vienna, Virginia, Mothers Out Front will publicly launch its electric school bus campaign. Speakers and attendees at the event with include school board members (such as Pat Hynes) and candidates (such as Karl Fritsch: see here) along with other elected officials (such as Delegate Mark Keam) and community leaders.
This is an opportunity to learn more about electric buses and join in to show that you wish to see Virginia move expeditiously down a path toward a prosperous, resilient, climate-friendly future.
June 26th, 2019 · Comments Off on Vive La France: Good news from across the pond (not just #FIFAWWC)
France has decided to accelerate, significantly, its offshore wind program for a very simple reason: offshore wind will provide reliable, low-cost, clean electrons to power the French economy. Just announced, a new offshore wind project that will deliver electricity to the French grid for 44 Euros per megawatt hour (mWh) (e.g., under $US50 per mWh and thus under 5 cents US per kilowatt hour).
France Gets 600 MW offshore wind farm for 44 Euros/MWh. 12 & 13 MW Turbines Used. France will build 1 GW of offshore wind every year through 2028. https://t.co/OFtVrP08go
— John Raymond Hanger ? (@johnrhanger) June 23, 2019
This is striking news about the continued plunging of offshore wind electricity prices. A decade ago, more than mildly engaged with some of the most involved people in the offshore wind industry, it seemed an optimistic outcome would be electrons coming ashore about 8-10 cents per kWh by 2020 or so … and even that seemed pretty ambitious. Truth in advertising — this was work related. The executive leadership that I was involved with and seeking to convince that leveraging a Corporate capacity to support offshore wind would make sense as part of long-term planning simply didn’t believe that 8-10 cents would ever be achieved. They doubted this would fall below about 15 cents per kwh and thus simply didn’t see the industry as competitive nor likely to grow. And, thus the opportunity wasn’t pursued. If they (if we) had only known …
So much of the public attention, to the extent there has been, re renewables and the power sector has been on solar panels. “In sight, in mind” might be a sensible term. Seeing panels on your neighbors rooftop certainly can catch your attention. Onshore wind (and the NIMBY-ite battles against it) have had significant attention as well. And, with wind farms powering meaningful shares of power demand in numerous areas (Germany, Texas, Iowa, …) with wind farms the ‘scenery’ for miles on highways in many areas, they too have had much attention. And, solar and onshore wind price plunges have kept them below offshore wind costs. But, these offshore wind cost reductions are serious and well below the ‘new build’ cost for any fossil fuel alternative.
Offshore wind price reductions have occurred for a number of reasons:
Economies of scale: writ large, building more of something drives down costs (in no small part because of) …
Learning (curves) making the next turbine, the next windfarm, that much easier (lower resource inputs of people & facilities) that foster
Technology developments from ever larger wind turbines (thus more efficient per kilowatt hour and higher capacity figures) to floating towers to better electrical interconnections to other specific components that are all incorporated into and captured in
Business models, learning, and experience which have, for example, made offshore wind a straightforward project financing for bankers rather than an unknown and uncertain arena. This drives down financing costs, from time to process paperwork to ‘risk premiums’ while also opening up ever-more financing houses to potential offshore investments (and, thus, competition).
Offshore wind appears to be a great example of public (structuring good permitting processes, setting policy that enables planning, etc …)-private (learning curves, financing, …) interactions to drive rapid advances in a technology and business arena to provide a meaningful tool for transforming the power (and larger energy) sector in much of the world.
The price point is far from the only impressive thing about this announcement. In mid-2019, the award is announced for the project. The wind turbines will be powering French homes in less than three years. From award to power generation for a 600 megawatt capacity power facility in the developed world (with tight permitting and other challenges) is, well, a rare beast.
The combination of rapid implementation path and extremely competitive (low) prices have led the French government to change, radically, its offshore wind plans.
