NYS Green New Deal Announcement Summary

Governor Cuomo recently announced the New York State Green New Deal a “nation-leading clean energy and jobs agenda that will put the state on a path to carbon neutrality across all sectors of New York’s economy”. I think that the Governor and advocates for this agenda need to explain how this will work, how much it will cost and how much it will affect global warming before we are committed to this path.

This summary of the program is one of a series of posts on the New York State Green New Deal. Cuomo billed this as part of his 2019 Justice Agenda: “nation-leading clean energy and jobs agenda that will put the state on a path to carbon neutrality across all sectors of New York’s economy”. There were 12 proposals in part 4 “Launching the Green New Deal” of this agenda. I reference my summary posts on each below and include my indented and italicized comments.

Components of the Green New Deal

Mandate 100 Percent Clean Power by 2040 – This will mandate that all electricity will be “carbon free by 2040.

In 1977 there was a blackout in New York City and the New York System Independent Operator now has a rule that requires 80% of generation to be provided in-City. In 2017 the daily energy needed for the peak hour period was 219,078 mWh. Because renewable energy is diffuse the area needed for that much renewable power is likely unavailable within the City. This could be a fatal flaw in this mandate and the State must develop a plan to confront this reality.

New York’s Path to Carbon Neutrality – The heads of relevant state agencies and other workforce, environmental justice, and clean energy experts will develop a plan to make New York carbon neutral.

The path re-establishes a Climate Action Council and mandates a plan to meet the goals. Presumably they will use existing programs as a template. If the New York Green New Deal were to rely on the “successful” RGGI program for the reductions proposed the State is looking at a cost of $35.2 billion.

A Multibillion Dollar Investment in the Clean Tech Economy that will Reduce Greenhouse Gas Emissions – There will be $1.5 billion in competitive awards to support 20 large-scale solar, wind, and energy storage projects across upstate New York.

The competitive awards announced in January 2019 total $1.5 billion and are supposed to provide more than 2 million tons of carbon reductions. Assuming that they really meant carbon dioxide for the 2 million tons that means 750 dollars per ton reduction cost. In 2015 NYS electric sector CO2 emissions were 32 million tons. If the New York Green New Deal were to rely on the NYSERDA competitive award process for those reductions the State is looking at a cost of $24 billion.

Expand NY Green Bank and Catalyze at Least $1 Billion in Private Capital – The NY Green Bank is a $1 billion investment fund designed to accelerate clean energy deployment and they will expand its charter.

In order to reach the 100% clean power goal by 2040 the plan doubles distributed solar deployment to 6,000 megawatts by 2025, up from 3,000 megawatts by 2023. If the Green Bank were to finance the deployment of 3,000 MW at the rate observed with their existing investments they would need over $2 billion. In 2015 NYS electric generation sector emissions were 32,000 tons. If the Green Bank was to finance the replacement of solar at the rate observed they would need over $41 billion.

 Chart a Path to Making New York’s Statewide Building Stock Carbon Neutral – There are plans for more energy efficiency investments.

New York State is the fourth most energy efficient state in the country now which is no small part due to investments already made which presumably improved the most efficiency at the lowest rate available. Given that the cost-effectiveness of future projects will be less the 20% further reduction goal is ambitious.

Direct State Agencies and Authorities to Pursue Strategies to Decarbonize their Investment Funds and Ramp Up Investment in Clean Energy – Commence a process to review and evaluate the feasibility and appropriateness of divesting from fossil fuels for agencies and authorities.

I think the most important investment strategy for the $240 billion dollars in New York funds should be economic rather than signaling virtue. The rationale for this mandate to divest is clear: divestment is not an investment strategy, or a way of putting direct economic pressure on energy companies. It is a political statement.

Increase Carbon Sequestration and Meet the U.S. Climate Alliance Natural and Working Lands Challenge – This will establish a carbon sequestration goal for our natural and working lands.

Based on results to date it is not clear how cost-effective these programs will be. However, the program that facilitates carbon sequestration in soil is a “no regrets” solution.

Create a Carbon-to-Value Innovation Agenda and Establish the CarbonWorks Foundry – This will create a Carbon-to-Value Innovation Agenda as a blueprint for the future of carbon-to-value technology as well as carbon capture, utilization and storage in New York.

The concept is to turn carbon dioxide into fuel and wasteful chemicals. While I am not a chemical engineer the idea that the waste products can be turned into a fuel without a whole lot of energy going back into the system seems a bit far-fetched. On the other hand the concept of using CO2 instead of sequestering it underground is appealing.

