One recurring narrative by proponents of the Climate Leadership & Community Protection Act (Climate Act) is that it will create significant economic activity. However, it has always seemed counter-intuitive to me that all this economic activity requires subsidies but I have not been able to make that point well enough for an article. A recent post at Climate Discussion Nexus does an excellent job refuting that narrative and I reprint it in its entirety here.
Everyone wants to do right by the environment to the extent that they can afford to and not be unduly burdened by the effects of environmental policies. I submitted comments on the Climate Act implementation plan and have written over 290 articles about New York’s net-zero transition because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. Every indication is that the costs will be astronomical as well. 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.
Our actions and investments are creating new economic activity right here in New York. The clean energy industry is growing before our eyes and the number of clean energy jobs in New York State reached a record level of 165,000 workers at the end of 2021. These jobs have helped lead New York’s COVID-19 economic recovery, the clean industry showing a faster recovery than other sectors. This recent growth is part of a larger trend in the State, with clean energy employment growing 17 percent since 2015 and continued growth on the horizon.
In partnership with businesses, schools, labor and trade organizations, we are supporting the creation of a clean energy workforce pipeline and providing new training opportunities for workers of all experience levels. These opportunities include programs designed to enhance skills in clean heating, energy efficiency, renewables, and other clean technology sectors. Our programs also assist businesses with recruiting, hiring, and onboarding costs for new employees. These efforts prioritize training programs for the state’s most underserved populations – low-income individuals, veterans, disabled workers, single parents, and the formerly incarcerated – and will also help integrate displaced workers into this new promising industry.
That means long-term economic opportunities for all New Yorkers.
I have looked at the New York Clean Energy Industry Report and found that the state’s clean job estimate claims are misleading and inaccurate. However, I have not described the basic fallacy. These jobs only occur because the entire existing energy system will be destroyed. The Climate Discussion Nexus article explains this problem very well. The following section presents the entire article.
“Stop!” shouts Terry Corcoran in the Financial Post, saying all the “green economy” hype basically repeats the “Broken Window Fallacy” Frederic Bastiat smashed in his 1850 essay that inspired Henry Hazlitt’s 1944 Economics In One Lesson which is one more lesson than the “parade of corporate and political heavyweights, such as U.S. climate czar John Kerry” have had. As Corcoran writes, “In the parable, a boy smashes the window in a town shop, creating an expense and loss for the shopkeeper.
But a bystander observes that there is an economic benefit to smashing windows: Glassmakers get more business, a conclusion glibly summarized in one commentary: ‘It’s a good thing to break windows — money gets circulated and the industry thrives.’” And so, Corcoran laments, this nonsense is even more prevalent in 2023 than in 1850 because now there actually are formal programs to go about breaking glass on a massive scale to enhance prosperity: “as governments in the Western world attempt to smash the windows of the energy system and replace it with an all-new net-zero energy regime.” And chortle about the opportunities they’re creating for glass-makers, freight carriers, window-installers, painters, and who knows what all? For instance Canary Media burbling “Chart: US climate law to spur thousands of new jobs in every state”.
They don’t. As Corcoran growls, “The broken window fallacy in such thinking, if I can presume to condense Bastiat, is that the real cost of breaking windows is ignored.”
In some sense the Canary claim that “Each U.S. state could gain between 2,000 and 140,000 clean energy jobs by 2030 thanks to investments spurred by the Inflation Reduction Act, according to a new analysis by the think tank RMI” is a no-brainer. But we don’t mean it in a good way. They say that:
“RMI analyzed the amount of money that could be invested in the 48 contiguous U.S. states as consumers, manufacturers and other businesses take advantage of tax credits and rebates provided by the climate law.”
But quite apart from the fatuity of trying to figure out how much “could be invested” in the United States’ incredibly complex $23 trillion economy, if something is only profitable with subsidies it is another way of saying it is not profitable, which means it is worth less than it cost to make so this “investment” destroys wealth rather than creating it. Thus for David Wallace-Wells to snicker in the New York Times that “G.O.P. elites are simply lagging behind their states” because the Inflation Reduction Act offers subsidies so huge even Republicans will take the money is not proof that the climate zealots have won the debate or that they are boosting prosperity, just that far too few commentators understand the very basic economic point that you have to subtract the subsidy from the nominal profit to see if the thing actually benefited society.
Heck no, he says. Rather:
“The Inflation Reduction Act is a spigot of spending designed to produce a decarbonization boom — indeed, while it is often described as a $370 billion piece of legislation, that analysis seems likely to significantly underestimate the ultimate size of its tax incentives, which could stretch much closer to $1 trillion with rapid renewable development.”
To borrow from Adam Smith, since we’re taking a trip to the land of economic fundamentals, for a trillion dollars you could support a wine industry in Wales. But the net cost would be huge.
It may seem futile to seek to refine economic theory in the face of such persistent obtuseness. Including Clean Prosperity’s:
“The government could also look at strategic financial support for industries where Canada can compete globally and generate significant economic benefits, good jobs, and manufacturing value added. We point to direct air capture, sustainable aviation fuel, and the electric-vehicle value chain.”
Ooooh. Strategic. Sure beats the other kind of financial support where you hurl money out windows and hope it hits voters. But if “Canada” can compete globally, and we didn’t even know it was a company, then why in the name of all handouts does something that generates significant economic benefits and add value require a subsidy?
Having thus harrumphed we need to stress that Bastiat’s metaphor goes even deeper than Adam Smith’s pointed observation that those who clamour for government support in the national interest are by no means such fools as those who believe them. It actually is true that, once the window is broken, the process of making a new one in the marketplace is socially beneficial because it plugs the ugly gap in the store front, protecting the merchandise and sheltering customers and staff from inclement weather, something we already knew was worth the expense because the shop keeper previously incurred it to install the former window.
So yes, once the window has been broken, replacing it is economically rational including for the shopkeeper. But the cost incurred a second time, to replace the broken window, merely restores what was previously there, so the shopkeeper ends up poorer by the cost of replacing the window than they were before it was broken. So if something flattened all our power plants, we’d be better off after we replaced them (if we replaced them with something that worked) than if we didn’t. But we would be worse off than we were before they got flattened.
The whole Green New Deal, Just Transition, Energiewende and all its ignorant destructive cousins around the world miss this key insight. They are not proposals to make us better off, they are proposals to vandalise the economy then incur costs repairing it. They include the vandalism as a feature not a bug, and hope to get us back to where we were (though as we’ve made clear elsewhere we have grave doubts about the enormous engineering obstacles to generating enough power with wind and solar let alone distributing it) with the entire cost of the replacement a net loss.
If proponents of the “energy transition” understood this point, and insisted that it was actually beneficial to smash the old window anyway because it refracted light in such a way that it would necessarily set the shop on firea much better way we could engage them in rational discussion. But as long as they babble that it’s all gain, that “It’s a good thing to blow up power plants” it is not possible to talk sense with them, just at them.
They do babble it, in forum after forum. For instance The Economistwith its headline “Saving the rainforests would be a bargain/ Far more money is needed to make conservation more profitable than slash and burn”. Um no. If it’s a “bargain”, it requires less money than other deals on the table.
The people at The Economist are not quite the economic illiterates their like-minded fellows at most other publications seem to be. They actually claim that:
“Profits from chopping down rainforests are surprisingly meagre. The land is not particularly fertile. A freshly cleared hectare of the Amazon fetches an average price of only around $1,200. By contrast, the social costs of clearing it are immense. Some 500 tonnes of carbon dioxide are pumped into the atmosphere. By a conservative estimate, that does $25,000 of harm by accelerating climate change.”
So they are making a version of the argument that the existing window, while seeming to provide shelter, entice customers and so on, actually is going to ignite the merchandise and the occupants. It’s just that their $25,000 number is highly suspicious despite bearing the PR-friendly label “conservative”. Others are not even that lucid.
In something called The Liberal Patriot, another in a long weary line of attempts to make modern progressive thought rational and palatable to normal people, Brian Katulis writes that what really concerns normal people is economic security. Thus, he notes:
“During his first two years in office, President Joe Biden introduced three pieces of legislation totaling at least $2 trillion of public investments in high-tech and clean energy aimed at re-making America’s economy…. it will require a strong focus on implementation and clear arguments for how these measures are making the lives of working-class Americans better. Advancing a clear argument on this front will be make-or-break for Biden’s re-election chances.”
He then takes a fairly level-headed look at the implementation challenges and the risks of the mercantilist “Buy American” provisions of the IRA. But when he gets off onto “a public communications strategy that convinces the American public about the value of these investments and how they are improving their lives in tangible ways” he misses the point. Scrapping America’s energy infrastructure then spending trillions to get back to the same level of production will leave the nation as a whole poorer.
Katulis says “The story is simple. No place in America will be left behind.” But the simple story is that Bastiat had it right. If you break every window in America then replace them all, the nation will be better off with fixed windows than with broken ones. But it cannot be better off than before the windows were broken because fixing them all only restores the benefits of having the original windows, but all the labour and raw material required to replace them is gone for good.
As for the guff about job creation, as Hazlitt said, if you want to make work ban trucks and require goods to be transported on people’s backs, and ban power tools and force them to dig with hand shovels. They will be poorer not despite there being more work, but because it now takes more work to get anything. It is incredible that such things must be explained again in 2023. But if we have forgotten Bastiat and Smith, there is nothing we have not forgotten.
Conclusion
I agree with everything in this article, but I do want to emphasize one point. The Climate Act is an ignorant cousin in the Green New Deal, Just Transition, Energiewende family and they all not only want to destroy the existing energy system but they don’t have a replacement that has any chance of working. The advocates who claim all these new jobs will occur should also, for example, include the costs to repair broken water pipes when the power goes out in the winter when there is no wind.
One of my pragmatic interests is market-based pollution control programs. As part of New York’s budget process Governor Kathy Hochul announced a plan to use a market-based program to raise funds for Climate Leadership & Community Protection Act (Climate Act) implementation. It has been touted as a solution for funding and compliance requirements because other market-based programs have been successful. Even though it has drawn widespread support I think the faith in the mechanism is mis-placed because the numbers do not add up.
This article was also published at Watts Up with That. I submitted comments on the Climate Act implementation plan and have written over 290 articles about New York’s net-zero transition because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. I also follow and write about the Regional Greenhouse Gas Initiative (RGGI) market-based CO2 pollution control program for electric generating units in the NE United States. I have extensive experience with air pollution control theory, implementation, and evaluation having worked on every cap-and-trade program affecting electric generating facilities in New York including the Acid Rain Program, RGGI, and several Nitrogen Oxide programs. 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.
Climate Act Background
The Climate Act established a New York “Net Zero” target (85% reduction and 15% offset of emissions) by 2050. The Climate Action Council is responsible for preparing the Scoping Plan that outlines how to “achieve the State’s bold clean energy and climate agenda.” In brief, that plan is to electrify everything possible and power the electric gride with zero-emissions generating resources by 2040. The Integration Analysis prepared by the New York State Energy Research and Development Authority (NYSERDA) and its consultants quantifies the impact of the electrification strategies. That material was used to write a Draft Scoping Plan that was released for public comment at the end of 2021 and approved on December 19, 2022.
The Climate Action Council (Council) has identified the need for a comprehensive policy that supports the achievement of the requirements and goals of the Climate Act, including ensuring that the Climate Act’s emission limits are met . A well-designed policy would support clean technology market development and send a consistent market signal across all economic sectors that yields the necessary emission reductions as individuals and businesses make decisions that reduce their emissions. It would provide an additional source of funding, alongside federal programs, and other funding sources, to implement policies identified in this Scoping Plan, particularly policies that require State investment or State funding of incentive programs, including investments to benefit Disadvantaged Communities. Equity should be integrated into the design of any economywide strategy, prioritizing air quality improvement in Disadvantaged Communities and accounting for costs realized by low- and moderate income (LMI) New Yorkers. Pursuant to the Climate Act, a policy would be designed to mitigate emissions leakage. Finally, an economywide strategy would be implemented as a complement to, not as a replacement for, other strategies in the Scoping Plan. A well-designed economywide program will bring about change in the market and promote equity in a way that does not unduly burden New Yorkers or with the global economy.
Hochul’s address stated that “New York’s Cap-and-Invest Program will draw from the experience of similar, successful programs across the country and worldwide that have yielded sizable emissions reductions while catalyzing the clean energy economy.” Subsequently other legislators have jumped on the bandwagon and offered legislation to modify the Hochul proposal. My problem is that the perception that these programs have yielded sizable emission reductions while providing funds needed for the transition are misplaced.
Emissions Market Program Background
The concept of emission markets is relatively simple. EPA explains that:
Emissions trading programs have two key components: a limit (or cap) on pollution, and tradable allowances equal to the limit that authorize allowance holders to emit a specific quantity (e.g., one ton) of the pollutant. This limit ensures that the environmental goal is met and the tradable allowances provide flexibility for individual emissions sources to set their own compliance path. Because allowances can be bought and sold in an allowance market, these programs are often referred to as “market-based”.
This is a fine overview but the details are what is important for New York’s plan. I have been following these programs since 1993 because I was responsible for submitting compliance reports from that point until my retirement in 2010. New York State has embraced this approach and I was involved in the stakeholder process associated with multiple rule-makings. Finally I have been tracking the performance of the Regional Greenhouse Gas Initiative (RGGI). All of my findings are based on observations of the inner workings of these programs.
For decades, the world’s governments have struggled to move from talk to action on climate. Many now hope that growing public concern will lead to greater policy ambition, but the most widely promoted strategy to address the climate crisis – the use of market-based programs – hasn’t been working and isn’t ready to scale.
Danny Cullenward and David Victor show how the politics of creating and maintaining market-based policies render them ineffective nearly everywhere they have been applied. Reforms can help around the margins, but markets’ problems are structural and won’t disappear with increasing demand for climate solutions. Facing that reality requires relying more heavily on smart regulation and industrial policy – government-led strategies – to catalyze the transformation that markets promise, but rarely deliver.
The authors recognize the enormity of the challenge to transform industry and energy use on the scale necessary for deep decarbonization. They write that the “requirements for profound industrial change are difficult to initiate, sustain, and run to completion.” Because this is hard, they call for “realism about solutions.” Cullenward and Victor recommend clear thinking and strategy as opposed to “Efforts spent tilting at ephemeral, magical policy solutions waste scarce resources that should instead be invested in things that work.” The goal of their book is to explain how market-oriented climate policies have fallen far short and how they might be modified so that they work. If you are interested in more information about emission markets I recommend this book.
General Market-Based Program Concerns
I submitted comments on the Draft Scoping Plan chapter on a market-based approach for the transition plan based on my observations of similar programs. The EPA Acid Rain Program was a cap-and-trade control program that enabled affected sources to meet their compliance options efficiently. Affected sources could purchase allowances from a facility that had more cost-efficient control options to meet the overall cap. EPA notes that the program “has helped deliver annual SO2 reductions of over 93% and annual NOX emissions reductions of over 87%” since the start of the program. The costs have been far lower than expected in no small part because the affected sources figured out how to use fuel switching to coal with lower sulfur content. The success of the Acid Rain program led to similar programs for NOx both nationally, regionally, and limited to just New York State.