”Today, the project off Dunkirk shows that costs fall even faster when projects are well set up,”Prime Minister Philippe said in a Policy Statement to the National Assembly.”We will be able to increase the pace of future calls for tenders to one gigawatt per year. It’s a good thing for the price of electricity, for our industry and for our planet!”
“With the launch of the Saint-Nazaire park project today, France is finally entering the age of offshore wind turbines. By 2022, 80 wind turbines installed off Saint-Nazaire will provide 20% of the electricity of Loire-Atlantique. It’s a first in France. But we do not stop there, we accelerate. Today, we are also initiating the Dunkirk park project, at a rate comparable to the best European results, which demonstrates the competitiveness of the French sector. Tomorrow, we will launch and award larger projects: 1GW per year, compared to 750MW originally planned in the Multi-Year Energy Program, by working with all the territories,”
French offshore wind is a very tangible example of
Cost-competitiveness of renewable energy options
Continued price reductions of major renewable options
Expertise-supported flexible government decision-making to leverage clean-energy technology and business advances
When it comes to fossil fuels, almost all of the externalities are damaging costs (from causing cancers to leaks polluting local waters to driving climate chaos). When it comes to ‘green’ action, almost all of the externalities are positive (improved health, ecosystem resiliency, productivity). Assessing these co-benefits and including them in decision-making should drive faster and more aggressive ‘greening’ efforts.
The office as example … focus on productivity payoffs, not utility costs
For example, when it comes to office buildings, it is often easy to layout energy efficiency and renewable energy projects to cut building emissions by a third with annual financial returns above 15 percent (and, often, well above 30 percent). An under five year payback might seem reasonable but might not really catch the CFO’s attention in terms of the total resources required (not just financial but, for example, also management/staff time and attention as an opportunity cost) relative to what might be a pretty small return on investment.
Now, in a North American office building, a reasonable back-of-the-envelope has people costs ballpark 100 times the building’s utility costs. In other words, efforts to reduce energy and water costs by half provide financial return of perhaps 0.5% of the payroll cost. However, greening offices drives greater productivity. In brief, people are healthier and perform better with cleaner air, quieter spaces, better lighting, and more consistent/comfortable temperatures. One (limited, conservative, likely understating benefits) study, for example, found a 3 percent decline in sick leave and 5 percent bump in productivity in green vs ‘non-green’ office buildings. A five percent productivity bump is worth perhaps five times the total utility bill.
Considering co-benefits in localities …
This post is sparked due to a correspondent seeking some thoughts and support with local discussions for a community to develop a “net zero” plan. One, somewhat sympathetic, government official expressed concerns about potential approaches, laying out that he owed it to the taxpayers to assure that projects have a reasonable return on investment. My response email:
“Fully-burdened cost-benefit analysis” seems like something you might wish to try to introduce into the conversation. In essence, governance structures (public and private) often have stove-piped decision-making processes. For example, the “facilities” team concerns itself with the costs of energy services but doesn’t calculate in the decisions secondary/tertiary (co-)benefits (nor, well, costs). Smart clean energy/climate/environmentally friendly facility investments and management can have huge co-benefits that often are not included into the conversation. This is something that a smart (local) government can do and thus be ready to address more aggressive climate-friendly actions due to the co-benefit value. Here are some examples speaking specifically to local governance opportunities:
Greening building boost productivity: Better lightning, cleaner air, quieter spaces, etc all lead to higher human performance — this is true in industry, commercial, office, and school environments. If one can do a ‘cost-neutral’ upgrade in energy efficiency with quieter HVAC systems, for example, that leads to higher student test scores and improved graduation rates, there is a huge economic and social value. Some thoughts as to the power of Greening School infrastructure. (Note that there is analysis that suggests the top predictor of a community’s economic performance 15-25 years from now is the HS graduation rate — greening will boost graduation rates.)
Electric Buses: While electric buses are now at a lower life-cycle price point in a stove-piped calculation, broader analysis of electric buses shows huge co-benefits: reduced local pollution (air and noise); better performance; potential for V2G to provide utility grid services (and thus earn revenue) when busses aren’t operating; improved driver health (lower noise, diesel pollution, more comfortable ride); and the potential for increased ridership due to better performance.
