College of Law Center for Energy and Sustainable Development

Energy Forward Blog

7 Nov

James Van Nostrand
November 7, 2012

New York Times Dot Earth Blog
November 5, 2012

How Natural Gas Kept Some Spots Bright and Warm as Sandy Blasted New York City
Andrew C. Revkin

My former colleague at Pace University, Andrew Revkin of New York Times Dot Earth fame, wrote an excellent post praising the role of natural gas in keeping the lights on in some parts of New York City in the aftermath of Hurricane Sandy. The well-kept secret, and one that deserves more attention, is the use of natural gas-fired combined heat and power (CHP) facilities to generate electricity and heat. New York University, for example, was able to go into “island mode,” and thereby maintain essential services on its Washington Square campus as the electric grid around it went dark. NYU had the foresight to install a grid of its own – referred to as a “micro grid” – which allows it to rely on natural gas-fired cogeneration facilities to provide a large portion of its electricity supply. More important, the heat that is produced in generating electricity, which is simply released into the atmosphere in typical large electric generating plants, is captured and used to heat and cool NYU’s buildings. Hence, the name combined heat and power, or recycled energy.

Two other former colleagues from my days at Pace Law School, Tom Bourgeois (Deputy Director of the Pace Energy and Climate Center) and Bill Pentland (a frequent contributor to Forbes.com) make the case for CHP in Revkin’s blog post. According to Pentland,

Today’s electric grid was not designed to survive strong winds, storm surges, falling trees and flying debris and seems ludicrously inadequate for the demands of America’s increasingly digital and connected economy. The costs of hardening the electric grid will be vast. One widely cited study by the Brattle Group estimated that the electric utility industry will need to invest a $1.5 trillion to $2.0 trillion in infrastructure upgrades by 2030.

Despite spending epic sums of money on the so-called “smart grid,” the electric power grid seems as stupid as it was before spending billions in federal stimulus dollars.

Why throw good money after bad if we have a compelling alternative? And make no mistake about it, we have a compelling alternative to the conventional electric grid. It is commonly called the North American natural gas infrastructure.

Bourgeois, for his part, is a lifelong CHP advocate, and co-directs the DOE-funded Northeast Clean Energy Application Center, which is charged with promoting CHP and district energy throughout the Northeast. Here is the vision of the future electricity system articulated by Bourgeois:

We need a new vision of the electric generation, transmission and distribution system rather than one that moves electricity generated at remote locations, arriving at the point of end use . . . with a loss of 67 percent of otherwise valuable thermal energy. We need some pilots of operating micro-grids and district systems with combined heat and power that ought to represent the energy system of the future. Go beyond thinking of individual building efficiency to zero-energy blocks or neighborhoods. A vision of optimally creating a suite of resources, efficiency, photovoltaics, clean distributed generation, demand response, storage, all managed in synch with the larger transmission and distribution system.

The 67 percent figure to which Bourgeois refers is the energy efficiency of a typical large, central electric generating station, which reflects the discharge of the “waste” heat into the atmosphere instead of capturing it and using it to heat and cool buildings, as CHP systems do, thereby allowing them to achieve efficiencies that reduce the loss to less than 30 percent.

One can hardly disagree with Revkin’s conclusion: “[G]iven the role natural gas played in keeping the lights on in otherwise darkened parts of the city after this storm, it’s clear that this resource can play an important part in building a robust, resilient and flexible electricity and energy grid for the city and region.” This solution has even greater relevance in West Virginia, where we have an interest in stimulating demand for natural gas as a means of stabilizing natural gas prices, which in turn will allow the Marcellus shale resource to be tapped for the benefit of West Virginians. Policymakers in West Virginia should be pursuing measures that encourage the development of CHP facilities in the State. Large industrial facilities, for example, are prime targets for CHP installations. In addition to consuming large quantities of natural gas – which helps the “demand” side of the natural gas market in this State – the electricity produced by CHP facilities can provide some insulation from the inevitable electricity price increases that electric ratepayers in the State will continue to pay for the foreseeable future as a consequence of previous decisions by investor-owned utilities (AEP and First Energy) to rely almost exclusively on coal for electricity generation. We need our manufacturing and heavy industry to be competitive, and natural gas-fired CHP can play a huge role in that. And this is all in addition to the undisputed reliability and efficiency benefits of CHP noted by Messrs. Revkin, Bourgeois and Pentland.