Despite the fact that these programs provided significant emission reductions at a lower cost to the affected sources the environmental community felt it was somehow unfair that some facilities made money selling allowances that had been given to them for free. That ignores the fact that those facilities selling the allowances made investments to get lower emissions. The idea that the polluters had to be made to pay led to cap-and-invest programs where the allowances are mostly available through an auction. The Regional Greenhouse Gas Initiative (RGGI) is a good example of that approach.
On the face of it, RGGI appears to provide emission reductions while also raising revenues so that model appeals to legislators. However, my observations of RGGI indicate that the theory of this approach is not matched by reality. Even though the CO2 emissions in the RGGI states have gone down substantially that was mostly because the effected sources switched from coal and residual oil to natural gas with lower CO2 emissions. The investments made with the auction proceeds that were supposed to fund emission reductions were only responsible for ~15% of the observed reductions. The accumulated total of the annual reductions from RGGI investments is 3,658,696 tons through December 31, 2020. The sum of the RGGI investments is $2,991,215,917 over that time frame. The cost per ton reduced $818 exceeds the societal cost of carbon so they are not justified by those societal benefits. Emission reductions in the future are going to have to rely on investments of the RGGI auction proceeds but at those high cost per ton reduced rates the costs may be too high for public acceptance.
One major difference between controlling CO2 and other pollutants is that there are no cost-effective control technologies that can be added to existing sources to reduce emissions. Combine that with the fact that CO2 emissions are directly related to energy production, the result is that after fuel switching the primary way to reduce emissions is to reduce operations. Consequently, CO2 emission reductions require replacement energy production that can displace existing production. If existing generation is not displaced with zero-emissions resources then energy production must be capped.
New York Numbers
The first numbers consideration is the cap itself. EPA explains that “The cap is intended to protect public health and the environment and to sustain that protection into the future, regardless of growth in the sector.” For the Acid Rain Program the cap was originally intended to reduce emissions by 50% but later was tightened down. In the NOx cap and trade programs the caps were set based on a technological evaluation of the control technology available to affected sources. The industry – agency issues with those caps centered on whether the agency estimates for additional control levels were reasonable. Importantly, the SO2 and NOx caps were based on the feasibility of affected source characteristics and were not binding in and of themselves.
On the other hand the CO2 cap in RGGI and the New York cap-and-invest caps are not based on feasibility. I define a binding cap as one chosen arbitrarily without any feasibility evaluation. In 2030 New York GHG emissions must be 40% lower than the 1990 baseline but this is an arbitrary target mandated by the Climate Act. The state’s Scoping Plan for this transition did not include an analysis to see if this target was feasible so I think this will be risky.
The following graph lists NY GHG emissions by sector from 1990 to 2030. The data from 1990 to 2020 is from the New York 2022 GHG emission inventory. Electric sector emissions are available through 2022 and I used those with estimates based on recent averages to project emissions for the other sectors in 2021 and 2022. The emissions shown for 2023-2030 simply represent the straight-line interpolation between the 2022 emissions and the 2030 emission limits consistent with the state’s Climate Act mandate that 2030 emissions must be 40% less than the 1990 baseline emissions.
I estimate that meeting the 2030 emissions limit will require a 4.5% annual decrease from each sector from 2023 to 2030. That is an unprecedented reduction trajectory. Those percentages translate to annual reductions of 2.73 million metric tons of CO2e (MMT) for the electricity sector, 0.97 MMT for agriculture, 5.32 MMT for buildings, 1.59 MMT for industry, 4.89 MMT for transportation, and 1.88 MMT for the waste sector.
The Climate Act has exemptions for certain sectors. All components in the agriculture sector are not required to meet the 40% mandate and energy-intensive and trade exposed industries also get some sort of a pass. Even a cursory examination of the data in the graph suggests that the presumption that a binding cap will necessarily ensure compliance is magical thinking. The historical trend in electricity sector emission reductions appear similar to the trend necessary to meet the 2030 target but the historical trend was caused by fuel switching and there are no more reductions to be had in that regard. In order to reduce electricity sector emissions the energy output will have to be displaced with wind and solar. Waste sector emissions have been more or less constant since 1990. An entirely new technology has to be implemented in the next seven years to get a 4.5% per year reduction in emissions. Transportation can only reduce emissions if the transition to zero-emissions vehicles accelerates a lot. When I point out that there has been no feasibility analysis I am concerned because the Scoping Plan did not analyze whether the necessary technologies are likely to be available and deployed as needed and there was no consideration of what if questions. At the top of that list is “what if the technology rollout is delayed?”
It is beyond the scope of this analysis to consider potential control strategies for every sector. I did investigate one proposed strategy for the building sector transition that was included in Hochul’s proposal. Part VI-B:, Decarbonize New York’s Buildings states:
Building electrification and related upgrades improve interior comfort, reduce exposure to air pollution, and support local jobs. But right now, only about 20,000 New York homes install modern heat pumps for heating and cooling each year. While New York is making progress through programs like NYS Clean Heat, more must be done to cut emissions in our buildings.
To accelerate green buildings in New York, Governor Hochul is setting an unprecedented commitment of a minimum 1 million electrified homes and up to 1 million electrification-ready homes by 2030, and ensuring that more than 800,000 of these homes will be low- to moderate-income households. This target will be anchored by a robust legislative and policy agenda, including: raising the current rate of electrification of approximately 20,000 homes per year more than tenfold by the end of the decade.
I evaluated this component of the plan and the emissions reductions that could be expected for comparison to the annual 5.32 million metric ton of CO2e reduction required to meet the binding cap. Instead of using the confusing and poorly documented Scoping Plan estimates of residential energy use I used the New York State Energy Research & Development Authority Patterns and Trends document. Appendix B, Table B-1 lists the average household consumption by fuel type. I calculated the GHG emissions (CO2, CH4, and N2O) for direct emissions and New York’s required upstream emissions for each fuel type to get an estimate of residential electrification impacts on emissions.
I assumed that the two million homes initiative would convert 250,000 homes per year (two million divided by eight years). I apportioned the type of fuels used by the observed number of residences using each fuel type in the Scoping Plan. In other words, for this analysis, I maximized the potential emission reductions by eliminating the average fuel use in Table B-1 to zero. I found that these conversions would reduce GHG emissions by 1.3 million metric tons of CO2e per year. The Building sector has to reduce emissions 5.32 million metric tons of CO2e per year so the two million home initiative will only reduce emissions 25% of the amount needed when it gets cranked up from 20,000 homes to 250,000 homes per year.
I also took a shot at the costs. I assumed that the two million homes would be converted over to electricity for heating, cooking, hot water, and clothes dryers. I calculated the differential cost between replacement of existing fossil-fired technology with heat pumps and included $6,500 for upgrades to the electric service. Following the Scoping Plan recommendations, I also accounted for improved building shells. I estimate that the average cost to electrify a single residence is $42,777 all in. Multiplying that cost by 250,000 homes per year gives $10.7 billion per year in residential electrification costs for one quarter of the reductions needed. If the building shell is not upgraded the average price increase drops to $24,750 and the total annual cost drops to $6.2 billion per year. Even if you assume that my cost estimate is 25% high and the building shell is not included the costs are $4.6 billion per year.
Another thing to consider is the costs per ton for emission reductions in the buildings sector. In the best case, not including building shells and 25% below my estimates, the cost is $3,500 per ton reduced. That is on the order of 28 times higher than the New York value of carbon which is $126 per ton in 2023.
Discussion
One of the talking points of the Scoping Plan was that emissions from the Buildings Sector was the largest source of emissions in New York. However, the difficulty getting reductions from the sector was not discussed. There are two ramifications of that overlooked challenge.
In the first place the cap and invest binding cap has set an ambitious emissions reduction trajectory of 4.5% reductions per year to ensure compliance with the 2030 Climate Act mandated cap equivalent to a 40% GHG emission reduction from the 1990 baseline. That equates to 5.3 million metric tons per year. I estimate that electrifying 250,000 homes per year that are currently burning fossil fuels will only reduce emissions 1.3 million metric tons per year or one quarter of the amount needed.
Where are the rest of the building sector emission reductions going to come from? The lack of specificity in the Scoping Plan documentation precludes an easy response to that question. There is another aspect of this even if there is some sort of technology available for the remaining reductions required. The current NY rate of electrification is 20,000 homes per year and Hochul’s two million homes per year program will increase that by more than ten times someday. The trained labor and supporting infrastructure necessary is simply not available at this time. Providing training for staff takes time and money and companies have to invest more time and money in the infrastructure to do the work. It is impossible to go from 20,000 to 250,000 homes per year overnight.
The theory of a market-based carbon emissions reduction program is that the higher cost of the fossil fuels with the allowance adder will incentivize innovation to get the most cost efficient solution. Even if someone were to develop a magical solution that dropped the costs to electrify an order of magnitude, there just are not that many emissions from an individual residence available. As a result, the cost per ton reduced will still be well in excess of the New York Value of Carbon, $471 per ton reduced vs. $126 per ton in 2023. If the costs to make these reductions exceed the societal benefit of the reductions then the reductions are not cost-effective.
The second ramification is equally troubling. It is not clear at this time exactly how the program will be rolled out. The state will put allowances up for auction annually equal to the reduction trajectory amounts needed to meet the 2030 emission limits. I am guessing that the providers who supply fossil fuel to the building sectors will be responsible for building sector compliance. They will purchase allowances for each quantity of fuel purchased. If they purchase fuel and have insufficient allowances to cover that energy then they cannot sell the fuel.
I don’t think the advocates for a binding CO2 cap really understand that limiting the number of allowances also places a limit on fuel use. In theory scarcity will drive the prices up incentivizing innovation for lower carbon solutions but the ultimate compliance strategy is to simply not burn fossil fuels. If the emission reduction control strategies are developed slower than the arbitrary compliance trajectory then there will be an inevitable artificial shortage of fuel. If a power plant has insufficient allowances, it cannot run and provide energy when needed. When the fuel providers don’t have enough allowances, then they will have to limit how much fuel aka energy they can provide to homes and other users. Given that the trajectory is so ambitious and the options to make reductions appear to be so limited I don’t see any way this will not result in artificial fuel shortages.
Even if there are sufficient allowances the artificial scarcity will drive up prices. One of the great unknowns of the Hochul proposal is the revenue target. A feature of most cap and invest programs are limits to constrain the auction price. However, the market price has no such limits. The impacts of a binding cap on costs is another unknown with likely bad consequences.
Conclusion
New York policy makers have glommed on to Cap and Invest because they think it is a solution that will easily provide revenues and compliance certainty. Unfortunately, that presumption is based on poor understanding of market-based emissions programs. The reality is that successful programs used emissions reduction strategies that are not available in the quantity or quality necessary for New York. Presuming that past performance would be indicative of future reduction success and establishing an arbitrary emissions target that is incompatible with realistic emission reduction trajectories is not going to end well because the numbers simply do not add up.
This is a summary of the presentation I am giving to the Mohawk Valley Environmental Information Exchange on March 8, 2023 explaining why I believe that the risks, costs, and impacts of the Climate Leadership and Community Protection Act (Climate Act) exceed the protections, savings, and benefits. It is very similar to a presentation I made last December.
Everyone wants to do right by the environment to the extent that they can afford to and not be unduly burdened by the effects of environmental policies. I submitted 23 comments on the Climate Act implementation plan and have published over 250 blog posts on New York’s net-zero transition because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that this supposed cure will be worse than the disease. 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.
Introduction
I explained that given the time constraints it was only possible to give sound bites to describe why I am skeptical of the ultimate impacts of the Climate Act. This blog post gives an overview of the presentation and, more importantly, a link to detailed information supporting my arguments. Everything presented draws on my blog posts and Draft Scoping Plan comments.
I discussed three primary concerns: reliability, affordability and environmental impacts. In every instance, my evaluation of the components of the transition plan has found that issues are more complicated, uncertain, and costly than portrayed by the State. Moreover, they have not provided a feasibility analysis to document whether their list of control strategies could work. In addition there is no implementation plan. The Climate Act is simply too fast and too far.
Overview of the Climate Act
I described the transition plan for New York’s Climate Act “Net Zero” target (85% reduction and 15% offset of emissions) by 2050. The Climate Action Council developed an outline of plans to implement the Act in 2022. The 22 members of the Council were chosen for their ideology and not their expertise. As a result of the lack of clear direction by the Hochul Administration their plan misplaced priorities. Instead of focusing on overarching policy issues there was inordinate attention to personal concerns of Council members.
Over the summer of 2021 the New York State Energy Research & Development Authority (NYSERDA) and its consultant Energy + Environmental Economics (E3) prepared an Integration Analysis to “estimate the economy-wide benefits, costs, and GHG emissions reductions associated with pathways that achieve the Climate Act GHG emission limits and carbon neutrality goal”. Integration Analysis quantitative implementation strategies were incorporated into the Draft Scoping Plan when it was released at the end of 2021. After an extended comment period and ostensible review of the comments the Council released the Final Scoping Plan at the end of 2022.
I expressed my disappointment with the public stakeholder process associated with the Draft Scoping Plan comments. Seven hundred people spoke at Climate Act Public Hearings and around 35,000 comments were received. However, on the order of 25,000 comments were “potentially the same or substantially similar”, i.e., form letters. That still left 10,000 unique comments that the Council promised would be “acknowledged”. In my opinion, the comment process was treated as an obligation not as an opportunity to improve, correct, or clarify the scoping plan.
Of course it is unreasonable to expect that the Council members could be expected to review all the comments themselves. Agency staff categorized the comments and then filtered them in presentations to the Climate Action Council that described themes with very little specificity. I think there was a clear bias in the presentations. Anything inconsistent with Administration’s narrative was disparaged, downplayed, or ignored. I was most disappointed that no comments on the fundamental basis of the Draft Scoping Plan, that is to say, the Integration Analysis, were mentioned, much less discussed.
I also addressed the Climate Act mandates for 2023. The expectation is that the regulations that implement policies that force the transition away from fossil fuels will be implemented by the end of 2023. However, the Climate Act also mandates a public comment and consultation process before promulgating regulations. It requires the Department of Environmental Conservation (DEC) to complete a public comment and consultation process before it can promulgate the 2024 Implementing Regulations. This process includes public workshops and consultation with the Climate Action Council, the Environmental Justice Advisory Group, the Climate Justice Working Group, representatives of regulated entities, community organizations, environmental groups, health professionals, labor unions, municipal corporations, trade associations and other stakeholders. At least two public hearings and a 120-day public comment period must be provided. Only after this extensive stakeholder process concludes is DEC authorized to propose the implementing regulations. When the regulations are formally proposed the State Administrative Procedures Act requires a 60 day public comment period, public hearings, and that the agency respond to all comments. I think this is a very ambitious plan.