Enhancing decision-making with understanding/incorporating co-benefits and intersectionality can foster more aggressive action since (almost always) the ‘cleaner’ option has significant co-benefits that should be of value to a government investment.
Many aware of climate change science and the (mounting) risks of climate catastrophe have long analogized the situation to World War II mobilization — in expressing the scale of the challenge, that the United States (and humanity) has the ability to rise to a challenge of such scale, and the level of existential threat that climate chaos creates for modern human civilization (if not humanity, itself). Those promoting worsening our climate risks, through denial of science and promotion of fossil fuels, have also resorted to such war analogies in their fights to maintain profitability at the expense of ecological catastrophe. This occurs, in part, when truth-wielding activism begins to have an impact on eco-system havoc wreaking profitability. A recent example comes from Alberta, Canada, as the newly-elected right-wing United Conservative Party (UCP) government seeks to boost investment in and profitability of highly-polluting tar sands facilities.
The Alberta government has dedicated 30 million dollars (Canadian) in an “Energy War Room” to (in a paraphrase of Premier Jason Kenney) engage in “a sustained campaign of defamation and disinformation” to promote climate-busting tar sands production. As if Exxon Mobil and other fossil fuel Dark Money hasn’t been enough, this is an explicit deployment of public funds to distort public understanding of climate science, the implications of burning fossil fuels, the mounting (and ever-more evident) climate crisis implications, and the viability of paths to reduce global economic dependence on polluting fuels.
Keith Stewart of Greenpeace Canada said “shooting the messenger” about the challenges of climate change won’t make these difficult issues go away.
“This is a campaign about trying to intimidate and silence critics,” he said.
There are plenty of struggles to be waged over Canadian energy projects in the coming years.
The war room just adds another flashpoint — and another player — to the battlefield.
As global advertising (revenue) and Russian efforts to get Trump elected show clearly, investing in strategic influence efforts can pay off — massively — even if the ‘pay off’ is negative for most of humanity. That is the UCP desire with the Energy War Room. To have an outsized impact on support for polluting energy no matter the actual implications of that pollution.
“What we have heard from the premier today is beginning of a partisan plan to pit the economy against the environment,” Irfan Sabir said in a statement. “This is a recipe for disaster.”
The UCP-led Alberta government isn’t planning to rely solely on a disinformation Energy War Room, but will leverage other government tools to impede those seeking to “prepare Alberta for the coming transition off of fossil fuels” including aggressive public inquiries and litigation.
In Alberta, polluting industry holds an outsized role in the overall economy. Whether accurate or not, UCP’s Kenney constantly asserts that tar sands “is the source of about one-third of the jobs in this province, directly and indirectly”. Dismantling the previous NDP administration’s policies to turn Alberta and Alberta’s economy on a path toward greater economic prosperity in a carbon-constrained future (a carbon tax, Climate Leadership Plan, …) was a core element of the UCP campaign and driving fears with disinformation about these clearly played a role in the UCP’s victory (which occurred amid economic challenges that had more to do with global energy shifts than NDP policies). The $CAN30M (and potentially to grow) investment of public funds in a fossil-foolish “Energy War Room” will raise even further that disinformation and undermine not just Alberta’s path toward future economic prosperity and surety but undermine the potential for successful global climate action as well.
June 12th, 2019 · Comments Off on Double Whammy: (Not) Positive Climate Feedback Cycle Driving Increased Energy Use?
In 2018, the world energy system saw an unusual “double whammy”: an increase in both heating and cooling degree days. Potentially a sign of increased climate disruption, with greater extremes possible (even amid generalized warming of the global system), this ‘double whammy’ helped drive a major increase in energy use and carbon emissions globally.
