Category Archives: Energy Management

Turning Peak Electric Demand Into a Positive

It is mid-winter and we are not thinking about the cost of cooling. However, it is not too early to consider that large portions of the country face a conundrum of an aging infrastructure, not as effectively delivering electricity to satisfy growing power demand. There is a growing risk of brownouts and blackouts – not from a shortage of electricity, but the difficulty in delivering it in amounts required when needed. This is bad for the bottom line of the utility and, of course, bad for business because without power or even with the heightened risk of losing power, businesses are vulnerable.

There is a double whammy of growing demand for energy and weaker infrastructure to deliver it. While many homes used to air condition only a couple of key rooms, now more homes can cool the entire house. It used to be people came home from work to a hot apartment or house, then turned on their AC unit and in a short time felt comfortable again. But with today’s technology, people can turn on their home ACs from their office, so they are cool when they enter their homes. As a result, there is demand for electricity simultaneously cooling an office and a home. This becomes a greater risk on a hot, humid day, which are growing in number. With economic growth, people use more electrical devices. We have the conundrum of a growing demand for electricity, with an aging infrastructure to deliver it at its peak. Many utilities now charge for high peak demand, as well as usage, to encourage reduction, but they are limited in cost hikes as ratepayers will not absorb the cost of upgrading infrastructure in their utility bills.

Therefore, many utilities must invest in programs to reduce electric (or natural gas) demand, particularly in the peak seasons (summer for electric, winter for gas). It is simply risky to expect a utility in some areas to deliver to meet growing peak needs. Many utilities have programs to reduce peak load and improve efficiency. In the most vulnerable areas of New York City (weakest infrastructure), Con Edison is giving away free of charge LED lights to building owners to reduce peak demand.

Another program that some utilities encourage is Demand Management (DM), which provides financial incentives to move energy-using processes to operate at night when relative demand is low. An example is replacing a large AC unit with an ice storage system, which would cool intake air. While making ice at night and maintaining it can use more electricity than an AC unit, the majority of electric use moves to night and not the peak afternoon hours. Therefore, this is something that utilities encourage – reducing demand during the peak period (hot, humid afternoons).

Another option is using an organization’s backup generation system to generate power on a hot, humid day, called Demand Response (DR). The building can be taken off the grid during peak demand, somewhat relieving the pressure on the utility to deliver large amounts of electricity to a particular area. In a typical program, the utility informs the building manager a day before that it will take the building off the grid and make sure they run their generator(s) during a few peak demand hours the next day. The utility provides healthy financial benefits for being available to go off the grid and each time one is called on and does so. The backup generator, often forgotten equipment, becomes a revenue generator. One complication of DR is the requirement that the facility obtain an air permit from the local environmental agency (usually the State). Being in DR, the unit is no longer “emergency” and loses its exemption from permitting. In addition, some states have specific emission or air pollution control requirements for non-emergency generators. Often, generators used for emergency purposes are older and may not have been an advanced model. Why spend on a unit that will be used so rarely? Thus, their emissions are likely higher and may not be able to meet the emission standards, unless they are upgraded, which could cost 6 figures.

Getting an air permit has a cost but is not too expensive. Upgrading to meet stringent emission standards, on the other hand, can be very expensive and overwhelm DR economic benefits. DR is something that companies which already have emergency generators should consider as a sound financial program. However, one should research air quality rules to see if there are stringent control requirements for such generators requiring costly upgrades.

CCES has the experts to provide you with site-specific information to help you decide on strategies to reduce your peak electric demand and enter incentive programs that reward such strategies. We can manage the implementation of the strategies to maximize your financial and risk benefits. Contact us today at 914-584-6720 or at karell@CCESworld.com.