Electric Grid Risks
Many of the most vocal supporters of the Climate Act believe that existing renewable technology is sufficient to transition the New York electric grid to zero-emissions resources by 2040 and that suggestions that may not be true are misinformation. In order to address that fallacy my presentation concentrated on my concerns about the reliability risks of an electric grid that is dependent upon intermittent and diffuse renewable resources. The electric grid is crucial to New York’s energy future because the primary de-carbonization strategy is to electrify everything possible using those resources. I described the existing grid, generation resource planning, the current New York State system, and the projected New York State system. Electric grid reliability requires that generation resources match electric load at all times and the challenges associated with wind and solar in this regard are ignored by those who believe that existing technology is sufficient.
I made the point that failure to adequately plan will mean an inevitable catastrophic blackout like the
Texas February 2021 blackout. In short, weather related issues due to freezing rain, snow and then an extended period of cold weather led to periods when the generating resources did not match the load necessary. The storm was the worst energy infrastructure failure in Texas history. Over 4.5 million homes and residences were without power, at least 246 people died, and total damages were at least $195 billion.
In order to illustrate the basic electric grid I included the following diagram. It shows that generating station provide power using turbine generators that convert mechanical energy into electric energy using water, steam, or other means to spin the turbines. I have heard the argument that the grid is inefficient because there are power losses between the generating station and the users but the fact is that New York will always be dependent upon a transmission system because there is insufficient space in New York City for sufficient renewable resources to provide the energy needed to keep the lights on. Power output from generating plants is stepped up at substation transformers for long distance transmission and then substation transformers step down the power for the distribution system for use by consumers.
I included the following diagram to make the point that New York is in the Eastern Interconnection which is the largest machine in the world. Incredibly all the fossil, hydro, and nuclear generating stations in the Eastern Interconnection work together. In order to provide 60 Hz power the generating turbines are synchronized to run at 3600 revolutions per minute. Operators keeps the voltages as constant as possible in the entire area but have the advantage that those turbines provide inertia and they can dispatch generating resources as necessary. Unfortunately, wind and solar resources are inverter based and cannot be dispatched as needed.
New York State has its own regional operator – the New York Independent System Operator (NYISO). Within Power the Eastern Interconnection system operators match the load with the generation in smaller regional systems. Regional system operators manage imports and exports between neighboring systems. New York has unique system constraints related to New York City and Long Island that warrant its own system operator.
NYISO operates the electric grid for New York State. There are 11 control areas with specific load, interconnection, and generation characteristics that must be addressed on a six-second basis to keep the lights on. New York State’s major challenge is that there are limits to transmission to the highly populated New York City and Long Island control areas. The NYISO has to address different time scales for load management
Sub-minute fluctuations are addressed automatically
Hourly and daily fluctuations are handled by operators
Annual peaks require planning so that operators can respond
New York’s high reliability performance standards are the result of decades of experience working with dispatchable resources and implementation of specific metrics developed after blackouts in 1965 and 1977.
In order to educate those who believe that existing renewable resources are sufficient for maintaining current reliability standards I described generation resource planning. The following load duration curve is a key concern of load management planning. There are three general resources. Baseline resources ideally are dispatched so they can run at a constant rate which enables the resource owners to tune the units to run as efficiently as possible. Daily load variations require some resources to follow load during the day. The biggest planning challenge is capacity and energy for peak loads that occur when temperatures are highest or lowest. Before deregulation, each utility was responsible for meeting all these resource needs. In New York City the solution for the peak load problem was a fleet of simple-cycle turbines dedicated for use to provide peaking power when and where needed.
The problem with existing renewable resource technology is matching load when the system is dependent upon renewable resources that cannot be dispatched and provide variable energy. This is a new and difficult challenge. It is exacerbated by intermittent renewable energy availability associated with peak loads. Load peaks with the coldest and hottest weather but those conditions typically are low wind resource periods. Wind lulls in the winter when solar is low availability is the critical reliability issue.
The NYISO 2022 Power Trends Report includes this description of the capacity (power available in MW) for the existing system. It shows that 70% of installed capacity is fossil fueled and 25% is zero emissions.
Wind and other renewables (solar energy, energy storage resources, methane, refuse, or wood) account for only 6% of installed capacity. Note that NYISO does not measure distributed solar directly. In their accounting it reduces the load so less generation is needed.
The NYISO 2022 Power Trends Report includes this description of Energy Production (MWh). Note that 50% of New York’s generated electricity is zero-emissions. There is a Climate Act target to “Increase renewable sources to 70 percent by 2030” that does not include zero-emissions nuclear. One reason that I am skeptical of the Climate Act is because 24% of renewable source energy produced is hydro and hydro pumped storage. Wind and other renewables (solar energy, energy storage resources, methane, refuse, or wood) account for 5% of energy produced. The 29% of the energy produced from renewable sources is far less than the 70% by 2030 target. I don’t think that it is feasible to develop over 29GW of renewable resources between now and 2030 with supply chain issues, constraints on permitting, procurement, and construction when development of supporting infrastructure is also needed for off-shore wind development.
The capacity factor is a useful metric to understand electric generation resources. The annual capacity factor equals the actual observed generation (MWh) divided by maximum possible generation (capacity (MW) times the 8,760 hours. In New York nuclear is a key contributor but the Administration recently shut down 2,000 MW at Indian Point. As a result, CO2 emissions from the electric sector increased by 23% since the phased-in shutdown of Indian Point started. At this time the simple-cycle peaking turbines are being phased out and peaking power is produced by oil-fired units and spare capacity in the gas and dual fuel units. Oil burning is a unique New York resource. Imagine the difficulty replacing that capacity with a resource that would only need to run 1% of the time. Note that in 2021 New York land-based wind only had a 22% capacity factor.
It is commonly argued that renewables are the cheapest type of new electric generating resources. For example, that was the claim in a Dave Davies interview on National Public Radio Fresh Air: “A new climate reality is taking shape as renewables become widespread” with New York Times staff writer David Wallace-Wells. Wallace-Wells said: “In fact, according to one study, 90% of the world now lives in places where building new renewable capacity would be cheaper than building new dirty capacity. And indeed, in a lot of places, it’s already cheaper to build new renewables than even to continue running old fossil fuel plants.” He went on to say “…we should be going all in on renewables here. We shouldn’t be building new coal or new oil or new gas capacity.”
The key to this claim is the reference to capacity. If that were the only factor involved in getting the electricity when and where it is needed 24-7, 365 days a year without losing load due to extreme (one in ten year) conditions then his argument that we shouldn’t be building new coal, oil, or natural gas capacity” would be valid. It is not. Obviously electric users want power even when the wind is not blowing at night. Electric system innumerates under-estimate the challenge of the energy storage requirements for extreme renewable resource lulls which correlate well with weather events that are safety threats because of extreme cold and heat.
Given time restraints I could not fully describe all the NYISO’s planning responsibilities. I did not include the following slide and made the point that their modeling analyses incorporate all of the complexities of the New York electric system. I did not describe the three primary components of their responsibilities: comprehensive system planning which examines near-term and longer-term issues impacting reliability, economic, and public policy transmission planning; interconnection planning to evaluate the reliability implications of resources interconnecting and deactivating from the grid; and
Inter-regional planning with neighboring grid operators. One of the primary functions of the NYISO is electric system planning. NYISO modeling incorporates all the complexities of the eleven control areas in the New York energy system.
I included the following summary of the NYISO Comprehensive System Planning Process to show all the components and to highlight the recent addition of a new component. In order to address the Climate Act NYISO added “Develop the System & Resource Outlook” component that looks at a longer planning horizon that was included previously.
The first report for the resource outlook component was released a couple of months ago. The 2021-2040 System & Resource Outlook can be downloaded from NYISO and a datasheet summary of key takeaways of the Outlook report is also available. The summary describes the four key findings: an unprecedented buildout of new generation is needed, load will increase when we electrify everything, transmission is necessary and must be expended to get diffuse renewables to New York City and a new resource has been identified: Dispatchable Emissions-Free Resource (DEFR). That resource is essentially a fossil-fueled turbine without any emissions.
I compared the NYISO Resource Outlook modeling analysis with the Integration Analysis modeling. The Outlook analysis was based on three scenarios. In order to evaluate the effects of different policy options, this kind of modeling analysis projects future conditions for a baseline or business-as-usual case. The evaluation analysis makes projections for different policy options, and then the results are compared relative to the business-as-usual case. NYISO ran two policy scenarios: one based on their estimates of future demand and one that tried to simulate the Integration Analysis projections. I compared their scenario 1 to the Integration Analysis in the presentation.
I compared the NYISO Resource Outlook modeling analysis with the Integration Analysis modeling. The Outlook analysis was based on three scenarios. In order to evaluate the effects of different policy options, this kind of modeling analysis projects future conditions for a baseline or business-as-usual case. The evaluation analysis makes projections for different policy options, and then the results are compared relative to the business-as-usual case. NYISO ran two policy scenarios: one based on their estimates of future demand and one that tried to simulate the Integration Analysis projections. I compared their scenario 1 to the Integration Analysis in the presentation.
The Integration Analysis modeling was used to develop the Draft Scoping Plan. It is important to note that contrary to usual practice the Integration Analysis baseline was a reference case that included “already implemented” programs. In other words there are some programs incorporated into the Reference Case that only exist to reduce GHG emissions. This definition of the Reference Case instead of a Business-As-Usual case is different practice and motivated to get a specific answer.
The Integration Analysis considered four different policy projections. The first considered the Advisory Panel recommendations for control measures, but the modeling showed that they did not meet the Climate Act targets. The Integration Analysis came up with three mitigation scenarios that did meet the targets. The model used for the analysis is not as sophisticated as the NYISO model. Modelers plugged in a set of control measures at varying efficiencies until they met the targets. Note, however, they have not claimed that the scenario measures as scoped out will provide electricity that meets current reliability standards. In my opinion this approach gave the impression to the Council that meeting the targets would be relatively easy. Council members requested scenarios that considered a faster implementation schedule and more reductions that the 85% target. The cost/benefit results claim that those more stringent scenarios provide more benefits primarily because of reduced costs. I think that is a counter-intuitive result so my comparison was against Scenario 2: Strategic Use of Low-Carbon Fuels.
I compared the installed capacity for the two models in the next table. As noted by the NYISO, an extraordinary development of renewables by 2030 is required and both models agree on that. There also are some key differences. The NYISO modeling projects more onshore wind, less offshore wind, less solar, and more DEFR. The NYISO model simultaneously optimizes resource capabilities and costs to come up with a least-cost solution. I think the wind differences are due to cost and availability differences. The two modeling approaches handle distributed solar differently. NYISO does not measure generation from distributed sources and only considers it as a way to reduce the load needed. The Integration Analysis explicitly includes distributed solar capacity and generation as an output. Note that existing storage is pumped hydro but any new storage will be batteries. Finally, it is notable that both modeling analyses project that 2040 DEFR will be comparable to existing fossil capacity albeit NYISO projects significantly more and Integration Analysis a little less.
I compared the energy produced (GWh) for the two models in the next table. The largest difference between the models is that NYISO projects that DEFR generates ten times more energy. It turns out that NYISO has DEFR generating 14% of the total energy in 2040 but Integration Analysis projects only 1%. NYISO projects more onshore wind than offshore wind and the Integration Analysis projects the opposite. There is huge difference between solar but I believe that is related to the fact that NYISO does not explicitly include distributed solar. Clearly the two models handle storage differently.
I noted earlier that I was disappointed that the Hochul Administration ignored my comments on the Integration Analysis. The capacity factor table shows one of the points I made in my comments. I pointed out that the Integration Analysis land-based wind capacity factors were unrealistically high. The model projected the 2020 generation with a capacity factor of 29% but the 2021 observed capacity factor was only 22%. The model could not even get the starting year correct. As a result the Integration Analysis projections for the land-based wind needed to meet the load is too low. For all renewable resources the Integration Analysis capacity factors are higher than the NYISO projections. I prefer the projections from the organization responsible for New York reliability to those from the unelected bureaucrats who have no such responsibilities.
There is one other point in this table. The DEFR capacity factors are different. To this point the extra capacity needed to keep the lights on during peaking periods was provided by relatively cheap sources of energy. When new peaking resources were needed, cheap simple-cycle turbines were installed. Currently peak energy resources are primarily from existing old, amortized facilities. As we shall see, the new DEFR required to keep the system working will use much more expensive resources. In our deregulated system the NYISO will have to develop a market payment scheme to cover those increased costs.
As noted earlier, I believe that the NYISO projections based on more sophisticated modeling has a much better chance than the Integration Analysis to describe a mix or resources that will maintain current reliability standards. Nonetheless, I have reservations about any projections because the future electric grid will depend on unprecedented amounts of renewable energy resources. The following slide lists six of concerns for an electric system dependent upon renewable resources. For my presentation I only mentioned the first three. Because wind and solar are intermittent that means you have to have storage for daily, seasonal, and peak load requirements. The lack of an implementation plan ignores that wind and solar success is location specific. New York needs a plan that encourages development where the resource is better during the winter lulls. Specifically, it is not a good idea to offer the same incentives to utility-scale developments on the Tug Hill plateau where over 200” of snow are common as areas where snowfall amounts are lower. The third concern is reliability services and they are a reason that wind and solar are far more expensive for deliverable energy than fossil.
I found a good summary of the essential reliability services in a paper by National Renewable Energy Laboratory authors entitled Getting to 100%: Six strategies for the challenging last 10%. It describes ancillary services that must be provided to keep the transmission system going. Wind and solar do not provide those services so someone, somewhere else has to provide them at some additional cost.
The ultimate reliability problem is illustrated in the following figure. This graph illustrates the long-duration wind lull problem from an early presentation to the Climate Action Council. It explicitly points out that firm capacity (DEFR) is needed to meet multi-day periods of low wind and solar resource availability. The Council has known about the problem all along but have basically pushed it aside as inconvenient. The thing to remember is that in order to prevent catastrophic blackouts caused because intermittent wind and solar are unavailable NYISO and the Integration Analysis are both banking on DEFR capacity. Using wind, solar and storage exclusively makes meeting the worst-case renewable resource gap much more difficult.
There is no doubt that the fate of future reliability is inextricably tied to DEFR success. The next slide discusses DEFR options. The Scoping Plan acknowledges the need for DEFR and proposes seasonal hydrogen storage as a placeholder technology. NYISO, while explaining that the resource is necessary, has offered no recommendations what technology could fill the need. The NREL authors of Getting to 100%: Six strategies for the challenging last 10% described six DEFR strategies
Seasonal storage which could be hydrogen or some other kind of long term storage solution
Renewable energy is basically overbuilding with battery energy storage. I believe this represents the preferred approach of those who claim existing technology is sufficient.
Existing technology adherents also claim that demand side resources can flatten the load peaks so much that less DEFR is needed
The problem with other renewables (e.g. hydro) in New York is that they cannot be scaled up enough to meet identified needs
Nuclear is the only proven and scalable DEFR technology currently available but it is a toxic option for NY politicians
Carbon capture is unacceptable to the activists and has technological challenges that make it an unlikely a DEFR option.