Deliver Climate Justice for Underserved Communities – The Green New Deal will help historically underserved communities prepare for a clean energy future and adapt to climate change by codifying the Environmental Justice and Just Transition Working Group into law and incorporating it into the planning process for the Green New Deal’s transition.

While no one argues that underserved communities should not be treated better, I am concerned that the direct costs of these programs will out-weigh any directed benefits. In my opinion the primary goal of the task force should be to keep electric energy affordable but it is not clear that is the first priority of this component of the plan.

Create a Fund to Help Communities Impacted by the Transition Dirty Power – This will provide funding to help communities that are directly affected by the transition away from conventional energy industries and toward the new clean energy economy

In my opinion this is an example of the political pandering of the Green New deal. If some block of voters is going to be disadvantaged then simply buy them off.

Develop Clean Tech Workforce and Protect Labor Rights – The Green New Deal will continue to require prevailing wage, and the State’s offshore wind projects will be supported by a requirement for a Project Labor Agreement.

In my opinion this is an example of the political pandering of the Green New deal. If some block of voters may benefit from this pork barrel spending then make sure they know there is pork available.

Make New York the National Hub for Offshore Wind and Deploy 9,000 Megawatts by 2035 -The Green New Deal will accelerate offshore wind progress in three specific areas: port infrastructure, workforce development, and transmission infrastructure.

According to the NREL’s 2017 Cost of Wind Energy Review, the levelized cost of energy of off-shore wind is over two and a half times more expensive ($124 per MWh vs $47 per MWh) than on shore wind. For the 9,000 MW of offshore wind mandated the estimated cost would be $6.3 billion.

 Conclusion

A recent opinion piece in the New York Times notes that relying entirely renewable power systems is much more expensive and still not practical than a system that incorporates nuclear, geo-thermal and fossil-plants. The research paper notes:

Whichever path is taken, we find strong agreement in the literature that reaching near-zero emissions is much more challenging—and requires a different set of low-carbon resources—than comparatively modest emissions reductions (e.g., CO2 reductions of 50%–70%). This is chiefly because more modest goals can readily employ natural gas-fired power plants as firm resources.

However the opinion piece claims that Cuomo’s Green New Deal did not mandate an all-renewables system. I agree that the plan accepts existing nuclear power but I do not believe there is any indication that existing fossil fueled power would be replaced by anything but renewables aside from a platitude that mentions carbon sequestration. The Cuomo administration has consistently delayed or disapproved fossil fuel infrastructure so I believe it is appropriate to assume that the 51,473,000 MWhr of electric energy produced by coal, oil and natural gas in 2017 would be replaced entirely by renewables in the Green New Deal.

This is the challenge that Climate Action Council must address. How will that electrical energy be replaced, how much will that cost and what effect will that have on the environment.

NY Green Deal: Make Building Stock Carbon Neutral

This is one of a series of posts on Governor Andrew M. Cuomo’s New York State Green New Deal. As part of his 2019 Justice Agenda he included a “nation-leading clean energy and jobs agenda that will put the state on a path to carbon neutrality across all sectors of New York’s economy”.

Not surprisingly there are no details other than the announcement, no mention of potential costs, and no explanation how all this will affect any of the many impacts that he claims are caused by climate change. There is a proposal to provide the plan to make New York carbon neutral and I will blog on those plans as they become available. In the meantime this post discusses the plan announcement for a path to make New York buildings carbon neutral as part of the New York Green New Deal.

In the following sections I list the text from the announcement and my indented and italicized comments follow.

Chart a Path to Making New York’s Statewide Building Stock Carbon Neutral

Buildings – and the fossil fuels traditionally used to heat and cool them – are a significant source of energy-related carbon pollution. As such, Governor Cuomo has made the improvement of energy efficiency in buildings a major priority. The Governor’s New Efficiency: New York agenda, released on Earth Day 2018, contains a comprehensive portfolio of proposals and strategies to meet an ambitious new target of reducing on-site energy consumption by 185 trillion BTUs by 2025. In addition, Governor Cuomo launched RetrofitNY in 2016 to stimulate the development of an energy efficiency industry that can tackle the challenge of deep building retrofits that will enhance building performance, reduce energy usage, and improve the quality of life for low- and moderate-income New Yorkers.