2018 saw increased heating AND cooling requirements (BP)
This “double whammy” created an anomaly: according to traditional economic modeling, slowing economic growth and somewhat higher energy costs should have resulted in lower energy and carbon emissions growth.
The ‘predicted’ line uses a simple framework of GDP growth and changes in oil prices (as a proxy for energy prices) to predict primary energy growth at a country level and then aggregates to global energy.
Although very simple, the framework is able to explain much of the broad contours in energy demand over the past 20 years or so.
This framework predicts that the growth in energy demand should have slowed a little last year, reflecting the slightly weaker economic backdrop and the strengthening in energy prices. Instead, energy demand picked up quite markedly.
Digging into the data further, it seems that much of the surprising strength in energy consumption in 2018 may be related to weather effects. In particular, there was an unusually large number of both hot and cold days last year, which led to higher energy consumption as the demand for cooling and heating services increased.
The increasing frequency and intensity of heating and cooling days was pretty widespread across many of the world’s major demand centres last year, particularly in the US, China and Russia helping to explain the strong growth in energy consumption in each of these countries
BP’s analysis suggests that roughly one-fourth of the global increased energy usage derived from this double-whammy phenomena — which might well be a resulting impact from increased climate disruption. And, that increased energy usage helped worsen the problem through increased energy demand using polluting energy sources (including increased coal use, globally, for the second year in a row).
As a Corporation, BP is one of the world’s leading contributors of Greenhouse Gases … and it has an executive suite that has a clear (if not total) understanding of the climate challenge.
Now, in terms of that increased energy usage globally, new renewable energy sources (primarily wind and solar) covered about a quarter of the increased demand. Massive, significant, double-digit growth continues … but is falling short of meeting increased energy requirements globally. E.g., we need clean power growth to expand even faster as a basic climate action mantra is “electrify everything … clean up the grid”. As per Dale,
even if renewables are growing at truly exceptional rates, the pace of growth of power demand, particularly in developing Asia, limits the pace at which the power sector can decarbonize. …
a shift towards greater electrification helps as a pathway to a lower-carbon energy system only if it goes hand-in-hand with a decarbonization of the power sector.
Electrification without decarbonizing power is of little use.
Dale’s assessment is that renewables would have had to grow more than twice as fast over the past three years just to keep up with increased energy demand — let alone drive ever more polluting energy sources off the grid.
If we focus solely on renewable energy, renewable generation over the past three years would need to have grown more than twice as quickly than it actually did. Rather than growing by a little over 800 Twh over the past three years, renewable generation would have needed to grow by over 1800 Twh.
A staggering number: that additional renewable generation of around 1000 Twh is roughly equivalent to the entire renewable generation of China and the US combined in 2018.
So in addition to the rapid growth in renewable generation we actually saw, the world would have also needed to have added the entire renewable generation of China and the US, in just three years, just to keep carbon emissions from the power sector flat.
One shouldn’t forget whose discussion this is — one of the oil majors — when absorbing the following assertion:
Alternatively, the same outcome for carbon emissions could have been achieved by replacing around 10% of coal in the power sector with natural gas.
Sure, when burned, natural gas emits roughly half the carbon dioxide compared to coal-fired electricity plants per kilowatt hour. That is, however, during combustion. BP’s analysis (“in line with industry standards” according to Dale during yesterday’s question and answer session) doesn’t include methane emissions and methane leakages in the well-to-burn calculations. Methane leakage — especially with the growing amount of shale natural gas — might eliminate the (and certainly reduces significantly any) climate benefits of burning natural gas rather than coal. While an oil and natural gas “major” desires, for business and revenue purposes, to maintain the concept of natural gas as a bridge to a cleaner energy system, the reality is that natural gas is a bridge to nowhere (other than climate catastrophe).
