Thursday, December 15, 2011
Thursday, December 1, 2011
Colorado Task Force on Transmission Siting and Permitting Issued Report to Governor and the Legislature Today
Sunday, November 20, 2011
Giving Thanks to the Military and the Companies that are Creating a Sustainable Military to Protect Our Troops
The Department of Defense (DoD) is seeking to address challenges to energy supply and by doing so, creating opportunity for companies that provide technologies that: reduce energy use, secure our energy supply and protect our troops by reducing our dependency on fossil fuel sources. For our forces abroad an example of these technologies are solar panels that roll up like beach mats that are then carried in backpacks to recharge batteries. The Wall Street Journal reported that the solar panels the size of placements can replace hundreds of pounds of spare batteries in their packs. Use of the panels reduces the need for helicopters to provide additional batteries and the trucks have to convoy less fuel for generators. Also, keeping extra batteries out of packs means the troops can move faster and farther than before.
The military has long been recognized as a source for technological innovation and in August, the Army established the Energy Initiatives Office Task Force to manage the development of renewable energy projects and help improve issues of energy security.
In a traditional sense, the term energy security often refers to oil supply. The U.S. currently imports at least 60% of its oil from foreign sources and the percentage is increasing. This is problematic for a number of reasons. The electricity problem, however, is different and also an issue of energy security. The U.S. has adequate natural resources to meet its electricity needs for the foreseeable future from coal, nuclear, natural gas, hydropower, wind, solar and geothermal. The issue is the electricity grid. It is susceptible to extended outage from natural disaster or sabotage.
The problems associated with an antiquated grid are multiplied for the DoD as the largest single consumer of energy in the United States. To address this challenge, the DoD is looking to renewable energy and micro grids to make sure that when disaster strikes, the military can sustain critical operations. According to the DoD, "the modern military needs to evolve its power infrastructure. New threats demand new defenses." The ability of an installation to sustain itself is adversely impacted by a fragile, aging, and fossil-fuel dependent electricity grid – and this poses a significant threat to national security.
To address these risks, the DoD is partnering with the Department of Homeland Security (DHS) and the Department of Energy (DOE) to create a micro grid technology. The initiative has been dubbed, the "Smart Power Infrastructure Demonstration for Energy Reliability and Security" or SPIDERS for short. The goal is to enable the ability to operate in an islanded mode during emergency for an extended period of time and provide redundancy in both energy supply and pathways for distribution. Ideally, smart technology would allow for integration of different energy sources, enable energy storage and provide for advanced metering capabilities. As an added benefit, the micro grid could help utilities manage their peak loads by "islanding" for short periods of time when utilities are facing critical load periods. The army is starting with three locations: Hickam Air Force Base, Hawaii; Fort Carson, Colorado; and Camp Smith, Hawaii.
And so, President Lincoln's call to honor the soldier and the citizen that supports him still stands today. It is anticipated that the deal flow between the military and suppliers in the private sector is likely to grow with major industry experts believing that collaboration and third party investment is the way forward to create a more cost effective and sustainable military.
Saturday, November 12, 2011
Greenhouse gases cause global warming. Greenhouse gases are gases that trap the sun's heat. One greenhouse gas is carbon dioxide. Some carbon dioxide is good because plants use it to make food. But people are adding much more. The result is that the extra carbon dioxide traps heat causing the temperature of the Earth to rise. If the temperatures keep rising it could cause extreme weather, warmer seas, changing habitats and hurt people and animals.
Saturday, September 24, 2011
Colorado has been focused on the challenges to transmission development for years. In 2006, the Colorado Transmission Task Force on Reliable Electricity Infrastructure (the “Task Force”) recognized that “Colorado’s ability to ensure continued affordable, reliable electricity and to build a vibrant economy depends on sufficient transmission capability.” In addition, the Task Force recognized that “[t]oday the system is strained and, if current trends continue, there will not be adequate transmission to meet the needs.” A robust grid provides consumers access to cheaper electricity and is the facilitator to development of Colorado’s vast renewable resources. Subsequent to the Task Force report, then Governor Ritter issued a series of reports that identified policy barriers to development and these reports led to legislative and policy changes in the state.
These legislative and policy changes however, impacted transmission development in the state by requiring more complex decision making at the Public Utilities Commission (the “Commission”). In an effort to address these changes, the Commission issued the Colorado Rules under Decision No. R11-0077 defining the Commission’s role in electric transmission facilities planning as well as new requirements for the state’s public utilities relating to planning. In this Decision, Commissioner Tarpey acknowledges that the “Commission has an obligation to ensure that proper transmission planning is taking place in Colorado and that the transmission system is sufficient to satisfy the needs of the Colorado citizens.”
