NewEnergyNews: From April 8 – HOW A CLIMATE-ENERGY BILL BENEFITS EVERYBODY’S BOTTOM LINE

NewEnergyNews

Gleanings from the web and the world, condensed for convenience, illustrated for enlightenment, arranged for impact...

The challenge now: To make every day Earth Day.

YESTERDAY

THINGS-TO-THINK-ABOUT WEDNESDAY,:

  • TTTA Wednesday-ORIGINAL REPORTING: California’s Step Toward An Automated Power System
  • TTTA Wednesday-NatGas Price Spikes On EU Stand Against Russia
  • THE DAY BEFORE

  • Monday Study – The Stark Economic Risks Of The Climate Crisis
  • THE DAY BEFORE THE DAY BEFORE

  • Weekend Video: Powerful Voices Say The New Energy Economy Is Here
  • Weekend Video: Tesla’s Texas GigaFactory Brings The Batteries
  • Weekend Video: Arizona’s “Impact Earth” Team
  • THE DAY BEFORE THAT

  • FRIDAY WORLD HEADLINE-Europe’s New Energy Transition Accelerating
  • FRIDAY WORLD HEADLINE-New Energy Still The Best Buy
  • THE LAST DAY UP HERE

    THINGS-TO-THINK-ABOUT WEDNESDAY,:

  • TTTA Wednesday-ORIGINAL REPORTING: California’s Rooftop Solar Supports Questioned
  • TTTA Wednesday-The Transportation Electrification Policy Fight Goes On
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    Founding Editor Herman K. Trabish

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    Some details about NewEnergyNews and the man behind the curtain: Herman K. Trabish, Agua Dulce, CA., Doctor with my hands, Writer with my head, Student of New Energy and Human Experience with my heart

    email: herman@NewEnergyNews.net

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      A tip of the NewEnergyNews cap to Phillip Garcia for crucial assistance in the design implementation of this site. Thanks, Phillip.

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    Pay a visit to the HARRY BOYKOFF page at Basketball Reference, sponsored by NewEnergyNews and Oil In Their Blood.

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  • FRIDAY WORLD, May 27:
  • The New Energy “Lifeline”
  • The New Energy World At War

    Tuesday, July 13, 2010

    From April 8 – HOW A CLIMATE-ENERGY BILL BENEFITS EVERYBODY’S BOTTOM LINE

    NewEnergyNews was pursuing an interview in South America Monday and was therefore unable to complete the planned lead post. As the Senate moves toward what is expected to be its best 2010 effort at passing a climate-energy bill, the post below from the halcyon, pre-coal mine cave-in, pre-BP oil blowout days of early this Spring is worth a look back at. What a difference a couple of disasters make, huh?

    A Better Climate Bill; Raising Efficiency and Renewable Electricity Standards Increases Consumer Benefits
    February 5, 2010 (Union of Concerned Scientists)

    THE POINT
    Some argued the nation would crumble under Barack Obama’s leadership, whereas it has endured the disaster left behind by the previous President and has even begun showing signs of a new flourishing. The same folks argued that passage of the health insurance reform bill would bring on utter collapse, whereas the sky remains as intact as the insurance coverage of children with pre-existing conditions. The same rabble-rousers will soon begin arguing that a climate and energy bill will break the nation and drive utility ratepayers into a budgetary corner.

    The Union of Concerned Scientists (UCS) begs to differ. Basing its assessment, A Better Climate Bill; Raising Efficiency and Renewable Electricity Standards Increases Consumer Benefits, on elements of the American Clean Energy and Security (ACES) Act of 2009, the bill passed by the House of Representatives and currently being reworked by Senate committees, UCS concludes that action on climate and energy will benefit consumers and even more ambitious legislation will benefit consumers even more.

    The major elements of climate and energy action considered by UCS in its analysis were contained in the House legislation: (1) A national cap on greenhouse gases (GhGs) that reduces U.S. emissions 17% below 2005 levels by 2020 and 83% below 2005 levels by 2050, and (2) a combined Energy Efficiency Resource Standard (EERS) and Renewable Electricity Standard (RES) that requires regulated utilities to obtain 20% of their power from efficiency implementations and New Energy sources by 2025.

    The UCS report describes in detail the findings about ACES by the Energy Information Administration (EIA) of the U.S. Department of Energy. EIA showed the ACES goals are achievable and affordable. But the EIA concluded, the UCS report points out, that the ACES House bill’s combined RES/EERS will not produce significant New Energy growth over what would take place under business-as-usual (BAU) because of loopholes that compromise its goals. For this the UCS report proposes a solution.