The Green New Deal announcement lays out some specific goals. In order to be credible those goals should be quantified. For example, what is the starting point for on-site energy consumption? An initial guess could use the NYSERDA Patterns and Trends documents table 3-3a nys primarary consumption of energy by sector and assume that residential and commercial sectors represent “on-site energy consumption”. In 2016 residential sector energy consumption was 558 TBtu and commercial sector energy consumption was 379 TBtu for a total of 937 TBtu so a 185 TBtu reduction represents a 20% lower value.

In my opinion energy efficiency is a classic energy example of the Pareto principle or the 80:20 ratio which states that 80% of the effects come from 20% of the causes. For energy efficiency it means that you can get 80% of the available reductions at 20% of the cost of doing all the reductions. Consider the anecdote of insulating your home. Adding insulation in the attic gets you a big benefit and is relatively cheap. Adding insulation to the walls gets you less of a benefit but is more expensive. Replacing the windows and doors with more efficient ones is a big expense but doesn’t get that much of a reduction. Those are the easy energy efficiency projects and anything else is going to cost a lot and not get much of an improvement.

  Wallet Hub analyzed state energy efficiency (https://wallethub.com/edu/most-and-least-energy-efficient-states/7354/). Their conclusions are highlighted below[1]:

To identify the most energy-efficient states, WalletHub analyzed data for 48 states based on two key dimensions, including “home-energy efficiency” and “car-energy efficiency.” We obtained the former by calculating the ratio between the total residential energy consumption and annual degree days. For the latter, we divided the annual vehicle miles driven by gallons of gasoline consumed. Each dimension was weighted proportionally to reflect national consumption patterns.

In order to obtain the final ranking, we attributed a score between 0 and 100 to correspond with the value of each dimension. We then calculated the weighted sum of the scores and used the overall score to rank the states. Together, the points attributed to the two major categories add up to 100 points.

Home-Energy Efficiency – Total Points: 55

Home-Energy Efficiency = Total Residential Energy Consumption per Capita / Degree-Days

Car-Energy Efficiency – Total Points: 45

Car-Energy Efficiency = Annual Vehicle Miles Driven / Gallons of Gasoline Consumed

The Wallethub rankings are listed in Table 1 2015 energy efficiency RGGI state rankings. New York ranked number one. This suggests to me that New York has already implemented most of the easy low hanging fruit of the available energy efficiency opportunities.

 Because buildings are one of the most significant sources of greenhouse gas emissions, Governor Cuomo is announcing a comprehensive strategy as part of the Green New Deal to move New York’s building stock to carbon neutrality. The agenda includes:

Advancing legislative changes to support energy efficiency including establishing appliance efficiency standards, strengthening building energy codes, requiring annual building energy benchmarking, disclosing energy efficiency in home sales, and expanding the ability of state facilities to utilize performance contracting.

All these requirements add to the regulatory burden for doing business in New York and it is not clear how much value for carbon reduction they will get.

Directing the Public Service Commission to ensure that New York’s electric and gas utilities achieve more in scale, innovation, and cost effectiveness to achieve the state’s 2025 energy efficiency target, especially through their energy efficiency activities and clean heating and cooling programs, and that a substantial portion of new energy efficiency activity benefits low- and moderate-income New Yorkers.

All these efforts disguise costs. The Public Service Commission will require that these programs be included in rate case submittals and the costs will be passed on to the customers. There is no unaffiliated voice for keeping consumer costs low vis-à-vis climate goals and myriad special interests involved in rate cases to fund these programs. Moreover the utilities have no reason to question these costs because it is a pass through.

Directing State agencies to ensure that their facilities lead by example through energy master planning, net zero carbon construction, LED retrofits, annual benchmarking, and by meeting their electricity needs through clean and renewable sources of energy, specifically including the exploration of clean energy solutions at State Parks and at State facilities within the Adirondack Park to dramatically reduce emissions, create jobs, and increase resiliency.

We will have to wait to see what this means.

Developing a Net Zero Roadmap to articulate policies and programs that will enable longer-term market transformation to a statewide carbon neutral building stock.

We will have to wait to see what this means.

Together, these bold actions will establish New York as a global leader on environmentally sustainable buildings while catalyzing major economic development opportunities and helping to create good jobs.

It is not clear to me what benefits accrue to the citizens if New York is a global leader on environmentally sustainable buildings.

[1] Wallethub reports that “Data used to create these rankings were obtained from the U.S. Census Bureau, the National Climatic Data Center, the U.S. Energy Information Administration and the Federal Highway Administration.”

New York Green Deal: Strategies to Decarbonize Agency Investment Funds

This is one of a series of posts on Governor Andrew M. Cuomo’s New York State Green New Deal. As part of his 2019 Justice Agenda he included a “nation-leading clean energy and jobs agenda that will put the state on a path to carbon neutrality across all sectors of New York’s economy”.