Similarly, the FERC Order acknowledges that coordinated transmission planning can protect the consumer because coordinated planning may be more efficient and cost effective. Specifically, the FERC Order requires, “public utility transmission providers to participate in a regional transmission planning process that evaluates transmission alternatives at the regional level that may resolve the transmission planning region’s needs more efficiently and cost-effectively than alternatives identified by individual public utility transmission provider in their local transmission planning processes.” FERC Order 1000, ¶ 6.
Colorado and the FERC emphasize coordinated planning and stakeholder input. Under the Colorado Rules, the three jurisdictional utilities in the state are required to file biennial ten-year transmission plans reflecting their own needs and reflecting how the utility coordinated with all transmission providers in Colorado. The FERC Order goes one step further by requiring regional planning processes to produce a regional plan. The Commission is careful, however, not to impede existing processes with the new requirements. Indeed, the Commission clarifies that “the obligation to participate in a regional transmission planning process that produces a regional transmission plan that meets the seven transmission planning principles, is not intended to appropriate, supplant, or impede any local transmission planning processes, that public utility transmission providers undertake.” FERC Order 1000, ¶ 161. The objective is to require planning processes to meet the planning principles outlined in FERC Order 890 while producing a regional transmission plan.
In another example of synergies, both Colorado and the FERC provided some leeway to the jurisdictional utilities as to how to meet the requirements for coordinated transmission planning. Specifically, the FERC Order provided flexibility for regions to enhance or define processes and procedures for planning. The FERC explains, “[p]ublic utility transmission providers have flexibility in developing the necessary enhancements to existing regional transmission planning processes to comply with this Final Rule, based upon the needs and characteristics of their transmission planning region.” FERC Order ¶158.
Colorado and the FERC also both recognize the importance of considering public policy in transmission planning. The FERC Order requires “each public utility provider to establish procedures for identifying those transmission needs driven by Public Policy Requirements for which potential transmission solutions will be evaluated in the local or regional transmission planning processes.” The FERC further encourages states to actively participate in identification of transmission needs driven by Public Policy Requirements. “Public utility transmission providers, for example, could rely on committees of state regulators or with appropriate approval from Congress, compacts between interested states to identify transmission needs driven by Public Policy Requirements for the public utility transmission providers to evaluate in the transmission planning process.” FERC Order 1000, FN 189.
While Colorado declined to address cost allocation under the new Colorado Rules, the FERC emphasized the close link between planning and cost allocation and believes that the planning is the appropriate forum to address cost allocation. “By linking transmission planning and cost allocation through the transmission planning process, we seek to increase the likelihood that transmission facilities in regional transmission plans are actually constructed.” FERC Order 1000 ¶ 501. Thus, the FERC Order requires each public utility transmission provider to file a method or set of methods for allocating the costs of new transmission facilities selected in the regional transmission plan. Importantly, while the FERC Order provides principles for regional and interregional cost allocation, the Order leaves sufficient flexibility within these principles so that regions can design methods according to regional needs.
The key areas of overlap between the Colorado Rules and FERC Order 1000 emphasize the need for coordinated planning, the need to consider Public Policy Requirements in this planning, and the need for public utilities to incorporate stakeholder input. These requirements are also in-line with the Clean Energy Vision (“CEV”) defined in the Western Grid 2050 report. “A CEV trajectory requires much greater regional coordination and cooperation to build the infrastructure that access and efficiently utilize the best renewable resources in the West.” According to the DOE, however, significant expansion of the transmission grid will be required under any future electric industry scenario and so if the FERC Order is any indication, it looks like Colorado is and has been taking the right steps towards development of a robust infrastructure.
Wednesday, September 14, 2011
Monday, September 12, 2011
An Overview of FERC Order 1000: Transmission Planning and Cost Allocation by Transmission Owning and Operating Public Utilities
Wednesday, September 7, 2011
Friday, September 2, 2011
Thursday, August 25, 2011
Wednesday, August 24, 2011
Western Grid 2050: Contrasting Futures, Contrasting Fortunes – A New Report For the Purpose of Informing Policy and Investment Decisions for the Western Electricity Sector
A new report, "Western Grid 2050: Contrasting Futures, Contrasting Fortunes" (the "Report") was issued today by the Western Grid Group ("WGG") with support from the Western Clean Energy Advocates ("WCEA"). The purpose of the Report is to inform policy and investment decisions for the Western electricity sector. Former Colorado Governor Ritter today joined advocacy groups in calling for western state leadership to work towards achieving the Report's vision.