Prescriptive Vs. Performance Energy Incentive Programs

More utilities and local governments are creating and implementing incentive programs to get buildings to be more energy efficient. Energy infrastructure is aging and expensive to replace. There is concern in many large cities that during a peak demand period, such as a hot summer afternoon, needed electricity will not be able to be provided throughout a utility zone, affecting citizenry, businesses, and quality of life. It is not only in the utility’s interest, but in the government’s, as well, to encourage energy efficiency, so that a peak demand can be met. One way to incentivize the procurement and usage of energy-saving technologies and strategies is to reduce its cost. More and more entities offer rebates for the implementation of certain technologies, which otherwise may be costly. Of course, if public money is going to be given out, it must be accounted for; it must go to owners who actually upgraded their buildings for energy efficiency. This can lead to significant bureaucracy, which itself is costly and takes away from the pool of money available to incentivize. Therefore, the simplicity of an incentive program is very important, as well.

With this in mind, there are two major philosophies used to design incentive programs for those to become more energy efficient, prescriptive vs. performance. Each has certain advantages to different groups of people.

Prescriptive energy incentive programs try to minimize bureaucracy, be simple for the building owner and manager, and emphasize installing the technology. A typical prescriptive program allows the participant to purchase and install the technology and reap the rewards fairly quickly, irrespective of the final results (energy savings). Prescriptive incentives typically pay out a certain percentage of the upfront cost of a technology so that the user can plan the expenditure and what it will get back.

For example, a New Jersey prescriptive lighting program pays the building owner a certain cost per LED light. It may be $5 per tube for replacement of tube fluorescents with LED tubes, $15 per fixture for replacement of high bay lumineres with LEDs, $15 per fixture for task lights, $100 per fixture for stairwell lights, etc. The building owner simply counts the number of lights that are replaced with the LED equivalents, multiplies by the incentive factors, and now can determine what the simple payback is. Once the lights are demonstrated to be installed, the calculations can be confirmed and the incentive check issued.

In a prescriptive program, it does not matter precisely how many watts the new LED lights are or the wattage of the lights being replaced. The effectiveness of the exercise (total kWh or KW load reduced) is not important for this incentive program. A prescriptive energy efficiency program is a reward for installing improved technology.

The other type of energy incentive program is performance, basing financial incentives on the achieved energy reduction of the strategies. For each light replaced by an LED, the before and after wattages of the lights must be computed and, together with the estimated usage (hours per year) of each group of lights, the total kWh or kW reduction is computed. The rebate tied to the reduction in electricity usage and demand is what a performance incentive program is all about. Such programs give the building owner a certain money (typically $0.10 per kWh or $1.00 per therm reduced or peak kW reduced). This is used for lighting incentive programs, as wattages can be compared.

However, for other technologies, it is more difficult to determine accurate gains and performance. For example, if one upgrades HVAC equipment to something more modern and efficient, the exact energy savings cannot be predicted because it depends on the outside weather which differs from year to year. One may get a huge reduction in kWh from one year to the next. However, it may be due at least in part to a milder summer in the year the technology is installed, as much as the efficiency improvement. One way to get around this is to have a performance incentive program use computer energy modeling holding the weather as a constant to predict energy usage with old and new equipment conditioning the indoor air.

Performance incentives, therefore, require a lot more information before the incentive is issued compared to prescriptive. This means more time spent on the computer and more labor hours that needs to get paid for before the incentive is earned. However, the effort will likely result in a document that reports what the energy reduction due to the new equipment is likely to be. And utilities and governments often wish to provide rebates based on the actual degree of efficiency or usage reduced achieved as opposed to merely upgrading technology which may not be that effective to demonstrate significant energy usage reduction.

CCES can help manage the energy incentive programs in your area and advise you on which ones are more relevant and profitable to your business at whatever stage you are at. We can do the testing, complete the incentive paperwork and answer questions of the regulators. Contact us today at 914-584-6720 or karell@CCESworld.com.

Massachusetts’ New Comprehensive Energy Plan

In December 2018, the Massachusetts Dept of Energy Resources released a new Comprehensive Energy Plan. (https://www.mass.gov/files/documents/2018/12/11/CEP%20Report-12122018_0.pdf).

It may serve as a model for other states or regions of the country. Massachusetts’ two-fold goal is to reduce its greenhouse gas (GHG) emissions consistent to what is called for by the United Nations and reduce energy usage substantially. It calls for the state to both electrify and to conserve energy usage as much as possible.

