Considering a Green New Deal

Will 2019 bring a "Green New Deal" for the U.S. or individual states?

President Franklin D. Roosevelt championed the original "New Deal" in the 1930s, as a series of federal reforms and measures designed to lift the U.S. economy out of the Great Depression. The First New Deal included banking and securities law reforms, funding for emergency relief operations by states and cities, and a Civil Works Administration. Later in the Roosevelt administration, a Second New Deal included labor law reforms, significantly increased federal employment through the Works Progress Administration jobs relief program, and the Social Security Act, among other measures.

More recently, the notion of a "Green New Deal" has emerged from a variety of sources. While the details of what constitutes a Green New Deal vary depending on the proponent, the basic concept most proposals have in common is a significant investment in clean energy to spur employment and revenue. For example:

• Mark Hertsgaard's 1998 book Earth Odyssey culminated with his vision of a "Global Green Deal" to transform global economies based on the New Deal.
• New York Times columnist Thomas Friedman has been credited with coining the "Green New Deal" phrase in a pair of opinion pieces in 2007. At the time, Friedman envisioned the government as "not funding projects, as in the original New Deal, but seeding basic research, providing loan guarantees where needed, and setting standards, taxes and incentives" to spawn business opportunities in clean power.
• In his 2008 presidential campaign, President Obama proposed addressing the nation's economic crisis by using green investments to promote new jobs, and the 2009 stimulus act included substantial measures along these lines which have been called a Green New Deal.
• In 2009, a United Nations program published a report calling for a "Global Green New Deal," again seeking transformation of global economies through investment in clean energy, systems and infrastructure.

The idea of a Green New Deal has again found some traction in 2019, although the details of what might be included remain unclear, as does the likelihood of its adoption. In 2018, as part of her successful campaign, now-Representative Alexandria Ocasio-Cortez proposed a federal "Green New Deal" to address climate change. While the concept does not appear to have been fully embraced by Congress, state legislation proposing state-level Green New Deals has started to arise. For example, Maine state Representative Chloe Maxmin has proposed a bill whose title has been published as LR 1034, "An Act To Establish a Green New Deal for Maine."

Whatever ultimate fate these proposals meet, the concept of stimulating the economy and improving environmental performance through investment in clean energy and other green infrastructure projects will likely remain on the table for the foreseeable future. Legislatures and policymakers will be faced with challenges and opportunities in crafting measures that will succeed, in terms of both enactment and actually making a difference. If nothing else, 2019 will bring continued discussion across all levels of government about how best to move the U.S. and individual states forward.

DOE report finds Solyndra gave "false and misleading" info

The Department of Energy's Office of Inspector General has released a special report finding that failed solar panel maker Solyndra, Inc. provided the Department with inaccurate and misleading information during the application process for a $535 million loan guarantee.  The report summarizes the results of a 4-year investigation into what went wrong with the Solyndra matter, and what lessons the Department can learn as it proceeds to exercise its authority to grant an additional $40 billion in loan guarantees.

In 2005, Congress established a federal loan guarantee program for eligible energy projects that employed innovative technologies. Title XVII of the Energy Policy Act of 2005 authorized the Secretary of Energy to make loan guarantees for a variety of types of projects, including those that “avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases; and employ new or significantly improved technologies as compared to commercial technologies in service in the United States at the time the guarantee is issued.”

The Department of Energy loan guarantee program was expanded by the American Recovery and Reinvestment Act of 2009, which added billions of dollars of new authority to support renewable energy, electric transmission, and advanced biofuels projects.  The Department's Loan ProgramsOffice has supported a portfolio of more than $30 billion in loans, loan guarantees, and commitments covering more than 30 projects across the United States.

The Department made its first award under this program in September 2009, approving a $535 million loan guarantee to a company called Solyndra, Inc.  Solyndra said it would build a solar photovoltaic equipment manufacturing facility in Fremont, California.  The Energy Department disbursed over $500 million to Solyndra through the program.  But just two years later, Solyndra showed signs of failure, as it ultimately stopped operations and manufacturing, let 1,100 employees go, and filed for bankruptcy.  U.S taxpayers lost over $500 million.

