Energy

CSG South

On June 2, 2014, the U.S. Environmental Protection Agency (EPA) released the Clean Power Plan Proposed Rule under the authority of Section 111(d) of the federal Clean Air Act. This Proposed Rule would establish state-specific goals to limit greenhouse gas emissions by setting firm carbon reduction standards that each state would have to meet beginning in 2020 and accelerating through 2030. While it is unclear whether the EPA will revise its Final Rule, which is expected by July 2015, many states in the Southern Legislative Conference (SLC) of The Council of State Governments already have enacted legislation addressing the Clean Power Plan Proposed Rule and its regulations.

This SLC Issue Alert provides an overview of some measures taken by state legislatures in the SLC region to address the Clean Power Plan Proposed Rule through the 2014 legislative session. This Issue Alert is not a legal analysis of Section 111(d), nor does it take a position on compliance pathways or the EPA’s proposed state-specific carbon dioxide (CO2) goals.

The Supreme Court’s 7-2 ruling in Oneok v. Learjet is a solid win for states, consumer protection, and the Ninth Circuit. The Court held the Natural Gas Act does not preempt state-law antitrust lawsuits alleging price manipulation that affect both federally regulated wholesale natural-gas prices and nonfederally regulated retail natural-gas prices.

Historically, federal regulation of the natural-gas industry has been divided into three segments:  production, interstate gas pipelines (wholesale), and local gas distribution (retail). The federal Natural Gas Act regulates only the second segment—the interstate shipment of gas including rate setting—states regulate the other segments. Since deregulation in the 1970s, pipeline wholesalers have sold natural gas at market rate based on price indices of voluntarily reported data of natural gas sales. In 2003 the indices were found to be inaccurate because natural-gas traders had been reporting false data. 

Interest in using solar energy to power homes continues to skyrocket and rural electric cooperatives are taking notice. Rural co-ops--nonprofit consumer-owned utilities--are responding to demands from their members looking to invest in community solar projects. Utilities are developing these programs, which allow customers to pay for the cost of one or more panels in exchange for a credit on their bill based on the energy the panels produce. This eCademy session features experts discussing the national trend of community solar programs and specific examples to help state policymakers better understand this emerging trend.

Interest in using solar energy to power homes continues to skyrocket and rural electric cooperatives are taking notice. Rural co-ops --nonprofit consumer-owned utilities-- are responding to demands from their members looking to invest in community solar projects. Utilities are developing these programs, which allow customers to pay for the cost of one or more panels in exchange for...

CSG South

In July 2008, the price of oil per barrel reached an astronomical $147, and the price of gasoline in several states exceeded $5 per gallon; just six months earlier in January 2008, the price per barrel had hovered around $90. Fast forward to the end of 2008, and the price had plunged to under $35 a barrel, when the United States and world economies were in the throes of the Great Recession, the worst economic downturn to sweep over the globe since the Great Depression. Reviewing the price per barrel in the last six months reveals similar trends: in June 2014, oil was around $115 per barrel and six months later, in early January 2015, it had dropped precipitously to below $50 per barrel. Interestingly, the four years with the highest average crude oil prices since the 1860s were 2008, 2011, 2012 and 2013; hence, the steep drop in oil prices is not a “new normal” but a return to more historic price levels. This SLC Regional Resource describes recent trends in oil prices, the reasons for their fluctuations, and the affect they have on individual states and industries in the region.

Last week the President unveiled his $4 trillion budget for Fiscal Year 2016.  The budget highlights the President’s continued support on several energy and environmental topics with emphasis on clean energy.  He reiterated his support for the Climate Action Plan he released in 2013 and called for an increase in funding support for the plan. 

Several agencies made the request for larger...

Federal and state tax credits coupled with state policies like net metering were intended to make residential solar installations more affordable for consumers and help states meet their state renewable portfolio standards. Their intent seems to have worked—residential rooftop solar is growing but the growth looks different than state leaders anticipated. Instead of homeowners making the upfront purchase of rooftop solar, an increasing number of consumers are choosing to enter third-party leasing contracts with solar leasing companies. In a third-party lease, a homeowner pays to have the solar leasing company finance, permit, install and maintain the system. The contract is attractive to homeowners because solar is installed without the large upfront costs and their solar utility rate can be set if the rate increased in the future.

The Solar Foundation, an independent nonprofit with a mission to increase understating of solar energy, recently published its annual National Solar Jobs Census 2014 report.  The report found the U.S. solar industry created jobs at a rate nearly 20 times higher than the average employment growth for a second consecutive year.

Distributed generation—mainly rooftop solar—is transforming the way electricity is generated, transmitted and distributed. In 2015, state lawmakers will likely continue debates about the most appropriate way to balance consumer demand for distributed generation while recognizing the real and substantial fixed and variable costs incurred by electric utilities and the potential impact of these policies on nonsolar consumers. This CSG eCademy session features perspectives from the electric power industry and a former utility ratepayer consumer advocate. Panelists share their thoughts on how to balance the challenges and opportunities the growth of distributed generation has brought to the forefront and how to address consumer concerns.

Federal regulations will continue to be a primary driver for energy and environment policy in the states for 2015.   Multiple rule proposals from the EPA related to air and water quality will remain at the forefront of conversation as the rules stay on schedule to be finalized in 2015.  Increasingly, the theme of conversation for states in 2015 is true flexibility when it comes to federal, state interaction.  It is a theme that will be tested with not only EPA rules but other federal, state interactions like endangered species and tackling the issue of grid reliability.  The following is a review of the top five issues for states related to energy and environment in 2015.  

Pages