According to the Department, in 2016, only 17% of Massachusetts’ energy demand of over 1 quadrillion BTUs was from the electric sector. Transportation uses 44% of its energy and buildings (thermal) use about 39%. Therefore, significant upgrades need to be made in these two areas.

To achieve progress in transportation, the Plan recommends the following 3 changes:

1. Improve electric charging infrastructure

2. Establish a “goal” to require all new cars, light duty trucks, and buses sold in Massachusetts beginning in 2040 to be electric or have equivalent emissions

3. Establish a RGGI-style reduction credit trading system for transportation GHG emissions with other Northeast and Mid-Atlantic states.

As for buildings (thermal), many buildings are switching fuels to natural gas, which results in solid GHG emission reductions. However, to meet the necessary climate change goals, a significant portion of buildings must do better. Because it is not likely in the foreseeable future that thermal load will become decarbonized, reductions can only work by reducing amount of fuel needed to be combusted. In other words, improve energy efficiency. The Plan has numerous references to improved efficiency, such as frequent testing and upgrading of boilers, improved insulation, smarter building, etc. But just as important, it has recommendations to get the information out and incentivize building owners and tenants to invest in energy and carbon reduction.

Together, this Plan could well be a model for what other states select as their way to reduce energy usage within their state and of GHG emissions in the future.

CCES has the experts to help your firm reduce energy usage in a smart way, to reduce costs and GHG emissions. Economical strategies, for you to get the best payback possible and to maximize other benefits, such as improved equipment and worker productivity, reduced O&M costs, no/minimal disruptions, etc. Contact us today at 914-584-6720 or at karell@CCESworld.com.

Recent U.S. DOE Report Shows Positive Signs for Wind Market

In August 2018 the U.S. Department of Energy (DOE) issued its 2017 Wind Technologies Market Report (https://www.energy.gov/eere/wind/downloads/2017-wind-technologies-market-report). The report tracks trends in installation, technology performance, cost, and price of wind power. Overall, the DOE report shows strong current growth and predicts this would continue into the next decade.

In 2009, power purchase agreements (PPAs) for wind power peaked at a price of $70/MWh. However, improvements in technology and implementation have lowered the price to about $20/MWh in 2017. The “wind belt” of the Great Plains has a lower average PPA price than the rest of the country. It follows that most wind power projects and the lowest prices would occur there, having the nation’s highest and most consistent wind speeds. DOE believes the PPA price will not drop significantly in the foreseeable future.

As a whole, U.S. wholesale electricity prices have declined in the last decade due, in part, to the overall decline in natural gas prices. Therefore, the wholesale energy market value of wind has followed along this major market indicator and declined similarly. Another factor influencing the cost of wind power is the decline in turbine prices as demand for wind grows and manufacturers devote more effort to production.

Due both to incentives from federal, state, and some utility players and to the decline in the price of wind energy, the wind power market in the U.S. has grown. The federal Production Tax Credit (PTC) has been cited by developers as a large motivator. Security is important, and investors and developers know that the PTC will be in place at least through 2021, encouraging wind farm development. There is concern that PTC will be phased out at that time, but many factors, including politics, will come into play as we get to 2021.

Even if the PTC is phased out, the wind market is likely to continue in the U.S. due to market forces, such as the low prices of PPAs. As there is economic growth and population shifts within the country, power is needed. Wind farms are certainly competitive cost-wise with building a new traditional gas or oil-fired power plant. In addition, wind may vary in the short-term, but if placed right it should provide a hedge against any future uncertainties about availability and price of natural gas.

CCES has the expertise to provide technical background to determine whether your building or company can benefit from generating your own power from renewable sources, like wind or solar. Contact us today at 914-584-6720 or at karell@CCESworld.com.