Because of the challenges of carbon sequestration to net out the 15% net-zero emissions, the Scoping plan mentions the CO2 removal strategy but in my opinion it is unlikely.
There are two approaches advocated by those who believe that existing technology is sufficient to maintain electric system reliability in a zero-emissions electric grid. Some claim that only minimal storage is needed because renewables are available somewhere else, that is to say, the wind is always blowing somewhere. Others claim that overbuilding renewables supplemented with battery energy storage systems is a viable solution.
While the concept that the wind is always blowing somewhere else is indisputably true, the issue is that in order to keep the lights on we need power at specific times and places from a dedicated source. New York City’s peaking turbines were located in specific locations to maintain reliability and they were dedicated to that application. New York’s reliability standards were developed based on decades of experience that showed that a certain installed reserve margin would guarantee that New York reliability standards could be maintained. Against that backdrop consider the following weather map on February 17, 2021. The Texas energy debacle was associated with this intensely cold polar vortex huge high pressure system. Remember that winds are higher when the isobars are close together. On this day there are light winds from New York to the southeast, west, and north including the proposed New York offshore wind development area. There are packed isobars in northeastern New England, in the western Great Plains, and central Gulf Coast. In order for New York to guarantee wind energy availability from those locations, wind turbines and the transmission lines between New York and those locations would have to be dedicated for our use. Otherwise I think it is obvious that jurisdictions in between would claim those resources for their own use during these high energy demand days. It is unreasonable to expect that this could possibly be an economic solution.
Another way of looking at this issue is to consider the NYISO fuel mix data available at the NYISO Real-Time Dashboard. I downloaded four days of February 2021 data to generate the following table. It shows that a high pressure system reduces wind resource availability across the state. The data show that less than a quarter of the daily wind capacity is available for this period. Note that the worst-case hour on 2/18/21 at 7:00 AM wind production was only 138 MW out of a New York total of 1,985 MW for a capacity factor of 7%. If we were to overbuild wind resources to replace fossil capacity 7,191 MW on that hour you would need 102,729 MW.
Clearly, overbuilding alone is not a viable solution. You have to have new energy storage and the currently available technology is battery energy storage systems. Both the Integration Analysis and NYISO Resource Outlook optimized the balance between renewables and storage but still found that DEFR was needed. Existing-technology proponents claim that over-building wind, solar, and storage is viable but have not countered the NYISO or Integration Analysis modeling results. I am concerned about the risks associated with the current preferred technology: lithium-ion storage battery systems. The first risk is logistical inasmuch as battery storage footprints are larger than the existing peaking turbine sites so finding space for the batteries is an issue. Worse is the fact that lithium-ion storage batteries have the risk of thermal runaway fires and explosions that trade an acute health risk for chronic, and speculative in my opinion, risks. Paul Christensen, Professor of Pure and Applied Electrochemistry at Newcastle University in the United Kingdom gave a presentation at PV magazine’s Insight Australia event in 2021 that describes the risks. His videos of thermal runaway tests are terrifying. He is one of the world’s leading experts on battery fires and safety and said global uptake of lithium-ion battery technology has “outstripped” our knowledge of the risks. He also stated that he is “astounded and appalled that if there is no appreciation of the safety issues involved” with large battery energy storage systems. This is another feasibility issue that is unaddressed by the Scoping Plan.
Hydrogen storage is the Scoping Plan DEFR placeholder technology. The plan is to use wind and solar electrolysis to produce “green” hydrogen from water. The stored hydrogen would either be combusted to power turbines or used in fuel cells. There are fundamental issues associated with the use of hydrogen that I detail on my blog. Hydrogen generation, storage and use loses much more energy than alternatives and may not even have a net energy benefit so it is unlikely to be sustainable. In order for it to provide the necessary peaking power in New York City a colorless, odorless, hard to store explosive gas will have to be stored and used. I don’t think that the technology will be embraced in the City. All the infrastructure necessary to produce, store, and use will have to be built and paid for to meet a projected capacity factor of 2%. I doubt that makes economic sense.
I concluded my discussion of the risks to electric system reliability by summing up the NYISO Resource Outlook Key Findings Datasheet. According to the organization that is responsible for keeping the lights on, DEFR is necessary for future reliability. Because a politically acceptable DEFR that can be scaled up to meet the levels needed for reliability is not currently available, a new technology has to be developed, tested, and put on line well before 2040. The NYISO makes the point that until you have the necessary DEFR technology on line shutting down existing fossil generation is inappropriate. I am disappointed that the NYISO Resource Outlook has not mentioned any costs. This is likely to be a particular issue relative to DEFR. Clearly conditional implementation dependent upon the availability of DEFR would be a rational approach.
There is no documentation that lists the specific costs of control strategies, the expected benefits, or the expected emission reductions making it impossible to estimate the total costs of the Climate Act. That information is necessary to determine whether the Integration Analysis projections are feasible. The Scoping Plan claims that the cost of inaction is more than the cost of action but a variation of this graph is the only documentation for that claim. I directly addressed this misleading and inaccurate statement in my comments at the Syracuse public hearing but there was no response or mention of the issues I raised at any Climate Action Council meeting or in the Final Scoping Plan documentation.
The statement is misleading because costs are given relative to the Reference Case and not a business-as-usual case as explained earlier. In other words, the Hochul Administration is not presenting all the costs to make the transition to net-zero by 2050. The Reference Case described as “Business as usual plus implemented policies” includes the costs of the following policies:
Growth in housing units, population, commercial square footage, and GDP
Federal appliance standards
Economic fuel switching
New York State bioheat mandate
Estimate of New Efficiency, New York Energy Efficiency achieved by funded programs: HCR+NYPA, DPS (IOUs), LIPA, NYSERDA CEF (assumes market transformation maintains level of efficiency and electrification post-2025)
Funded building electrification (4% HP stock share by 2030)
Corporate Average Fuel Economy (CAFE) standards
Zero-emission vehicle mandate (8% LDV ZEV stock share by 2030)
Clean Energy Standard (70×30), including technology carveouts: (6 GW of behind-the-meter solar by 2025, 3 GW of battery storage by 2030, 9 GW of offshore wind by 2035, 1.25 GW of Tier 4 renewables by 2030)
Note that the costs for electric vehicles, charging infrastructure, and distribution system upgrades necessary for electric vehicle charging are excluded from the cost of action. Correcting that “trick” alone would undoubtedly show the costs of action are more than the costs of inaction.
There is another egregious cheat that further undermines the claim. It is inaccurate because the Scoping Plan counts the societal benefits of avoided greenhouse gas emissions multiple times. My Draft Scoping Plan comments on benefits documents why I believe that their claim for $235 billion in societal benefits should only be $60 billion. Their approach is equivalent to me saying that because I lost 10 pounds five years ago, I can say that I lost 50 pounds. Correcting that error would also by itself invalidate their benefits claim. Bottom line is that I estimate that the real costs are at least $760 billion more than the imaginary claimed benefits.
I wrote a post on this shell game description of costs and benefits. I concluded that a shell game is defined as “A fraud or deception perpetrated by shifting conspicuous things to hide something else.” In the Scoping Plan shell game, the authors argue that energy costs in New York are needed to maintain business as usual infrastructure even without decarbonization policies but then include decarbonization costs for “already implemented” programs in the Reference Case baseline contrary to standard operating procedure to use a status quo baseline for this kind of modeling. The documentation for Reference Case assumptions was missing in the draft documents. Shifting legitimate decarbonization costs to the Reference Case because they are already implemented and hiding the documentation fits the shifting condition of the shell game deception definition perfectly.
In my opinion one of the biggest environmental success stories in my lifetime is the reintroduction of Bald Eagles to New York State. When I moved to Syracuse in 1981 it was inconceivable that it would be possible to see a Bald Eagle from my home but I have seen several in the last few years. One of the missing pieces of the Climate Act implementation plan is an update of the Cumulative Environmental Impact Statement to reflect the latest estimates of the number of wind turbines and areal extent of solar panels. I worry that the combined effect of all that development will threaten Bald Eagles.
The following table was not included in the presentation but shows the capacity of the resources not considered in the cumulative impact statements. Clearly, much more renewable capacity will be required than has been evaluated.
Comparison of Integrated Analysis Projected Capacity and Cumulative Environmental Impact Statements (MW)
The following table used in the presentation shows the number of wind turbines and areal extent considered in the completed cumulative impact statements relative to the projected numbers in the Integration Analysis. The Scoping Plan calls for at least 497 more onshore wind turbines, 493 more offshore wind turbines and 602 more square miles covered with solar equipment than has been evaluated in cumulative analysis.
I have considered the avian impact of the Bluestone Wind Project in Broome County New York to show impacts for a single facility. It will have up to 33 turbines and have a capability of up to 124 MW covering 5,652 acres. Over the 30-year expected lifetime of the facility the analysis estimates that 85 Bald Eagles and 21 federally protected Eastern Golden Eagles will be killed. A first-order approximation1 is to scale those numbers to the total capacity projected for the Scoping Plan. This back of the envelope approximation suggests that at least 216 Bald Eagles could be killed every year when there are 9,445 MW of on-shore wind. There were 426 occupied bald eagle nest sites in New York in 2017. In my comments on this topic I stated that the Final Scoping Plan must include proposed thresholds for unacceptable environmental impacts like this. There has been no response whatsoever to my comment.
When New York’s GHG emissions are considered relative to global emissions I conclude that New York only action is pointless. In the presentation I compared New York emissions to global emissions in two graphs. I used CO2 and GHG emissions data for the world’s countries and consolidated the data in a spreadsheet. I used the New York State GHG data set CO2e AR4 100 year global warming potential GHG values for consistency. Plotted on the same graph New York GHG and CO2 emissions cannot be differentiated from zero.
When the New York emissions are plotted relative to global emission increases the futility of New York affecting global emissions is shown. The trend results indicate that the year-to-year trend in GHG emissions was positive 21 of 26 years and for CO2 emissions was positive 24 of 30 years. In order to show this information graphically I calculated the rolling 3-year average change in emissions by year. New York’s emissions are only 0.45% of global emissions and the average change in three-year rolling average emissions is greater than 1%. In other words, whatever New York does to reduce emissions will be supplanted by global emissions increases in less than a year.
Climate Act advocates frequently argue that New York needs to take action because our economy is large. I analyzed that claim recently and summarized the data here. The 2020 Gross State Product (GSP) ranks ninth if compared to the Gross Domestic Product (GDP) of countries in the world. However, when New York’s GHG 2016 emissions are compared to emissions from other countries, New York ranks 35th. More importantly, a country’s emissions divided by its GDP is a measure of GHG emission efficiency. New York ranks third in this category trailing only Switzerland and Sweden.
Despite the fact that the ostensible rationale for GHG emission reduction policies is to reduce global warming impacts, the Scoping Plan continues an unbroken string of the Administration analyses not reporting the effects of a policy proposal on global warming. The reason is simple. The change to global warming from eliminating New York GHG emissions are simply too small to be measured much less have an effect on any of the purported damages of greenhouse gas emissions. I have calculated the expected impact on global warming as only 0.01°C by the year 2100 if New York’s GHG emissions are eliminated.
Conclusion
My presentation explained why I am skeptical of the value of the Climate Act. Attempting to get to zero emissions is an extraordinary challenge that is downplayed by the Climate Act, the Council and the Scoping Plan so most people are unaware of the likelihood of success. The experts say we need DEFR but it has to be developed for New York in less than a decade which I believe is unlikely. There is no reason to expect that the costs won’t be huge and the Hochul Administration has covered up of costs and benefits. The cumulative impacts of the required renewable developments have not been evaluated and could be unacceptable.
The fact that our emissions are less than one half of one percent of global emissions and global emissions have been increasing by more than one half of one percent per year may not mean that we should not do something but it does mean that we have time to make sure we don’t do more harm than good. Before any implementing legislation or regulations are even considered a feasibility analysis that asks “what if” questions should be completed to prove current standards of reliability and safety can be maintained. In the meantime the state should develop an implementation plan to make sure that renewable resource development is consistent with the Scoping Plan.
Finally, what is going to happen when we have electrified everything and there is an ice storm? Extreme weather events can have devastating consequences on a more fragile wind and solar electricity network. I am particularly worried about ice storms. On a local level it is not clear how the public will be able to survive a multi-day power outage caused by an ice storm when the Climate Act mandates electric heat and electric vehicles but the bigger reliability concern is that fact that ice storms can take out transmission lines. The January 1998 North American ice storm struck the St Lawrence valley causing massive damage and required weeks to reconstruct the electric grid. When everything is electrified how will it be possible to rebuild?
I lost track of this proposed regulation so I did not let my New York readers know that there was the opportunity to comment on the proposed rulemaking that will incorporate the State of California’s Advanced Clean Cars into New York’s regulations. This is the implementing regulation for the state law to switch to zero emission vehicles. It is unlikely that it will do any good but it would be appropriate to comment and express any misgivings you have about the requirement for a battery electric vehicle. The comment deadline is 5 pm, Monday, March 6, 2023. Written comments may be submitted by e-mail to air.regs@dec.ny.gov. Put Part 218 in subject line.
This is another article about my evaluation of the Climate Act that I have written because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. 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.
Part 218 Advanced Clean Cars
The rulemaking is described at the New York State Department of Environmental Conservation (DEC) Air Pollution Regulatory Revisions webpage. It explains that:
Emergency Rulemaking – Parts 200, General Provisions, and 218, Emissions Standards for Motor Vehicles and Motor Vehicle Engines. The emergency/proposed rulemaking will incorporate the State of California’s Advanced Clean Cars II (ACC II) regulation. The proposed amendments establish new zero emission vehicle (ZEV) and low emission vehicle (LEV IV) standards intended to reduce GHG (greenhouse gas) and NMOG + NOx (non-methane organic gas + oxides of nitrogen) emissions from light- and medium-duty on-road vehicles.
The ZEV amendments include an annual ZEV sales requirement for original equipment manufacturers (OEMs), minimum technical requirements, ZEV assurance measures, regulatory flexibilities, and simplified credit accounting. The proposed ZEV amendments will apply to 2026 and subsequent model year light-duty passenger cars (PC), light-duty trucks (LDT), and medium-duty passenger vehicles (MDPV). Starting with model year 2026, OEMs, will be required to deliver an increasing annual percentage of their sales that are ZEVs or PHEVs. This percentage requirement will start at 35% in model year 2026 and increase to 100% of sales for 2035 and subsequent model years. The proposed LEV IV amendments will apply to 2026 and subsequent model year PC, LDT, and medium-duty vehicles (MDV).
The Notice of Emergency Rulemaking will be available in the December 28, 2022 issues of the State Register and the Environmental Notice Bulletin. A virtual hearing is scheduled for March 1, 2023 at 1 pm. The comment deadline is 5 pm, Monday, March 6, 2023. Written comments may be submitted to NYSDEC, 625 Broadway, Albany, NY 12233-3254, ATTN: James Clyne, P.E., or by e-mail to air.regs@dec.ny.gov.
