PM2.5 Health Impacts in New York City

In the last several days I have been drafting a review of  the PEAK Coalition report entitled: “Dirty Energy, Big Money” and today I was working on the air quality health impacts section.  I also noticed today that the usual suspects are claiming links between air pollution and Covid-19 susceptibility. In this post I will explain how I could be convinced that the reports underlying presumption that inhalable particulates have dire health impacts is correct.

I am a retired electric utility meteorologist with nearly 40 years-experience analyzing the effects of air quality and meteorology on electric operations.  I have been reviewed health impact claims throughout my career.  This background served me well preparing this post.  The opinions expressed in this post do not reflect the position of any of my previous employers or any other company I have been associated with, these comments are mine alone.

Background

Health impacts associated with inhalable particulates, also known as PM2.5 because it refers to airborne particles with a diameter of 2.5 micrometers or less, turn out to be the primary rationale for all the recent EPA air quality emission reductions cost-benefit analyses.  For example, EPA’s air toxics emission limits were cost effective not because of direct impacts of mercury and other heavy metals but because the control systems for those pollutants would have decreased PM2.5 concentrations and led to alleged health improvements.

Steve Milloy’s Scare Pollution: Why and How to Fix the EPA explains the problems with those health impact claims.  Milloy points out that no one has proven a biological explanation why the inhaled particles will cause fatal inflammation.  The alleged relationship is based on epidemiological statistical evaluation of air quality and health impact data.  The basic problem is that there are many confounding factors known to cause the observed health impacts and trying to tease air quality impacts out of the mix is difficult to prove.

It gets worse.  The studies that are the basis for the alleged air quality health impacts were at relatively high ambient concentrations.  Make no mistake that air pollution can be a very bad thing but the levels of pollution in the United States that clearly caused health impacts occurred many years ago and included a mix of pollutants not found anywhere in this country today.  It gets worse because the dose-health impact relationship is being extrapolated using the linear no-threshold model which has been used to estimate the dose response for radiation health impacts.  The concept is that there is no threshold below which there is no effect.  However, in my opinion and others, extrapolating measurements and responses at high levels down to levels near the level of detection is an unwarranted presumption.  Nonetheless, advocates for ever lower air quality improvements routinely claim health impacts behave the same way.

Public Health Impacts

The primary public health reference in the PEAK Coalition report I am reviewing was the New York City Department of Health and Mental Hygiene’s (DOHMH) Air Pollution and the Health of New Yorkers report.  The PEAK coalition description of air quality public health impacts quotes the conclusion from the DOHMOH report: “Each year, PM2.5 pollution in [New York City] causes more than 3,000 deaths, 2,000 hospital admissions for lung and heart conditions, and approximately 6,000 emergency department visits for asthma in children and adults.”  These conclusions are for average air pollution levels in New York City as a whole over the period 2005-2007.

The DOHMOH report specified four scenarios for comparisons (DOHMOH Figure 4) and calculated health events that it attributed to citywide PM2.5 (DOHMOH Table 5).  Based on their results the report notes that:

Even a feasible, modest reduction (10%) in PM2.5 concentrations could prevent more than 300 premature deaths, 200 hospital admissions and 600 emergency department visits. Achieving the PlaNYC goal of “cleanest air of any big city” would result in even more substantial public health benefits.

It is important to note how air quality has improved since the time of this analysis.  The NYS DEC air quality monitoring system has operated a PM2.5 monitor at the Botanical Garden in New York city since 1999 so I compared the data from that site for the same period as this analysis relative to the most recent data available (Data from Figure 4. Baseline annual average PM2.5 levels in New York City). The Botanical Garden site had an annual average PM2.5 level of 13 µg/m3 for the same period as the report’s 13.9 µg/m3 “current conditions” city-wide average (my estimate based on their graph).  The important thing to note is that the latest available average (2016-2018) for a comparable three-year average at the Botanical Garden is 8.1 µg/m3 which represents a 38% decrease.  That is substantially lower than the PlaNYC goal of “cleanest air of any big city” scenario at an estimated city-wide average of 10.9 µg/m3.

Note that in DOHMOH Table 5 the annual health events for the 10% reduction and “cleanest” city scenarios are shown as changes not as the total number of events listed for the current levels scenario.  My modified table (Modified Table 5. Annual health events attributable to citywide PM2 5 level) converts those estimates to totals so that the numbers are directly comparable.  I excluded the confidence interval information because I don’t know how to convert them in this instance.

I confirmed that the DOHMOH analysis used a linear no-threshold health impact analysis and used their relationship to estimate the effect of the observed air quality reduction. I tested the linear hypothesis by scaling the “current level” scenario number of events to the proportion of the PM 2.5 concentrations (the last row in the table) for the “current level” and the other two scenarios.  My estimated health impacts were all within 1% which proves that the DOHMOH analysis relied on a linear no-threshold approach.  As a result, that means that I could estimate the health impact improvements due to the observed reductions in PM2.5 as shown in the last three columns in the modified table.  I estimate that the observed reduction in PM2.5 concentrations prevented nearly 1,300 premature deaths, 800 hospital admissions and 2400 emergency department visits.

Conclusion

In order to convince me that the PM2.5 health impacts claimed by MOHDOH and many others are correct I need to see confirmation with observed data.  The DOHMOH report claims that in 2005-2007 that PM2.5 concentrations led to, for example, 3,200 premature mortality events.  I have no idea how that number compares to observed values for this parameter or the others included.  I estimate that for the observed reductions in measured PM2.5 the number of premature mortality events would be reduced 1,296 events down to 1,904 events.

The first question for the health experts is whether the change from 2005-2007 to 2016-2018 of 1,296 events could be observed against natural variations or is that number within the normally expected variation.  If not then my hope for verification is not possible but more importantly it also means that the gloom and doom stories of significant health impacts are base on nothing more than insignificant statistical noise that is not really observable.  If those data are greater than expected natural variation, then it would be possible to document improvements in these alleged health impacts due to the 38% decrease in PM2.5.  If that is the case, then I stand corrected.

Here is the thing though.  The percentage of people with asthma in the United States from 2001 to 2018 is not showing a decrease at the same time ambient levels of all air pollutants are going down substantially.  While correlation does not necessarily mean causation, no correlation with a purported cause indicates a bet on a dead horse.  Therefore, I am not holding my breath that the data will show the purported benefits.

CLCPA NYS Wind Energy Resource

New York has established energy policy based on conceptions that do not hold up to numerate scrutiny.  This post addresses the idea that New York wind energy can reliably power the electric system and in tandem with solar energy can replace existing generating resources.  In order for the statewide wind energy resource to be considered a reliable source the distribution of wind energy must not include significant periods with low power output.

In the summer of 2019 the Governor Cuomo and the New York State Legislature passed the Climate Leadership and Community Protection Act (CLCPA) which was described as the most ambitious and comprehensive climate and clean energy legislation in the country when Cuomo signed the legislation.  The Citizens Budget Commission developed an overview of the CLCPA targets in Green in Perspective: 6 Facts to Help New Yorkers Understand the Climate Leadership and Community Protection Act.

The legislation requires 70% of the generation supplying New York to be renewable in 2030, statewide emissions of greenhouse gas emissions are to be reduced to 60% of 1990 emissions and elimination of fossil-fired electricity production altogether by 2040.  Unfortunately, the politicians that passed this law never bothered to figure out how it could be done.  I have written a series of posts on the feasibility, implications and consequences of this aspect of the law based on evaluation of data.  This post addresses the wind energy resource of New York.

Approach

I used two sources of data from New York Independent System Operator (NYISO).  For an overview I used the annual report that presents load and capacity data including historical and forecast seasonal peak demand, energy usage, and existing and proposed generation and transmission facilities.  The Load and Capacity Date Report or Gold Book is a featured report in the NYISO document library.  This post and a summary I posted in April 2019 use data in Table III-2 Existing Generating Facilities from those reports to describe the annual wind energy resources available.  I used the 2019 wind date from the April 2020 Gold book in this analysis.  Note that in 2019 all wind energy came from on-shore facilities.

The NYISO Real-Time Dashboard includes a window for the real-time fuel mix that includes the amount of wind generation being generated in the state.  The window also includes a link to historical data.  I downloaded data from June 2018 through September 2019, sorted out the wind production numbers, and then calculated hourly averages.  I use Statgraphics Centurion software from StatPoint Technologies, Inc. to do my statistical analyses and in this case I loaded the hourly data and calculated frequency distribution statistics.

Results

The New York State Wind Facility Status table lists 2019 wind data from the NYISO 2020 Gold Book for all the New York wind energy facilities.  The NYISO table provides the name plate ratings and 2019 net energy produced.  In 2018 there were 1,982 MW of wind energy nameplate capacity that generated 3,985 GWh of electrical energy for a state-wide annual capacity factor of 24.5%.  Note that there is a wide variation of capacity factors, that the highest is 37.4%.  All the capacity factors greater than 30% are from more recent larger turbines. The Chateaugay Wind Power facility and the Jericho Rise Wind Farm are in the same general area so I expect that the wind resource would be similar.  In 2019 the Chateaugay capacity factor was 21.1% and the Jericho Rise capacity factor was 33.4%.  I believe the main reason for the difference is the size of the turbines – the blade tip height for Jericho Rise is 18.5m (60.7 ft) higher than at Chateaugay. The Chateaugay turbines have a hub height of 80m and a rotor diameter of 77m while the Jericho Rise turbines have a hub height of 80m and a rotor diameter of 114m.  Overall, New York wind facilities only provide a quarter of their name plate capacity.

Another wind-resource issue is the distribution of the hourly output.  The NYS Hourly Wind Frequency Statistics June 2018 through September 2019 document lists frequency distribution data for sixteen months of operations in New York.  The histogram of wind output categories shows that low output is more frequent than high output.  The frequency tabulation for wind table shows that there were 25 hours when none of the 24 wind facilities in the state produced any power and that 36% of the time less than 200 MW per hour was produced.  The probability plot graphically shows the skewed distribution and the percentiles indicate that half the time hourly wind output is less than 324 MW.