Not surprisingly there are no details other than the announcement, no mention of potential costs, and no explanation how all this will affect any of the many impacts that he claims are caused by climate change. There is a proposal to provide the plan to make New York carbon neutral and I will blog on those plans as they become available. In the meantime this post discusses the language used to describe the mandate for New York agencies and authorities to study strategies to decarbonize their investment funds and invest in clean energy as part of the New York Green New Deal.

In the following sections I list the text from the announcement and my indented and italicized comments follow.

Direct State Agencies and Authorities to Pursue Strategies to Decarbonize their Investment Funds and Ramp Up Investment in Clean Energy

In 2018, Governor Cuomo called on the New York Common Fund, which manages over $200 billion in retirement assets for more than one million New Yorkers, to adopt a serious and responsible plan for decarbonizing its portfolio. Over the past year, the Governor has worked with the Office of the Comptroller to establish an advisory panel of experts to develop a decarbonization roadmap and guide the Common Fund toward investment opportunities that combat climate change.

I am guessing but I think that the plan to decarbonize the portfolio of the State agencies is publicly intended to publicize and signal the reality of climate change and change the economics of the fossil energy industry. It seems to me that rather than publicizing the issue for the unaware people in New York it is really intended to cater to the environmental activists who want to signal the virtue of New York State. The economics of the fossil industry will unlikely be affected: “Sin stocks”, such as tobacco shares, get a small discount because many investors will not touch them. But the main effect of this is that those who buy the stocks earn better returns. There is plenty of low-cost, environmentally insensitive capital available for energy companies that need it.”

 I am not going to bother doing a detailed comparison of the long-term financial viability of investment opportunities that combat climate change relative to the fossil assets but it seems to me that I have heard about more renewable company failures than fossil company failures. Given that renewables appear to be dependent upon subsidies suggests to me that their long term investment prospects are not that good. Investing in those stocks is yet another subsidy.

As part of the Green New Deal, Governor Cuomo is taking the next step, by directing State authorities, public benefit corporations, and the State Insurance Fund, which collectively hold approximately $40 billion in investments, to commence a process to review and evaluate the feasibility and appropriateness of divesting from fossil fuels. To scale up investment in renewable energy, green infrastructure, and climate solutions, agencies and authorities will also work to educate plan administrators and investment consultants regarding investment opportunities in the clean energy sector.

I think the most important investment strategy for the $240 billion dollars in New York funds should be economic rather than a signaling virtue. The rationale for this mandate to divest is clear: divestment is not an investment strategy, or a way of putting direct economic pressure on energy companies. It is a political statement.

NYISO Carbon Pricing Concept Proposal Translation

On December 7, 2018, the New York Independent System Operator (NYISO) released a draft for discussion purposes only for the Carbon Pricing Proposal Prepared for the Integrating Public Policy Task Force. This post attempts to summarize this proposal. I have translated the text of the overview of the concept for those outside of the process to date.

New York Carbon Pricing Proposal History

On August 11, 2017, NYISO and the New York State Department of Public Service (DPS) jointly initiated a process to engage with stakeholders to examine the potential for carbon pricing in the wholesale energy market to further New York State’s energy policy goals. This initiative began in the fall of 2016 as a project commenced by the NYISO through its stakeholder process. The NYISO retained The Brattle Group to evaluate conceptual market design options for pricing carbon emissions in the competitive wholesale energy markets administered by the NYISO. The Integrating Public Policy Task Force (IPPTF) was created to solicit stakeholder feedback for the carbon pricing proposal. The IPPTF meeting materials page lists all the documents produced by NYISO and stakeholder comments.

Over the past year the involvement of the DPS has steadily declined so now it is primarily a NYISO process. Over this time the stakeholder process has considered a straw proposal, draft recommendations, and this latest document “continues to build on these prior documents and represents continued refinements of the market concepts based on additional input received from stakeholders, both during IPPTF meetings and in writing and the analytical information provided to the task force.”

Overview of Carbon Pricing Concept

Carbon Pricing Proposal Prepared for the Integrating Public Policy Task Force, Page 4

The NYISO would incorporate the social cost of carbon emissions into the NYISO-administered wholesale energy markets using a carbon price in dollars per ton of carbon dioxide emissions. The NYISO would apply the carbon price by debiting each energy supplier a charge for its carbon emissions at the specified price as part of its settlement. Suppliers would embed these additional carbon charges in their energy offers (referred to as the supplier’s carbon adder or adjustment in $/MWh) and thus incorporate the carbon price into the unit commitment, dispatch, and price formation through the NYISO’s existing processes. In addition to charging internal emitting generators, the NYISO would charge imports and credit exports the LBMP carbon impact to prevent the carbon charges on internal generation from causing emissions leakage and costly distortions.