The Report anticipates that the Western electricity sector will need to invest more than $200 billion by 2030 however, how this money is invested will significantly affect quality of life in the west. According to the report,
To explore and evaluate the relative economic, environmental, energy security and public health consequences of the different investment choices, the report examined two trajectories: "Business as Usual" ("BAU") and "Clean Energy Vision" ("CEV"). In the study, the BAU trajectory focuses discretionary investment on retrofitting, repowering and adding coal generation and on meeting any incremental needs with new gas fired generation and the CEV trajectory focuses discretionary electricity resource investment on energy saving and renewable energy technologies.
One of the goals of the Report was to encourage an open dialogue on electricity system investment priorities in the West. In comparing the two trajectories, BAU and CEV futures will require different regulatory and policy mechanisms. The BAU paradigm is based on the existing infrastructure.
On the other hand, the report provides that the CEV trajectory will require different infrastructure, different planning and different regulation to support it.
The Report is the first in a series of planned reports by the WGG and WCEA. In September, the WGG and WCEA intend to release the second phase of the report, "Clean Energy Vision Policies" describing mechanisms that can be used to guide transition to the CEV trajectory.
The Western Grid 2050 report can be found here: http://www.cleanenergyvision.org/wp-content/uploads/2011/08/WG2050_final_rev082211.pdf
Monday, August 22, 2011
Tuesday, August 16, 2011
The Office of Advocacy was established to represent the views of small entities before federal agencies and Congress and is an independent office within the U.S. Small Business Administration in order to give small entities a voice in the rule making process. Dr. Sargeant, a co-founder of a start-up that was eventually acquired, is particularly well suited for this role as he brings the small business perspective to the table. His experience with and passion for small business was apparent in his responses to each of the challenges highlighted by the participants.
Three general themes were consistently expressed by the businesses present: (1) lack of access to capital; (2) the need to streamline and update regulations to address current issues and new business models; and (3) the competitive disadvantage created by federal agency matching requirements relating to how the regulations define the criteria for matching contributions and whether the SBA could be used to fill in any gaps to level the playing field for the small business in competing against large business. Among other things discussed, one suggestion was to provide carve outs for small businesses for government solicitations.
Dr. Sargeant acknowledged that long latencies in the regulatory process hinder progress and they are acutely aware of the need to find a safe way to bring products to market. The Office noted that through Executive Order 13563, the Obama administration directed a retrospective analysis of existing rules in order to consider how best to promote analysis of rules that may be outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned. The Executive Order exemplifies the problem facing cleantech small business in that the regulations need to catch up to innovation in addition to being clear, certain and predictable so that businesses can succeed. Through Mr. Hart and this region's Office of Advocacy, small businesses in this region have the opportunity to participate in identifying outmoded or inefficient regulations specific to their business models.
Another recurring theme throughout the discussion as emphasized by Mr. Hart, was the need for companies to have a certification mechanism to provide a tool that emerging technologies can use to prove commercial scale marketability. For example, China promotes commercialization by providing "Competency Centers." These Centers provide the infrastructure for companies to test their product under commercial conditions in order to provide the data that these companies need to take steps towards market acceptance and actual market integration.
From my perspective, one thing was clear from the round table discussion: The Office of Advocacy was on a fact finding mission to learn first-hand from small business the regulatory challenges that they are facing. The time was spent listening to small business and comments from the Office were focused on discussing efficient pathways to use to effect change. The next step is to identify and advocate for solutions.
Monday, May 16, 2011
New Bill in Colorado Creates Task Force to Study Siting and Permitting for Electric Transmission Facilities
On the final day of the Colorado legislative session, the General Assembly passed Senate Bill 11-045, a bill creating a task force to study the siting and permitting framework for electric transmission facilities in the state. The bill calls for a 17 member task force to be convened by the Director of the Commission or its designee and provide a report to the Governor and the General Assembly no later than December 1, 2011. The bill directs the task force to address six concepts:
- An inventory and evaluation of Colorado's current siting and permitting framework for electric transmission facilities;
- Research into examples of how other states approach siting and permitting of electric transmission facilities;
- Identify possible models for improving Colorado's existing siting and permitting processes as applied to electric transmission facilities;
- Recommend actions to streamline siting and permitting processes applicable to electric transmission facilities, including balancing of environmental, land use and community effects with transmission project costs and schedule risks;
- Examination of the advantages and disadvantages of a state-wide transmission siting and permitting framework for electric transmission facilities; and
- An examination of the political acceptability of and potential strategies for, creating a state-level siting entity.
- One member representing cooperative electric associations that distribute electricity;
- One member representing cooperative electric associations that generate and transmit electricity;
- Two members representing investor-owned electric utilities;
- Two members representing municipally owned electric utilities;
- One member representing renewable energy electric generation interests;
- One member representing large commercial consumers of electricity; and
- Two landowners representing agricultural interests who reside in different geographic areas of the state.