7 Nov

James Van Nostrand
November 7, 2012

On Friday, November 2, Associate Professor Jamie Van Nostrand led a group of students on a trip to Washington, D.C. to visit the Federal Energy Regulatory Commission (FERC). As part of Professor Van Nostrand’s Siting and Permitting of Energy Facilities class, the students analyzed three particular types of energy projects over which FERC has jurisdiction: natural gas pipelines, electric transmission lines, and hydroelectric facilities. Professor Van Nostrand arranged for his class to spend part of the day at FERC talking with senior FERC staffers who work in these areas. Nils Nichols, a WVU Law alum, made the arrangements for the trip.

FERC Visit

In the picture: Anne Marie Hirschberger, Energy Analyst, FERC; Tyler Reseter, Travis Brannon, Joshua Cottle, Matthew Chase, Jeffrey Blair, James Van Nostrand, Ed Amos (all WVU Law); Nils Nichols, Director, Division of Pipeline Regulation, FERC Office of Energy Market Regulation.

The FERC staffers who briefed the class were: Nils Nichols: Director, Division of Pipeline Regulation, Office of Energy Market Regulation; Jacqueline (Susie) Holmes, Associate General Counsel, Energy Projects, Office of the General Counsel; Merrill Hathaway, Office of General Counsel, Energy Projects; and Anne Marie Hirschberger, Energy Analyst, Office of Energy Market Regulation.

“It’s great to take advantage of Morgantown’s proximity to Washington, D.C.,” according to Professor Van Nostrand. “And it also helps that we had a WVU Law alum, Nils Nichols, in a senior position at FERC who could make arrangements for our students to meet with FERC staffers who work in the areas that we studied in our class. I think it was very instructive for our students to meet the people who actually make the decisions, and to understand how a regulatory agency oversees the energy industry.”

According to Van Nostrand, his Energy Regulation, Markets and the Environment class will make a similar trip to Charleston, WV in mid-November to meet with Commissioners and senior staff at the West Virginia Public Service Commission.

20 Aug

James Van Nostrand
August 17, 2012

NY Times
August 11, 2012

Hundred-Year Forecast: Drought
Christopher R. Schwalm, Christopher A. Williams and Kevin Schaefer

These authors deny that climate change should be perceived as a “threat” that will manifest itself sometime in the future; rather, they state that “it is increasingly clear that we already live in the era of human-induced climate change, with a growing frequency of weather and climate extremes like heat waves, droughts, floods and fires.” According to the Fifth Assessment of the Intergovernmental Panel on Climate Change (IPCC), droughts of the length and severity currently being experienced in the United States will be commonplace through the end of the century unless human-induced carbon emissions are significantly reduced. This article reports that the Northern Hemisphere has just recorded its 327th consecutive month in which the temperature exceeded the 20th-century average. This year had the fourth-warmest winter on record, with record-shattering high temperatures in March. And 2012 has already seen huge wildfires in Colorado and other Western states. More than 3,200 heat records were broken in June alone. These authors conclude, along with many others, that:

“[T]his extreme event could become the new normal: climate models point to a warmer planet, largely because of greenhouse gas emissions. Planetary warming, in turn,
is expected to create drier conditions across western North America, because of the way global-wind and atmospheric-pressure patterns shift in response.”

The problem will be particularly acute in the American West, where the allocation of water resources is a serious and contentious issue. As stated in this article, “[v]irtually every drop of water flowing in the American West is legally claimed, sometimes by several users, and the demand is expected to increase as the population grows.”