If New York has to rely on renewable energy in the future it is important to know the frequency distribution of wind at night.  I addressed this by simply looking only at four hours either side of midnight.  The NYS Night Hourly Wind Frequency Statistics June 2018 through September 2019 document lists the same statistics for this limited data set.  While there are only a couple of hours with no wind output and the frequency of hours with output less than 200 MW was down to 31% there still is a significant number of hours when the lack of solar and low wind output.  That means that energy storage is going to be absolutely necessary.

Another aspect of concern is the duration of low wind periods.  I used the same data format as the wind frequency statistics but only included 2018 data to determine how long light periods lasted – a critical parameter when it comes time to try to rely on wind energy to provide reliable power.  I calculated the length of time the total NYS wind energy resource failed to exceed various thresholds from 100 MW to 600 MW.  The 2018 Total NYS Wind Energy Light Wind Energy Periodss table lists the longest calm periods for each threshold.  For example, the longest period when less than 100 MW of the state’s total wind capacity of 1,982 MW was 58 hours ending on 9/13/2018 at 1800.  In the second section of the table frequencies are listed.  There were 12 periods when less than 100 MW of wind capacity was available for 24 hours, 5 periods for 36 hours, and one period of 48 hours.

Conclusions

Annual capacity factors average 25%.  All the turbines with capacity factors greater than 30% are using turbines that with tip heights greater than 425 ft.  Although that improves performance it also means that there are greater environmental impacts.  I believe we cannot expect much improvement for future on-shore wind development simply because I assume that the best locations have already been developed.

The distribution of hourly wind output was a mild surprise to me because  I did not think it would be as bad as it is.  Advocates for renewable power maintain that it is possible to address the problem of calm winds at one location by simply adding facilities in other locations so that somewhere the wind will be blowing.  If that were the case using New York resources the hourly distribution would not show that 5% of the time the total wind energy production for the entire state was less than 20 MW.  Furthermore, I suspect that even expanding the location of wind facilities to off-shore New York and adjoining jurisdictions is not going to significantly reduce the number of hours when wind resources are going to have to be supported by significant amounts of energy storage.

The fact that night time wind generation also shows significant hours with low levels exacerbates the need for energy storage.  In an earlier post I estimated how much energy storage would be needed for one example period.  These results reinforce my position that New York State has to do a comprehensive analysis of the availability of renewable resources to determine a strategy for meeting demand with an all-renewable system.  Until that is complete we are only guessing whether the ambitious goals of the CLCPA can be met much less how much this is all going to cost.

My Additional Comments on NESE Pipeline Alternatives

The Northeast Supply Enhancement (NESE) pipeline is a proposed pipeline to bring natural gas to New York City and Long Island.  This post documents additional comments I have submitted in a New York Department of Public Service proceeding related to denial of service requests by National Grid in New York City and Long Island which is associated with the project.

In NESE Pipeline Alternatives for National Grid I included an overview of the proceeding and described my comments.  Since then I submitted three additional comments addressing particular aspects of comments submitted by others.  Opponents of the pipeline alternative that claim that additional energy efficiency efforts can eliminate the need for a pipeline. The Eastern Environmental Law Center submitted a report to the docket by Synapse Energy Economics entitled “Assessment of National Grid’s Long-Term Capacity Report: Natural gas capacity needs and alternatives” on April 14, 2020.  Several commenters suggested that “climate realities” mean that the current criteria for the coldest day can be revised.

Energy Efficiency Performance Comments

I do not dispute that the theory that investments in energy efficiency will reduce the need for additional generating resources is a good idea because there is no benign way to generate electricity.  Nor do I dispute that New York has a good energy efficiency record.  However, I don’t think that past performance is necessarily an indicator of future results simply because the easiest and most effective, aka low hanging fruit, energy efficiency projects have already been implemented.  Any future reductions will not be as cheap or effective.

The comments I submitted attempted to determine how well the existing energy efficiency programs have been doing.  Supporters of increased energy efficiency claim that energy growth is decreasing and increased investments will reduce growth even more.  There is a fundamental problem when evaluating energy efficiency, namely it is difficult to compare different time periods because energy use is not just a function of how efficiently it is used but also varies because of weather, the economy. and number of customers.  In order to address that I used the average natural gas use per customer averaged over the latest five-year period of data compared to the previous five years of data.  I found that residential, commercial, and industrial use per customer all went up over the ten-year period for the state as a whole and residential and commercial use per customer went up in New York City and Long Island.

I concluded that in order to justify National Grid’s high-demand (80% of future efficiency targets) and a low-demand scenario (100% of future efficiency targets) bounds to their analysis and the feasibility of the no-infrastructure project option for incremental energy efficiency that the fact that energy use per customer has been going up has to be reconciled.  If the Public Service Commission ultimately requires National Grid to include the incremental energy efficiency project as part of the solution, then it is up to them to show why the future results will differ from the recent past.

Synapse Report Comments

The Eastern Environmental Law Center submitted a report to the docket by Synapse Energy Economics entitled “Assessment of National Grid’s Long-Term Capacity Report: Natural gas capacity needs and alternatives” on April 14, 2020.  The report concludes: the supply gap most likely does not exist, National Grid has multiple cost-effective demand-side options to meet any foreseeable need, and National Grid’s analysis of long-term capacity options is not compatible with New York’s climate change policies.

The comments on the supply gap primarily addressed purported problems with the worst case (design day) which I address below.  They also complained that National Grid should try to maintain the number of customers who are willing and able to shift from natural gas to other sources of energy.  This disregards the fact that the most used alternative source is fuel oil which New York City is in the middle of prohibiting so they cannot keep those customers.

The Synapse report claims that National Grid has multiple cost-effective demand-side options to meet any foreseeable need including energy efficiency, demand response, and alternative energy systems such as heat pumps. As described previously there are issues with energy efficiency that Synapse ignores.  Demand response advocates assume that the load shifting opportunities available in the summer will also be available in the winter.  I argued that when 85% of your load is heating and the diurnal heating load cycle does not vary as much as the summer cooling cycle, how can you shift the load?  As a result, I believe that a demand response should not be considered a viable alternative to a proven technology for winter heating.  Alternative heating systems are electrified systems.  Air source heat pumps are touted as a viable alternative to natural gas furnace but when the temperature drops below 20° Fahrenheit there simply is not enough energy available for this technology to work.  Ground source heat pumps don’t have that problem but are difficult to retrofit anywhere and have siting demands that are likely not achievable in New York City.

The Synapse report concludes that National Grid’s analysis of long-term capacity options is not compatible with New York’s climate change policies.  In a rational world New York’s plan to implement the Climate Leadership and Community Protection Act would be available to determine compatibility but there is no plan now and one will not be available for several years.  Because the timing for the state plan is incompatible with the needs of this project and the State has yet to show that an electric system that relies only on non-fossil fueled sources can meet that peak load condition I concluded that National Grid cannot afford to wait to integrate their plan with the CLCPA plan.

Design Day Criteria Comments

I submitted this comment because other comments submitted recommend changing the design day criteria and downplay future energy needs during the worst-case cold weather periods based on “climate realities”.  I showed that when you look beyond the superficial and mis-represented IPCC science it becomes clear that climate model results and even the current observed trend of local temperatures are no reason to conclude that warmer temperatures are inevitable.  Poorly understood natural variation is as likely to be the primary driver of temperature as GHG concentrations.  Unfortunately, natural variation and climate modeling estimates of the future are very uncertain.  Therefore, I argued that it is inappropriate to change the design day criteria and that using the entire period of record for temperatures to determine the design day is the most appropriate approach.

Conclusion

“It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong”, Thomas Sowell.

Unfortunately, New York State energy policy appears to be driven by the mis-informed and innumerate squeaky wheels who respond to the request for comments with a veritable flood of responses.  Moreover, the bullying tactics of the Governor coupled with his micro-management of all decisions to cater to the aforementioned squeaky wheels that represent a political base he apparently counts on means that professional opinions of all companies in the state and agency staff are not considered.  Sowell’s comment portends bad things happening for New York energy policy in general and this proceeding in particular.

In my comments I showed that the fact that cold snaps are dangerous to health requires a plan that ensures adequate energy is available is necessary.  The theory that energy efficiency, demand response and electrification can actually provide the energy necessary should be considered relative to the real world.  Coupling those aspirational efforts with a lack of understanding about climate and climate change projections are a recipe for unanticipated problems and unintended consequences.

I urged the Public Service Commission to choose the Northeast Supply Enhancement pipeline and the other pipeline distribute infrastructure projects based on my evaluation of the alternatives. The other proposed solutions are based on theory and not proven results.  I believe it is in the best interests of New York to implement a proven technology solution for current and future heating requirements as soon as possible. 

RGGI Leakage

In November 2019 the Regional Greenhouse Gas Initiative (RGGI) released their annual RGGI electricity marketing report.  I have not been following this annual report but have been looking at emissions leakage and realized that it is supposed to address RGGI leakage.

I have been involved in the RGGI program process since its inception.  I blog about the details of the RGGI program because very few seem to want to provide any criticisms of the program. The opinions expressed in this post do not reflect the position of any of my previous employers or any other company I have been associated with, these comments are mine alone.

Emissions Leakage

Emissions leakage refers to the situation where a pollution reduction policy simply moves the pollution around geographically rather than actually reducing it.  Ideally if you want to solve global warming with a carbon price then you want to apply it to all sectors across the globe so that it cannot occur.  In general, I don’t think a global carbon pricing scheme is ever going to happen because of the tradeoff between the benefits which are all long term versus the costs which are mostly short term.  I don’t see how anyone could ever come up with a pricing scheme that equitably addresses the gulf between the energy abundant “haves” and those who don’t have access to reliable energy such that “have nots” will be willing to pay more (as carbon taxes) as they catch up with those who have abundant energy.