Because the carbon charges on suppliers would increase the variable costs of carbon-emitting generation dispatched by the NYISO, a carbon charge would raise the energy market clearing prices whenever carbon-emitting resources are on the margin (referred to as the carbon pricing effect on LBMPs, or LBMPc). All suppliers, including clean energy resources, would receive the higher energy price, net of any carbon charges due on their emissions. A carbon charge would also provide incentives for innovative low carbon technologies that may not yet be developed. Low carbon dioxide emitting New York resources, including efficient carbon-emitting units, renewables, hydropower, and nuclear generators, would benefit from higher net revenues. Load Serving Entities (LSEs) would continue to be charged the LBMP for wholesale energy purchases, which would account for the carbon adder of the marginal units. The NYISO would return the carbon charge residuals (Carbon Residuals), collected from carbon dioxide emitting suppliers and net imports, to LSEs.

Translation of the Overview (Indents are the translations of the Overview text)

The NYISO would incorporate the social cost of carbon emissions into the NYISO-administered wholesale energy markets using a carbon price in dollars per ton of carbon dioxide emissions.

The fundamental idea behind carbon pricing is that when carbon dioxide emissions cost money society will produce less of them. The carbon price will be set at the social cost of carbon (SCC) which will be determined by the DPS “pursuant to the appropriate regulatory process”. The choice of the carbon price provides the entire basis for this approach and that issue has not been considered in this process. I have commented on that problem (for example my comments on the April 23, 2018 ). The SCC value proposed was developed by a working group established by an Obama Executive Order to estimate the economic harm of CO2 emissions. My fundamental problem with that SCC value is that it does not accurately reflect the current state of the science relative to the probability of temperature being highly sensitive to CO2. As a result that value over-estimates the potential benefit of New York emission reductions. Ultimately the SCC relies on a complex causal chain from carbon dioxide emissions to social impacts that are alleged to result from those emissions. Richard Tol testified that these connections are “long, complex and contingent on human decisions that are at least partly unrelated to climate policy. The social cost of carbon is, at least in part, also the social cost of underinvestment in infectious disease, the social cost of institutional failure in coastal countries, and so on.” In addition, the Trump Administration has proposed a different and far lower value for the SCC. For me the bottom line is that most of New York State ratepayers are aware of the ramifications of this value and the possibility that it could add a billion dollars per year to the rates of the state.

The NYISO would apply the carbon price by debiting each energy supplier a charge for its carbon emissions at the specified price as part of its settlement.

The carbon dioxide emissions from every energy supplier will be estimated for the same time period as the settlement prices by the NYISO.

Suppliers would embed these additional carbon charges in their energy offers (referred to as the supplier’s carbon adder or adjustment in $/MWh) and thus incorporate the carbon price into the unit commitment, dispatch, and price formation through the NYISO’s existing processes.

The carbon price will calculated as the SCC value times the tons emitted. It is very likely that the carbon price will set the clearing price for the settlements. New York is an unregulated electric market and the NYISO is the interface between the suppliers and load serving entities who provide the power to consumers. The price NYISO pays the suppliers is the Locational Based Marginal Price (LBMP). Each supplier submits a bid to provide power at a specific price. The NYISO keeps track of how much power is produced and who provides it. Suppliers get paid the highest price bid that provides power to the grid for each hour.

In addition to charging internal emitting generators, the NYISO would charge imports and credit exports the LBMP carbon impact to prevent the carbon charges on internal generation from causing emissions leakage and costly distortions.

This sentence suggest that this is simple but in reality this is much more complicated and could doom the entire plan. Not only does the NYISO have to estimate the carbon dioxide emissions from the sources in its control area where it has enough information to determine what was running and at what level now they have to make an estimate of the carbon emissions from imports where they do not have that information. This is outside my area of expertise but the experts who have commented on this do not seem impressed that the plan proposed will work. I am also uncomfortable because I suspect this complexity will lend itself to unintended gaming.

Because the carbon charges on suppliers would increase the variable costs of carbon-emitting generation dispatched by the NYISO, a carbon charge would raise the energy market clearing prices whenever carbon-emitting resources are on the margin (referred to as the carbon pricing effect on LBMPs, or LBMPc).