My Comments
For what it is worth I had been accumulating material for comments so I manage to put together something to submit. I include a link to my comments and describe them below. I submitted comments to the Department of Environmental Conservation (DEC) because the proposed rulemaking ignores feasibility, affordability, and life-cycle environmental impacts. The primary rationale for this emergency rulemaking is to implement the control strategy recommendations included in the Climate Leadership & Community Protection Act (Climate Act) Scoping Plan. The Climate Action Council deferred a feasibility analysis of reliability, affordability, and environmental impacts to the rule-making phase. The result of this irresponsible avoidance of responsibility is a regulation that could very well not be in the best interests of New York
New York agencies are begrudgingly following their mandates for public comments. In the past each rulemaking had its own web page with a bit more description. More importantly the web page would have links to each component of the regulatory package. Admittedly they often would only be in html format so trying to develop comments required downloading and reformatting. This proposed amendment refers to a single pdf format file Part 218 Advanced Clean Cars II (ACC II) that includes all the components in one massive file. If they wanted to encourage public input then they would have everything on a dedicated web page and include links to the pdf format components.
It gets worse because the rationale provided in the proposed amendment documentation is insulting. The program boils down to California did it so we can too. There is no consideration of the potential that circumstances in New York differ from California. The two-county Buffalo–Niagara Falls Metropolitan Statistical Area (MSA) had an estimated population of 1.1 million in 2020 and can be crippled by winter storms. Blizzard conditions with winds excess of 70 mph and heavy lake effect snow in the Buffalo area on Christmas Eve 2022 resulted in devastating impacts across the Buffalo area. Battery electric vehicles (BEV) mandated by this proposed rule do not do well in those conditions. Thirty-nine people died in this storm and more surely would have died if electric vehicles were the only option available. California has no similar major metropolitan areas subject to this type of extreme weather so relying on their analysis so suggesting that it will work here too is disingenuous at best.
The Climate Act mandates a full life-cycle analysis of fossil-fuel use. On the other hand, the life-cycle impacts of the so-called “zero -emissions” alternatives are ignored. BEVs may not have emissions when operating but the volume of materials needed to access the rare earth elements necessary for those technologies certainly have environmental impacts when mined and processed. The vehicles mandated by proposed Part 218 require between 1,000 and 2,000 percent more minerals to deliver the same amount of power and on the order of 400% more metals to manufacture the same vehicles. The consequence of this is that many more materials will be required. The Part 218 Regulatory Impact Statement should address where the materials necessary for BEVs come from and whether there will be sufficient quantities available for the New York transition.
I also addressed disposal of electric vehicles. The modern gas automobile is one of the most highly recycled products in human existence. After initial creation, each vehicle has an average life cycle of about 20 years. At that point it is dis-assembled and its parts are sold used in a global used parts chain, which is the most profitable part of the whole life cycle. In comparison, a Tesla has a plastic body, and a battery assembled from thousands of 18650-type cells, so it is extremely hard to recycle. The body can’t be recycled. According to recent Tesla documents the batteries are “valorized” by grinding them up and putting their waste in construction cement. In contrast, Toyota/Honda hybrid batteries are easily re-used and recycled.
The rationale for this action is that “zero-emissions” vehicles in New York are good for the planet. However, the proposed amendment simply exports emissions elsewhere. I referenced a horror story of the Indonesia Morowali Industrial Park where the danger and pollution involved in mining nickel is at a rapid pace to meet the demand for EVs. I asked how this proposed amendment comports to the environmental justice cornerstone of the Climate Act.
The regulatory documents associated with the Proposed Amendment do not address a critical feasibility problem. DEC has to address BEV charging requirements and existing on-street parking. Who is responsible for providing the on-street charging infrastructure for car owners that do not have a dedicated charging resource?
The proposed amendment mandates that starting with model year 2026, car makers, will be required to deliver an increasing annual percentage of their sales that are ZEVs or PHEVs. This percentage requirement will start at 35% in model year 2026 and increase to 100% of sales for 2035 and subsequent model years. Despite tremendous publicity and extensive subsidies nothing can obscure the fact that EVs remain extremely costly for consumers and offer unproven maintenance and reliability records. I will never buy a BEV because I cannot afford a car that does not offer the same flexibility and convenience as an ICE vehicle. Moreover, I do not want to deal with home charging infrastructure and the safety risk of Lithium-Ion battery chargers below my bed room. What happens when the public does not buy enough of these vehicles to meet those quotas?
Conclusion
This is another instance of a regulation that affects most New Yorkers but only a few are aware of its existence. I expect that the climate activists will mobilize their acolytes to submit comments supporting the rule-making. DEC will count the pro and con comments and consider implementation as a mandate from the public because more comments in favor than against will be submitted. If everyone was aware of this I am sure there number of people opposed would far outweigh the number in favor.
Worse is the complete disregard for rigor in the analysis. The primary rationale is “California said they could do it and we agree”. I did not spend sufficient time to develop comments on the California analysis but given the record of the state’s response to my comments it would only have been a waste of time.
I encourage readers to send a comment. I think it is sufficient to say that the state needs to prove that this is feasible, affordable, and doesn’t cause more environmental harm than good. They have not done that work so this should be delayed until they can prove their case.
One of the few members of the New York State media who has been taking the time to evaluate the potential impacts of the Climate Leadership and Community Protection Act (Climate Act) is Tim Knauss writing for the Syracuse Post Standard. He recently had another good article published that addressed the energy needs of Micron Technology’s planned semiconductor fabrication plant, His takeaway message was that, when fully complete, would consume more energy than the State of Vermont. Richard Ellenbogen frequently copies me on emails that address various issues associated with New York’s Climate Act. I asked his permission to present his evaluation of this article.
I believe that Ellenbogen truly cares about the environment and the environmental performance record of his business shows that he is walking the walk. Ellenbogen is the President of Allied Converters that manufactures food packaging. His facility is about 55,000 square feet and does a lot of manufacturing with heat to seal the bags, all electrically driven. The facility has solar panels and uses co-generation. He explains:
In 2008, the average energy cost per square foot for a commercial facility in Westchester was $1.80. We were at 16% of that 12 years later and even with the increases, we are at 62% of that 14 years later. That has been done while having a carbon footprint 30% – 40% lower than the utility system. The $1.80 per foot also included commercial office space and our operation is far more energy intensive than an office. We use energy extremely efficiently and as a result, our bills are much lower than everyone else.
Micron and the Climate Act
Knauss wrote an article that asked the question: How would Micron’s electricity-hogging plant here live with NY’s war on fossil fuels? He explained:
When fully built, the complex of four chip fabs would use 640 million kilowatt-hours a month, more than enough for 1 million average New York homes.
Micron has promised to buy all that electricity from renewable sources, a promise that reflects New York state’s commitment to have an emission-free electric grid by 2040. But Micron could find it tough to keep that promise unless the floodgates open to new wind and solar farms.
It’s one of the least-discussed challenges of the Micron project, as New York’s signature economic development success story collides with a major environmental aspiration.
Micron announced in October that it planned to invest up to $100 billion building four giant chip fabs at a 1,400-acre site in Clay. The fabs would employ up to 9,000 people directly and could spin off 40,000 more jobs, state officials said.
The development won’t happen all at once. Micron said it plans to start producing chips in 2026 and will fully build the complex within 20 years.
Knauss explained that the construction schedule coincides with implementation of the Climate Act. By 2040 the law mandates the elimination of fossil fuels from the electric system. As part of the plan to eliminate fossil fuel emissions everything possible will be electrified which means that load is going to have to go up:
Even before Micron surfaced, operators of the statewide electric grid were estimating an 8.7% increase in electricity consumption by 2035, according to forecasts by the New York Independent System Operator.
Micron could add another 5%, according to estimates worked up by National Grid and Micron as part of a term sheet agreement with state officials. The documents indicate that Micron could draw an average of 928 megawatts – the output of a large nuclear plant – as soon as 2035.
I have not followed the Micron agreement very closely but it depends a lot upon Federal and State incentives. Those incentives come with strings attached:
Micron’s promise to use all renewable power is more than goodwill. Its ability to collect up to $5.5 billion in state subsidies depends on that pledge.
According to the term sheet Micron signed with economic development officials, the company agreed to use “100% renewable energy for electricity.”
Micron must enter a state-approved sustainability plan in exchange for the billions in aid. The plan has not been finalized yet, but there will be plenty of wiggle room. State economic development officials aren’t likely to box in Micron if it prevents the company from building.
There is a relevant component to the agreement. According to their plans Micron intends to use natural gas for heating. Knauss claims (I have not verified) that “the company also would be exempt, as a manufacturer, from proposed state legislation that would require most buildings eventually to go all-electric.”
Ellenbogen Fact Check and Alternative Approach
Ellenbogen has a number of recipients on his email chain and one of them sent him the link to the Knauss article and asked the following question:
Rich, check out the following article. Micron is making promises about 100% renewable energy that they can’t keep without cheating. Maybe they will buy credits for curtailed electricity that never gets on the grid from solar panels in California. Also note the exceptions they are getting to use gas for heating while everyone else needs to electrify. According to this, Micron will consume more electricity than all of Vermont. If so, they ought to be building their own on-site nuclear plant. (Seriously.) That would actually give them the process heat they need, too.
Ellenbogen responded with the following analysis.
I fact checked his information and the Micron chip factory actually will use more electric energy than the state of Vermont. The factory will use 8.12 Terawatt hours per year and Vermont’s annual electric load is only 5 Terawatt hours, with a Terawatt Hour equaling 1,000 Gigawatt Hours. Wondering how Vermont’s electric load could be so small, I checked and their onsite heating is only 6.26% electrified with the other 93.74% coming from fossil fuels or wood. A pie chart documenting that is below and everything that you might ever want to know about Vermont’s electric utility system is in this pdf.
Ellenbogen hits the nail on the head when he points out that fossil-fired backup is necessary:
What I find interesting is that all companies want to locate in upstate NY and then claim that they are only using “green” energy from Niagara Falls or the upstate nuclear plants, ignoring the fact that all marginal generation in NY State will be provided by fossil fuels for many decades into the future. While the Micron facility justifies the energy expense because of the 9,000 jobs, a realistic analysis has to be done regarding the best way to provide energy for that facility.
A nuclear plant would be a great zero-emissions alternative but the politically driven energy policy of New York would have to change dramatically to address the practical issues he points out:
While the person that sent me the email is correct about the use of a nuclear plant being the most environmentally friendly way to supply this facility, the $15 billion for a one gigawatt nuclear plant would add 15% to the projected $100 billion price tag and might make it non-cost effective. It would also take a very long time to get the approvals and build the facility. Additionally, the words “Nuclear Energy” might be the only words uttered in NY State that are more toxic than the words “Fossil Fuels”. Chip manufacturing facilities use ovens at about 1000 degrees-C to bake the silicon wafers accounting for their enormous energy use. Many processes use high energy lasers and microwaves, as well.
Ellenbogen goes on to evaluate how much solar would be needed. I have some questions about the battery storage requirements and cost numbers but my numbers come to the same conclusion:
If we look at renewable options, to supply the 8.12 Terawatt hours with solar arrays at this facility, accounting for storage losses, would require a 9.28 Gigawatt array. At 7.5 acres per megawatt of solar array would require 69,600 acres or 110 square miles of solar arrays. To acquire farmland upstate to support that at the going rate of $3200 per acre, the land alone would cost about $221 million. The array, at $2/watt would cost $18.56 billion and we haven’t calculated the storage costs or the interconnection costs yet, but 1 Gigawatt of storage for 90 days, which is the minimum that would be needed, would require a 2.16 billion KWh battery. At $500 per KWh, less than last year’s battery cost, the battery would cost $ 1.08 trillion. Coupled with the array cost and the land, the total cost will be $ 1.098 trillion dollars or more than ten times the cost of the fabrication facility. A large percentage of the $1.098 trillion battery packs would have to be replaced every 10 years as the batteries decayed and became unusable.
Even without the battery storage, the 9.3 Gigawatt array would cost more than the nuclear generating plant and would be unable to support the Micron facility (without batteries). It would add almost 20% to the project cost. Renewables are less expensive than fossil fuel generation per kilowatt-hour if the batteries are not included. However, where a fossil fuel or nuclear powered utility system does not need batteries, an intermittent renewable system will and that is where the price comparison collapses as the battery storage makes the renewables non cost competitive.
Ellenbogen also looks at using offshore wind. Importantly he draws on his practical experience with carbon credits to discredit this alternative:
Alternatively, instead of solar the facility would require about 3 GW of the proposed 9 GW of offshore wind but the batteries would still be needed. Either way, the numbers for this are ludicrous and no business will locate to NY State under these conditions. Alternatively, the state is going to require Micron to buy carbon credits which is just putting lipstick on a pig because the emissions will still be there. They will just be gone on paper. I am familiar with carbon credits as I have been selling the credits from my arrays to utilities in Washington DC for 12 years. They are designed as an incentive to make utilities want to install their own renewables rather than purchase the credits. However, if they truly worked as planned, after 12 years the utilities would have installed the renewables and there would be a glut of credits available causing the price to drop. In 2010, I was receiving about $440 per megawatt-hour of solar energy that we generated. Last month, I sold them for $410 per megawatt-hour so the price has only dropped by 7% in 12 years. While renewable generation has been installed to support Washington’s utility system, the credits have not been enough to induce the utilities to invest heavily in renewable construction. If the Washington DC Government raised the price of the credits high enough to induce the utilities to build their own renewables, the utility bills would increase too much and the public would scream at the policy makers.
Recall that Ellenbogen has developed an energy-efficient solution for his manufacturing facility. He explains how that could work for Micron:
A far better solution that would also be cost effective would be to site a 1 Gigawatt combined cycle gas generating facility next to the Micron plant to provide its energy needs without long transmission lines that will increase line losses. By doing that, the Micron facility could also take advantage of the excess thermal energy for its heating and air conditioning needs, which will be substantial. It would be a co-generating plant on steroids and would relieve a lot of stress on the state’s transmission system. A generating plant the size of the recently built Cricket Valley Energy Center (1.1 Gigawatts) would suffice. That only cost $ 1.58 billion which is a small investment of an additional 1.6% compared to the $100 billion facility cost and would save the company money on its energy bills and simultaneously make them more cost competitive. Additionally, the Cricket Valley Energy Center sits on 193 acres, 0.002 or 0.2% of the land area of the equivalent solar array. Micron would recoup the $1.58 billion cost from energy savings.. Rather than the state forcing Micron to pretend to be environmentally friendly, Micron would actually be environmentally friendly. However, the gas bans will preclude using this option all over the state because it doesn’t meet the ideological purity test.
He concludes his writeup:
This is what I was saying regarding the state’s policy actually increasing carbon footprint. NY State’s energy policy may seem environmentally friendly, but it is just the opposite and will increase carbon emissions. The policies don’t make any sense from an economic standpoint or an environmental standpoint.