 

Despite this potential problem, carbon pricing schemes including the RGGI cap and auction program have been implemented in small jurisdictions.  When RGGI was being developed emissions leakage was a big concern.  In March 2007, the Emissions Leakage Staff Working Group submitted a report: Potential Emissions Leakage and the Regional Greenhouse Gas Initiative (RGGI): Evaluating Market Dynamics, Monitoring Options, and Possible Mitigation Mechanisms.  The report noted that “Under a “middle-of-the-road” scenario, cumulative emissions leakage was estimated at 27% of net CO2 emissions reductions through 2015” but “Projected emissions leakage is predominantly in the form of a shift in the location of new natural gas-fired power plant builds, rather than decreased utilization of existing plants”. In an independent analysis, Kolodziej and Wing (2008) used theoretical and numerical general equilibrium models to evaluate potential leakage and concluded that “Although RGGI’s economic impacts are small, they induce substantial increases in power exports from unconstrained states which result in emission leakage rates of more than 50%”.

The 2007 Emissions Leakage Staff Working Group report recommended that “for the purpose of quantifying and determining the extent of potential emissions leakage, ensuring that leakage does not undermine the emissions reductions achieved by the program, and supporting RGGI’s goals of monitoring emissions leakage, it is essential to be able to track and verify the environmental attributes associated with all the power being generated and used within the RGGI region, as well as the environmental attributes of power generated in adjoining regions”.  The emissions page in the allowance tracking category of the RGGI website notes “As part of RGGI’s program design process, the participating states determined that regular reports would be made to monitor and track power generation serving load in the RGGI region, as well as the emissions associated with that generation.”

RGGI Leakage

I believe that the RGGI electricity marketing reports represent the commitment to track leakage.  They summarize data for electricity generation, net electricity imports, and related carbon dioxide (CO2) emissions for the states in RGGI.  One metric presented could “provide a preliminary or potential indication of emissions leakage, or a lack thereof”.  However, there is a caveat: “because this report does not establish the causes of observed trends, it should be emphasized that this report does not provide indicators of CO2 emissions leakage”.

The most recent report, CO2 Emissions from Electricity Generation and Imports in the Regional Greenhouse Gas Initiative: 2017 Monitoring Report, states that:

Annual average net electricity imports into the nine-state RGGI region increased by 22.2 million MWh, or 39.6 percent, during the 2015 to 2017 annual average compared to the 2006 to 2008 base period. CO2 emissions related to these net electricity imports decreased by 2.3 million short tons, or 9.1 percent, during this period, indicating a reduction in the average CO2 emission rate of the electric generation supplying these imports of 317.0 lb CO2/MWh, a reduction of 35.0 percent.

Compared to the annual average during the 2006 to 2008 base period, 2017 electric generation from RGGI generation decreased by 54.6 million MWh, or 31.7 percent, and CO2 emissions from RGGI generation decreased by 73.9 million short tons of CO2, or 53.4 percent. The CO2 emission rate of RGGI electric generation decreased by 509.4 lb CO2/MWh, a reduction of 31.7 percent.

One could easily assume that at least some of the observed decrease in generation within the RGGI states was caused by the increased imports. In the worst case 22.2 million MWh of the observed decrease in the 2017 54.6 million MWh electric generation decrease from RGGI generation could be caused by leakage.  However, in order to make that assumption you have to presume that the RGGI effect on prices was the only driver of imports.  I have found analyses that claim RGGI’s effect on emissions ranged from 17% and 24% but because the cost adder of the RGGI carbon price was relatively small I do not believe that the RGGI price drove affected source control decisions.  As a result, I believe that the only reductions from RGGI that can be traced to the program are the reductions that result from direct investments of the RGGI auction proceeds.  Therefore, RGGI investments are only directly responsible for less than 5% of the total observed reductions.  As a result, that suggests that the change in imports wasn’t primarily caused by RGGI but other factors so leakage is not an issue at this time.

However, there could be big changes to RGGI compliance coming.  Because the allowance cap is decreasing and the share of banked allowances owned by investors is increasing, I believe that there will be a significant price increase in the next several years.  Moreover, there are few opportunities left for fuel switching left at RGGI-affected sources and that has been the primary cause for the observed emissions reductions to date.  That will put additional pressure on RGGI region prices.  As a result, leakage may become an issue soon.  One caveat is that New Jersey joined the program in 2020 and Virginia will join soon thereafter and that could defer these issues down the road.

Conclusion

I have to comment on one disappointing aspect of the RGGI monitoring reports.  Leakage was a major stakeholder concern going into the program and I believe that this report was intended to address that concern.  However, the report notes that “because this report does not establish the causes of observed trends, it should be emphasized that this report does not provide indicators of CO2 emissions leakage”.  With all due respect, I think the report should actually make its best estimate of CO2 emissions leakage because it is a potential problem.  However, if the report showed that leakage was a problem, then that would be embarrassing if not a flaw in RGGI.  As a result, it is not surprising that the report ducks the issue.

I conclude that to this point leakage has not been an issue. However, the lack of leakage is because fuel switching reduced emissions without raising prices.  When fuel switching no longer becomes an option, I expect that the costs to reduce emissions will create a boundary price differential that will lead to RGGI leakage.  Unless the addition of New Jersey and Virginia create opportunities for cost-effective reductions then RGGI leakage will become a problem in the next several years.

Acadia Center RGGI 10-Year Review

The Acadia Center recently released “The Regional Greenhouse Gas Initiative: Ten Years in Review”.  According to the report “The country’s first program designed to reduce climate change-causing pollution from power plants has provided a wealth of lessons to be incorporated into the next generation of climate policies, from successes to build on to opportunities for improvement”.  This post compares the claims of success for the Regional Greenhouse Gas Initiative (RGGI) against reality.

I have been involved in the RGGI program process since its inception.  I blog about the details of the RGGI program because very few seem to want to provide any criticisms of the program. The opinions expressed in this post do not reflect the position of any of my previous employers or any other company I have been associated with, these comments are mine alone.

Background

RGGI is a market-based program to reduce greenhouse gas emissions. It is a cooperative effort among the states of Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont to cap and reduce CO2 emissions from the power sector.  This program is a prototype for “cap and dividend” pollution control programs. RGGI holds quarterly auctions for CO2 allowances.  Affected sources purchase the allowances they think they will need to operate and surrender them to RGGI every three years at the end of the compliance period.  The proceeds are used to fund investments throughout the region.

The Acadia report analyzes data since the launch of the program. Their analysis claims that “CO2 emissions from power plants in the RGGI states have fallen 90% faster than in the rest of country, while economic growth in the RGGI states has outpaced the rest of the country by 31%. The program has also driven substantial reductions in harmful co-pollutants, making the region’s air cleaner and its people healthier.”

As I will show below this report is fundamentally flawed because it attributes all the reductions in CO2 emissions and air quality improvements to the RGGI program.  In reality fuel switching is the primary cause of the reductions.  When the savings that RGGI claims as benefits due to investments from the auction proceeds are evaluated, they are a small fraction of the observed reductions.

RGGI Ten Years in Review Emissions Reduction Claim

The Acadia report states:

States participating in RGGI have seen a steep decline in CO2 emissions from power plants over the last 10 years. Since 2008, the year before the program launched, RGGI emissions have fallen from 133 million short tons of CO2 to 70 million tons in 2018, shown in Figure 1. The impressive electric sector emission reductions achieved in RGGI states over that time period have outpaced reductions in the rest of the country by a staggering 90%. While the RGGI program has not been the sole factor behind the region’s rapid electric sector decarbonization, earlier analysis[1] shows that it has been a key driver—and accelerator—of emission reductions from power plants.

I do not dispute the observed reduction values but the claim that the RGGI program has been a key driver or accelerator, whatever that means, is bogus.  The referenced paper by Murray and Maniloff does not indicate that the majority of the reductions are due to RGGI and I think their estimate of 24% is an unlikely upper bound.  There are two ways to determine how much RGGI itself has contributed to the observed reductions and both show even lower estimates of the RGGI effect on emissions.

The Murray and Maniloff analysis referenced shows the region’s emissions would have been “24 percent higher without the program, accounting for about half of the region’s emissions reductions during that time”.  The econometric modeling used in their analysis assumes that compliance with the program is made more efficient by an allowance acquisition program that resembles commodities markets.  In reality, based on my experience in the utility allowance trading business and discussions with my peers, the vast majority of companies and possibly all companies treat allowance acquisition as simply a tax.  Allowances are purchased in the auctions or on the secondary market based on short-term compliance needs.  The over-riding concern is compliance.  I am not familiar enough with econometric modeling to say how this affects the results but I believe they do.

In my opinion the Murray and Maniloff analysis assumed that companies would do things to reduce their CO2 emissions rather than just buying allowances as a tax.  However, the only thing that they could do is to improve combustion efficiency to use less fuel.  Fuel costs are the over-riding driver for operating costs so plants have already looked into this and probably made the efficiency changes that they could afford so there were few opportunities left to become more efficient.  In addition, EPA’s New Source Review program can penalize old facilities that make efficiency improvements because they are concerned that they those improvements could extend the life of a higher emitting facility.  Based on my experience and discussions with colleagues in the industry affected generating units did not do anything to control emissions for RGGI.  More importantly when this analysis observed facilities shutting down, they claimed that was due to RGGI.  In fact, all the facilities that I am familiar would have shut down even if RGGI were not in effect.  For all these reasons I do not accept this reference as credible evidence for RGGI success.

The first way to determine why emissions dropped over this period is to evaluate the emissions data.  I queried the database at EPA Clean Air Markets Division data and maps  and downloaded emissions, load and heat rate data for the nine RGGI states for the years 2000-2018.  In order to determine what fuel was used I had to use these data instead of the data in the RGGI system because the EPA data includes fuel type information.  This means that there are differences in the annual totals because the EPA data set has more units in it.  Prior to the start of RGGI I had to ask for data from “all programs” and for consistency kept that constraint even after the start of RGGI.