Financial Factors Point to 2019 As The Best Time to Invest In Energy Upgrades

One of the most common complaints from building owners who want to upgrade their facilities, be more energy efficient and green, and save costs is that they do not have the funds to invest in those energy-saving technologies. If they can just get access to capital cheaply, they would make the investment and reap the benefits and savings in the future. As has been discussed in these writings, energy upgrade is a great investment, as good as any in any bank or on Wall St. A well-designed and executed project can net the building owner or company 20%, 30% or greater return on investment per year. Given that, a number of financial institutions have begun specializing in energy project financing. They realize with returns like these the risk of a borrower not having the funds to pay a loan back is very low. With low risk, they can afford to offer relatively low interest rate loans. Never has funds been so available for energy upgrade projects.

One area of lending specifically for energy projects is Commercial Property Assessed Clean Energy or C-PACE (in some areas, known as PACE). With C-PACE, building owners can begin to implement smart energy upgrades quickly and re-pay over a long time through a voluntary benefit assessment lien, levied and recorded against the benefiting property, to be repaid along with property taxes. C-PACE allows building owners to potentially finance 100% of the cost of energy upgrades with, in most cases, only positive cash flow. The team assesses the likely future energy cost savings over time and arranges payments based on those projections, so that there is only positive cash flow. In the meantime, the upgrade is completed and the owner gets the benefits while repayment is made. Payments are usually made at the same time as property taxes are paid to the municipality, which transfers C-PACE payments to the lender. The owner knows when payment is due and how much.

A C-PACE loan is repaid through a long-term assessment, similar to property taxes, spacing out payments longer than traditional 7-year financing. Therefore, energy cost savings will exceed annual C-PACE payments for nearly all applicable projects. Only positive cash flow. While the owner receives a long-term asset upgrade, tenants get lower overall expenses and a more productive work environment.

Building owners commonly express concern that a C-PACE loan binds it to the building. While the buyer does have the obligation to pay back the loan once they take over ownership, the C-PACE lender has no say regarding the sale.
The C-PACE lender does not impose traditional lender requirements, such as quarterly reporting, maintenance of debt covenants or similar requirements. One less item for the building owner to worry about.

Things are topsy-turvy in government, in terms of energy policies and incentives to upgrade one’s energy systems. But waiting is not the answer because there is much money being wasted waiting and in the meantime operating old, clunky energy inefficient systems. This is simply not good business. As funds are now more readily available with terms that are more acceptable, 2019 is the best time to borrow funds and move forward and evaluate, design, and implement good energy upgrade projects.

CCES has the experts to help you plan the most financially beneficial energy upgrade project. We can give you several options to save money on energy and related systems and you can choose the one(s) most beneficial to you. CCES knows the PACE and C-PACE programs, as well as other lenders to help your projects go to reality and get the most benefits for you. Contact us today at karell@CCESworld.com or at 914-584-6720.

EIA Report on 2017 CO2 Emissions

On October 31, 2018, the US Energy Information Administration (EIA) released its report on US greenhouse gas (CO2) emissions in 2017. See: https://www.eia.gov/environment/emissions/state/

US energy-related CO2 emissions fell in 2017 to 5.14 billion metric tons, a drop of 0.9% from 2016 levels. Energy-related CO2 emissions dropped 14% (861 million metric tons) since 2005, and in 7 of the previous 10 years. Most of this year’s decline was due to continued reduction in coal combustion by fuel and in electric power by sector. CO2 emissions from the transportation sector rose slightly in 2017, exceeding those from the electric power industry sector for the first time since estimations began. Please note that before one celebrates too much, the electric power segment decline in CO2 emissions in 2017 were caused, in part, by a slightly milder summer nationwide (and lower demand for space cooling) compared to 2016.

In the longer term, from 2005 to 2017, the US economy grew by 20%, while US energy consumption fell by 2% and energy-related CO2 emissions decreased by 14%. Therefore, US economic growth in 2017 was 29% less carbon-intensive, and energy consumption was 12% less carbon-intensive.
Looking ahead, EIA projects that US energy-related CO2 emissions will rise by 1.8% (nearly 100 million metric tons) in 2018, then remain virtually unchanged in 2019.