The Solyndra matter drew significant public attention, with even the Department calling it an "ordeal" and many labeling it a scandal.  What went wrong?  Should the government have guaranteed Solyndra's loans?  Was the loan guarantee program flawed?  Or was it acceptable bad luck that the first awardee failed?

Since 2011, the Department of Energy's Office of Inspector General has investigated the Solyndra matter.  Its special report released August 24, 2015, describes the Inspector General's findings:

Our investigation confirmed that during the loan guarantee application process and while drawing down loan proceeds, Solyndra provided the Department with statements, assertions , and certifications that were inaccurate and misleading , misrepresented known facts , and, in some instances, omitted information that was highly relevant to key decisions in the process to award and execute the $535 million loan guarantee. In our view, the investigative record suggests that the actions of certain Solyndra officials were, at best, reckless and irresponsible or, at worst, an orchestrated effort to knowingly and intentionally deceive and mislead the Department.

In particular, the report identified "notable misrepresentations and omissions made to the Department by Solyndra" relating to Solyndra's sales contract commitments and ability to command a premium market price for its panels.  The report suggests this false and misleading information led the Department to approve the loan guarantee, when it might not have done so with the right information.  The report found that Solyndra failed to meet contractual obligations from the loan guarantee documents relating to truth and full disclosure.

The Inspector General's special report also found that the Energy Department's due diligence efforts were "less than fully effective", with missed opportunities to detect and resolve indicators that portions of the data provided by Solyndra were unreliable.  Nevertheless, the report concludes that ultimate blame should fall on the company: "the actions of the Solyndra officials were at the heart of this matter, and they effectively undermined the Department’s efforts to manage the loan guarantee process. In so doing, they placed more than $500 million in U.S. taxpayers’ funds in jeopardy."

The Department of Energy continues to offer loan guarantees for a variety of technologies and projects.  The report suggests that the Department strengthen its due diligence process, and reemphasize to loan applicants their absolute obligation to be truthful, complete, timely and transparent.

North America's largest battery energy storage online

A California public utility has brought the largest battery energy storage in North America online.  Funded partially by federal stimulus funds, Southern California Edison's Tehachapi Wind Energy Storage Project is designed to demonstrate the effectiveness of large-scale battery storage systems.

Southern California Edison Company is the largest electricity supply company in Southern California.  As part of the U.S. Department of Energy's implementation of the American Recovery and Reinvestment Act of 2009, the utility won funding to develop a major battery energy storage system (or BESS).  The Tehachapi Wind Energy Storage project consists of an array of lithium-ion batteries capable of storing 32 megawatt-hours, deliverable as an 8 megawatt stream of energy for 4 hours.  The LG Chem batteries rely on the same lithium-ion cells installed in battery packs for General Motors’ Chevrolet Volt electric vehicle, and feature 608,832 individual battery cells arrayed in 10,872 battery modules and 604 battery racks.  Along with two 4MW/4.5MVA smart inverters, the project will be housed in a 6,300 square foot facility sited at SCE's existing Monolith substation.

Of the project's $49,956,528 total budget, half will be paid for by SCE, while federal funds will cover $24,978,264.  In return, the project will examine whether and how the battery energy storage system improves grid performance and helps integrate wind and other large-scale variable energy resourced generation.  Project performance will be measured by 13 specific operational uses, most of which either shift other generation resources to meet peak load and other electricity system needs with stored electricity, or resolve grid stability and capacity concerns that result from the interconnection of variable energy resources.  These uses include: providing voltage support and grid stabilization; decreasing transmission losses; diminishing congestion; increasing system reliability; deferring transmission investment; optimizing renewable-related transmission; providing system capacity and resources adequacy; integrating renewable energy (smoothing); shifting wind generation output; frequency regulation; spin/non-spin replacement reserves; ramp management; and energy price arbitrage.  In addition, the project will demonstrate how lithium-ion battery storage can provide nearly instantaneous back-up capacity, minimizing the need for fossil fuel-powered back-up generation.