    Using the same economic modeling system and basic assumptions as the EIA, UCS researchers revisited the question of how emissions caps, an EERS and an RES will affect consumers. They added, however, a more potent RES requiring 25% of electricity to come from New Energy sources by 2025, as well as a separate EERS requiring utilities to reduce their electricity consumption 10% through efficiency measures by 2020. By separating these standards, the compromises limiting New Energy expansion in the ACES would be eliminated.

    click to enlarge

    As a result of these stronger requirements, consumer electricity and natural gas spending would be cut $113 billion through 2030. This would reduce average U.S. household spending for energy by ~$100 per year in 2030. The separate and stronger standards would also drive the shift to a New Energy economy and produce enough new domestic energy sources to eliminate the need for ~50 new nuclear plants.

    In a recent lighthearted interview, The Daily Show’s Jon Stewart remarked that if people are disinclined to be reasonable, they will not accept the truth of even the most obvious facts. Those who feared the advent of Barack Obama and fear-mongered about health insurance reform are unlikely to be swayed by the new UCS facts. They are here with charts and numbers, however, for those who are willing to see them.

    What the facts say is simply this: It is within the reach of this nation to free itself of dependency on imported oil, stop funding both sides of the “war on terror,” shift to secure domestic energy sources, sharply stimulate the sluggish economy, create hundreds of thousands of net new good quality jobs and significantly reduce all kinds of energy-related pollution including the GhGs associated with global climate change without burdening the average U.S. household with higher utility bills.

    Don’t be afraid, it’s only the truth.

    click to enlarge

    THE DETAILS
    The UCS analysis used EIA’s National Energy Modeling System and EIA’s “Basic Case” policy scenario cost and performance assumptions. Its findings suggest that separate and stronger RES and EERS policies compare favorably with that ACES Basic Case as well as with EIA’s “Business-as-Usual Reference Case” in which no climate and energy policy is enacted.

    The theoretical UCS construct would:
    (1) Cut consumer electricity and natural gas spending $113 billion through 2030;
    (2) Reduce average U.S. household spending for energy by ~$100 per year in 2030;
    (3) Drive the shift to a New Energy economy and produce enough new domestic energy sources to eliminate the need for ~50 new nuclear plants.

    The reasoning that foresees lower consumer costs begins with the assumption of individual energy use reductions through efficiencies. With diminished demand, there would be downward pressure on prices. In addition, adding larger portions of New Energy to the current Old Energy mix would increase the overall supply of electricity, further inclining the price down.

    click to enlarge

    The key finding in the UCS study is that these downward price pressures would be stronger than the upward pressures likely to come from a national cap on GhGs. This finding reinforces the conclusions of previous studies, including those by the EIA, the Environmental Protection Agency (EPA) and a host of others. (See NEW ENERGY MANUFACTURING CAN MAKE THE MIDWEST ONCE AGAIN MIGHTY, THE STANDARD FOR NEW ENERGY JOBS, NEW ENERGY JOBS FOR THE STATE OF THE UNION…, …HOW NEW ENERGY CAN MAKE THE RUST BELT SHINE, CAP&TRADE IS GOOD FOR THE FARMERS…, NEW ENERGY WILL BRING BLUE COLLAR JOBS BACK…, NEW ENERGY EVERYWHERE, CLIMATE FIGHT IS…GOOD FOR THE BOTTOM LINE and LATEST NEW ENERGY JOB TRENDS…)

    click to enlarge

    UCS found that Separate and stronger RES (25%) and EERS (10%) goals would reduce average consumer electricity prices 2.2% per year below the Basic Case in 2020 and 1.5% per year in 2030. Consumer natural gas prices would be 3.4% lower in 2020 and 1.4% lower in 2030.

    This adds up to $23 billion in lower consumer electric and gas expenditures in 2020 and $29 billion lower expenditures in 2030. This is a cumulative cost savings through 2030 of $113 billion ($51 billion for households, $42 billion for commercial businesses, and $20 billion for industrial customers) in net present value (using a 7% interest rate).

    The average U.S. household, according to UCS, would get a $77 per year lower non-transportation energy expenditure in 2020 and a $94 per year lower expenditure in 2030.