20 Aug

James Van Nostrand
August 17, 2012

NY Times Magazine
August 9, 2012

Here Comes the Sell: The Secret to Solar Power
Jeff Himmelman

This article from the Sunday New York Times Magazine contains a few noteworthy nuggets:

  • “Enough sunlight falls on the earth’s surface every hour to meet the entire world’s energy needs for one year. A plot of roughly 100 miles by 100 miles in the American Southwest, if covered with today’s industry-standard 15-to-20-percent-efficient solar panels, could generate enough power for the entire United States. This is not the whole story, of course; the sun shines only during the day, and as yet we have no efficient way to distribute and store the power that such a plot would generate (so that the energy could be used at night, for example). But the potential of the sun as a power source is nearly unlimited”
  • “[O]ver the last five years, revenue in the global solar-energy industry has increased to $93 billion in 2011 from $17 billion in 207.”
  • “[T]he [solar] installers would much rather lease you a system than have you buy one, even though buying one is usually a better deal if you can afford it. The average price of a system has come down to $25,000 or so from $50,000 over the last five years.”
  • “People don’t buy gas stations. People don’t buy utilities. Why are we having them buy solar equipment?”
  • “[T]he basic value proposition is this: Say you have been paying your utility, on average, $100 a month. The solar company installs solar panels on your roof, maintains them, monitors them and repairs them for the life of the lease. The output will reduce your utility bill to roughly $20 a month, and you pay around $65 a month to lease the equipment (and the power the equipment produces, along with maintenance). You’re now paying $85 a month total, 15 percent less than you were, the installer has a revenue stream that it can use for cash flow or sell off to an investor and everybody is playing his part in reducing the burning of fossil fuels.”
  • “[T]here is something truly disruptive about solar: a fully distributed model of energy generation. We currently rely on the centralized hub-and-spoke delivery systems of the utilities, many of which are outdated and suffer tremendous losses as electricity travels from power plants, along transmission and delivery lines and into our businesses and homes. There is a massive infrastructure of regulation and enforcement in the energy market to underwrite the utilities; it’s one of the most highly regulated and noncompetitive markets in the country. Imagine a world in which homeowners and business owners are miniature power plants, with the full ability to sell power back to the grid at retail prices — power, literal and figurative, would be wrested from the hands of monopolistic, polluting utilities and their ancillary industries: mining, fracking and the like.”
  • “The advantages of such a system are obvious. Not only would Americans pay less for energy, but with solar they would also provide power back to the grid at peak hours, when utilities are the most taxed — and when they turn to their most expensive and dirtiest ‘peak’ power plants, which are standing by for just such occasions. We would also avoid some blackouts, because fewer houses would be reliant on the grid, and transmission failures wouldn’t cascade in the same way.”
30 Jul

James Van Nostrand
July 30, 2012

Los Angeles Times
August 24, 2011

Nation’s Weather Extremes May Be the New Normal
Julie Cart and Hailey Branson-Potts

Climatologists are warning that the extreme weather events experienced this year may become the new “normal” in the future. In addition to hundreds of deaths from cold and heat and tornadoes, the national economic toll for extreme weather so far this year is estimated at $35 billion, more than five times the average annual loss. According to a story in yesterday’s Los Angeles Times, “[c]limate scientists point to the predictable and cumulative effects of climate change — both hot and cold — to account for much of the extreme weather, although the connection between tornadoes and climate is not clear. In any event, scientists caution that the future will hold greater temperature extremes, and for longer duration.” Officials at the National Oceanic and Atmospheric Administration (NOAA) say that extreme weather events have been more frequent since 1980. According to NOAA’s National Climatic Data Center, one way climate changes can be assessed is by measuring the frequency of events considered “extreme” (among the rarest of temperature, precipitation and storm intensity values). The Climate Extremes Index (CEI) value for the contiguous United States is an objective way to determine whether extreme events are on the rise. The number of extreme climate events (those which place among the most unusual of the historical record) has been rising over the last four decades.

26 Jul

James Van Nostrand
July 26, 2012

NY Times
July 21, 2012

There’s Still Hope for the Planet
David Leonhardt

The United States is now enduring its warmest year on record, and the 13 warmest years for the entire planet have all occurred since 1998, according to data that stretches back to 1880. Atlanta has recorded its hottest day in history this year. Dallas endured 40 straight days above 100 degrees last July and August — and this year so far has been even hotter than last year. As David Leonhardt acknowledges in this column, “[n]o one day’s weather can be tied to global warming, of course, but more than a decade’s worth of changing weather surely can be.” Although the country is moving further away from doing something about climate change through legislation at the federal level, the nation’s energy supply is nonetheless becoming de-carbonized. Low natural gas prices, as a result of the new supplies that can cost-effectively be extracted through hydraulic fracturing and horizontal drilling, have stimulated rapid growth in gas-fired electricity generation, to the point where natural gas-fired generation is virtually tied with coal-fired generation in recent months.

