Energy

Climate Adaptation

Twenty-Three regulators and legislators from around the country attended the CSG “Building Relationships Between Regulators and Legislators” Policy Academy on September 13-15 in Washington DC. The policy academy provided a forum for state regulators and legislators to engage and collaborate with each other on energy resource planning. In addition to participating in breakout discussions, attendees heard from representatives of the electric utility industry, industry associations, academics, think tank researchers, and others about...

Community Solar and Community Choice Aggregation, or CCA, are two relatively new, increasingly pursued, and still evolving strategies helping to transform the U.S. electricity system. These approaches put local governments at the center of energy purchase and development decision-making efforts. States should pay attention to these two potentially overlapping approaches as they can address a number of energy-related challenges. Their effectiveness depends on the form they take, including whether they are enabled by state legislation. This article describes these programs and recommends support for strategic energy planning to gain a full awareness of challenges and opportunities.

The coal industry has been on a bumpy ride in recent years. The industry has seen a wave of bankruptcies and mine closures in the face of falling demand and efforts to reduce carbon emissions. Jobs losses in the industry have led to economic devastation in already struggling communities across eastern Kentucky, southern West Virginia, and southwestern Virginia.

Bringing back coal mining jobs and reviving the coal industry is at the top of President Donald Trump’s energy agenda. But it is unclear whether the federal government has the power to disrupt a complex set of trends that have to do with market forces and technology, in addition to regulations.

This brief first looks at the current state of the U.S. coal industry. It then discusses a variety of trends that have impacted the coal industry over the past several decades as well as in the last few years. While environmental regulations have certainly played a part, this brief argues that there are other, likely stronger influences at work. The brief closes by discussing the outlook for coal’s future.

The mix of energy sources used to generate electricity across the country has changed significantly in the last decade as coal, while still the largest single source of fuel, has lost its share of the generation market to natural gas and renewables like wind and solar. States’ electricity generation includes such sources as coal, natural gas, nuclear power, hydropower, and renewables. The electricity generation mix varies significantly from region to region and even state to state, depending on available resources and regional market prices.

The U.S. Department of Energy released its highly anticipated grid reliability study on Wednesday. The report’s main conclusion faults low natural gas prices as the driving factor for most baseload power plant retirements, rather than environmental regulations and renewable energy incentives—a conclusion that should not come as too much of a surprise to anyone in the power sector.

Energy storage is a game changer. In a recent blog, I noted how the falling costs for batteries, along with the spread of solar power, has the potential to significantly expand the ability of energy storage and distributed energy resources to participate in the nation’s electricity system. GTM Research expects the U.S. energy storage market to grow to roughly 2.6 GW in 2022, almost 12 times the size of the 2016 market. Seventy-one megawatts of energy storage were deployed in the first quarter of 2017, growing 276 percent over Q1 2016.

The consulting firm McKinsey & Company recently released a report noting that energy storage prices are falling faster than anyone expected, with battery costs down to less than $230/kWh in 2016 from almost $1,000/kWh in 2010. The falling costs for batteries, coupled with the spread of solar power, presents a growing threat of disruption for utility business models.

In May 2017, the U.S. Energy Information Administration, or EIA, released a daily energy brief noting U.S. nuclear capacity and generation is expected to decline as existing generators retire. Five nuclear plants, with a combined capacity of 5,000 megawatts, or MW, have retired in the past four years, primarily due to competition from low-cost natural gas, unfavorable market policies, and/or local opposition. The Three Mile Island generating station in Pennsylvania is the latest nuclear power plant to announce retirement plans. In addition to these recent retirements, six other plants are scheduled to retire in the next nine years.

The transformation of the electric grid in the United States is proceeding at a rapid pace. Several factors, including the proliferation of distributed energy resources, or DERs, utility-scale renewable generation, energy storage, advanced metering infrastructure, and other technologies, are changing the way electric power is now generated, transmitted and distributed.

Last week President Trump withdrew the United States from the Paris Climate Accord, citing the “draconian financial and economic burdens the agreement poses on our country.” The decision to withdraw from the agreement—a major international treaty to address climate change—is going to have broad policy and environmental impact on the global stage.

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