It is not unreasonable to assume that the increase in cost due to the carbon price will put CO2-emitting resources on the margin all the time because of the cost of fuel and CO2. I have estimated that if carbon pricing was in effect in 2015 the total cost to be $3.027 billion and in 2016 $2.985 billion which are both more than double the direct tax of Social Cost of Carbon (SCC) times the annual CO2 emissions ($1.321 billion in 2015 and $1.248 billion in 2016).

The NYISO analyses claim that there will not be any significant cost increase to the consumer. They assume that the actual carbon price costs will be completely returned to the consumers despite New York’s poor record in the past. Other cost increases are supposed to be balanced by decreases in other costs: lower subsidies to renewables from other state programs, lower subsidies to nuclear power from a state program, and an assumed shift of renewables to high load areas (Downstate NY) because of the price signal. The assumed shift of renewables is controversial because it ignores all the siting constraints that have so far reduced renewable development downstate.

All suppliers, including clean energy resources, would receive the higher energy price, net of any carbon charges due on their emissions.

One of the great ironies of this program is the fact that because different fossil-fired sources have different rates and the highest emitting rate sets the marginal price then all the fossil-fired sources with lower rates will get a windfall equal to the difference in the CO2 rates times the SCC. The NYISO has never quantified how the carbon prices monies will be allocated across source categories.

A carbon charge would also provide incentives for innovative low carbon technologies that may not yet be developed.

In theory this sounds possible but in practice this pricing signal will likely be so weak that development of new low carbon technologies due to this program is unlikely. There are so many incentives already in place the suggestion that this will drive development is implausible.

Low carbon dioxide emitting New York resources, including efficient carbon-emitting units, renewables, hydropower, and nuclear generators, would benefit from higher net revenues.

While this is true, as noted above the NYISO has never quantified how much of the higher net revenues would go to which of these categories. It is likely that it will significantly add to the revenues of carbon-emitting units.

Load Serving Entities (LSEs) would continue to be charged the LBMP for wholesale energy purchases, which would account for the carbon adder of the marginal units.

This is just noting that the existing revenue system will remain in place.

The NYISO would return the carbon charge residuals (Carbon Residuals), collected from carbon dioxide emitting suppliers and net imports, to LSEs.

All the cost estimates assume that all the carbon price money will be returned to the consumer. I think that it is unlikely that at least some of the money won’t be diverted to cover the cost of returning this money. In addition, New York does not have a good record investing proceeds from the Regional Greenhouse Gas Initiative (RGGI) as originally intended. New York lawmakers have twice diverted RGGI proceeds directly into the general fund. Moreover, as shown by the Environmental Advocates of New York, the Cuomo Administration has used RGGI funds to replace other funding sources for existing programs rather than funding the original intent which was for additional programs.

Conclusion

The ultimate question that must be resolved is whether carbon pricing can work in the wholesale electric market sector in New York State. I agree that the theory of a carbon price on the whole economy and all energy sectors lets the market decide how best to reduce carbon is attractive. However, in this application it would only apply to one energy sector in one region of the economy. I am not optimistic that this will work as advertised.

I attempted to translate the text for those outside the process. I also mentioned some of the issues with this policy in this post. The comments I submitted late last summer provide more details for my concerns. There are many implementation concerns that NYISO has glossed over that I believe are significant problems. Ultimately, I fear that this policy will be implemented with much hoopla and self-congratulations by the advocates of the program and the consumers of New York will be saddled with another program that increases costs without any tangible benefits to society.

Murphy Commentary in Syracuse Post Standard: Earth has a Fever – Public Policy has the Cure

On September 23, 2018, the Syracuse Post Standard published a guest commentary entitled “Earth has a Fever – Public Policy has the Cure” by Cornelius B. Murphy, Jr. SUNY Senior Fellow for Environmental and Sustainable Systems. As is typical in Dr. Murphy’s commentaries a list of disasters is trotted out, the climate crisis of global warming is blamed for them, and the sermon ends with a call to “improve the future of our planet”. I disagree with his arguments and his proposed policies.

Unfortunately, Dr. Murphy’s list of disasters are, in fact, only peripherally related to climate change and I am not in the mood to dissect each of his claims because “the amount of energy necessary to refute BS is an order of magnitude bigger than to produce it”, Brandolini’s BS asymmetry principle. Consider only the Cyanobacteria outbreaks in 55 lakes in New York State he claims are due to warm water column temperatures and nutrients. His attribution is correct but his emphasis is wrong. If there are limited nutrients it does not matter how warm the water is you will not get eutrophic algae blooms that lead to Cyanobacteria outbreaks.