Leonhardt observes in this column that “[g]overnments have played a crucial role in financing many of the most important technological inventions of the past century,” including hydraulic fracturing, nuclear and hydropower, all of which have combined to reduce the carbon emissions associated with America’s electricity supply. Leonhardt makes the case for increasing the federal support for clean energy. At the recent peak, in 2009, all federal spending on clean energy — including money for research and subsidies for households and businesses — amounted to $44 billion. This year, Washington will spend about $16 billion. The scheduled expiration of the production tax credit for wind would help reduce the total to $14 billion next year. According to Leonhardt, the sums for clean-energy research that many scientists and economists support are not huge. A politically diverse group of experts recently set a target of $25 billion a year in federal spending on research and development (some of which could come from phasing out ineffective programs).

26 Jul

James Van Nostrand
July 26, 2012

NY Times
July 23, 2012

Will Drought Cause the Next Blackout?
Michael E. Webber

About half of the nation’s water withdrawals every day are used for cooling electric generating plants. As the nation suffers the most widespread drought in 60 years, stretching across 29 states, the risk is great that power plants may be forced to shut down, due to the insufficient water flows to serve the cooling function. Oil and natural gas production may be threatened as well, given the millions of gallons of water necessary for hydraulic fracturing, the process used to extract oil and natural gas from shale in several regions of the country. In Texas today, some cities are forbidding the use of municipal water for hydraulic fracturing. The multiyear drought in the West has lowered the snowpack and water levels behind dams, reducing their power output. The U.S. Energy Information Administration recently issued an alert that the drought was likely to exacerbate challenges to California’s electric power market this summer, with higher risks of reliability problems and scarcity-driven price increases. As climate change trends continue and the demand for energy in the U.S. continues to grow, this water vulnerability will become more important over time.

26 Jul

James Van Nostrand
July 26, 2012

NY Times
July 23, 2012

Save Energy, Win a Prize
Diane Cardwell

This New York Times article reports on the use of social media by utilities to encourage their customers to use less energy. The article reports that the need to find ways to encourage long-term conservation is ever more critical. Although states and utilities have run conservation programs for decades, as a nation we are far from acquiring all cost-effective energy efficiency. At least 25 states have set specific goals for reductions in energy use that in many cases will continue to increase even as electrical demands and the grid’s complexity keep growing. West Virginia has no such energy efficiency targets; although an Energy Efficiency Resource Standard (EERS) was proposed during the 2012 legislative session, it failed to make it through the House Judiciary Committee. As a result, the energy efficiency programs run by the State’s utilities (Appalachian Power and First Energy) are fairly modest. Moreover, utilities in West Virginia do not consider energy efficiency and conservation to be resources in the same sense as “supply-side resources” (e.g., generating plants), as there is no requirement in West Virginia for utilities to engage in integrated resource planning (a process that puts demand-side resources (energy efficiency and conservation) on the same footing as supply-side resources in the utility resource acquisition process).

Nationwide, the total budget for utility customer energy efficiency programs in 2010 was $4.6 billion, up more than four times from the $1.1 billion spent on such programs a decade earlier, according to the American Council for an Energy-Efficient Economy (ACEEE). West Virginia is not following this national trend in boosting investments in energy efficiency; the State, ranks 44th out of the 50 states in ACEEE’s State Energy Efficiency Scorecard. In ACEEE’s analysis of energy efficiency programs nationwide, West Virginia tied in last place with Alaska with respect to utility public benefits programs and policies metrics, scoring 0 out of 20 points. The EERS proposed during the 2012 legislative session by Delegate Mike Manypenny (D-Taylor) would have established long-term energy efficiency targets for electric utilities, requiring reductions in electricity consumption of 5% from 2010 levels by 2018 and 15% by 2025. The bill also would have provided financial incentives for utilities that meet or exceed their targets. According to ACEEE’s analysis, “[t]he utility regulatory business model has been a long-standing barrier to energy efficiency in West Virginia and the presence of an EERS that includes financial incentives for utilities that meet their targets could have moved the state of a much higher rank in the Scorecard.”