Conclusion
Tim Knauss continues to impress me. He has done another fine job evaluating a technical issue clearly and accurately devoid.
With regards to the Micron plan – reality is always going to win. The state’s hocus pocus shell game of energy and environmental policies don’t actually decrease costs. Ellenbogen has offered an alternative that has worked for him and will work for Micron. Unfortunately, the ideologues in the State won’t consider his approach. I hope that this does not scuttle the implementation of the Micron plans.
Ellenbogen’s cover email concludes: “This is a classic example of how NY State’s Climate Law is going to raise Carbon Footprint, raise energy costs, and damage the state economy, echoing my remarks at the Capital on Monday.”
I attended a town hall meeting for the 2023 Budget sponsored my New York State Assemblyman, Al Stirpe, to explain why I am opposed to any legislation in the budget supporting implementation of any aspect of the Climate Leadership and Community Protection Act (Climate Act). The meeting format did not lend itself to presenting anything as detailed as the comments I wanted to make. This post documents the Climate Act-related issues that came up at the meeting and the comments I wanted to make.
This is another article about my evaluation of the Climate Act that I have written because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. Moreover, the costs will be enormous and hurt those least able to afford increased costs the most. I have worked over 40 years as an air pollution meteorologist in the electrical generating sector. After retirement, I served as Director of the Environmental Energy Alliance of New York, and later started the Pragmatic Environmentalist of New York blog that debates the challenges of balancing the risks and benefits of environmental issues. 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.
Everyone wants to do right by the environment to the extent that they can afford to and not be unduly burdened by the effects of environmental policies. New York environmental policies have lost sight of the need to balance the risks and benefits of environmental initiatives. I submitted comments on the Climate Act Scoping Plan and have prepared a layman’s summary of issues associated with the Climate Act. Those resources provide more backup to the references linked in the following.
Meeting Notes
Assemblyman Stirpe took an hour to go through the proposed legislative budget. He went through quite a bit of detail of all the components. The Climate Act component of the discussion was no more than five minutes of the presentation.
I got to the meeting a little early and there were people talking about the effects of the Climate Act, especially the electric vehicle mandate and the gas ban. Clearly, they were not in favor of either component. Someone in the audience made the point that most people still aren’t aware of the ramifications of the Climate Act and suggested that more outreach would have been appropriate. His response insinuated that people were getting wrong information from the fossil fuel interests. Several other people made comments that were skeptical of the rationale of an existential threat from climate change and others complained about components of the Climate Act.
Mr. Stirpe incorrectly responded to a couple of comments. To the climate change is not that big a deal comment he said he has been shoveling less snow and insinuated that climate change was to blame. I pointed out that he did not know the difference between weather and climate. Near the end of the meeting he insinuated that air quality has not improved much since 1970 and the first earth day. I was tempted to respond at the meeting but by that point everyone was tired and I thought he wouldn’t appreciate my response. The fact is that according to the EPA Air Quality Trends website Northeast air quality improvements from 2000 to 2021 have been significant:
Carbon monoxide has decreased 61%;
Nitrogen dioxide has decreased 35%;
Sulfur dioxide has decreased 90%;
Ozone has decreased 16%;
Particulate matter has decreased 31%; and
Inhalable particulate matter has decreased 43%.
Air quality is much better than it has been in the past. This misunderstanding is particularly problematic for a New York legislator because Environmental Justice activists have lobbied policymakers into accepting the PEAK coalition conclusion that “Fossil peaker plants in New York City are perhaps the most egregious energy-related example of what environmental injustice means today” and are putting tremendous pressure on the legislature to act. However, the analysis that forms the basis of that conclusion is flawed. The health impacts claimed in that analysis are for ozone and inhalable particulates that are secondary pollutants that form far downwind of the adjoining neighborhoods of peaking power plants.
My Climate Act Comments
I gave Assemblyman Stirpe a document with the following information.
I am opposed to any legislation implementing the Climate Act because the Hochul Administration has not done a feasibility analysis that proves that the Scoping Plan list of control strategies can maintain current levels of reliability, will be affordable, and will not do more environmental harm than good. I have written over 290 articles on my Pragmatic Environmentalist of New York blog about the Climate Act and I am convinced that the state is on a dangerous path.
New York greenhouse gas emissions are less than one half percent of global emissions per year but global greenhouse gas emissions have been increasing by more than one half percent per year on average since 1993. Anything we do will be supplanted by emissions elsewhere in less than a year. That does not mean we should not do something but it does mean that we can take the time to do it right.
The New York Independent System Operator recently published “Information for Policy Makers” that summarizes their activities “to design and implement the operations, planning and market enhancements necessary for the grid in transition.” I have noted that their work describes the situation well. New York electric gird is a complex system that has evolved over many years. It is a highly reliable system using proven hardware and procedures. Reliance on unprecedented levels of wind and solar has not been demonstrated successfully anywhere. The energy storage system technology to account for intermittent wind and solar has not been tested on the scale necessary for the proposed use. These facts make it an ill-conceived plan that will likely end in blackout. Furthermore, the rush to electrify everything is not safe. What will happen when everything has been converted to electricity and there is an ice storm?
The Scoping Plan does not include a detailed accounting of the costs to consumers. The administration claims that the costs of inaction are greater than the costs of action but that claim is misleading and inaccurate. It is misleading because the Scoping Plan costs of action only includes the costs of the Climate Act and do not include all the costs to meet the net-zero by 2050 target, including vehicle electrification. It is inaccurate because it double counts the societal benefits of reductions.
The Climate Act only accounts for fossil fuel life-cycle costs and environmental impacts while ignoring the lifecycle impacts of wind, solar, and energy storage technologies. Those “zero-emissions” resources may not have emissions when generating electricity but the volume of materials needed to access dilute wind and solar energy and the rare earth elements necessary for those technologies certainly have environmental impacts when mined and processed. The large number of wind turbines and solar panels will also create massive amounts of waste when they are retired. Furthermore, the cumulative environmental impacts of thousands of wind turbines and square miles of solar panels has not been evaluated for the levels proposed in the Scoping Plan.
Opposition to Following Legislation
My submittal noted that I oppose the following legislative proposals. I oppose all components of the NY Renews Climate Jobs, and Justice package including the Climate and Community Protection Fund as well as the following specific bills:
A4592/S2016 “NY Home Energy Affordable Transition Act”;Aligns utility regulation with state climate justice and emission reduction targets; repeals provisions relating to continuation of gas service; repeals provisions relating to the sale of indigenous natural gas for generation of electricity.
A4306/S732 DEC to establishes a carbon dioxide emissions price for electric generation from carbon-based fuel; creates a carbon dioxide emissions fund; distribute revenue to low-income individuals and communities and to support mass transit.
A920/S562 the “all-electric building act”; provides that the state energy conservation construction code shall prohibit infrastructure, building systems, or equipment used for the combustion of fossil fuels in new construction statewide no later than December 31, 2023 if the building is less than seven stories and July 1, 2027 if the building is seven stories or more.
A279/S4134“New York State Build Public Renewables Act”; requires the New York power authority to provide only renewable energy and power to customers; requires such authority to be the sole provider of energy to all state owned and municipal properties; requires certain New York power authority projects and programs pay a prevailing wage and utilize project labor agreements.
S4854/no same as. Requires agencies to develop recommendations regarding the establishment of microgrids at critical facilities.
A4393/S2007. Establishing a one hundred percent clean renewable energy system for electricity by two thousand thirty-four; such energy system shall include solar, wind, geothermal and tidal sources.
A4866/no same as. “fossil fuel facilities replacement and redevelopment blueprint act” requires NYSERDA, DPS and DEC to prepare a blueprint to guide the replacement and redevelopment of the oldest and most-polluting fossil fuel facilities and their sites by 2030.
A411/S3581 Declares a climate emergency and places a ban on fossil fuel infrastructure projects but shall not apply to repair or maintenance of existing infrastructure.
Support for following legislation:
I listed the following two legislative proposals as ones I think will help address my concerns.
S2030/no same as Directs the public service commission in consultation with NYSERDA to conduct a full cost benefit analysis of the technical and economic feasibility of renewable energy systems in the state of New York and to compare such directly with other methods of electricity generation within nine months after the effective date and every four years thereafter.
A4999/S2474 Directs the state energy planning board to conduct a study of the technical and economic feasibility of a one hundred percent renewable energy system and a reduction in greenhouse gas emissions.
Conclusion
I don’t think Assemblyman Stirpe understands just how poorly informed he is because of the mis-information in the Scoping Plan and the constant propaganda from the media and climate activists. I had offered in the past to give him a briefing but he refused. I do not expect to hear anything as a result of the comment I gave him. If did respond I would ask him to put pressure on the Hochul Administration to give a full accounting of the costs, do a feasibility study of the effects on electric system reliability and do a cumulative environmental impact analysis of the Scoping Plan recommendations for wind and solar resources. Until the Scoping Plan is proven to be feasible, it is inappropriate to support any implementing legislation.
According to a press release: “New York State Senate Republican Leader Rob Ortt, members of the Senate Republican Conference, and statewide energy stakeholders today unveiled a package of smart energy policies to pursue a cleaner energy future. The plan puts affordability and reliability first for New York ratepayers, in sharp contrast to some of the radical proposals coming out of Albany.” I am highlighting a link to the press conference where this is announced because Richard Ellenbogen did a masterful job explaining his concerns about the net-zero transition plan and they match my worries.
This is another article about the Climate Act implementation plan that I have written because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. 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
The implementation plan for New York’s Climate Act “Net Zero” target (85% reduction and 15% offset of emissions) by 2050 is underway. At the end of 2022 the Climate Action Council completed a Scoping Plan that makes recommends strategies to meet the targets. The Hochul Administration is developing regulations and proposing legislation to respond to those recommendations in 2023.
Unfortunately, the Scoping Plan is just a conglomeration of control strategies that are projected to provide the emission reductions required. The Plan did not do any feasibility analyses or address any “what if” questions raised by the NYISO or anyone else for that matter. As a result, I am convinced that it will fail.
I recently published Richard’s analysis of New York’s energy storage plan as a guest post. Ellenbogen is the President of Allied Converters that manufactures food packaging. His facility is about 55,000 square feet and does a lot of manufacturing with heat to seal the bags, all electrically driven. The facility has solar panels and uses co-generation. He explains:
In 2008, the average energy cost per square foot for a commercial facility in Westchester was $1.80. We were at 16% of that 12 years later and even with the increases, we are at 62% of that 14 years later. That has been done while having a carbon footprint 30% – 40% lower than the utility system. The $1.80 per foot also included commercial office space and our operation is far more energy intensive than an office. We use energy extremely efficiently and as a result, our bills are much lower than everyone else.
NYS Senate Republican Conference for Smart Energy Solutions
The event was an announcement for “smarter energy solutions”. The Republicans are calling for several alternatives and affordable amendments to the state’s current course of action, including:
Independent cost studies and full transparency;
Supporting diverse energy sources;
Keeping needed power supply online to ensure the reliability of New York’s power grid; and
Repealing and opposing anti-market mandates on consumers.
Richard was introduced as during the press conference to describe his technical concerns. He explained that he was representing an engineer’s perspective of the Climate Act Scoping Plan. I think his comments are a nice short and sweet description of the underlying technical issues that make the net-zero transition a very risky proposition that will cost too much for the state to afford. His email to me said:
The following link is to my presentation at today’s Senate Republican Press Conference at the Capital in Albany. I want to thank them, and Senator Mattera in particular, for offering me the platform to present reality to a wider audience before State policy causes major damage to our energy systems, public health, and to the state economy.
During the question and answer period Richard said he made a power point presentation that explained his concerns about the proposed net-zero energy transition before the Climate Act was signed. That document and other information is available on his website.
Conclusion
There are a few minor issues I might quibble with but overall this is a great summary of the issues facing New York with this plan. I only hope that it wakes some people up.
I have published three previous articles about New York Independent System Operator (NYISO) analyses related to New York’s Climate Leadership and Community Protection Act (Climate Act). This post describes their new webpage that summarizes their activities “to design and implement the operations, planning and market enhancements necessary for the grid in transition.” It does a good job explaining some of the issues associated with a net-zero transition. The only thing left is to get New York policy makers to listen.
This is another article about the Climate Act implementation plan that I have written because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. 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
The implementation plan for New York’s Climate Act “Net Zero” target (85% reduction and 15% offset of emissions) by 2050 is underway. At the end of 2022 the Climate Action Council completed a Scoping Plan that makes recommends strategies to meet the targets. The Hochul Administration is developing regulations and proposing legislation to respond to those recommendations in 2023.
Unfortunately, the Scoping Plan is just a conglomeration of control strategies that are projected to provide the emission reductions required. The Plan did not do any feasibility analyses or address any “what if” questions raised by the NYISO. I have written three posts that described issues raised by NYISO, The first post (New York Climate Act: Is Anyone Listening to the Experts?) described the NYISO 2021-2030 Comprehensive Reliability Plan (CRP) report (appendices). The difficulties raised in the report are so large that I raised the question whether any policy maker in New York was listening to this expert opinion. The second post (New York Climate Act: What the Experts are Saying Now) highlighted results shown in a draft presentation for the 2021-2040 System & Resource Outlook that all but admitted meeting the net-zero goals of the Climate Act are impossible on the mandated schedule. The third article described the final version of the 2021-2040 System & Resource Outlook. It shows that in order to minimize the storage and renewable over-build requirements that a Dispatchable Emissions-Free Resource (DEFR) is needed but goes on to point out that DEFRs such as hydrogen, renewable natural gas, and small modular nuclear reactors are not commercially viable today. “DEFRs will require committed public and private investment in research and development efforts to identify the most efficient and cost-effective technologies with a view towards the development and eventual adoption of commercially viable resources.”
The NYISO oversees system reliability and the competitive electric market in New York. They are responsible for “keeping the lights on for New Yorkers by managing today’s energy flows and by planning the grid far into the future.” Frankly, with regards to the Climate Act transition they are in a very difficult position because New York’s Climate Act was written by climate activists who had a very poor understanding of the challenges of a transition to a zero-emissions grid. There are two options for the future. If the State comes to its senses and takes the work done by the NYISO to heart and chooses a path consistent with their recommendations, then NYISO will be characterized as obstructionists who just don’t understand that academics know better than anyone in the industry. If the State ignores their warnings and there is a catastrophic blackout, then they will be blamed for improperly implementing the vision of the academics. Either way they will be scapegoats.
Information for Policy Makers
The new website (pdf copy) is obviously designed to try to explain the complexities of electric system operations and planning for a non-technical audience. The documentation has three main sections: “Planning for Reliability”, “Wholesale Electric Markets”, and “Our Independence and Transparency”. Because the information is a useful overview, I will summarize each section below.
The Planning for Reliability section explains that the NYISO is responsible not only for the real-time matching of generation with load operations for the electric system, but also “planning far into the future to make sure the electric system and its interrelated components can meet customer demand.” The introduction concludes: “The acceleration of New York’s transition to a zero-emission grid is creating a system of new, intermittent generation, which benefits the environment but can make it more challenging to keep the system reliable.” So how does the website describe the challenges?