The bill is now before the Governor.
Monday, April 25, 2011
Sustainability: The ‘Embracers’ Seize Advantage – A New Report Issued by the MIT Sloan Management Review Addressing Corporate Commitments to Sustainability-Driven Management
Thursday, March 24, 2011
- Delay construction of projects by up to three years, and require operating projects to retroactively conduct post-construction wildlife studies for a minimum of two and as much as five years, adding unforeseen costs to the operating budgets of these facilities.
- Require “adaptive management”, which could include operational changes, such as shutting off turbines at certain times of the year, which will add further unquantifiable costs to even projects already permitted and operating.
- Request analysis on wildlife-based sound impacts without any peer-reviewed scientific evidence that sound related to the construction and operation of wind farms has the potential to impact wildlife.
- Greatly expand applicability under the National Environmental Policy Act (NEPA) to projects built on private lands, adding time and costs to developing wind projects, when there is no federal staff to perform this vastly increased amount of administrative work.
Potential Impact to REC Trading Markets
Thursday, March 17, 2011
Monday, February 28, 2011
New Mexico Electricity Transmission Planning Report - Recommendation that the State Consider a Regional Transmission Organization
Background for the introduction of SM 54, the Memorial requesting formation of a technical committee to consider functionality of a Regional Transmission Organization (RTO) or like structure for New Mexico, can be found in New Mexico's Electricity Transmission Planning Report (Report) issued by the Energy, Minerals and Natural Resources Department on November 1, 2010. The Report provided a number of recommendations from the "Governor's Task Force on Statewide Electricity Planning" which was created by Executive Order of the Governor. The Task Force was charged with preparing recommendations regarding opportunities and steps to enhance the statewide electricity transmission grid, including any appropriate collector systems and financing and cost-recovery options, on a 5-year, 10-year and 20-year planning horizon."
The Report highlights New Mexico's strategic positioning in the Nation:
The United States has three transmission interconnection systems serving the nation: the Eastern Interconnect, the Western Interconnect (Western Electric Coordinating Council – WECC), and the Texas Interconnect (Electric Reliability Council of Texas – ERCOT). For the most part, these interconnections operate separately. New Mexico happens to "straddle" both the Eastern and Western interconnects affording it the opportunity to export power both eastward and westward. The state is also adjacent to ERCOT. Thus far, the majority of the focus on exporting New Mexico's renewable energy out-of-state has been on western markets like Phoenix, San Diego and Los Angeles. However, there are significant opportunities to export power to eastern markets particularly as more and more states adopt renewable portfolio standards.
The Report recommends that the New Mexico Governor's Office organize a transmission summit of southwestern states to "facilitate the development of transmission lines across state borders and eliminate existing bureaucratic, economic and other barriers to interstate transmission lines."
The Report further introduces the concept of a regional transmission organization (RTO).
A multi-state RTO is common in the eastern United States, RTOs plan, finance and cost-allocate transmission lines that cross multiple state lines. A portion of eastern New Mexico, in Southwestern Public Service Company's service territory, is part of the Southwestern Power Pool RTO. In her presentation to the Task Force, former Federal Energy Regulatory Commissioner Suedeen Kelly emphasized that New Mexico should consider being part of a multi-state RTO. Some Task Force members strongly support the area of New Mexico not covered by the Southwestern Power Pool RTO be covered by a newly established southwestern states RTO, while other members felt the Federal Energy Regulatory Commission's (FERC) existing "Notice of Proposed Rulemaking" on cost-allocation for multi-state transmission lines is the preferred avenue to resolve this issue.
The Report recommends that New Mexico consider forming an RTO if FERC's proposed rule on cost recovery does not become a formal rule:
If FERC's proposed rule on interstate transmission line cost recovery does not become a formal rule then, yes, the state should consider establishing an RTO for the southwestern United States that addresses cost recovery on a broader, regional basis. The Southwestern Power Pool has been a very successful model for this. Note: Concerns were raised by the Task Force regarding the potential additional costs to the ratepayer that may occur under an RTO framework. This would need to be carefully evaluated and considered before moving forward with becoming part of an RTO.
SM 54 pending in the 2011 New Mexico legislative session provides the conceptual framework to address these, and other, concerns regarding a New Mexico RTO, New Mexico joining an existing RTO or New Mexico contracting for services of an RTO.
Saturday, February 26, 2011
A copy of Senate Memorial 54 can be located here: http://www.nmlegis.gov/Sessions/11%20Regular/memorials/senate/SM054.pdf