While US energy-related CO2 emissions declined in recent years, the EIA estimates that global energy-related CO2 emissions rose by 21% (6,040 million metric tons) from 2005 to 2017. This rise in emissions was led by China, India, and other Asian nations, which collectively increased by slightly more than this amount. EIA projects that the rate of global growth of energy-related CO2 emissions will slow to 1% in 2018 and remain essentially flat in 2019.

The EIA estimates that the 4 states that emit the most energy-related CO2 emissions per capita (in order) are Wyoming, North Dakota, West Virginia, and Alaska. All of these states did reduce per capita CO2 emissions in the last decade, Alaska by 32%.

CCES has the experts to help you determine your company’s carbon footprint and recommend strategies to reduce it that will also save you costs and improve worker efficiency. A win-win: a better environmental footprint and many financial benefits, too. Contact us today at karell@CCESworld.com or 914-584-6720.

Can California Become Carbon Negative?

On September 10, 2018, California Governor Jerry Brown set California on an ambitious clean energy path signing Senate Bill 100 (SB 100), which requires that by 2045, 100% of California’s electricity be generated from carbon-free sources. In addition, Governor Brown signed off of a new statewide goal to reduce California’s overall greenhouse gas (GHG) emissions to zero by 2045 and then go negative thereafter. SB 100 also requires that its implementation does not increase carbon emissions elsewhere in the western grid and does not permit resource shuffling, a limitation that effectively prevents California from relying on fossil fuel generation from outside the state to serve the state’s electricity needs.

SB 100 makes California the world’s largest economy to commit to generating 100% of its power from clean energy. California has been steadily increasing its renewable portfolio standards, from an initial goal of 20% by 2017 to 60% by 2030, to the 100% by 2045. SB 100 does give California some flexibility. While hydropower and nuclear power do not qualify as renewable energy under renewable portfolio standards, these likely will qualify under SB 100, as they are “zero-carbon”. SB 100 also leaves open the possibility for other carbon-reducing innovations such as carbon capture and sequestration technology should it ever become practical.
SB 100 requires all California state agencies to incorporate this policy into all relevant planning and to issue joint report to the California legislature by January 1, 2021, and every four years thereafter discussing progress toward the goals.

Many opponents of the bill do not believe California can meet these goals unless it joins a larger regional market to have access to carbon-free energy from outside the state. This will mean entering into agreements with these other neighboring states to develop their own large renewable energy projects from which California can use the energy in its grid. It may be difficult to convince some of these states to replace traditional fossil fuel plants with more renewable power. If they can do so, then California may be able to reach a goal of negative carbon emissions in the future.

CCES can help your firm understand your electric bill and your sources of electricity to enable you to be most economic in your energy use and most efficient. Contact us today at 914-584-6720 or at karell@CCESworld.com.

Cybersecurity Is Important For Everyone

By David J. Rosenbaum, Citrin Cooperman & Co.

Why is an article on cybersecurity appearing in a blog and newsletter on energy and environmental matters? Because this is a situation of grave concern to all companies, municipalities, etc. As engineers, we are involved in compiling and managing data, mainly through complex computer systems. However, data is now at risk of being stolen, altered or deleted, and this can have mammoth impacts on all kinds of firms.

Who is at risk? Any entity…
• connected to the Internet
• storing data electronically or in the Cloud
• involved with the Internet of Things (IoT).
Who may pose the threat to you and your data? Hackers, like you read about in the news. But employees, clients, and regulators, too.

What must cybersecurity protect?
• “Computers”, such as desktops, laptops, tablets, smart phones
• Networks, such as servers, firewalls, peripheral devices, IoT
• Data at rest (on computer hard drives, removeable media, in the Cloud)
• Data in motion (email, the web, wifi, phones)

What are the objectives of cybersecurity?
• Confidentiality: safeguarding records and information
• Integrity: protecting data from unauthorized access, change, or destruction
• Availability: ensuring that data is available to those authorized to view it.

Whether you are a big firm or a one-person shop, your data is vulnerable. Cybersecurity does not/cannot prevent a breach; it enables you to manage the risk. If you think spending money on cybersecurity is an issue, think of the costs of a breach including forensics, technology expenditures, notification, legal, system downtime, fines and penalties, and reputational.