They explain that wind and solar are not dispatchable resources and are intermittent so energy storage is needed. They point out that the current energy technology is limited. The website goes on to explain:
The grid will always need sufficient flexible and dispatchable resources to balance variations in wind and solar resource output. These resources need to be long-duration, dispatchable, and emission-free. Essentially, they must have the attributes of fossil generators (responding quickly to rapid system changes) without the emissions. Such resources are not currently commercially available and may not be for many years.
This is a wind-up to make the point that:
The retirement of fossil-based resources is outpacing the development of new renewable-based resources and other dispatchable, emissions-free resources. The effect is that reliability margins will thin to concerning levels beginning in 2023, highlighting the need for a careful transition that maintains grid reliability and resilience.
I am a bit disappointed with this description. In order to really emphasize the risk involved it is necessary to understand the current reliability standards are the result of decades of experience and evaluation. The resulting standards have done a good job preventing blackouts. However, in the future there are potential issues because the standards are based on the presumption that the system is static. The unprecedented introduction of significant amounts of new intermittent and non-dispatchable resources changes things a lot. I don’t think this discussion explains how much riskier planning is becoming as a result.
This section also points out the importance of transmission. The fact is that New York City will never be able to produce enough electricity from in-City wind and solar so the power necessary will have to be transmitted from elsewhere. They are constraints on this transmission regionally and also locally where upgrades are needed to get the power from newly developed wind and solar projects. The website explains the transmission planning process and concludes: “A historic level of investment in the transmission system is currently underway, with projects that will deliver more clean energy to consumers while enhancing grid resilience and reliability”.
The website raises a little discussed aspect of the transition process. There is an interconnection procedure where the NYISIO determines if a proposed new resource will have reliability issues and whether transmission system upgrades are needed to address them. The website brags about the transparency of their process but does not bring up another uncertainty. In particular, the interconnection hardware for intermittent resources must be able to differentiate between power fluctuations caused by variable wind, for example, and transient power changes in the grid. If they don’t handle this correctly problems ensue. For example, the 2022 Odessa Texas disturbance illustrates the “need for immediate industry action to ensure reliable operation of the bulk power system with the ever-increasing penetrations of inverter-based resources”.
This section of the website concludes with a description of the planning process and “NYISO’s role in identifying system needs, and finding solutions, is part of the process of planning for the grid of the future.”
The next section, Wholesale Electric Markets, gives an overview of competitive wholesale electric markets. It is not surprising that they extoll the virtues of market-based solutions including consumer benefits because that is the basis for their existence. Nevertheless, it also is a useful overview of how the markets work.
In order to match the generation with the load the NYISO has three markets: the energy market, ancillary service market, and capacity market.
These three markets work together. In simple terms:
Energy markets secure resources to supply the demand on a minute-to-minute basis.
Ancillary service markets procure a variety of additional services to protect the electric system and balance supply and demand to meet system needs instantaneously.
Capacity markets provide incentives to generation resources to maintain additional energy reserves over a longer period. Through the capacity market, we determine how much capacity is needed to meet the expected peak demand for the year plus a margin of additional resources to call on, if necessary.
According to the NYISO website the wholesale market can support New York’s Climate Act goals. It states:
Competitive, wholesale markets can help with the transition to a zero-emission grid by sending the right economic signals to developers to invest in new technologies in the right geographic area to best serve the grid. These markets leverage competition to keep electricity as cost-effective and efficient for New Yorkers as possible, and to help make sure there are adequate resources in place in the future.
I disagree with the implication of the statements that “Competitive markets have over time created pressure on the generating fleet to switch to newer, more efficient generation plants” and “Since 2000, electric generators that primarily combust natural gas increased from less than 50% to more than 60% of the generating capacity in the state”. This is the same argument that proponents of the Regional Greenhouse Gas Initiative make when they argue that emissions have come down significantly and insinuate that the emissions trading system was a primary factor in the emission reductions. The price of natural gas came down so much relative to other fuels that the generating fleet would have switched to newer, more efficient generating plants with or without the RGGI program. I believe that the conversions would have happened even without competitive markets.
I am disappointed with the following explanation how the market can support the Climate Act:
Additionally, the NYISO has implemented market enhancements to support climate goals and to position the NYISO as a national leader in competitive wholesale electricity markets. Through engagement with stakeholders and regulators, new market rules for energy storage integration, participation in our wholesale electricity markets by distributed energy resources, and new ancillary services products support reliability and minimize costs for consumers. Market rules that incentivize investment in resources that can respond rapidly to changing conditions will be essential for maintaining reliability of the grid of the future.
In my opinion, the transformation of the electric system that was built up over decades using dispatchable synchronous generating resources into a system that relies on a significant amount of intermittent, asynchronous generating resources is an enormous challenge. NYISO planners have to not only attempt to anticipate all the effects of all these changes to the electric grid but also try to design market rules that provide the resources needed. The addition of the market component should have been highlighted as a significant additional challenge to get a system that works.
The final portion of this section discussed electricity prices in the NYISO region.
The Our Independence and Transparency section explains how the NYISO was formed and how it operates. It provides a concise overview of the regulatory and reliability organization oversight requirements for any independent system operator. There is a description of the governance policies and budgeting.
They also emphasize their independence but there is some backstory here. At one point in the previous Mario Cuomo Administration, the current chairman of the New York State Energy Research & Development Authority, Richard Kauffman was Cuomo’s energy czar. In a filing to the Public Service Commission, the NYISO noted that in order to meet Cuomo’s Clean Energy Standard, a predecessor regulation to the Climate Act, New York would have to install over 1,000 new miles of bulk transmission lines at great cost and effort. In response, , Richard Kauffman, accused NYISO Director Brad Jones and his NYISO report as “misleading, incomplete, and grossly inaccurate…revealing an alarming lack of developed analysis into the imperative to address climate change…” Kauffman’s letter accused Jones of protecting fossil fuel generators and said that he was “dismayed by [Jones’] public comments. Not long after that Jones left and ever since comments have been much more guarded. Kaufmann also authored a commentary for The Hill about a “carbon bubble” that claimed that government intervention will be necessary if the market response to climate change is delayed too long. In this political climate it is not surprising that all NYISO planning reports are carefully worded to not antagonize the Administration. In my opinion, however, the Administration needs to hear the unvarnished truth.
Discussion
The title for this webpage says it is information for policy makers. New York climate policy is driven by the Climate Act’s Climate Action Council. That body consists of 22 members that were chosen by ideology not expertise. Their contribution to the Climate Act implementation was the Scoping Plan that was approved last December. The Council only paid lip service to any pretense of addressing reliability concerns with the NYISO so even if this document had been available at the start of the Scoping Plan development process I doubt that the majority of the members would have read it, much less acted on the recommendations.
This year the Hochul Administration is pushing to implement the recommendations of the Scoping Plan either by new legislation or by proposing new regulations. When pressed about the lack of feasibility analyses in the Scoping Plan the Climate Action Council has said those concerns would be addressed in the regulatory process. I imagine the policy makers who are responsible for the new legislation and regulations are the target audience. Unfortunately, I fear their minds are already made up and the issues raised here will be ignored.
The summary for policy makers has several key messages that New York policy makers need to consider as they develop legislation and regulations. The state should not shutdown existing fossil-fuel generators until sufficient clean energy resource are available. A new resource is needed but is not ready for use and may not be available for “many” years so an emphasis on developing that resource must be a priority. Because New York’s fossil resources are retiring faster than new resources are coming on line there already are concerns about the reliability margin. Unprecedented upgrades to the transmission system will be required to get the power from wind and solar projects to New York City where it is needed the most.
Conclusion
I think this is a very useful overview of policy issues that the NYISO is considering relative to the implementation of the Climate Act. However, I am not optimistic that the target audience will consider these issues as implementation proceeds. In the political climate of Albany it is not clear how to get policy makers to consider the risks of ignoring the issues raised.
Gov. Kathy Hochul’s proposed budget for fiscal year 2024 includes billions of dollars for climate-related funding but climate activists are not satisfied. This post highlights things they want to implement in the Climate Leadership and Community Protection Act (Climate Act). I also want to point out that these are only the acknowledged parts of the funding because there are major costs buried in the utility costs that won’t be counted by the Governor.
This is another article about the Climate Act implementation plan that I have written because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. 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.
Even with its billions of dollars in climate-related funding, policy experts said Gov. Kathy Hochul’s proposed budget for fiscal year 2024 needs more vigor to meet the urgency of the climate emergency.
The article mentioned that the budget package includes specific items that will add costs. There is a proposal for a cap and invest program. To my knowledge the Hochul Administration has not admitted how much this is expected to cost. The Executive Budget would also add 231 new staff positions at the DEC to enact and enforce regulations for climate laws. The article notes that “The budget is sprinkled with incentives such as $200 million to start EmPower Plus, a program from the state’s energy research and development authority that will provide 200,000 low-income residents with free energy-efficiency solutions for their homes, such as insulation, electrification and energy-saving appliances.” I was not surprised by the statement in the introductory paragraph because I think costs will be enormous.
What did catch my attention were the comments by Julie Tighe, president of the New York League of Conservation Voters. “We know ultimately it’s going to take a lot more money to do that,” Tighe said. “It’s a good down payment to make sure that we’re starting to take action and helping people who are least able to afford it.” I want readers to know her vision:
The governor’s budget also includes big-ticket items like more than $9 billion for mass transit improvements, a historic amount that’s 10% more than last year. But the state continues to invest record amounts on infrastructure for modes of transportation that are responsible for 28% of the state’s greenhouse gas emissions, such as roads and bridges. Tighe contends that massive counterinvestments are needed to get New Yorkers to stop driving and use cleaner forms of transportation that are also affordable and viable alternatives.
“We can’t drive our way out of the climate crisis,” Tighe said. “We need people to take mass transit. We need people to be taking e-bikes and walking more and using regular bikes.”
An organization that is located at 30 Broad Street in New York City has mass transit options. For those of us that live in upstate New York public transit options are limited and e-bikes, walking and regular bikes are not a credible option in the winter even if there are no distance limitations.
It has been educational to watch the gas ban messaging unfold. The Gothamist explains:
The executive budget, for example, features a controversial gas ban for new buildings, except it doesn’t go as far as some state legislators and environmental experts think it could. The All-Electric Building Act — a state bill currently stalled in the Senate’s finance committee — would prohibit the use of fossil fuels in newly constructed buildings and require those structures to rely completely on the electrical grid on a faster timeline than the governor is recommending.
Hochul’s version also comes with many exemptions and later deadlines for switching from gas to electric in homes and buildings. Buildings are the state’s largest climate polluters, responsible for 32% of total greenhouse gas emissions. Experts have called the electrification of buildings “low-hanging fruit” when it comes to making an impact in mitigating global warming.
That sums up the climate activist position. But the reality is that they are a small, albeit loud, constituency. I suspect that the majority of those currently using gas want to continue using it. In response to concerns raised by those folks, there also has been a flurry of news articles worried that “misinformation is spreading about Governor Kathy Hochul’s plans with a phase-out of fossil fuel systems.” James Hanley eviscerates the Administration response to the gas stove ban:
As the old Marx Brothers joke goes, “Who are you going to believe, me or your own eyes?”
Doreen Harris, president and CEO of the New York State Energy Research and Development Authority, told lawmakers that she was setting the record straight, and that “We are not taking away gas stoves, as one example of perhaps misinformation we need to correct.”
But the Climate Action Council that she Co-Chaired produced a Climate Leadership and Community Protection Act (CLCPA) Scoping Plan – which she voted to approve – that says the state will in fact be taking away gas stoves.
It’s right there on page 190, in the chapter on buildings, for all the world to read.
So where’s the misinformation?
Indeed, where is the misinformation? My position is that much of the misinformation is coming from the Hochul Administration. Most of this is political gamesmanship where the exact wording of the legislative or regulatory proposal allows some wiggle room when confronted with an inconvenient question. In the instance of the gas stove ban she falls back on claiming that she only wants to ban gas in new homes and moves on before the Scoping Plan reference can be brought up. The biggest item of the Administration’s overt misinformation is the ultimate cost to get to the Climate Act target of net-zero by 2050. The Administration claim in the Scoping Plan is that the “costs of inaction are more than the costs of action”. Aside from the biases and exaggerations of the alleged benefits, the official line consistently ignores the caveat that the Scoping Plan costs only include the costs of the Climate Act itself and not the costs of “already implemented” programs that are necessary to get to net-zero by 2050. The already implemented programs include the following:
Growth in housing units, population, commercial square footage, and GDP
Federal appliance standards
Economic fuel switching
New York State bioheat mandate
Estimate of New Efficiency, New York Energy Efficiency achieved by funded programs: HCR+NYPA, DPS (IOUs), LIPA, NYSERDA CEF (assumes market transformation maintains level of efficiency and electrification post-2025)
Funded building electrification (4% HP stock share by 2030)
Corporate Average Fuel Economy (CAFE) standards
Zero-emission vehicle mandate (8% LDV ZEV stock share by 2030)
Clean Energy Standard (70×30), including technology carveouts: (6 GW of behind-the-meter solar by 2025, 3 GW of battery storage by 2030, 9 GW of offshore wind by 2035, 1.25 GW of Tier 4 renewables by 2030)
Needless to say when the costs of these programs are added to the Climate Act program costs, the costs of the actions necessary to get to the Climate Act net-zero by 2050 target far exceed the costs of inaction. Nonetheless, the climate activists want more funding:
“The governor’s budget proposal is lacking when it comes to ambitious climate funding,” said Elizabeth Moran, a New York policy advocate with EarthJustice, a nonprofit public interest environmental law organization. “There’s some funding there, but it’s far from what we know is needed.”
When it comes to carbon emissions from buildings, Hochul has planted some long-awaited policies in her budget, including a mandate for all-electric new construction that includes a few exemptions, such as commercial kitchens.
But the timeline is delayed relative to other state proposals and some local laws. For smaller buildings, Hochul’s plan would take effect in 2026. That differs from the All-Electric Building Act, which calls for the electrification of new smaller buildings by 2024. Likewise, New York City’s Local Law 97 wants to electrify any new building larger than 25,000 square feet by next year.
Hochul’s plan would delay this regulation for new commercial buildings until 2029. The All-Electric Building Act calls for implementation by July 2027. Facilities such as laundromats and hospitals would not be required to comply. Fossil fuels will continue to be used in backup generators.
I am opposed to any “all-electric” legislation or regulation because of safety: what happens when there is an extended electric outage? The article notes that the Adminstration tries to get around this by saying “fossil fuels will contine to be used in backup generators”. What is the percentage of fossil fuel sales for backup gnerators sold by suppliers? My guess is that it is a small fraction, at most 10%, of their sales. Is there any scenario where those suppliers will be able to remain viable when they lose 90% of their business?