Returning to the “double whammy”
One of the continued ‘unknown’ fears in climate change analysis: when will (not) positive feedback cycles (such as melting Arctic ice leading to warming oceans driving faster melting/warming in the Arctic) mount to the point where they overwhelm the human impacts driving global warming and thus potentially overwhelm humanity’s ability to turn the tide on climate catastrophe. In 2018, the ‘double whammy’ of heating and cooling degree day increases might have accounted for roughly a third of increased energy demand. If that “third” hadn’t occurred, Dale’s “thought experiment” as to necessary renewable energy growth to meet increased energy demand might not have looked as daunting.
In any event, the key takeaways from the BP Statistical Review seem to be:
We are going the wrong way on climate emissions — worsening, rather than solving, the problem(s).
Renewable energy growth is impressive and having an impact … but needs accelerating.
Is this an indication of dangerous cyclical impact? Human-driven #climate change #carbon emissions leading to disrupted weather which drives more polluting energy use which …?
Tom Perez and the DNC staff have truly stepped into it … explicitly rejecting hosting a climate debate and threatening Democratic Party presidential candidates ready to participate in one hosted by some other organization. By pegging the climate crisis as yet another ‘single issue’, Perez and his team are demonstrating a fundamental failure to understand the severity of the climate crisis, how responding appropriately to climate change is intertwined with nearly every arena of society/politics, and just how important climate is politically.
In contrast to the Presidential candidates and a growing number around the country, the Perez and the DNC team seem oblivious (or, perhaps even worse, resistant) to a new reality:
Now, some seem to agree with the DNC that ‘climate is just another issue’ that doesn’t merit its own debate. RL Miller has a good way to consider this:
A dedicated group worked to set up a climate / environmental forum. They provided all candidates with a set of seven issues/questions and the candidates were able to say which questions they wished to engage in during the forum. During a competitive primary, more than 400 people showed up (after they had to secure a larger venue than first planned) for the event along with easily that many watching remotely. Hmm … in a competitive primary, perhaps 750-1000 people in a live audience … do you think that the candidates paid attention to that? That the candidates came prepared to engage substantively (so that they wouldn’t look like fools) on key issues in front of so many voters?
Speaking at the Houston Climate Forum. Texas should be the national leader on environmental efforts and protecting our air, water, and public lands. pic.twitter.com/yKal9xoQCk
When voters care, candidates respond. At the first candidate forum I attended [in 2017], I cringed at the nonsensical response I got to my question about climate. This time, asking seven more challenging questions to seven candidates, I found almost all the responses to be thoughtful and well informed.
As a professor, I could tell the candidates had done their homework. They couldn’t bluff their way to an easy A with voters who cared.
In preparing for the forum, the candidates moved from ‘nonsensical’ to ‘thoughtful and well informed’ on environment and climate issues. Each had to think about the issues as they prepared for the Forum. Certainly, they didn’t forget all this material the moment it was over. With so many voters showing they cared, clearly and seriously, about the issues, the candidates continued to be prepared to and did talk about these issues in the weeks that followed.
And, Cohan’s perspective on the political implication:
Whoever is elected …., they’ll know there’s a motivated contingent of voters eager to see a more vigorous federal response to climate.
TX-07 is just one district. If climate matters there, that doesn’t necessarily mean that it will elsewhere. Though, as Cohan concluded:
And if we’ve shown that to be true in the oil patch of a red state, perhaps similar events elsewhere could provide a wake-up call to other representatives as well.
While not all voters would tune in for a climate debate, simply having that debate would
drive the candidates to be on their A game (even if not with an “A grade“) on climate;
foster a greater understanding of the climate crisis across the United States electorate;
provide a glaring contrast between Democratic Party candidates efforts to deal with reality and Trump’s nonsensical rejection of basic science;
potentially help the political punditry (The Village) and political consultancy class understand that climate change matters politically; and,
demonstrate that the Democratic Party establishment understands that ‘climate has FINALLY arrived in our politics’.
When it comes to a #ClimateDebate, Texas’ 7th shows us it can and would work. Tom Perez and the DNC should either lead on the issue (hold a climate debate) or get out of the way and allow the candidates to participate in one hosted by others.