The RGGI Nine-State EPA Clean Air Markets Division Annual Emissions Data by Primary Fuel Type table lists load and CO2 mass data from 2006 to 2018.  In order to establish a baseline, I used the average of the three years prior to the start of the program.  The CO2 mass and load from coal-fired units went down over 80% from the baseline to 2018.  The RGGI states have a relatively high concentration of residual oil-fired units and load and CO2 mass went down nearly as much.  Diesel and other oil-fired units went down over 50%.  On the other hand, natural gas firing loads went up 35% and CO2 mass went up 43%.  Because natural gas firing has much lower CO2 per MWhr emission rates the total CO2 mass went down 41% from my baseline to 2018.  Because fuel prices are the primary driver of unit operations and because the RGGI allowance price was relatively small in comparison to the fuel price differential of natural gas relative to coal and oil I conclude that the primary driver of RGGI region CO2 emission reductions was fuel switching not RGGI.

The second way to determine the effect of RGGI is to use RGGI’s own information.  The Investment of RGGI Proceeds in 2017 report tracks the investment of the RGGI proceeds and the benefits of these investments throughout the region. I recently calculated that the total annual reductions since the start of the program were: 4,014,410 MWh of electricity use avoided, 9,824,199 MMBtu of fossil fuel use avoided, and 2,818,775 short tons of CO2 emissions avoided.  The total reduction in load from the baseline until 2018 is 51,098,013 MWh so the direct investments of RGGI auction proceeds were responsible for 7.9% of the observed reduction in load.  The total reduction in CO2 from the baseline until 2018 is 52,202,198 tons so the direct investments of RGGI auction proceeds were responsible for only 5.4% of the observed emissions reduction.

Clearly the Acadia report claim that the RGGI program has been a key driver of emission reductions from power plants is wishful thinking and not supported by the data.

RGGI Ten Years in Review – Aligning the RGGI Cap with Current Emissions

Because historical emissions have been less than the cap on emissions, the Acadia report calls for program reforms including a more stringent cap, more constraints on the allowance supply, and adjustments to eliminate the allowance surplus.  The report notes that “To be most effective, the RGGI cap needs to more closely reflect the new, lower-carbon reality of the region’s electric sector and the science-based GHG reduction targets adopted by the RGGI states.”

There is one facet of the cap and trade pollution control theory that is neglected with these recommendations.  In order to be effective, the affected sources must have options to reduce their emissions.  In general, with any GHG market-based program the sources affected by the rule don’t have options.  As noted above there are no real options for a power plant to reduce its emissions.  Theoretically a power plant could develop its own non-CO2 emitting generating units but the reality, especially in a non-regulated state, is that fossil-fired power plants have little incentive to pursue those options.  Most importantly, non-regulated generators have no obligation to serve.  In my opinion they will simply operate as long as they can make a profit or have the allowances available to operate then shut down.

The most important limitation to market-based cap programs is the cap limit.  If there are no other operations then affected facilities will just operate less or shut down entirely.  In their naïveté the Acadia report authors support a strict cap that actually constrains CO2 emissions.  The problem is that CO2 emissions represent generated power.  If the facilities cannot emit CO2 then they cannot produce power.  At some point the apparent preference of environmentalists for wind and solar resources will require grid services support to support the transmission grid because those resources are diffuse and energy storage because those resources are intermittent.  No cost studies that claim wind and solar are approaching the cost of natural gas generation include those integration costs.  If the trajectory of emission reductions does not account for that reality then I predict there will be big problems.

RGGI Ten Years in Review – Economic Trends and Electricity Prices

The Acadia report claims that RGGI has “generated significant economic benefits” by investing auction proceeds in “energy efficiency, renewable energy, and other consumer programs that increase economic activity in participating states.”  They also claim that “The RGGI states have managed to rapidly reduce CO2 emissions without impeding economic growth” and that the “average retail electricity prices have dropped since RGGI took effect”.

The Investment of RGGI Proceeds in 2017 report released in October 2019 tracks the investment of the RGGI proceeds and the benefits of these investments throughout the region. According to the report, the lifetime benefits of RGGI energy efficiency investments made in 2017 includes energy bill savings of over $1.4 billion on an investment of $315.6 million which qualifies as significant economic benefits.  However, RGGI is supposed to be a CO2 reduction program and what are the lessons to be incorporated into the next generation of climate policies from RGGI.  Sadly, from the standpoint of an efficient CO2 reduction program I don’t think you can call RGGI a success.  From the start of the program in 2009 through 2017 RGGI has invested $2,527,635,414 and reduced CO2 2,818775 tons annually which results in $897 per ton of CO2 reduced.

I will not debate the claims that RGGI rapidly reduced CO2 emissions without affecting economic growth and that retail electricity prices dropped.  However, as shown earlier the RGGI reductions had little to do with RGGI itself and much more to fuel switching to cheaper natural gas.  It seems to me that these claims then should be more to do with fuel switching than RGGI itself.

Conclusion

The Acadia report concludes:

RGGI has successfully demonstrated the viability of a market-based program to reduce CO2 emissions from the power sector while generating benefits for participating states. RGGI’s experience has disproven the concerns most frequently associated with capping emissions from the power sector. Emissions have declined rapidly, far more dramatically than projected, without stifling economic growth. RGGI’s reinvestment model has benefited the regional economy and increased employment while accelerating deployment of renewable energy and funding energy efficiency programs. The region’s residents now pay lower electricity prices than before the program began and breathe cleaner air.

I don’t think that RGGI has disproven any capping emissions concerns.  In fact, I think it is more likely that as RGGI increases the stringency on its cap at the same time that fuel switching options are used up that we will see what happens when a market-based control program has a restrictive cap.  Given that affected sources only have the option to not run when allowances are not available, I do not think this will end well.

By RGGI’s own numbers despite the apparent value of the energy efficiency investments the fact is that as a CO2 control program the results are expensive, far exceeding any regulatory social cost of carbon value.  If society is to depend upon RGGI investments as the control program to drive emissions reductions on the order of the Green New Deal then enormous costs are inevitable.

[1] Brian Murray and Peter Maniloff, Why Have Greenhouse Emissions in RGGI States Declined? An Econometric Attribution to Economic, Energy Market, and Policy Factors, Duke Nicholas Institute, August 2015. Available at: https://nicholasinstitute.duke.edu/environment/publications/why-have-greenhouse-emissions-rggi-states-declined-econometric-attribution-economic

New York Energy Efficiency Goals

One of the cornerstone presumptions in New York’s energy future plan is that increasing future energy efficiency efforts will play a key role in the transition to a cleaner, greener electric grid.  In the summer of 2019 the Governor Cuomo and the New York State Legislature passed the Climate Leadership and Community Protection Act (CLCPA) which was described as the most ambitious and comprehensive climate and clean energy legislation in the country when Cuomo signed the legislation.  Among the targets of that legislation is: conserve 185 trillion British thermal units (TBTUs) of annual end-use energy use by 2025, of which at least 20 percent should be from energy efficiency improvements in disadvantaged communities.

Energy efficiency is a major component of New York’s energy planning because if less energy is used then less energy will need to be generated. That concept is not debatable and I support energy efficiency efforts, in no small part, because they can be directed at those least able to pay for the inevitable higher prices resulting from government intervention into energy supply.  The question addressed in this post is whether New York’s energy efficiency programs have done well enough that we can expect this to be a substantive component for future energy reduction goals.  This post will look at two New York energy efficiency goals: one made in the past and one a key component for future energy needs.

Energy Data Used to Evaluate the Goals

The New York State Energy Research and Development Authority (NYSERDA) publishes an annual a comprehensive summary of energy statistics and data on energy consumption, supply sources, and price and expenditure information for New York State called Patterns and Trends.  For anyone interested in New York energy information this is a great resource.  One thing that I particularly like is that when you click on a table there is a link to a spreadsheet with all the data.  For space reasons the report does not list all the numbers but the downloadable spreadsheet includes everything.

Unfortunately, during the Cuomo Administration, the annual updates are lagging further and further behind.  In January 2011, the report updated with data through the end of 2009 was published 13 months after the end of that year.  The latest report available, Patterns and Trends – New York State Energy Profiles: 2002-2016,  publication date is January 2019 but it did not get released for another month so it came out 26 months after the end of the year.  Clearly, the 2017 data update will be even later.

2002 Energy Plan Energy Efficiency

The 2002 Energy Plan includes energy resource assessments including Energy Efficiency  that serves as an excellent overview of energy efficiency (EE) assessment for anyone wanting more background information.  This assessment summarizes how New York’s EE programs evolved between 1990 and 2001 during the transition from traditional utility regulation to today’s de-regulated system.  In those 11 years collective energy efficiency expenditures invested “more than $2.9 billion”.   For example, according to Table 4, NYSERDA-Administered System Benefit Charge Energy Efficiency Spending with Projected and Actual Achievements (1998-2006), in this assessment, reductions to annual electric energy production totaled 11,655 (GWh) for an investment $758.7 million.  Statewide achievements between 1990 and 2001 included

      • Cumulative savings of 57,256 GWh of electricity and 1,688 MW of summer peak demand.
      • Cumulative annual savings in 2001 were 7,095 GWh, or about 5.2% of the approximately 137,000 GWh of electricity sales to ultimate consumers during that year.
      • Cumulative summer peak demand reductions in 2001 were 1,688 MW, or about 5.4% of the 30,982 MW peak that occurred during that summer.

The 2002 State Energy Plan provided “policies, strategies, and recommendations to provide New York with fairly priced, clean, and efficient energy resources”.  The Executive Summary includes the following energy efficiency goal: “The State adopts the goal of reducing primary energy use per unit of Gross State Product (GSP) 25% below the 1990 level of energy use, by 2010.”  I will determine whether the State made that historic goal below.

National Grid Natural Gas Supply Energy Efficiency Goals

In response to the New York Department of Public proceeding related to denial of service requests National Grid prepared a summary report to help “enable an agreed long-term solution(s) with New York State by June 2020” so that the solution(s) can be in place and in operation by the winter of 2021/2022.  EE projections and programs play a key part in this plan to ensure adequate natural gas supplies.  In the report,        National Grid discussed historical demand growth and made two projections, a high-demand and a low-demand scenario, to bound their analysis. In the high demand scenario, they assume that 80% of the State energy efficiency targets are achieved and in the low demand scenario they assume that 100% of the targets are achieved.  In order to meet future energy requirements, they also included a no-infrastructure energy efficiency project to “reduce Design Day demand through intensive weatherization measures, such as air-sealing and maximized insulation”.