Utility customers in West Virginia need access to utility-sponsored energy efficiency programs. The state continues to face dramatic price increases for residential customers and, while customers have little control over the rates charged by utilities, they may have some control over their utility bills if they could avail themselves of utility energy efficiency programs. Policymakers in West Virginia have a number of options to make this happen. First, legislators could adopt an EERS, as proposed by Delegate Manypenny. Second, legislators could adopt integrated resource planning, as proposed by Senator Foster during the 2012 legislative session (S.B 162), which would stimulate investment in energy efficiency by placing demand-side investments on the same footing as generation resources. Third, if the legislature fails to enact either of these measures, the Public Service Commission has all the statutory authority it needs to (1) impose energy efficiency targets on the utilities it regulates, and (2) require utilities to engage in integrated resource planning. It’s time to move West Virginia out of the ranks of the lowest-performing states in the country with respect to energy efficiency.

17 Jul

James Van Nostrand
July 16, 2012

Longview Plant

Last week I had the pleasure of touring the Longview Power Project, which is located just north of Morgantown near the Pennsylvania border. At a cost of approximately $2.0 billion, Longview is the largest privately-funded project in West Virginia history. Longview came on line in December 2011, and generates 770 megawatts (MW) of power, or about 695 MW net of the service station requirements (i.e., the electricity consumed on site). Several features of this state-of-the-art coal plant are noteworthy:

  • It is a merchant plant. Unlike the plants owned by investor-owned utilities such as Mon Power (First Energy) or Appalachian Power (American Electric Power), Longview is owned by an independent power producer. (The plant is operated by GenPower.) An investor-owned utility owning and operating this plant would be assured of cost recovery, as the output would be sold to the “captive” ratepayers of the utility, and ratepayers would bear the costs of the plant’s operation through their electric bills. In the case of Longview, however, the investors are taking the risk that the output of the plant can be sold into the market at a price that covers its costs, and (hopefully) produces a profit.
Longview Generator
  • Longview is profitable. This plant uses the latest in supercritical pulverized coal (SCPC) technology, and thus operates at efficiency levels far greater than virtually all other coal plants in the nation’s fleet of coal plants. The efficiency is generally reflected in the “heat rate” at which the plant converts energy into electricity. While the average net heat rate of coal plants across the country is 10,600 Btu/kWh, the Longview plant has a heat rate of 8,728 Btu/kWh. That means the plant has lower operating costs, which is important given its status as a merchant plant. If the plant were inefficient and “out of the money” or “above market,” its output could not be sold in the wholesale power markets, and Longview’s investors would lose money.
  • Longview is cost-competitive. The output of Longview is sold into the regional wholesale power market, the PJM, which is short for Pennsylvania-Jersey-Maryland. PJM is a regional power market that coordinates the movement of wholesale electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia. Its headquarters are located in Valley Forge, PA, about 20 miles northwest of Philadelphia. PJM essentially creates the marketplace where buyers and sellers of electricity meet, and is also responsible for operating and maintaining the region’s transmission network and “keeping the lights on,” at least at the transmission level. In its role as the market maker for wholesale electricity, PJM essentially dispatches all the power plants in the region, in order according to their variable operating costs, until supply equals demand (which establishes the market-clearing price). For example, nuclear plants, which have very low operating costs, are dispatched first, while “peaking” natural gas-fired plants (typically simple cycle combustion turbines) or older, inefficient coal plants are dispatched at the margin. PJM system operators will work their way up the dispatch cost curve until market equilibrium is achieved (i.e., supply equals demand). That is why the efficiency of Longview is so important. Because of the low-cost characteristics of Longview – its heat rate of 8,728 Btu/kWh is far superior to the average of the coal plants in the PJM of 11,000 Btu/kWh – it ranks very high in the dispatch order and the plant is virtually “in the money” 24 hours a day, 7 days a week.
  • Longview is relatively “clean.” Longview is equipped with state-of-the-art air emissions reduction technology. These systems include:
Longview Coal Flow