Between technological advances and a series of recent policy decisions, battery energy storage could be poised for rapid growth.  For example, in 2011 the Federal Energy Regulatory Commission issued Order No. 755, requiring the grid operators in organized markets to compensate battery energy storage systems and other fast-ramping frequency regulation resources based on the actual service they provide.  Last year's Order No. 784 required public utilities to take into account the speed and accuracy of regulation resources such as batteries.  Meanwhile, batteries are hoped to help balance into the grid large amounts of energy from intermittent renewable resources such as solar and wind projects.

After two years, the Tehachapi Wind Energy Storage Project will have completed its initial demonstration run.  Will the project lead to greater deployment of battery energy storage systems in the U.S.?

May 16, 2011 - DOE loan guarantee program ramping down

The U.S. Department of Energy's loan guarantee program for renewable energy is preparing to run out of funding and shut down.  Last month, I noted how the Department's "1705" loan program uses loan guarantees to help energy projects get lower-cost financing.  Through the 1705 program, created and funded through the 2009 federal stimulus act, the Department committed $11 billion to support 19 projects ranging from nuclear power to solar, wind to transmission, biofuels to energy efficiency.  Continued funding for the loan guarantee program for 2011 was in doubt during the recent wrangling over the federal budget, but survived the cutting -- through September 30, 2011.

Now, DOE is preparing to close out the 1705 program.  With stimulus act funding expiring September 30, 2011, DOE is pushing to get the funding out the door -- and to turn away applicants who are not yet far enough along in the process.  Because project construction must also commence by September 30, DOE is screening out applicants it deems unlikely to meet that deadline.  While DOE's other loan programs -- the 1703 program for certain clean technologies and the Advanced Technology Vehicle Manufacturing program for fuel-efficient transportation -- will remain in operation, the apparent end of the 1705 program will close the book on an innovative federal incentive for renewable energy development.

April 19, 2011 - 400 MW solar project proposed in California

Last week I noted Google's investment in the 392 megawatt Ivanpah solar project in California.  That project, which is currently under construction in the Mojave Desert, is on track to be the world's largest solar thermal project.  Ivanpah uses heliostat mirrors to focus sunlight on centrally located solar power towers.  The towers use the solar energy to generate steam.  The steam runs through steam turbines and a generator to produce electricity.

"Turn your grocery bags into green energy" - seen at a Vermont market

Now an even larger solar project has been proposed for California -- this time solar photovoltaic.   Developer Pegasus Energy has proposed a 400 MW solar PV power plant on about 2,000 acres in Alameda County California.  The Mountain House Solar Farm would sell power to local utility PG&E, and might break ground in early 2013.

As we often see, the twin challenges of financing and regulatory uncertainty team up to add a wrinkle to these plans.  The developer has built a financing model based on using an incentive authorized by the American Recovery and Reinvestment Act: a cash grant in lieu of the federal 30% business energy investment tax credit (ITC).  That incentive program, known as the 1603 grant program, is currently slated to end this year.  The developer is reportedly hopeful that grant funds will be extended until January 1, 2013, and would be available to help finance the project.  This may be a realistic hope, as the 1603 program has already been extended once (by Section 707 of the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010), so renewal is possible.  On the other hand, recent struggles over the federal budget do call into question the continued survival of any given clean energy incentive programs.  Will Congress renew the 1603 energy grant program?

3/19/10

The board of the Los Angeles Department of Water and Power approved the Energy Cost Adjustment Factor, a multicomponent rate hike that includes Mayor Villaraigosa's carbon tax. This will add $30 per year to residentials' electric bills, and will increase business rates by 20%. Proceeds will be spent on energy efficiency.