A key to cybersecurity is employees. Users, often, unknowingly introduce threats by opening emails or clicking on links. Therefore, training is important.

To begin a cybersecurity assessment, the entity must understand:
• What information is maintained that needs to be protected
• Which systems maintain the information and who controls it
• How the information is currently protected
• Which rules/standards apply to data in question (i.e., HIPAA, PCI, privacy, etc.)

National Institute of Standards and Technology (NIST) framework for improving critical infrastructure cybersecurity. Core:
• Identify. Develop organizational understanding to manage cybersecurity risk
• Protect. Develop and implement appropriate safeguards of infrastructure
• Detect. Develop and implement appropriate activities to detect an event
• Respond. Develop and implement appropriate actions once event detected
• Recover. Develop and implement appropriate activities to restore capabilities.

Cybersecurity Best Practices:
• Assess your risk
• Determine applicable rules/standards to comply with
• Develop written cybersecurity policies. Must be written.
• Implement Best Practices (i.e., complex passwords, firewalls, antivirus, backups)
• Train employees to be aware and alert and implement best practices
• Audit, test, and upgrade policies, practices, and security

Yes, cybersecurity is another responsibility and headache for managers already overwhelmed with responsibilities. But given the costs listed earlier, this needs to be done. Remember, it is not a matter of if, but when you’ll be subject to a cyber attack.

Citrin Cooperman’s Technology Consulting group has a practice focused on cybersecurity. Its TRAC Cybersecurity Services include risk assessment, penetration testing services, and remediation strategy. Contact David Rosenbaum at 914-693-7000 or at drosenbaum@citrincooperman.com.

The Positive and Negative Impacts of Solar Energy

by Arthur Smith, LEDwatcher  http://www.LEDwatcher.com

Solar energy can be a vast source of power that can provide clean, sustainable electricity. We are now able to use solar panels in all types of weather. It used to be that if it was cloudy the panels would quit charging. But now, with newer technology, solar power can be generated even on snowy and cloudy days. And as we focus more on cleaner power, solar energy is making its way further into our daily lives. https://www.telegraph.co.uk/news/science/science-news/10701064/British-scientists-develop-solar-panels-which-work-better-on-a-cloudy-day.html

Of course, solar energy isn’t perfect. Just like everything else in life it has its positives and negatives. And one of the biggest downfalls of solar energy is its negative effect on the environment. So in this article we will look at both the negative and the positive impacts of solar energy, so you can judge for yourself whether solar energy could be beneficial for your home or business how environmentally-friendly and good solar power actually is.

The Negatives

• Taking Up Space. The more electricity that needs to be produced, the more solar panels you will need. And the more panels are needed, the more space they will take up. Because of this, large solar farms will need to be set up to meet solar energy demands. Rendering this land useless. How to counteract this? By setting up the solar power plants on land that otherwise can’t or isn’t used. This would make the acreage beneficial again, and would mean that no farmland needs to be sacrificed to generate more solar energy.

• Pollution. Although solar panels have the reputation of being pollution-free, pollution is produced while the panels are being manufactured and installed. Hazardous products are used in the manufacturing process of solar panels. The transportation and installation of the panels also emit greenhouse gasses. How to make solar panels a completely pollution-free technology? By creating greener ways of producing the panels, as well as employing electric cars to transport them to the place of installation.

The Positives

• Electricity Savings. Harnessing solar energy and using it to power your home will lower your energy bills. By how much? That will depend on the size of your solar system and your electricity usage. But the good news is that in some countries if you produce more electricity than you consume, you can sell the surplus to your electricity supplier letting you not only save but actually earn money from your solar panels.

• Reduced Greenhouse Gas Emissions. The more energy that we can create with solar power the less fossil fuels we will be burning and the smaller amount of greenhouse gasses we will release into the atmosphere. Solar energy is an amazing way to reduce our greenhouse gas emissions and live greener lives.

• Sustainability and Resilience. Solar energy is also a renewable resource,whereas fossil fuels are not. As long as the sun is shining in the sky we will always have access to solar energy. So solar power is an unlimited energy source, which will be there to meet the energy needs of generations to come.