    Through 2024, consumer electricity and natural gas prices, with a serious national emissions cap and the separate and stronger RES and EERS policies, match those of doing nothing. After that, the rising price on emissions would no longer be fully offset by revenues from allowance auctions.

    click to enlarge

    Non-transportation energy for the average household would, therefore, drop by $13 per year in 2020 but go up by $170 per year in 2030.

    But increased Energy Efficiency would still drive consumption down, producing the small but significant cumulative consumer electricity and natural gas bill savings of $24 billion through 2030 over business-as-usual.

    With the currently proposed ACES energy and climate legislation, EIA expects allowance prices to be $31.60 per ton in 2020 and $64.50 per ton in 2030. With the more stringent UCS provisions, allowance prices will be ~4.4% lower ($30.20 per ton in 2020 and $61.70 per ton in 2030) so that the upward pressure on household energy prices would be less.

    In addition, with the ACES provisions, the auction of allowances would generate revenues that would be rebated to households. The EIA did not factor these rebates into its calculations. UCS ran such calculations based on its more demanding RES/EERS proposal and found consumers would likely get rebates of ~$764 per year in 2030, replacing the ~$170 deficit with a ~$600 benefit.

    click to enlarge

    EIA calculated the ACES legislation would not stop U.S. economic growth but would slow it from the 2.40% (to $19.9 trillion in 2030) BAU pace to 2.37% ($19.7 trillion in 2030). Household consumption would be $83 (0.1%) per year less. The stronger UCS policies reduce household consumption ($136 per year) and economic growth (0.3%) just slightly more.

    And, as UCS points out, even further economic growth can be expected as a result of lower energy costs and more expendable income.

    The separate and stronger RES/EERS policy will drive a 23% growth in the use of New Energy sources and make them 22.4% of the U.S. grid supply by 2030. In the same time frame, the policy will drive enough Energy Efficiency implementation to reduce total electricity sales 6% below what they would be with the proposed legislation and 12% lower than they would be with BAU.

    click to enlarge

    The reduced electricity demand and increased supply of New Energy would eliminate the need for an estimated 50 new 1,100 megawatt nuclear plants, each costing an estimated $4.6 billion-to-$11 billion. It also reduces natural gas use 18% below BAU and 15% below the ACES level in 2020 (and 32% and 4% in 2030).

    The UCS proposal eliminates 7 gigawatts of new coal capacity by 2030 and reduces reliance on it 40% by 2030.

    The final point made by UCS is that the cumulative improvements in the quantity and quality of U.S. energy consumption would have a big impact on GhGs. The ACES provisions cut emissions 21% below the 1990 level by 2030. The UCS policy cuts emissions 23% below the 1990 level.

    It is worth repeating the most important point: All these changes to the quantity and quality of U.S. energy sector would come at no significant cost and most likely a slight economic benefit to the average U.S. energy consumer.

    That's above and beyond the benefits that come with not having to fish Boston, New York, Chicago, Miami, Los Angeles, San Francisco and Seattle out of the water.

    click to enlarge

    QUOTES
    - From the Union of Concerned Scientists analysis: “Allowance pricing helps overcome a single market barrier to renewable energy and energy efficiency: the failure of conventional energy pricing to account for the costs resulting from global warming emissions. The additional complementary policies are meant to overcome other market barriers to energy efficiency and clean energy technologies so they can play a larger role in reducing emissions than would be possible with carbon allowances alone. For example, even though energy-efficient technologies provide long-term financial savings to consumers, risk-averse or financially constrained consumers may be reluctant to purchase them because of their higher up-front costs. Similarly, renewable energy faces structural barriers in the electricity sector (e.g., access to the grid, price distortions from unequal subsidies) but provides valuable fuel price stability once deployed.8 The larger role played by efficiency and renewable energy under a comprehensive policy approach can thus help lower carbon prices.”

    click to enlarge

    - From the Union of Concerned Scientists analysis: “A strong national carbon cap that significantly reduces heat-trapping emissions in every sector of the economy is essential if we are to avoid the most dangerous effects of global warming. Renewable energy and energy efficiency are also smart climate solutions, with proven track records of delivering emissions reductions in a cost-effective manner. But fully unlocking the potential of these solutions will require strong complementary policies including a renewable electricity standard and an energy efficiency resource standard, in combination with an economy-wide carbon cap. This inte-grated approach to reducing carbon emissions would provide the framework for a national transition to a clean, safer energy economy and, according to our analysis, would also increase the benefits for consumers, the economy, and the environment.”

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