What's new in federal energy/climate legislation? Kerry-Graham-Lieberman grows more detailed, allegedly through leaks after the closed-door session with industry (read: energy) leaders. Here's a good summary from ClimateProgress.org.


Maine energy efficiency programs in the news: a good Kennebec Journal article on how Efficiency Maine is using the $9 million in federal stimulus money that it received to award performance-based rebates of up to $3,000 for residential weatherization and efficiency measures.



A well-written Bangor Daily News article on the proposed Thorndike wind siting ordinance that goes before the annual town meeting this weekend. Other towns are also considering what they should do to regulate towers.

Maine moves to ban the importation of out-of-state firewood for use in campfires, due to the threat of non-native invasive insect species moving into Maine through the firewood.

More residential weatherization money! Rep. Chellie Pingree held a workshop yesterday with Efficiency Maine and Maine State Housing Authority to -- yet again -- publicize weatherization programs. MSHA has about $34 million for low-income weatherization projects, and Efficiency Maine has $9 million in federal stimulus funds for all income levels.

An editorial in the Toledo Blade calls for Ohio to do more to attract solar energy manufacturers, noting that since 2000 Ohio has slipped from "global leader in solar energy" to 14th out of the United States in number of solar manufacturers.

Remember the huge underground coal mine fire that destroyed the town of Centralia, Pennsylvania? It's back in the news today. The state is moving to take the property within the town by eminent domain, apparently so it can sell the mineral (coal) rights to a mining company. Meanwhile, the few remaining residents are claiming fraud, namely that the underground fire isn't so dangerous and that their property should remain theirs.

International energy news: Senegal and Syria both want civilian nuclear power.

Here's the Portland Press Herald blurb on Michael Stoddard's selection as Executive Director of Efficiency Maine. I've worked closely with Michael in his current (3 more weeks) role as senior counsel at Environment Northeast. Congratulations Michael!

US Department of Energy has filed a petition to withdraw its request to store nuclear waste at Yucca Mountain.

Remember the "Buy American" portions of the stimulus bill? Apparently they only apply to projects built by the government, not projects built by private companies. Senator Chuck Schumer cites the example of a $1.5 billion wind project in West Texas that is will receive $450 million in stimulus grants, most of which will be used to purchase of turbines from China. How much of that money truly stimulates American jobs?

On the residential weatherization front, President Obama gave more details on his proposed "Homestar" energy retrofit program. President Obama first announced this initiative in his State of the Union address. The initiative needs legislative approval, but for now it looks like it will provide jobs for contractors by offering homeowners up to $3,000 to insulate their houses, replace their leaky doors and windows, replace their old water heaters and roofs, and generally cut down on their consumption of energy.

2/22/10

As expected, the federal Surface Transportation Board has received the Montreal, Maine & Atlantic Railway's notice of intent to abandon 233 miles of track in Maine, from Madawaska to Millinocket. Even though this line serves about 20 industrial freight customers, the Railway says it has been losing $4 million to $5 million a year through operating the lines because freight revenue has fallen. The typical freight shipped on the line includes lumber, plywood, logs and wood chips have fallen, all of which are in low demand given the slump in the housing market. If the rail is abandoned, it could cost 750 jobs as increased transportation costs would lead the region's manufacturers to scale back production.

Iran is choosing sites for uranium enrichment plants, claiming it wants civil nuclear power, not weapons.

Distributed generation gets a policy boost, with a finding that widely-adopted rooftop solar might be easier to develop than utility-scale solar arrays, due to the challenges of siting larger projects.

Much buzz today over Bloom boxes, distributed fuel cell arrays about to be announced. Bloom Energy, which raised $400 million in venture capital, holds a press conference on Wednesday at which it is expected to unveil its products. Interestingly, Google already has a 400 kW array in beta-testing operation.

