NewEnergyNews: TODAY’S STUDY: The State OF The U.S. Energy Transition, Part 4


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    Tuesday, January 24, 2017

    TODAY’S STUDY: The State OF The U.S. Energy Transition, Part 4

    Transforming the Nation’s Electricity System: The Second Installment of the Quadrennial Energy Review

    January 2017 (U.S. Department of Energy)

    Summary for Policymakers: Building a Clean Electricity Future

    A clean electricity system reduces air and water pollution, lowers GHG emissions and limits the impacts to the ecosystem in areas such as water and land use. Addressing climate change will require the United States to greatly reduce our carbon emissions, while simultaneously addressing new grid management challenges that have arisen due to recent trends in electricity generation and demand, the changing climate, and the national security implications of grid dependency. Keeping this context in mind, this Chapter explores the essential elements of a clean electricity system, and identifies the policy, market and technology innovations needed to achieve it. In short, we have made substantial progress in reducing the environmental impact of the electricity system, but much work remains.

    Key Findings

    • A clean electricity system reduces air and water pollution, lowers GHG emissions and limits the impacts to the ecosystem in areas such as water and land use.

    • Deep decarbonization of the electricity system is essential for meeting climate goals; this has multiple economic benefits beyond those of environmental responsibility.

    • The United States is the largest producer and consumer of environmental technologies. In 2015, the U.S. environmental technology and services industry employed 1.6 million people, had revenues of $320 billion, and exported $51 billion worth of goods and services.

    • Though the U.S. population and economy have grown, between 1970 and 2014, aggregate emissions of common air pollutants from the electric power sector dropped 74 percent even as electricity generation grew by 167 percent.

    • U.S. carbon dioxide (CO2) emissions from the power sector have substantially declined. Between 2006 and 2014, 61 percent of these reductions are attributed to switching from coal- to gas-fired power generation and 39 percent to increases in zero-emissions generation.

    • The increasing penetration of zero-carbon variable energy resources (VERs) and deployment of clean distributed energy resources (DERs) (including energy efficiency) are critical components of a U.S. decarbonization strategy.

    • It is beneficial to a clean electricity system to have many options available as many of the characteristics of clean electricity technologies complement each other.

    • Currently, 29 states and D.C., have a Renewable Portfolio Standard and 23 states have active and binding Energy Efficiency Resource Standards (EERSs) for electricity. States that have actively created and implemented such electricity resource standards and other supporting regulatory policies have seen the greatest growth in renewables and efficiency.

    • The integration of variable renewables increases the need for system flexibility as the grid transitions from controllable generation and variable load to more variable generation and the need and potential for controllable load. There are a number of flexibility options such as demand response (DR), fast ramping natural gas generation, and storage.

    • Energy efficiency is a cost-effective component of a clean electricity sector. The average levelized cost of saved electricity from energy efficiency programs in the United States is estimated at $46/MWh, versus the levelized cost of electricity for natural gas combined-cycle generation, with its sensitivity to fuel prices, at $52 to $78/MWh.

    • Electricity will likely play a significant role in the decarbonization of other sectors of the U.S. economy as electrification of transportation, heating, cooling, and industrial applications continues. In the context of the Quadrennial Energy Review (QER), electrification includes both direct use of electricity in end use applications as well as indirect use whereby electricity is used to make intermediate fuels such as hydrogen.

    • Realizing GHG emissions reductions and other environmental improvements from the electricity system to achieve national goals will require additional policies combined with accelerated technology innovation

    • Improving understanding of the electricity system and its dynamics through enhancements in data, modeling, and analysis is needed to provide information to help meet clean objectives most costeffectively. • Decades of federal, state, and industry innovation investments have significantly contributed to recent cost reductions in renewable energy and energy efficiency technologies.

    • Innovation in generation, distribution, efficiency, and demand response technologies is essential to a low carbon future. Innovation combined with supportive policies can provide the signal needed to accelerate deployment of clean energy technologies, providing a policy pull to complement technology push.

    • Nuclear power currently provides 60 percent of U.S. zero-carbon electricity, but existing nuclear merchant plants are having difficulty competing in restructured electricity markets due to low natural gas prices and flat or declining electricity demand. Since 2013, six nuclear power reactors have shut down earlier than their licensed lifetime, and eleven1 others have announced plans to close in the next decade. In 2016, two states, Illinois and New York, put policies in place to incentivize the continued operation of existing nuclear plants.

    • Enhanced oil recovery (EOR) operations in the United States are commercially demonstrated geologic storage, and could provide a market pull for the deployment of carbon capture, utilization, and storage (CCUS).

    • Federal laws currently limit the ability of regulated utilities to utilize federal tax credits in the same manner as private and unregulated developers. Publicly owned clean energy projects cannot benefit from the clean energy tax credits because tax equity investors cannot partner directly with tax exempt entities to monetize tax credits.

    • Low-income and minority communities are disproportionately exposed to air quality and water quality issues associated with electric power generation. Compared to the U.S. population overall, there is a greater concentration of minorities living within a three-mile radius of coal- and oil-fired power plants. In these same areas, the percentage of the population below the poverty line is also higher than the national average.

    • Some energy technologies that reduce greenhouse gas emissions, such as carbon capture, utilization, and storage (CCUS), concentrated solar power, and geothermal generation, have the potential to increase energy’s water intensity; others, such as wind and photovoltaic (PV) solar power, can lower it. Dry cooling can reduce water intensity but may increase overall GHG emissions by decreasing generation efficiency. Though there can be a strong link between energy and water efficiency in energy technologies, many research, development, demonstration, and deployment (RDD&D) funding criteria do not incorporate water use or water performance metrics. Designing technologies and optimizing operations for improved water performance can have both energy and water benefits.

    • There is currently no centralized permanent-disposal facility for used nuclear fuel in the United States, so this radioactive material is stored at reactor sites in 35 states awaiting development of consolidated storage facilities and/or geologic repositories.

    • Coal combustion residues, such as coal ash and scrubber slurry, are the second most abundant waste material in the United States, after household waste.

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