The State’s 2002 EE goal was normalized relative to the state gross domestic product.  As a result, the result of that test is irrelevant to determining whether we can have confidence in the energy use projections in the National Grid demand growth projections and their no-infrastructure energy efficiency proposal.  What we need to look at is the actual energy use and energy use per customer.

2002 Energy Plan EE Goal Evaluation

The 2002 Energy Plan EE goal is to reduce primary energy use per unit of Gross State Product (GSP) 25% below the 1990 level of energy use, by 2010.  Table 2-5b, New York State Factors Influencing Energy Demand and Expenditures, lists the Gross State Product and Table 3-1b, New York Consumption of Energy by Fuel Type, lists energy use for the State.  The Evaluation of the 2002 State Energy Plan Goal table lists the annual values from the downloaded spreadsheets for each table, calculates energy use per GSP and then lists the % reduction from 1990 for each year since 1990.  In 2010, the reduction in this parameter was 30.1% easily exceeding the 2002 Energy Plan goal of a 25% reduction.

On the face of it this is good news but we also have to ask why did the State meet the goal.  Total energy use actually went up 3.2% since 1990.  However, the State Gross Product went up 47.5% and that increase more than made up for the energy use increase such that the energy use per GSP parameter went down.

A couple of points for context.  Energy use is a function of multiple effects including the weather (extreme heat or cold increases energy use), the economy (when more businesses are making things they use more energy), as well as how efficiently the energy is being used.  As a result, a single year to a single year comparison could be mis-leading.  Clearly, however, the fact that the energy use per GSP exceeds the goal means that the State effectively met that goal.  I think it is also a laudable achievement to increase the GSP that much and keep the energy use since 1990 pretty close to a small increase.  On the other hand, the aggressive New York state-wide goals for the future will need to rely on reductions in energy use not just energy use per GSP.

Confidence in the Future Projected EE Goal

While I am impressed that the State met its 2002 energy efficiency goal, in the context of actual energy reduction I believe that it is more important to reduce total energy use and energy use per customer served.  If those data suggest that EE is working as well as suggested by the State then we can have confidence that meeting future energy use goals will be achieved.  This section describes the data I used and how it was processed to look at that energy use itself.

For this analysis I used data from the following Patterns and Trends appendices that provide electric and gas number of customers and electric and gas sales.

Appendix F-2, New York State Electricity Customers by Sector by Utility

          • Table F-2a. Residential Sector Electricity Customers by Utility
          • Table F-2b. Commercial Sector Electricity Customers by Utility
          • Table F-2c. Industrial Sector Electricity Customers by Utility

Appendix F-3, New York State Electricity Sales by Sector by Utility

          • Table F-3a. Residential Sector Electricity Sales by Utility (GWh)
          • Table F-3b. Commercial Sector Electricity Sales by Utility (GWh)
          • Table F-3c. Industrial Sector Electricity Sales by Utility (GWh)

Appendix F-5, New York State Natural Gas Customers by Sector by Utility

          • Table F-5a. Residential Sector Natural Gas Customers by Utility
          • Table F-5b. Commercial Sector Natural Gas Customers by Utility
          • Table F-5c. Industrial Sector Natural Gas Customers by Utility

Appendix F-6, New York State Natural Gas Sales by Sector by Utility

          • Table F-6a. Residential Sector Natural Gas Sales by Utility (Millions of Cubic Feet)
          • Table F-6b. Commercial Sector Natural Gas Sales by Utility (Millions of Cubic Feet)
          • Table F-6c. Industrial Sector Natural Gas Sales by Utility (Millions of Cubic Feet)

Both sets of data include values for the residential, commercial and industrial sectors.  Note that these data are only available back to 2001.  Although the primary emphasis is on the goal for natural gas usage, I will include both electric and gas information.

The New York State Natural Gas System Customers, Natural Gas Sales, and Natural Gas Use per Customer Data and Trendstable lists the parameters that I think are more appropriate to evaluate the likelihood that energy efficiency can reduce the amount of natural gas that will be needed for the worst case heating requirements.  In 2016 the amount of natural gas used in the residential sector has increased 9.7% since 2002, in the commercial sector the amount used went down 12.8% and in the industrial sector the amount used went down 9.0%.  The amount of natural gas used per customer went up 3.9%, commercial sector was down 21.1% and industrial sector was down 56.6%

I have issues with these data that should be kept in mind.  In the industrial sector note that the number of industrial customers just about doubled from the 2001 to 2006 years.  Looking at the utility data in Table F-5c this was because of an increase at Brooklyn Union Gas.  I suspect this is more a reporting artifact than an actual change in the number of industrial customers.  Fortunately, that seems to be an exception in the data.

Recall that energy use is a function of weather, the economy and how the energy is used among other things that make the year to year variation and the choice of starting and ending points a concern when trying to determine what is actually going on.  In order to try to address this problem I calculated the percentage change of the energy use per customer for different periods.  The Alternate Natural Gas Use Trends Comparison table lists the change between the first eight year averages and the second eight year averages of the sixteen years of data available, the first five year averages and the last five year averages in the period of record, and the last five year averages relative to the proceeding five year averages.

Alternate Natural Gas Use Trends Comparison

Gas Use (Sales per Customer)
Residential Commercial Industrial
2001-2008 0.091 0.83 18.85
2009-2016 0.094 0.77 11.86
% Difference 3.0% -7.8% -37.1%
2001-2005 0.092 0.90 25.93
2012-2016 0.09 0.77 12.27
% Difference 2.8% -14.7% -52.7%
2007-2011 0.091 0.76 10.96
2012-2016 0.095 0.77 12.27
% Difference 3.8% 2.2% 12.0%

Both the commercial and industrial sectors show impressive reductions in use per customer in the first two alternatives.  However, the industrial sector values are skewed by the questionable number of customers data.  It is very concerning that during the period 2007 to 2016, when there was extensive energy efficiency investment, that the energy use per customer in all three sectors went up.

The New York State Electric System Customers, Electricity Sales, and Electricity Use per Customer Data and Trends table lists the same electric system parameters for completeness.  In 2016 the amount of electricity used in the residential sector has increased 15% since 2002, in the commercial sector the amount used went up 27% and in the industrial sector the amount used went down 14.8%.  The amount of electricity used per customer went up 20.9%, commercial sector use per customer went up 22.2% and industrial sector use per customer went up 63.16%.

As was the case with the natural gas numbers there are issues with the number of customers per sector.  For example, the number of  NYSE&G industrial customers went from ~2,700 in 2002 to 16,292 in 2003 and then back down to ~2,700 in 2004.  Something is wrong there.  Niagara Mohawk customers in 2001 and 2002 are also suspiciously different than the rest of the years.  Otherwise there are no suspect year to year variations.

I addressed the suspicious data issue and the variations due to other effects the same way as the natural gas data.   I calculated the percentage change of the energy use per customer for different periods.  The Alternate Electric Use Trends Comparison table lists the change between the first eight year averages and the second eight year averages of the sixteen years of data available, the first five year averages and the last five year averages in the period of record, and the last five year averages relative to the proceeding five year averages.

Alternate Electric Use Trends Comparison

Electric Use (Sales per Customer)
Residential Commercial Industrial
2001-2008 6.706 71.55 1,614.8
2009-2016 7.044 73.40 2,083.5
% Difference 5.0% 2.6% 29.0%
2001-2005 6.524 68.80 1,573.7
2012-2016 7.024 72.97 2,352.6
% Difference 7.7% 6.1% 49.5%
2007-2011 7.065 75.01 1,689.1
2012-2016 7.024 72.97 2,352.6
% Difference -0.6% -2.7% 39.3%

The sales per customer for all three sectors show increases in the first two alternatives.  However, the industrial sector values are skewed by the questionable number of customers data.  The good news is that contrary to the natural gas energy use, both residential and customer electric use per customer decrease which is what we would expect if energy efficiency programs were working well.  The industrial sector numbers show an increase but that is much more likely due to the changing character of industrial use, e.g., fewer customers but larger users.

Conclusion

I do not dispute that the energy efficiency concept that if less energy is used then less energy will need to be generated is a great thing.   In this post I looked at two New York energy efficiency goals: one made in the past and one a key component for future energy needs to see if results to date support this emphasis.

The 2002 Energy Plan included an energy efficiency goal to reduce primary energy use per unit of gross state product 25% below the 1990 level of energy use, by 2010.  I found data for gross state product and energy use, calculated the parameter used in the goal and determined the percentage reductions since 1990.  In 2010, the reduction in this parameter was 30.1% easily exceeding the 2002 Energy Plan goal of a 25% reduction.

However, upon closer examination, I found that the reason the goal was met was because the gross state product increased more than energy use increased.  The gross state product was included in the goal to try to reduce the economy’ effect on energy use.  This underscores the importance of evaluating energy efficiency programs based on actually reducing the amount of energy used.

At this time New York’s energy policy is counting on substantive reductions in energy use as part of the plan to reduce greenhouse gas emissions.  For example, National Grid’s proposed options to address natural gas supply deficiencies in New York City and on Long Island assume that the New York energy efficiency will meet or exceed 80% of the CLCPA targets and that they could get substantive additional reductions from an intense weatherization project.

I calculated the natural gas and electric energy use per customer rates since 2001 to determine if the energy efficiency investments to date have been successful.  The problem is that energy use is not just a factor of energy efficiency but also weather and the economy.  To get around that I conclude the best I can do is compare the averages of the last five years to the proceeding five year.  For electricity the residential and commercial sector energy use declined as we would expect given the energy efficiency investments.  However, natural gas use increased in the residential, commercial and industrial sectors.