I think that Dr. Murphy should read Roger Pielke Jr’s book on The Rightful Place of Science: Disasters and Climate Change to appreciate the actual problems associated with climate change. Dr. Pielke is reviled because he shows how the consensus of climate science does not support the climate crisis Dr. Murphy invokes as the reason to act now. As Ben Pile’s review of the updated version of the book notes “In other words, climate change may well be a problem, but the data sets consistently show that economic and technological development mitigate the worst problems that climate has always caused.”

 

Dr. Murphy says that Climate disruption is a social issue and that the “The least advantaged among us will suffer the most with limited access to air conditioners and cooling centers”. I agree that energy poverty problem is a social issue. I am sure that we disagree on the cure however. While Dr. Murphy would have us try to moderate extreme weather I believe that there is no evidence that the policies he espouses will prevent it. If anything we might be able reduce future frequency and severity but society is not where near resilient to existing weather so it makes sense to emphasize adaptation over mitigation.

 

My biggest concern is that the current New York State Energy Plan promotes the use of fossil-free technology that is so expensive that the least advantaged among us will have limited access to the energy they need for cooling and heating because they will be unable to afford it. Ben Pile explains:

Moreover, campaigners’ conviction that anthropogenic climate change is bringing disaster upon us overlooks the extent to which economic and social development has enabled us to cope better with extreme weather events. As Pielke explains, ‘societal change is underappreciated, overlooked, and part of that is politics’. ‘The climate-change issue’, Pielke continues, ‘has taken all the oxygen out of the room for vulnerability, resilience, natural climate variability, indeed pretty much everything else that matters. It is absolutely the case that overall being richer as communities, as nations, is associated with more resilience, less vulnerability to natural disasters, particularly when it comes to loss of life… The climate issue has become so all-encompassing that it’s hard to get these other perspectives into the dialogue.’

Stop This Nonsense

I am tired of the constant drumbeat from those who are convinced that greenhouse gas emissions are going to cause an inevitable horror show of environmental impacts and that we need to stop emitting those emissions else we are doomed. In science you should look at the range of possibilities and probabilities. The fact is that though those horrific forecasts are possible, they are pretty unlikely. It is much more likely that any impacts will tweak weather to be a little more severe and a little more frequent if there is any effect at all.

The problem is that these prophesies of doom are driving all kinds of New York State policies that allegedly will prevent catastrophe. If New York implements all the programs the Cuomo administration wants to do so that we reduce our emissions 80% from 1990 levels by 2050 the global temperature increase prevented will be the same as going south a half a mile.

Jo Nova said it well: I say, just stop. Stop installing infrastructure we don’t need, stop subsidizing it, stop pretending we need green electrons. Stop pretending we need “storage” to solve a problem we never had. Stop buying electricity at inflated prices from generators which don’t make it when we need it. People wanting to make money selling solar power can pay for the batteries themselves. Start spreading the costs of this pointless experiment as fairly as we can instead of dumping it on electricity consumers who don’t have solar and on taxpayers who have never had the opportunity to vote whether they support these massive investments.

Here is the bottom line. There will be no measurable effect so all this is virtue signaling and the cost for New York is billions. No one is saying that if we control greenhouse gases that historical severe weather won’t happen. A much better investment of our tax and energy dollars would be to make society more resilient to the observed weather impacts of the past.

Reality Slap to the REV Microgrid Concept

I believe that the Reforming the Energy Vision (REV) call for microgrids will result in the unintended consequence of encouraging the development of natural gas fired combined heat and power units. The most compelling reason is because that approach does not need to include storage in order to provide 24-7 power and any storage component will make that option much more expensive. However that reality does not comport with the dreams of those who believe a no-fossil future is necessary. This brings us to an ideal situation to see how this will be reconciled in New York State.

The ideal candidate for conversion to a combined heat and power unit is an office complex that has a power plant for steam heat and uses grid electricity. The Empire State Plaza in Albany NY is just such a complex. The New York Power Authority (NYPA) has proposed the Empire State Plaza Microgrid and Combined Heat and Power Plant to replace the existing system. However, their rationale ran aground against the idealism of local community members and environmentalists from across the state who assailed NYPA’s plan to replace aging steam turbines in the low-income, predominantly African-American Sheridan Hollow community with two new combined heat and power turbines to provide electricity and steam.