• Low Maintenance. After installation, solar technology is low-maintenance. Therefore, they are great for rural areas that are off the grid and can’t be accessed easily, and don’t require as much man-power to maintain.

• Cost Advantages. The source of solar energy is free and is in great abundance. Which means that as long as there are discount schemes to help with the solar panel costs, they can also be a great help to people in more remote areas that might not have access to electricity, due to the lack of infrastructure to bring in electricity or fuel or a power plant.

• Energy Independence and National Security.  Finally, relying on fossil fuels can exacerbate many technical, political, and financial issues. We can better safeguard ourselves by collecting our own energy and not being dependent on others. Wars and natural disasters can also put a heavy strain on the existing fuel supplies leading to very high prices. This makes solar power that much more a cost-efficient solution.

For many locations, buildings, and regions, the benefits of solar energy far outweigh its negative effects. Solar should be seriously considered by businesses as not only a cost-effective energy management strategy, but part of the way to a greener, more sustainable future.

Arthur Smith is the lead editor of LEDwatcher, a blog that focuses on solar and LED lighting. With years of experience working in both solar and lighting industries, Arthur has turned to blogging and writing guest articles for different websites to help others learn more about these technologies as well.  See    http://LEDwatchter.com.

USEPA Proposes To Replace The Clean Power Plan

On August 21, 2018, the Trump Administration released its proposed replacement for the Clean Power Plan (CPP), called the Affordable Clean Energy (ACE) Rule. https://www.epa.gov/sites/production/files/2018-08/documents/frn-ace-proposal_8.20.2018.pdf

What’s interesting is that the USEPA’s own analysis open demonstrates that the ACE will result in fewer benefits than the rule it replaces, such as GHG and criteria pollutant emission reductions. So this is a “step backward” in terms of environmental impact. See the ACE Fact Sheet: https://www.epa.gov/sites/production/files/2018-08/documents/ace_overview_0.pdf. ACE is projected to reduce GHG emissions by one-tenth that the CPP is projected to: up to 30 million short tons of CO2e by 2025, compared to 300 million short tons under CPP. Interestingly, the Fact Sheet states that ACE will result in a “monetized domestic climate benefit” of $1.6 billion, compared to no rule at all. This is an interesting admission by this Administration that climate change is real and tangible and also that reducing GHG emissions will result in financial benefits. In addition, if these numbers are true, then reducing GHG emissions by 300 million tons should result in a greater economic benefit to the U.S. Why would the Administration go against such economic logic?

In addition, the Regulatory Impact Analysis prepared for the proposed ACE states that replacement will result in hundreds of additional premature deaths per year due to higher particulate emissions rates allowed by ACE. Most of these deaths will occur in U.S. regions downwind of coal-powered power plants. Proposing a rule change that will reduce reductions of GHG emissions (at a cost to our economy) and raise the number of premature deaths goes against USEPA’s stated priority of protecting public health.

Other changes in the proposed rule include:

• Reducing the USEPA’s authority to regulate and letting more GHG regulation in the hands of states, going against the recent recognition that impacts of air emissions do cross state lines and is, therefore, a federal responsibility.

• ACE applies only to coal-fired power plants, while CPP applies to both coal and gas-fired plants.

• ACE encourages improved efficiecy, rejects carbon capture and sequestration.

• Removal of cumulative GHG emission reduction targets or limits for power plants.

• Trading of GHG credits will not be allowed, although averaging among units in a single facility will be allowed. It is unclear how that may affect an existing trading program, like RGGI.

• While ACE contains USEPA-approved guidelines for reducing GHG emissions, a state’s standards may be less stringent than the USEPA guidelines. The state must explain why meeting USEPA guidelines for GHG emissions is a hardship.

The proposal to implement ACE was published in the Federal Register on August 31, 2018, beginning a public comment period. Comments are due by October 30.

CCES has the experts to help you develop an energy and a GHG emission reduction program to provide you maximum financial benefits and operating flexibility. Contact us today and we can help. karell@CCESworld.com or 914-584-6720.