This result raises concerns for me vis-à-vis National Grid’s proposed alternative options for supplying natural gas to New York City and Long Island.  I suspect that the State will force National Grid to choose options that rely on energy efficiency rather than ones that require new fossil-fuel infrastructure despite the fact that they will guarantee adequate supplies of natural gas. The fact that energy use per customer has gone up suggests that existing energy efficiency programs are not working as well as assumed and will not guarantee that additional natural gas is available on the coldest days.

NESE Pipeline Alternatives for National Grid

The Northeast Supply Enhancement (NESE) pipeline is a proposed pipeline to bring natural gas to New York City and Long Island.   I sent Comments submitted 27 March 2020 in a New York Department of Public Service proceeding related to denial of service requests by National Grid in New York City and Long Island which is associated with this project.  This post describes what is going on, the proposal to resolve the issue and my comments on the proceeding.  Be forewarned there is a lot of material to cover so this is a long one.

Purpose

The request for comments is in regard to a requirement to come up with alternatives to provide additional natural gas supply to National Grid’s service territory on Long Island.  In this section I explain what happened to the original plan to fix the problem and events leading up to the current discussion.  On May 15, 2019 the New York State Department of Environmental Conservation (NYSDEC) denied a water-quality permit for the NESE natural gas pipeline that would bring more natural gas to New York City and Long Island.  On May 24, 2019 National Grid imposed a moratorium on new natural gas connections In New York City and Long Island because they could not guarantee enough supply for additional customers based in part because the pipeline was blocked.  In late November 2019 National Grid relented and started doing hookups for new customers following threats from Governor Cuomo to pull their license to operate.  The fact remains that the there is still a problem so National Grid has developed a collaboration for a “safe and reliable energy future”.  I submitted my comments in response to the public outreach program related to this effort.  Once that effort is complete all the feedback will be collected and reviewed, and the National Grid will issue a supplemental report that summarizes and includes public and customer input.  This is supposed to “enable an agreed long-term solution(s) with New York State by June 2020” so that the solution(s) can be in place and in operation by the winter of 2021/2022.

Water Quality Permit Denial

In order to ensure adequate supplies Transcontinental Gas Pipe Line Company (Transco) proposed the Northeast Supply Enhancement Project (NESE).  The permit application project description states:

The NESE Project is a 26-inch diameter pipeline proposed by Transcontinental Gas Pipe Line Company LLC (Transco) that would transport natural gas from Pennsylvania through New Jersey, traveling underwater in the Raritan Bay and Lower New York Bay to approximately three miles offshore of the Rockaway Peninsula in Queens Borough. Approximately 23.5 miles of underwater pipeline will be installed, of which approximately 17.4 miles would be in New York State waters.

The NESE Project would connect to the existing Rockaway Delivery Lateral in Queens and would provide 400,000 dekatherms per day of incremental capacity to National Grid to serve customers in Brooklyn, Queens, and Long Island. According to Transco, the project is intended to support reliability as well as help displace the use of oil.

The NESE Project would be installed a minimum of 4 feet below the sea floor through a combination of jet trenching, clamshell dredging and horizontal directional drilling (HDD). Construction would be phased to avoid potential impacts to marine species. If permits are ultimately issued, compensatory mitigation would be required to offset unavoidable impacts to benthic resources, including shellfish.

On May 15, 2019, the NYSDEC denied the application for the required Clean Water Act Section 401 Water Quality Certification based on their review of the permit and over 14,000 public comments received on behalf of 45,000 individuals. The full decision (PDF) is outlined in a letter by Daniel Whitehead, Director, Division of Environmental Permits, NYSDEC.  I summarize the rationale below.

Because this is an interstate pipeline project the Federal Energy Regulatory Commission (FERC) has to approve the application to build the pipeline.  On March 27, 2017, Transco submitted to FERC an application for a Certificate of Public Convenience and Necessity for construction and operation of the Project. FERC issued a Draft Environmental Impact Statement (DEIS) on March 23, 2018. The NYSDEC submitted comments to FERC regarding the DEIS on May 14, 2018 and FERC issued a Final Environmental Impact Statement (FEIS) for the Project on January 25, 2019. The FEIS outlined some of the numerous environmental impacts FERC anticipated from the construction and operation of the Project. On May 3, 2019, FERC issued Transco a Certificate for the Project subject to certain environmental conditions recommended in the FEIS. According to FERC, these conditions would mitigate many of the environmental impacts associated with the Project.

Even though FERC approved the project Transco still had to get a Water Quality Certificate from New York State.  After the usual iterations between the applicant and the NYSDEC, the application for the Certificate was deemed complete on January 30, 2019.  When the application went out for public comment well over 90 percent of the 14,000 public comments opposed the Department’s issuing a Certificate.  On the basis of their review of the application and public comments, NYSDEC determined that there would be significant water quality impacts.  This includes “significant water quality impacts from the resuspension of sediments and other contaminants, including mercury and copper. In addition, as proposed, the Project would cause impacts to habitats due to the disturbance of shellfish beds and other benthic resources.”

All environmental impacts involve tradeoffs.  If resuspension of sediments were the deciding criterion and prohibited in every instance then no project that disturbed an underwater surface could proceed – no bridges, no docks, nothing.  For that matter fisherman’s dredges that are towed along the bottom could be prohibited.  In a rational world, the fact that all those activities and the construction of a pipeline are short-term would be considered and if the overall long-term benefits to society out-weigh the transient impacts then the permit would be approved.  This instance is complicated by the fact that the sediments are contaminated, so mercury and copper limits could be exceeded.  Again, if this is the criterion, then no work that disturbs sediments in New York harbor should be permitted.  Another unavoidable impact is habitat disturbance and the same trade-offs apply.  However, the State could have required Transco to rehabilitate the disturbed shellfish beds after the pipeline was installed.

This is an example of hypocritical decision making by the Cuomo Administration.  NYSDEC rejected the National Fuel Gas Empire Pipeline application for a new 97-mile pipeline because it would have caused permanent impacts to 2.335 acres of wetlands within the 73.377 wetland acres impacted.  The poster child for Cuomo hypocrisy is the rejection of the Finger Lakes LPG application for an underground storage facility because of “significant adverse impacts on community character” when the only visible infrastructure was a small pond and a building. On the other hand agencies have approved the Cuomo-correct applications for off-shore wind farms which will permanently disturb much more of the seafloor than the NESE pipeline would have temporarily disturbed, approved projects that permanently disturbed wetlands but allowed the developer to create compensating wetlands, and approved wind and solar applications that have significant impacts on community character.  There is absolutely no question in my mind that the professional staff at NYSDEC and the other NYS regulatory agencies, if left to make permitting decisions based on their experience and the facts of the case, would have approved all of the rejected applications. The reason there were rejected was the Cuomo Administration.

National Grid Moratorium

National Grid’s problem is that they have determined that there is not enough current gas supply to serve future customers.  In their report they explained that 85% of the gas used on the coldest days is used for heating.   If they don’t have enough gas available then service to existing customers will be jeopardized and that means heating supplies will be at risk.  In my comments I provided references that conclusively show that cold weather is more impactful on health than hot weather and I have also shown that claims that hot weather is worse are based on a reporting artifact related to different lag times for hot and cold effects.  Therefore, National Grid has the moral responsibility to ensure heating supplies are available and the State should support those efforts.

Gas supply is regulated by the Public Service Commission (PSC) so the projection methodology is comprehensive and well-documented  When a utility company calculates how much supply they have, how much they are using and how much they will need in the future to argue that they need more supply  infrastructure, the first thing PSC staff does is generate their own analysis using the same methodology.  The two sides compare projections to determine if there are differences and reconcile the numbers.  My point is that the assumptions used in these calculations have been developed over the years to ensure adequate and reliable gas supply and they should not get changed at the whim of anyone.

Faced with their analyses that show they don’t have enough gas for future additions and with the rejection of the solution that they had planned to use to resolve the problem National Grid announced that they had to put a moratorium on new supply hookups.

Cuomo’s Response to the Moratorium

In the fantasy world of Cuomo’s New York, numbers, facts, and precedence don’t matter.  It is all about Andy.  Once people could not get the preferred alternative of a natural gas hookup they squawked and the politician saw an opportunity to cater to voters. His response was to have the Public Service Commission order National Grid to provide natural gas hookups.  According to the New York Post “The Public Service Commission said it has the authority based on a section in Public Service Law that says if a gas company is unable to meet the needs of reliable service to customers, the state has the power to step in”.   Following established State practice National Grid calculated how many customers they could handle and cut off any additional customers when the infrastructure proposed to resolve the problem was rejected by the State.  Obviously National Grid was unable to meet the needs of customers solely because the State would not let them,

Furthermore, Cuomo huffed and puffed a threat to revoke the operating license for National Grid if they did not comply.  Now here is where the precedence issue arises.  The Department of Public Service (DPS) and Public Service Commission are supposed to be independent.  In this instance an independent agency could have said “Sorry Governor but your politically driven appeasement of your voting base meant that there may not be enough gas supply available and in order to protect the citizens the prudent choice is to put a moratorium in place.”  The problem is that the DPS no longer independently serves the public interest.   In the summer of 2019 a group of retired Department of Public Service employees submitted a letter that stated “Until the current administration, Governors have generally respected the plain language of the Public Service Law (PSL), which … safeguards the mission of the DPS to serve not political interests but the public interest.” The letter signed by fifteen retired department workers states: “Governor Andrew Cuomo, however, has not done so.”

Like most bully threats there are questions whether Cuomo could have actually revoked National Grid charter to operate.  Nonetheless it was a thinly veiled threat to step in line or he would make doing business miserable.  National Grid is a business and in order to succeed financially they depend on a rate-making process that is entirely co-opted by the Cuomo Administration.  If National Grid steps out of line there is no question that his Administration will hurt them as often and as hard as possible.

National Grid Interim Solution

Not surprisingly National Grid caved and agreed to lift the moratorium for two years.  According to a Utility Dive report:

National Grid has identified new solutions to supply consumer gas needs in downstate New York since announcing the moratorium, company spokesperson Domenick Graziani told Utility Dive in an email. These include a “previously unavailable source of short-term peaking supplies,” which he declined to provide further details on.

