Driving Forces for a Greener Economy

What is it that’s moving us to Renewables?

Blog#75 CaliforniaGeo 7-14-20

The Climate Forward department of the New York Times has been covering many subjects that pertain to sustainability, renewable resources, climate change, greenhouse gases, and the like.  They began a tally immediately after the Trump Inauguration in early 2017.  Since then, the Administration’s rhetoric against environmentalism led a massive rollback of previous regulations.  Yet, what is becoming clear is that Trump’s policy preferences are not changing the energy sector of our economy that much.  Renewable electricity has continued to expand  across the nation, beating up on rival fossil-fueled resources.

Well before inauguration, our president promised to reinvigorate coal, but it was already a dying industry.  The stake through coal’s heart has  been solar and wind generated electricity.  Even without any costs assessed as a carbon penalty against it, coal-fired electricity has become uneconomic to permit, build, and operate.  The “Levelized Cost of Electricity,” a common industry finance metric has consistently shown that solar and wind are cheaper over 20 years than coal.  And though natural gas (methane) has been marketed for many years as a “bridge fuel” to something better, it too, is falling to solar and wind in an increasing number of wholesale markets.

 Chicken or the Egg Influence

Which came first?  The answer is complicated, but costs of electric energy are falling only for renewable supplies.  In the image (at left) does regulation pave the way or is majority preference what makes change possible?

 We know there is strong ideology in line with the White House favoring the extractive and polluting industries, but greater belief in and an understanding of global warming has galvanized a growing ideological public preference for all things “green.”

 Regulation has taken a more active part in considering whether change in the energy sphere is something that should continue.  State and local governments have taken steps that answer many of their constituents demands for green (such as the first-ever abandonment of gas-supplied new buildings in the city of Berkeley, California, which has been copied many times over.  A representative from the Bay Area’s Pacific Gas & Electric was present in support of this policy’s adoption.  Whether this was a friendly policy shift on the utility’s part to counter their felony probation over the San Bruno gas line explosion and/or the wine country and Paradise, CA fires, remains to be seen.  

As a condition of exiting bankruptcy and becoming eligible for state monies to fund future wildfire responsibility, PG&E’s CEO had to plead guilty in June, 2020 to 84 counts of involuntary manslaughter in Butte County Superior Court.  To the company’s credit they will begin closure of their last nuclear power plant in less than four years and will back-fill with a variety of renewables, grid-scale storage, and conservation.  When completed, this choice is expected to be $5.1 Billion less cost to its ratepayers.

 Environmentalism

Embrace it or not, activism for the environment is on the rise and has accelerated in the last five years.  In California, PG&E’s Diablo Canyon faced an uphill battle for relicensing because of environmentalists’ concern over cooling discharge to ocean water affecting marine life.  Onshore, there is very little water accessible to the utility for cooling, and massive cooling towers were unpopular.  Eventual engagement with green organizations produced an assortment of alternatives that are expected to work and cost less.  This utility became responsive and cooperative.

The Green New Deal has captured America’s youth and a good slice of other demographics that are not pleased with the pace of climate change that has already begun to affect their lives.  And it’s not just the youth.  A Massachusetts group led by mothers that started out as an energy efficiency promotion to weatherize older homes and save money for consumers grew into something else very powerful.  The Home Energy Efficiency Team (HEET) went on to become methane leak detectives.  Eventually, they mapped Boston and surrounding areas for leaks that were moderate-to-massive coming from 100 year-old corroded pipes. 

Newer solutions

HEET’s activism and partnership with Mothers Out Front put them in a position to engage with three gas utilities and state regulators to avoid spending $9Billion to tear up and replace those lines in and around Boston.  Consultants from the engineering firm BuroHappold identified the feasibility and cost effectiveness of establishing GeoMicroDistricts, circuits of water-filled pipes that would serve geo heat pump connections just as customers currently tap gas lines.  Utilities would begin to charge thermal fees to customers for that useful water branch circuit, and multiple buildings would share energy with each other along this thermal highway.  Regulators have approved and three pilot programs are underway to verify the engineers’ plans.

One other reason the gas companies have considered this option is that Massachusetts, like four other eastern states (and unlike California) have adopted what’s called a Renewable Thermal Standard (RTS).  It means that regulators will monitor the gas companies’ efforts to reduce their carbon combustion footprint by increased amounts over time.  This is the methane equivalent of the widely known Renewable Portfolio Standard (RPS) which mandates certain percentages of renewable electricity by future target dates.  Both of these programs can trace their origins to green policy and significant public support.  California may be seen as slow out of the blocks in the sprint toward an RTS standard but they are moving by different means in a parallel direction.  Flat-out de-carbonization is the goal and the  gas utility rate base is being used to electrify significant amounts of housing, and to foster full electrification of new occupied buildings.  Such a move is seen to reduce combustion byproducts both outside and inside, but also to avoid leaks that are suffered everywhere.  [A 2015 study by Cornell’s Howarth & Ingraffea found that leakage between the wellhead to the customer’s meter exceeded 7%.]

Cancelled Infrastructure Expansion

Utilities that provide electricity are not only concerned with their transmission lines and service capacity, but how the power they distribute will be generated.  Historically, plans for new plants are being planned many years before permitting and actual construction.  No utility wants to deliver brownouts or blackouts to its customers.  Utilities are granted territorial monopolies (to avoid infrastructure duplication) but are regulated by a public body.  

Recent developments on the east coast have seen tremendous controversy and at this moment, major project plans for pipelines have been stopped, while large renewable generating facilities and  storage will take their place.  Regulated, investor-owned utilities can propose, but regulators must approve their plans for infrastructure expansion. 

The Atlantic Coast Pipeline (that would have carried gas) has been cancelled by Dominion Energy and Duke Energy.

 New Infrastructure

There is growing renewable generation in solar and wind.  200 large-scale wind turbines will be built 27 miles seaward of Virginia Beach, making this only the second wind development on federally-leased Atlantic waters after Rhode Island.  A lot more wind generation is planned, and its costs continue to decline, even at sea.

In Offshore Engineer, Tom Harries, head of wind analysis, said: “Offshore wind is benefitting from the 67% reduction in levelized costs achieved since 2012, and to the performance of the latest, giant turbines.”

The power of economy-of-scale for wind are following a similar pattern to that of solar photovoltaic over the last 10 years and they are both driving fossil-fired generation off the grid, even  without strict policy directives or heavy doses of green advocacy.

The forces of ideology, policy, and public majority are working together with economics to advance a greener world at a pace only dreamed about a few years ago.

—Bill Martin