Low NOX burners with overfire air and selective catalytic reduction (SCR) technology
Hydrated lime injection system to reduce acid mist
Removal of particulate matter (PM) through 99% efficient fabric filter baghouse

  • SO2 removal through 98% efficiency wet flue gas desulfurization system (FGD). Although the combined effect of these systems achieves significant removal of mercury, it is noteworthy that the plant would not meet the requirements of the EPA’s new Mercury and Air Toxic Standards (MATS) rule if it were to be licensed as a new facility. As an existing source, however, Longview easily clears the standard of the top 12% cleanest emitters.
Longview Conveyor
  • Longview is a “mine mouth” project, and thus fuel arrives by overland conveyors directly from a nearby mine 4 miles away. Less than two hours passes from the time the coal is mined until it reaches the bunker at the plant. This mine mouth supply reduces the delivered cost and avoids the impacts associated with trucks, rail or barges. The mine is operated by MEPCO, which is based in Morgantown, WV. MEPCO is the largest independent coal operator in the region, with about 800 employees. MEPCO has a long-term contract to provide coal to Longview, which consumes about 275 tons per hour, or about 2.3 million tons annually. MEPCO also provides coal to two nearby First Energy plants (Hatfield’s Ferry Power Station and Fort Martin Power Station) under long-term coal supply agreements.
  • Longview provides about 100 good-paying jobs. In addition to the employees at Longview, the MEPCO coal mine producing the coal for Longview employs over 210 miners.
Longview Control Room

The Longview Power Project is an impressive facility, and makes a strong case for a continuing role for coal in the nation’s electricity future. In the face of historically low natural gas prices, which have resulted in depressed wholesale electricity prices, Longview is still in the money, and is returning profits to its investors. More important, this relatively clean facility is displacing older, dirtier generating units, thereby achieving a lower carbon footprint for the region’s electricity supply. Longview is succeeding in the competitive PJM power markets, thanks to its high-efficiency supercritical pulverized coal technology. With its extensive air quality control systems, Longview easily meets all currently effective emissions requirements (although it would not meet the EPA’s limits for CO2 emissions once the greenhouse gas regulations become effective for new sources).

The Longview story stands in sharp contrast to the dozens of coal plants throughout the country that are scheduled to be retired in the next few years. While most of the coal industry blames the extensive plant closures primarily on the “job-killing EPA,” the fact of the matter is that most of these plants are being closed due to simple economics: with natural gas prices at historical lows, inefficient coal plants simply cannot compete, and the dispatch stack at PJM (and similar market forces) are forcing retirement of plants that have long outlived their useful lives. Longview proves that coal – and relatively “clean” coal at that – can compete, if the electric utility industry chooses to invest in the latest generating and emissions reducing technologies.

16 Jul

National Oceanic and Atmospheric Administration

State of the Climate: National Overview June 2012

Extreme heat in the second half of June helped make the first six months of this year the hottest January to June ever recorded in the lower 48 United States, according to the National Oceanic and Atmospheric Administration. Eighty-six locations set temperature records in June, with another 87 tying existing marks. That helped push the average temperature in the contiguous United States to 71.2 degrees Fahrenheit, 2 degrees above the 20th-century average. The sizzling heat capped the warmest 12 months since record-keeping began in 1895, NOAA said, inching out the previous record-holder—June 2011 to May 2012—by just 0.05 degree Fahrenheit.

In addition to the warmer temperatures, drought conditions now cover 56 percent of the contiguous United States, the highest percentage since the government-supported Drought Monitor began 12 years ago, NOAA said, helped by below-average precipitation in the West, Plains, Ohio Valley and mid-Atlantic states. Wyoming recorded its driest June ever last month. Colorado and Utah recorded their second-driest Junes, with eight other states experiencing conditions that rank among the 10th driest for the month. Precipitation totals across the country were mixed during June. The nation as a whole experienced its tenth driest June on record, with a nationally-averaged precipitation total of 2.27 inches, 0.62 inch below average.