Another example of the desires of climate activists is an accelerated schedule. It can be argued that the state’s leading climate activist is Robert W. Howarth, Ph.D., the David R. Atkinson Professor of Ecology & Environmental Biology at Cornell University. In his statement supporting his vote to approve the Scoping Plan, he reiterated his claim that he played a key role in the drafting of the Climate Act, developed the irrational methane requirements, and credited one politician for getting the Act passed. The article noted his desire and others that the phase-in should speed up:
Dr. Robert Howarth, a member of the Climate Action Council, said there is no reason to wait to require electric appliances in new construction, especially when they will have to be replaced in the case of heating and hot water, when laws take effect. Howarth said following the new regulations could save homeowners money in the long run while also cutting emissions faster. More than a third of building emissions come directly from natural gas use in cooking, heating and hot water. And a year does make a difference when the total leaks nationwide from turned-off gas stoves add up to the annual carbon dioxide emissions from half a million cars.
To speed up the transition, more incentives and assistance for homeowners in the budget could go a long way, said Dr. Gernot Wagner, a climate economist at Columbia Business School. Even homeowners who don’t qualify may also switch to electric as a result of wider adoption. The proposed $200 million for the EmPower program is a drop in the bucket when there are more than 7.5 million households in the state, and Tighe said assistance is needed for other homeowners, even large building owners, especially since New York is the country’s No. 1 user of heating oil.
Under Hochul’s proposal, new buildings can’t have cooking appliances that use fossil fuels such as natural gas. Existing buildings won’t be required to swap their gas stoves for electric models, even when purchasing replacements. By 2030, the governor would ban fossil fuel-powered heating or hot water equipment in homes.
The author of this article did not pick up on the fact that the Scoping Plan recommends that existing buildings will have to replace any fossil-fired appliance with an electric appliance starting in 2035. By then it will be somebody else’s problem and Hochul will be long gone.
Governor Hochul’s Executive Budget – Energy
The Gothamist article discussed two aspects of the electric energy system. Apparently because there isn’t enough interest by the private sector to build the infrastructure necessary for the net-zero transition, the Executive Budget proposed letting the public power operator get involved:
The Hochul is empowering the New York Power Authority to develop, finance, construct, own, operate and maintain renewable energy projects. This move will ensure that enough zero-emissions power sources are built. The governor is calling for the phaseout of electricity production from gas-fired peaker plants by 2035, and wants to support the training of a green power workforce.
The private sector and customers have traditionally shouldered the cost of renewable energy projects. They’re handled outside of the budget, mostly through renewable energy credits.
I have no opinion on the value of this approach but picking and choosing when the State depends on the market for electricity supply seems to be a slippery slope. The other aspect concerns transmission projects:
“The state budget does not include funding for transmission infrastructure,” said Jason Gough, deputy communications director for the governor’s office. “Utilities typically pay for the cost of power infrastructure, including transmission lines. These costs are passed to utility ratepayers through the delivery charge for electric service.”
Let me translate Gough’s comments. “These costs are passed to utility ratepayers through the delivery charge for electric service” means “The costs of the Administration’s policies that we won’t let the utility companies itemize for their ratepayers, are passed on so that the ratepayers will vent their anger at the utility companies rather than the Administration”. The next press release will say “The utility bill increase is not our fault, it is greedy industry’s fault.”
The article goes on:
But transmission lines and other infrastructure are needed to bring clean power to the downstate grid, which is mostly dependent on fossil fuels. New York City doesn’t have the space, Tighe said, to build enough solar and wind power. The absence of direct funding for this key infrastructure could hinder the city in reaching its goal of a zero-emission grid.
“New York City needs a lot more power lines going toward the city in order to enable the sort of clean energy transition, the rapid transition that is necessary now,” Wagner said. “Transmission is the biggest bottleneck to decarbonize New York state.”
Several days ago, I wrote about the hidden costs for this infrastructure. The New York Public Services Commission recently approved rate increases for this purpose in case 20-E-0197. The transmission upgrade projects will cost $4.4 billion to support 3.5 GW of renewable energy or $1.26 billion per GW. An additional 2.8 GW is expected by 2025 and another 4.1 GW by 2030 according to Scenario 2 of the Scoping Plan. At that rate, ratepayers will be on the hook for a total of $13.05 billion through 2030. It is disappointing to me that Upstate ratepayers are on the hook for bill impacts up to and exceeding twice the bill impacts of Con Ed ratepayers who need Upstate power to reach the goal of a zero-emission grid. If the Hochul Administration would stop pandering to her political base and have the courage to be responsible for these costs then they should be spread equitably over all the state.
The Gothamist article describes proposed policies for transportation:
Public transportation will receive a big boost in the proposed budget. The MTA could get around $8 billion, a 10% increase. The funds will address the revenue deficit incurred as a result of a drop in ridership during the pandemic. But Moran said additional financial support is needed for faster fleet electrification, and more of it.
For individual vehicle electrification, the DOT expects to receive $175 million from the federal government as part of the Infrastructure Investment and Jobs Act over the next five years to build fast charging stations along New York’s interstate highways.
Hochul has also included congestion pricing as a revenue stream to help fund the ailing transportation authority. Tighe applauded the measure as a “good incentive for people to stop driving in Manhattan.”
The governor’s proposal also wants to fund mass transit outside of New York City. It includes nearly $1 billion for non-MTA public transportation, including some bus electrification and rehabilitation of upstate light rail.
Affordability is important in making public transportation a viable alternative to driving, Tighe said.
As noted previously, climate activists are big proponents of public transit. Unfortunately, that is only a solution in urban areas. None of these proposals benefit rural Upstate New York.
Cleaner modes of transportation require more funding to substantially reduce emissions, Wagner said. New bike lanes and the expansion of car-free pedestrian areas would make an impact on reaching goals and encourage these commuting modes, he added. The budget proposal doesn’t specify how much money will go to these environmentally friendly travel alternatives, and there are no direct amounts either. But these projects can be funded through the state DOT’s small umbrella programs such as the Transportation Alternatives Program and clean air funding initiatives.
Other climate activist strategy favorites are bike lanes and pedestrian areas. One of the issues with these green solutions is that they don’t work all the time but the activists demand complete compliance. In the winter bike lanes in many parts of the state are dangerous and pedestrian areas challenging. Winter is also a reason that many Upstaters are reluctant to depend completely on battery electric vehicles.
“Is this [budget] going to set us on a completely different path commensurate with the challenge? No,” said Wagner. “It is doing a lot of good things. Not to be ungrateful, but I thought we all recognized that we are in a climate crisis here.”
New York’s Greenhouse Gas (GHG) emissions are less than one half one percent of global emissions and since 1990 global GHG emissions have increased by more than one half a percent per year. That does not mean that we should not do something but it does mean that even if there is a climate crisis New York cannot do anything about it alone. We must make sure that we are not doing more harm than good with the net-zero implementation.
Discussion
This is just a part of the legislative initiatives to meet the Climate Act targets. There are many member items also up for consideration. In addition, there are also regulatory initiatives. For example, the Department of Environmental Conservation is promulgating Part 218: Advanced Clean Cars II (ACC II) as part of the reckless push for all electric transportation. The emergency/proposed rulemaking will incorporate the State of California’s Advanced Clean Cars II (ACC II) regulation into New York’s existing rules.
My overarching problem with all these initiatives to meet the recommendations of the Scoping Plan is that the Integration Analysis that provided the background for the Plan did not include a feasibility analysis. The Integration Analysis is simply a list of potential control strategies with estimated emission reductions that when combined together provide the controlled emissions appropriate for the emission targets. There was no consideration of “what if and how about” questions like how are all the people who live in homes that have to park on the street going to be able to charge their cars? What if the magical solution necessary to keep the lights on called dispatchable emissions-free resources is not available on the schedule of the Climate Act. The Hochul Administration has not given consumers the expected costs or addressed the question what happens after everything is electrified and there is an ice storm.
Consider the feasibility of just one control strategy component. The article notes that NYSDOT expects funding of $175 million from the federal government as part of the Infrastructure Investment and Jobs Act over the next five years to build fast charging stations along New York’s interstate highways.. A gas station fuel pump costs about $20,000 and can serve a customer in less than six minutes. A 50-kilowatt fast DC charger costs about $100,000 and can serve an EV customer in about 30 minutes. The gas pump can serve five times as many customers for one-fifth of the capital cost of a high-speed charger. Think about the feasibility issues. The $175 million can only fund 1,750 fast chargers. The closest NYS Thruway service center to my home has ten automotive fuel pumps but is a small service center. Consider what would be needed to maintain the same level of refueling capacity. The service center would need 50 charging stations to provide the same amount of refueling capacity and I suspect that would blow through the $175 million for the 27 service centers on the NYS Thruway. The space available and energy needed for those chargers means physical upgrades are needed at the service centers. Throw in the fact that for a long time it will be necessary to provide gasoline too. Finally, the NYS Thruway is just under 500 miles and the total NYS interstate mileage is 1730 miles so the $175 million would provide recharging support for less than half the interstate mileage. The implementation logistics for this component of the electric vehicle requirement appear unrealistics so the onus should be on the State to prove that this can work. They have not done this for any of the control strategies included in the Scoping Plan.
If any reader has concerns similar to mine, I encourage you to contact your elected officials and demand answers to these “what if” and “how about” questions before they vote on or support any legislation related to the Climate Act. There are opportunities to comment on regulations. A virtual hearing is scheduled for March 1, 2023 at 1 pm for Part 218: Advanced Clean Cars II (ACC II). The comment deadline is 5 pm, Monday, March 6, 2023. Written comments may be submitted to NYSDEC, 625 Broadway, Albany, NY 12233-3254, ATTN: James Clyne, P.E., or by e-mail to air.regs@dec.ny.gov.
Conclusion
Climate activists like Robert Howarth and Julie Tighe are pushing the state down a road towards a canyon without a bridge. Howarth’s arguments that Mark Jacobson’s academic analysis of wind, water, and solar energy is proof that a net-zero transition is cost-effective and possible is misplaced. The reality is that the Climate Act is promoting a system with less stability, robustness, and reliability that will undoubtedly raise costs a lot.
It is not only the disconnect relative to technical limitations but the attitude of the activists that disappoints. Tighe said: “We can’t drive our way out of the climate crisis” relegating everyone in the State who must rely on driving because they have no viable alternative to second class citizenship. This is no less demeaning than Marie Antoinette’s infamous “Let them eat cake”. Unfortunately, it can only get worse. Now there are climate scientists who are arguing for rationing to fight climate change.
If the Hochual Administration wants to solve their alleged climate crisis then they have to come up with a solution that provides the developing world with the prosperity and quality of life that comes with abundant and cheap energy. It is immoral to deny them that right because the best adaptation strategies for extereme weather require prosperous societies. The onus is on New York to provide them with affordable emissions-free energy technology or get out of the way. At home, the only means left to avoid the Climate Act stampede that will destroy our existing reliable and affordable energy system is to speak up now and vote anyone who supports this out of office before the we go over the cliff.
I know that there are enormous hidden costs to the Climate Leadership and Community Protection Act (Climate Act). A friend sent information that lifts the veil of secrecy enough to get an idea how much money is involved and the impacts to Upstate New York
This is another article about the Climate Act implementation plan that I have written because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. Moreover, the costs will be enormous and hurt those least able to afford increased costs the most. 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.
Transmission Upgrades
North American Wind Power gleefully reported that the “The New York State Public Service Commission has authorized a large number of upstate transmission system upgrades that are designed to alleviate bottlenecks in the grid and allow a higher penetration of renewable energy.”
In its decision, the commission approved requests from Central Hudson Gas & Electric, New York State Electric & Gas, National Grid and Rochester Gas and Electric to develop a total of 62 local transmission upgrades that will reduce congestion in the Capital Region, the southwest and northern region of the state.
“New York is making significant upgrades and additions to the state’s existing transmission and distribution systems to integrate new large-scale renewable energy projects into the state’s energy supply, and we must ensure that these investments are smart and cost-effective,” says commission Chair Rory M. Christian. “The commission recognizes the need to address congestion in certain parts of the state where renewable energy is already bottled and where additional generation projects are in development or likely to be developed in the future.”
In total, the projects will clear the way for 3.5 GW of capacity for clean energy – enough for more than 2.8 million average-sized homes.
“In order to keep moving towards our clean energy goals, New York needed grid investments in these three locations,” comments Anne Reynolds, executive director of the Alliance for Clean Energy New York. “This will allow electricity generating projects to deliver the clean power they make and will facilitate additional renewable energy projects coming online.”
The projects, which will cost an estimated $4.4 billion, include upgrades to existing transmission lines, upgrades to existing substations and the construction of three new substations. The utilities plan to complete the projects between 2024 and 2030.
Upstate Reality
It is not unexpected that the renewable energy crony capitalists are happy to have these projects funded, For ratepayers it is just the tip of iceberg. The transmission upgrade projects will cost $4.4 billion to support 3.5 GW of renewable energy or $1.26 billion per GW. An additional 2.8 GW is expected by 2025 and another 4.1 GW by 2030 according to Scenario 2 of the Scoping Plan. The ratepayers will be on the hook for a total of $13.05 billion through 2030.
The New York Public Services Commission Case for this decision is 20-E-0197. The order approving the transmission upgrades is available for download here. According to the order there is a pressing need for transmission upgrades in three areas of Upstate New York:
The Commission found these areas to be characterized by “the presence of existing renewable generation that is already experiencing curtailments and a strong level of developer interest that exceeds the capability of the local transmission system. ”The Phase 2 Order identified these areas as Hornell and South Perry (NYSEG/RG&E), the Watertown/Oswego/Porter subzone (National Grid), and an area of southeastern New York consisting of facilities owned by NYSEG, National Grid, and Central Hudson. The same locations –referred to in the Phase 2 Order and here as the Areas of Concern (AOC)–are also identified by the New York Independent System Operator, Inc.
In other words, the renewable developers are unable to build as much wind and solar as they want because there are transmission constraints getting it out of those areas. Because New York City cannot ever hope to install enough wind and solar generating capacity within the City the primary destination of this power is New York City. However, the Public Service Commission is saying that it is the responsibility of the upstate utilities and their ratepayers to subsidize the renewable developers who want to build in those areas and sell downstate.
The specific impacts are described starting at page 39:
Table 6 below shows the estimated impacts, in dollars annually, of the AOC Projects for typical customers assuming the above noted energy price increase estimates. Table 7 below shows the estimated ratepayer impact, as a percentage, of the dollar increases depicted in Table 6 above for each of the major electric utilities. The percentage increases shown in Table 7 are based on 2021 typical total bills, with the exception of NYSEG and RG&E Industrial High Load Factor (HLF) customers, which is based on 2019 data – the most recent data available for these utilities.
Conclusion
The numbers are clear. Upstate bills will rise much more than the bills for Con Ed ratepayers in New York City. The bill impacts are nearly double for most of the Upstate ratepayers. It hardly seems equitable that rural New Yorkers have to bear the brunt of the impacts of the massive renewable development necessary for New York State’s Climate Act but also have to disproportionately pay for the privilege of having it in their backyards.
Pragmatic Environmentalist of New York 