The utility also anticipates reductions in demand due to energy efficiency and demand response programs, a new compression project that will provide additional long-term capacity to portions of Long Island and a greater-than-expected number of customers interested in shifting to “non-firm” service — that is, customers who switch to oil or other alternative fuels when asked to by National Grid. These customers are charged differently from residential and other “firm” customers and can be penalized if they don’t make the switch, according to Graziani.

As noted, before, environmental development issues involve tradeoffs and that is also true for energy development.  In this instance the “previously unavailable source of short-term peaking supplies” turned out to be trucked compressed natural gas.  This option requires a facility where the gas is compressed outside of Long Island and loaded into trucks that transport it to a vaporization facility on Long Island where it can be vaporized and added into a pipeline for delivery.  Natural gas can be transported from the production well to the user entirely by underground pipelines.  While there are safety and environmental issues related to that relatively simple approach there is no question that the CNG truck option through New York City is much riskier and that environmental impacts will be greater when additional handling components are added to the transport from well to user.  Elsewhere this “virtual pipeline” is widely condemned so it is not surprising that the National Grid spokesman declined to provide further details.

This is another instance of Cuomo administration hypocrisy: on one hand basking in the limelight as a leader against climate change by prohibiting new fossil fuel infrastructure but on the other hand needlessly risking safety and increasing environmental impacts with a solution only intended for use as a stop gap in emergencies.  Mark my word if there is CNG truck accident it will be anybody’s fault but Cuomo’s.

National Grid Collaboration

At this time National Grid is conducting an outreach program as described below:

For National Grid, serving our 1.9 million natural gas customers across Brooklyn, Queens, Staten Island, Nassau, and Suffolk is both a privilege and a responsibility. New York has seen dynamic economic growth in the Downstate region, expanding residential and non-residential building space, and thousands of oil-to-gas conversions over the last 10 years. These factors have resulted in a substantial increase in the demand for natural gas, placing stress on our existing gas network and threatening National Grid’s ability to meet our customers’ needs when demand is at its peak. This leaves little room for error in the face of unplanned supply interruptions or other contingencies.

As part of the settlement agreement with New York State that lifted the moratorium on new gas connections imposed in May 2019, we are taking numerous measures to ensure we have sufficient supply for the winters of 2019/2020 and 2020/2021, including increasing reliance on compressed natural gas (“CNG”) trucking when needed to meet peak demand.

Beyond the next two winters, however, continued growth in demand for natural gas creates a challenge that must be addressed. There are multiple potential solutions, each with its own considerations regarding safety, reliability, environmental and community impact, and cost. National Grid has prepared and provided to New York State an extensive Long-Term Capacity Report to facilitate constructive dialog in the quest to answer the challenges presented by increasing demand. The purpose of this Summary Report is to distill the content of that full report for the general public so that all may understand the issues involved and the potential solutions to be considered.

We wish this to be a collaborative process and encourage feedback, either through the public meetings hosted by National Grid in March 2020 or by sharing your thoughts via our online survey at www.ngrid.com/longtermsolutions.  This site also provides access to the full report and a link through which you can share feedback directly with the New York State Department of Public Service.

In other words, National Grid is desperately trying to appease the Governor who wants to play to the no fossil fuel infrastructure maniacs he actively courts.  To do that they have come up with this stakeholder process that lays out the problem and offers a number of alternative approaches to the problem.  All the while trying not to favor any of them.

My Submittal

National Grid has developed a slick website that provides information on the long-term solution options.  Also included are links to the reports, schedule of events, ways to submit comments, and transcripts from their meetings.  I will describe the summary report and reproduce some of the comments I submitted in italics.

In the first section of the summary National Grid describes the problem.  In order to define how much natural gas will be used they use the “Design Day” concept.  This is the plan for peak demand conditions as the level of gas delivery needed to serve all of our customers during an extreme cold weather event. In the Downstate NY region Design Day is defined as a 24-hour period that averages 0° Fahrenheit in Central Park. They note that approximately 85% of this Design Day capacity is used to heat homes and businesses—keeping people warm on the coldest of days.

I frankly could only stand listening to the comments made during the public meeting for a brief period but in that time two people complained about the use of 0° Fahrenheit as the design day because temperatures have been warming.  I am frustrated that they spout off numbers without any consideration that they have no responsibility in the event that they are wrong.  Moreover, I am sure that the choice of the design day temperature is proscribed by some PSC order somewhere to prevent gaming the system so it is unlikely that changing the number could be considered.  Nonetheless, I accessed Central Park data to see whether that value is representative to prepare the following comment:

I am a meteorologist so I checked the representativeness of the 0° Fahrenheit in Central Park criterion.  I used the Northeast Regional Climate Center CLIMOD 2 data portal to download Central Park daily minimum, maximum and average temperature data from 1869 to the present.  Over that period the lowest daily average temperature was -5.5° Fahrenheit and there were six other days with daily average temperatures less than or equal to the 0° Fahrenheit design day criteria.  Note also that on December 30 and 31, 1917 there were two days with average temperatures below 0° Fahrenheit in the midst of a seven-day period with daily average temperatures less than 10° Fahrenheit. 

I also evaluated hourly meteorological data for two NYS Mesonet stations (Rush and York sites from December 29, 2017 to January 8, 2018.  In that period the temperature did not get above freezing and on January 6, 2018 the average temperature was 0.8° Fahrenheit.  Based on my meteorology background and despite the fact that the most recent date with an average zero degree design day temperature in Central Park was 15 February 1943, I believe the weather conditions that caused a 0.8° Fahrenheit average day near Rochester in 2018 support the continued use of the 0° Fahrenheit in Central Park criterion.  Because 85% of the Design Day capacity is used for heating this design day criterion may not be stringent enough and certainly should not be adjusted upwards.

National Grid discussed historical demand growth and made two projections, a high-demand and a low-demand scenario, to bound their analysis. In the high demand scenario, they assume that 80% of the State energy efficiency targets are achieved and in the low demand scenario they assume that 100% of the targets are achieved.  Based on the projections and factoring in low-carbon solutions they predict that they will need to close a gap of 400 MDth/day between customer demand and available natural gas supply with the existing system.

In contrast to National Grid’s optimistic projection that they will reduce demand growth by over 50% I disagree.  In the first place, New York has already had extensive energy efficiency efforts in place during the time that demand growth increased 2.4%.  As a result, the easiest and most effective, aka low hanging fruit, energy efficiency projects have already been implemented.  Any future reductions will not be as cheap or effective.  Another problem is that natural gas works well for heating and cooking so it is the preferred alternative.  The “no new fossil-fuel infrastructure” argument is fine in theory but when faced with having to choose a poorer alternative I believe there will be plenty of pushback from the majority of the population that wants the advantages of natural gas and is not as motivated as the environmental advocacy folks so vocal in this proceeding. 

 This is particularly true with regards to home heating electrification because the preferred retrofit alternative is air source heat pumps.  My personal experience with this technology has been bad and I think that is a major problem for those who want to electrify heating. The word on the street is more often negative than positive.  In my case I did research to try to understand the problem.  In my 9/16/2019 filed comments on Resource Adequacy Matters, Case 19-E-0530, I included an analysis in an appendix entitled Air Source Heat Pumps that demonstrated the fundamental flaw with this technology.  In short, when the temperature drops below 20° Fahrenheit there simply is not enough energy to be transferred and converted to heat for the technology to work.  In the event of a seven-day cold snap like the one that occurred around New Year’s Day 1918 anyone without supplemental heat would freeze and the increased electrical load needed to provide supplemental electric resistance heating could lead to unprecedented peak loads.  Claims that improved air source heat pumps will solve this problem are unwarranted absent repealing the laws of physics.

 As a result, I do not think that the low demand case in which 80% of the State energy efficiency targets are achieved is likely.  More realistically the low demand will be 50% of the targets and the high demand 80%.  I am confident that 100% of the State energy efficiency targets will not be met.

Another aspect of the National Grid demand reduction plan is to use three low-carbon solutions: renewable natural gas, hydrogen blending and power-to-gas, and geothermal heat pumps.  National Grid claims that “with proper funding and support, we anticipate that these programs can cover 15–35 MDth of the Downstate NY gas supply gap”.

      • Renewable natural gas (RNG) facilities use biomass—such as landfills, wastewater treatment, food waste, and livestock manure— as feedstock for producing gas. National Grid currently has two RNG sites in their Downstate NY region: one on Staten Island and another at Newtown Creek expected to come online in the winter of 2020. They believe there is even more opportunity to expand RNG in their Downstate NY region.
      • Natural gas supplies can be augmented by blending in hydrogen gas produced by splitting water into hydrogen gas and oxygen gas through the process of electrolysis. Hydrogen blends, in the form of town gas, were used in heating for decades, both in the US and other countries. National Grid has proposed a two-year study to assess optimal parameters for incorporating hydrogen in the Downstate NY region.
      • By transferring heat to and from the ground, geothermal heat pumps offer an attractive, low-carbon alternative for providing central heating and cooling. Based on the success of a demonstration project that connected 10 homes with shared-loop ground-source heat pump (GSHP) systems, National Grid is seeking to expand this program to 900 homes over the coming four years.

As shown below I don’t think these projects have much, if any value.  At the Trust Yet Verify blog, the author notes that in Flanders, they have the expression “calculating oneself rich” which means presenting one’s case in a too optimistic way that doesn’t accord with reality.  Had I been aware of that expression when I wrote the comments, I would have used it because it describes these projects well.