On February 5, 2018 NYPA caved to this pressure and announced that they will do additional studies of the proposed Empire State Plaza Microgrid and Combined Heat and Power Plant project in Albany in order to better evaluate renewable energy options for the project. The press release claimed that:

“This will allow a more comprehensive review of possible alternative energy sources that may be feasible to explore as part of the Sheridan Avenue project to improve reliability, resiliency and energy efficiency at the plaza. The project partners, the New York State Office of General Services and NYPA, will take this time to enlist ongoing engagement and input from members of the public, including local community members, energy experts and advocacy organizations and will incorporate community benefits into the project’s go-forward plan.”

According to slide 8 in the NYPA presentation on the Empire State Plaza CHP and Microgrid Project Overview the Plaza consumes 111,000,000 kWh per year and uses 1,003,084 klbs of steam per year. NYPA proposed two Taurus 70 combustion turbines that will produce more than enough electricity and steam heat to fulfill those needs. The key to the greater efficiency of a combined heat and power facility is that you use the waste heat, in this case to produce steam for heating. The proposed application is ideal because the CHP output can use the existing electrical and steam infrastructure thus saving costs.

According to slide 5 in the NYPA presentation Project Overview Slide 5, NYPA considered and rejected:

  • Solar Photovoltaic
  • Solar Thermal
  • Geothermal
  • Wind Power

Let’s review the feasibility of these alternative energy sources. As noted above my main rationale for using natural gas CHP is that you eliminate the need for storage. In their project overview this issue was not addressed because they noted fatal flaws without it. The more comprehensive review proposed in the press release must address that issue or be compromised.

NYPA noted that there is not enough roof space or appropriate acreage in Albany and that the option does not provide heat for solar photovoltaic as issues. At the simplest level if we assume 0.75 kWH per day per square yard of solar photovoltaic, then you would need 84 acres of space for enough PV cells so I have to agree with the NYPA space argument. Furthermore that is the minimum level needed because PV output varies over the year. In order to do the calculation correctly you would need to match the PV output with the actual daily and seasonal load curves. In any event you would still need to provide energy for heating and that requirement is exacerbated by the fact that the fact that when you need the heat the most the solar energy is lowest.

With regards to solar thermal, NYPA noted that the technology cannot generate steam, space is an issue and it does not provide electricity. If your only requirement is hot water then solar thermal may have value but in this case I agree with NYPA. To use solar thermal for heating you would have to replace the existing heating system, you need the solar thermal collectors contiguous to the facility so space is an even bigger constraint, and the peak need for energy is in winter when the solar energy available is lowest. The final nail in the coffin is that this option does not provide electricity.

Geothermal has two flaws. In the first place it cannot generate steam heat so that means that the existing heating system cannot be used. Secondly, it does not produce electricity.

NYPA noted that wind power is hard to site in urban areas, has safety issues in urban areas, and noted that the area does not have enough wind potential for the project. In addition they could have noted that wind does not produce steam so the heating system would have to be changed.

The press release course of action notes:

NYPA will engage community stakeholders, energy experts, and community advocacy organizations to examine renewable options including large scale net metering for solar and wind inputs. The Authority will further assess the feasibility of incorporating any renewable energy options as part of a proposed locally-sourced mini-power grid. The grid will be connected to the statewide grid, and also be able to operate independently, to power the Governor Nelson A. Rockefeller Empire State Plaza in Albany. The goal for the proposed project is to be able to supply 90 percent of the power for the 98-acre downtown Albany complex and be able to save the Plaza an estimated $2.7 million in annual energy costs.

In my opinion, this will be difficult to justify and meet the criteria listed. The ultimate problem is that renewable energy is intermittent and diffuse. Any meaningful renewable energy component to this project will have to include storage to address intermittency or it is simply a virtue signaling symbolic gesture. As noted by NYPA and confirmed in my simple estimates, renewable energy’s Achilles Heel of diffusivity means that in order to include any substantive wind or solar it will have to be collected beyond the Empire State Plaza boundary. When that happens the goal of being able to operate independently is contradicted because the existing grid will be used to transmit the power.

Judith Enck, the former EPA regional administrator for the Obama administration claims “If the state of New York is serious about climate change, it has to stop investing in fossil fuels.” While for this particular project I concede that it is technologically feasible to use renewable energy I don’t see how it could be implemented without substantially higher costs to address intermittency with storage and without contradicting the basic tenet that it will be able to operate independently. NYPA is a New York agency controlled by the Governor. It will be interesting to see how the short-comings of renewable energy are reconciled with the reality of the electrical and heating needs of the Empire State Plaza.