Speaking of Google, FERC granted Google's market-based rate authorization. As someone who works with FERC's market-based rate structure, having filed a number of petitions myself, it is interesting to me to see how the media reports this: as enabling Google to purchase low-cost power. Surely we all want to purchase low-cost power -- what would it take to enable us all to purchase power at market-based rates? Most people would qualify -- no market power, etc.

Some question whether Energy Star really means much for appliance efficiency.

The administration's pro-nuclear news of last week continues to resonate, as Texas evaluates whether proposed new reactors there will receive similar government support.

Six Maine school and university oil-to-wood heating projects will receive more than $3.2 million in federal Recovery Act funds managed by the Maine Forest Service. The Presque Isle office of the University of Maine Cooperative Extension was awarded $16,575 for installation of a pellet boiler to replace the current oil boiler, displacing 1,850 gallons of fuel oil. (The existing boiler is around 10 years old -- are we incenting inefficient replacement of newer equipment while older, less efficient facilities remain?) Overall this project costs an estimated $40,169, with the remainder of the project funded by the Maine Economic Improvement Fund. Regional School Unit 29 in Houlton was awarded $750,000 for conversion of an oil boiler to a wood chip boiler at Houlton High School, displacing 65,000 gallons of the 85,000 gallons of fuel oil used annually by the district. The district uses about 85,000 gallons of oil a year, according to the superintendent. Here, the district will keep its oil boiler, but will rely on the new boiler for heating. Other winners are Oxford Hills High School, the Greenville School Department, Phillips Middle School and Poland Middle-High School. Maine Forest Service Director Alec Giffen said the six projects collectively “will annually avoid the burning of almost 263,000 gallons of oil, recirculate $600,000 in fuel dollars in the Maine economy, and avoid more than 5 million pounds of emissions from fossil fuels.”

More Maine stimulus: EECBG grants to central Maine communities.

2/17/10

More information on the DOE nuclear loan guarantees: the US will guarantee $8.3 billion of the $14 billion Plant Vogtle development spearheaded by the Southern Company -- and the developers are still saying they are exposed to risks from private financing for the rest. DOE is reportedly looking at three more sites: Unistar's third reactor at Calvert Cliffs in Maryland; a troubled San Antonio, Texas project, facing rising cost estimates and a lawsuit filed by San Antonio's municipal utility against its partner in the project, NRG; and the joint Scana Corporation and Santee Cooper proposal near Jenkinsville, S.C.

An interesting take by Michael Northrup: there is a clean energy gold rush, but the US is being left behind. We have only one out of the top 10 wind manufacturers (General Electric) and only two of the top 10 solar manufacturers (First Solar and Sun Power, both of whom actually make stuff overseas). An interesting tie to Habib Dagher's vision that the opportunities for renewables lie not only in having installed capacity, but in manufacturing the equipment needed for development. Under this model, your production is not limited by your local demand, but rather the global market -- meaning we can import dollars into the country (or our states) from abroad, resulting in a net increase of the pie.

Solar news: NV Energy and NextLight Renewable Power, LLC announced a 25-year power purchase agreement for power from NextLight's Silver State Solar Power photovoltaic plant. This 50 MW project located near Primm, NV should see groundbreak by the end of 2010, employing 230 construction workers and coming online in May 2011. The specific terms of the power purchase agreement were not disclosed, but we do know that the long-term agreement stems from NV Energy's 2009 Request for Proposals for renewable energy and requires approval by Nevada's Public Utilities Commission.

In Maryland, some are pushing for property-assessed energy efficiency loans, and increased incentives for solar. Maine faces a similar proposal in the form of LD 1717.

In Connecticut, U.S. Sen. Chris Dodd calls for rebuilding the Kleen Energy plant that recently exploded while under construction.

$14 million in stimulus grants to Maine ports (Searsport, Eastport, Portland), stated as supporting "green cargo" like wind turbine parts.

Diesel from algae? DARPA says yes, and that it will be cost-competitive with true fossil fuel.

$9 million loan program to retool the old Ethan Allen furniture factory in Island Pond, Vermont, into a pellet factory.