Renewable natural gas is produced from anerobic digesters.  The New York State Energy and Research Development Authority (NYSERDA) has an integrated data system that provides operational data on DERs installed in New York including anerobic digesters.  At the current time there are 38 facilities with a rated electrical output of 22,263 kW.  The majority (29) of these digesters are located on dairy farms.  Eight are at waste water treatment plants and one is located at the Saranac brewery.  Only three of these have output greater than 3 MW and the majority are rated between 100 and 500 kW.  It is telling that NYSERDA rates these by electrical output because that indicates that the methane is primarily used to generate electricity. The National Grid report states that the Newtown Creek WWTP will be capable of producing 1.0 MDth/day and that they are “connected to a 1.6 MDth/day plant in Staten Island”.  Presumably during peak natural gas demand periods, the plan could be to divert the methane to the gas system rather than using it for generating electricity.   I believe that this option has limited potential simply because there are not many possible sites where it could be deployed.

 National Grid has proposed a two-year study to assess optimal parameters for incorporating hydrogen in the Downstate NY region.  In other words, this is more of a concept than a proven technology in today’s energy landscape.  Cynic that I am I consider this more wishful thinking than an actual plan.

 Ground source heat pumps work but the implementation logistics of trying to install meaningful amounts even, if the geology was favorable, in the service territory for this proceeding precludes this as a viable contributor to meaningful load reductions.

The meat of the report is the description of ten distinct options for closing the gap of up to 400 MDth/day between natural gas demand and supply over the next 15 years.  National Grid is careful to state that they do not propose a “best” or “most desirable” solution and pragmatically observe that the ultimate approach ultimately will likely be a portfolio including two or more of these options.  As noted earlier they have the responsibility to provide natural gas and the politicians who demand solutions that are driven by an agenda will disavow any culpability if they don’t work.

National Grid proposes ten projects in three categories.  They propose three large-scale infrastructure projects: an offshore liquified natural gas (LNG) deep water port, an LNG import terminal, and the Northeast Supply Enhancement pipeline project.  There are four distributed infrastructure projects: a peak LNG facility, LNG barges, the Clove Lakes Transmission Project, and the Iroquois enhancement compression project.  There are three no-infrastructure projects: incremental energy efficiency, demand response, and electrification.

The summary report concludes with an assessment of the relative attractiveness of the proposed options with respect to each of the evaluation criteria to “help our customers and the general public evaluate the options”.  I reviewed and commented on the scoring but will not include all my comments here.  In brief, I think that by necessity National Grid scored the NESE pipeline lower than they should have to be “Cuomo correct”.  For example, they gave all the large infrastructure projects the same safety score. I disagree because in most things related to safety simpler is better.  Both LNG alternatives are significantly more complicated because they involve storage and regasification components.  Moreover, they both require marine transport which compared to a pipeline has to be less safe.  I suggested that the scores for those projects be dropped relative to the pipeline.

I did include a comment on the environmental scoring because I have a lot of experience with environmental impact analyses and I disagree with the environmental scoring.  Frankly the evaluation criteria in the report in Table 19 don’t help much.  Greenhouse gas (GHG) emissions is one criterion used.  I don’t see how the compression, regasification, and transportation components of the LNG options would not mean higher GHG emissions. All the other GHG emissions intensity values are the same for all three options.  As a long-time air quality meteorologist, I struggle to find air substantive air quality problems with natural gas use as compared to other dispatchable sources of energy but I believe that air pollution emissions from LNG ship transportation are larger than pipeline compressor stations.  I can accept that the potential impact from construction is higher for pipelines but once in place the operation impacts are likely lower.   I assume that environmental risk relates to the ecological impact.  The fact is that there have to be pipelines from the well pads to the ports for the LNG options.  Expanding pipeline capacity to bring the needed natural gas directly to the City is simpler, safer and less prone to problems.  I cannot comment on the potential of any option to support New York’s decarbonization goals because there is no plan to implement those goals, only targets.  The politicians that enacted legislation with the goals made a major mistake putting the cart (the aggressive targets) before the horse (figuring out what was feasible).  In conclusion I would add another cell to the environment scoring bar to the pipeline option because it is significantly better than the other two.

 Two of the distributed infrastructure projects, Clove Lakes Transmission Project and the Iroquois enhancement compression project, are simple upgrades that will provide more capacity.  I see no reason why they should not be included.

The no-infrastructure projects all qualify as “Cuomo correct” virtue signals.  Because I don’t believe that the existing energy efficiency targets will be met, I reject out of hand the idea that even more substantive energy efficiency could be implemented.  Demand response is a favored component of “smart grid” advocates for shaving summer peak demand.  However, that is not a solution here because the expectation is that the load peak will shift to the winter.  I believe that there are significant differences between cooling peak loads and heating peak loads.  Most importantly, there is a hot period diurnal cycle that means that shifting between uses (A/C is not as large a component of total load as heating is to the total load) and times (when the sun is down there is no direct solar heating and cooling load needs drop significantly) is possible.  The question boils down to this: when 85% of your load is heating and the heating load does not vary much how can you shift the load?  I for one would not accept a thermostat that someone else controls for heating my home.  I do not think I would be an exception.

The third no infrastructure project was heating electrification using cold-climate, electric heat pumps.   I think that widespread implementation of cold-climate heat pumps will be a mistake as I noted in my resource adequacy comments. Bottom line is when you it is really cold and you really need heat they don’t work simply because there isn’t enough energy available. In addition, you are just shifting the problem onto the electric side.  Given that electric transmission is more susceptible to interruption than pipelines I think electrification is a less resilient option.

 The only positive that can be said about these no-infrastructure projects is that they are consistent with the Climate Leadership and Community Protection Act (CLCPA) expected infrastructure.  Unfortunately, we are guessing at what the state plans to do because they set targets without figuring out if they could be met much less how they would be met.  Moreover, I don’t think that the implementation timing for these kinds of projects will be consistent with timing for when the gap between demand and supply needs to be reduced.

National Grid points out that “Creating a comprehensive solution requires looking at how different options can work together to solve the gap between demand and supply”. Then they listed three possible approaches.  I was disappointed that they did not include the NESE pipeline large-scale infrastructure and the two distributed infrastructure pipeline projects as an option. I commented:

It did not get much attention in the documentation but the solution to the fact that current pipeline capacity cannot support today’s peak load demand is to truck compressed natural gas from somewhere on the other side of the supply constraint to somewhere on the inside of the supply constraint.  In my evaluation of the difference between pipeline and LNG infrastructure options I argued that the added safety and environmental effects of marine transport relative to pipelines made pipelines a superior choice.  However, the safety and environmental effects of trucks are greater than those of marine transport.  All three solutions rely on incremental Energy Efficiency, Demand Response, and Electrification to reduce demand and remove the need for CNG trucking. As a result, I could never support any of these solutions simply because it is likely that the need for CNG trucking will remain longer.

The first combined option, build out Large-Scale Infrastructure, capable of almost fully meeting projected needs claims that if construction is not completed before 2021/22, incremental Energy Efficiency (EE), Demand Response (DR) and Electrification would be required to reduce demand and meet customer needs. CNG trucking would be discontinued once the infrastructure is completed. Any shortfall in meeting demand reduction targets would lead to restrictions on new customer connections until the infrastructure is completed.  Incremental EE, DR and electrification won’t be implemented in this time frame – no way no how.

The second combined option, combine distributed infrastructure solutions with incremental No-Infrastructure solutions fails because all of them need to be implemented to meet projected gap so it will be necessary to combine one or two of these options with additional demand reductions achieved through EE, DR, and Electrification to fully meet needs. National Grid admits CNG trucking would remain in place unless demand reduction targets are exceeded, and any shortfall in meeting those targets would lead to restrictions on new customer connections.  Given that I think there is no way the demand reductions will be met CNG trucking remains in use for longer.

The final combined option, fully rely on a portfolio of incremental no- Infrastructure solutions, will undoubtedly be the preferred alternative of the energy innumerate and, thus the king of innumeracy Governor Cuomo.  Because it is unlikely that demand reduction targets will be exceeded, CNG trucking will remain in place, and any shortfall in meeting such demand reduction targets will lead to restrictions on new customer connections.  Somehow, someway when this fails to meet the needs, Cuomo will be the first to blame National Grid.

 Conclusion

National Grid states: “Our hope is that by helping our customers understand the possible approaches for addressing these concerns, they will provide feedback to help guide future decision making.”  Let me translate that for anyone unversed on current New York State energy policy.  National Grid is a business and in order to succeed financially they depend on a rate-making process that is entirely co-opted by the Cuomo Administration.  This report and the extensive outreach program, is a necessary part of doing business but it is just window dressing.  The ultimate decision will not be made to balance costs and risks against benefits to customers.  Whatever the facts say about energy reliability, effects on health, safety risks and costs, the final plan will be a politically driven decision made at the highest level of the Administration based on whatever is determined to best garner support from Cuomo’s political base.

This is another instance of Cuomo administration hypocrisy: on one hand basking in the limelight as a leader against climate change by prohibiting new fossil fuel infrastructure but on the other hand needlessly risking safety and increasing environmental impacts with an interim solution only intended for use as a stop gap in emergencies.  There are three pipeline alternatives that should be the clear choice as less risky, safer and minimal environmental impacts.  The other long-term infrastructure alternative solutions include several options that would continue to use more complicated and thus more risky approaches.  The obligatory no-fossil fuel infrastructure options could, in theory, provide enough energy needed to meet the design day criteria but two of the options (electrification and demand response) have never been implemented on the scale necessary and expecting to get even more energy efficiency reductions runs counter to observed results.  The question is whether the Cuomo administration will risk safety and reliability by requiring the use of those risky approaches to cater to people who will pay no price for being wrong.

Of course, the underlying argument that forms the basis of this entire charade is that climate change is an existential threat.  I believe that is a flawed argument.  New York’s politicians constantly claim that their energy policies have scientific support and they typically lean on the popular conception of an overwhelming consensus that the observed warming is necessarily bad.  In reality, most qualified scientists believe humans are causing some warming, but only a minority are very concerned about it.  The catastrophic impacts touted as proof that something needs to be done invariably rely on a future emission projection scenario that is so unlikely that it is inappropriate to use for policy decisions.  Finally, if the problem is global warming then it logically requires a global solution.  The reality is that New York’s possible impact on global warming reduction is too small to measure and would have effects that could not conceivably alter any of the purported catastrophic impacts.