Climate Change: Climate Change: A Northwest PerspectiveA Northwest Perspective

Peggy DuxburySeattle City Light

February 20, 2008

• Most hydro-dependent region = most affected by climate change impacts

• Allocation Matters!

• NW Leadership on conservation and renewables should be recognized

• NW utilities spend billions on salmon recovery, habitat protection, FERC relicensing to keep hydro operating

Climate Change: A Northwest perspectiveClimate Change: A Northwest perspectiveClimate Change: A Northwest perspectiveClimate Change: A Northwest perspective

Seattle Times, Nov 1, 2006

Primary Fuel Type

Coal = Black

Oil or Diesel = Blue

Natural Gas = Red

U.S. Power PlantsThe size of each circlerepresents the quantity of emissions in 2002

24 million tons

15 million tons 4.0 million tons

Power plant COPower plant CO22 emissions emissionsPower plant COPower plant CO22 emissions emissions

And 4% of national power output

Power plants in the Northwest generate 1% of national power plant CO2 emissions

4%

96%

99%

1%

1,500 lbs/MWh

2,000 lbs/MWh

1,000 lbs/MWh

LOWEST EMISSION RATES IN USLOWEST EMISSION RATES IN US(lbs of CO(lbs of CO22 per mwh of electricity produced) per mwh of electricity produced)

Northwest Efficiency AchievementsNorthwest Efficiency Achievements1978 – 20051978 – 2005

Northwest Efficiency AchievementsNorthwest Efficiency Achievements1978 – 20051978 – 2005

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Avera

ge M

egaw

att

s

1978 1982 1986 1990 1994 1998 2002

BPA and Utility Programs Alliance Programs State Codes Federal Standards

Since 1978 Utility & BPA Programs, Energy Codes & Federal Since 1978 Utility & BPA Programs, Energy Codes & Federal Efficiency Standards Have Produced Efficiency Standards Have Produced OverOver 3100 aMW of Savings. 3100 aMW of Savings.

SOURCE: NW Power and Conservation Council, 2007

Allocation Comparison: Output vs. EmissionAllocation Comparison: Output vs. Emission Source: EIA 2004 & 2005Source: EIA 2004 & 2005

*CO2 allowance allocation based on total electricity output, including fossil, renewable, and incremental nuclear output (relative to 1990).

Difference between emission and performance/output approach

@ $5/ton = $479 million

@ $7/ton = $671 million

@ $10/ton = $959 million

Avoided Emissions from NW conservation (compared to coal)

“In most of the11 state where AEP operates, it’s under no obligation to hold down demand. On the contrary, it makes more money the more electricity people use.”

Source: “Inside the Messy Reality of Cutting Power Plant’s CO2

Output” Wall Street Journal, Thursday, July 12, 2007

Many still do little / no conservation:Many still do little / no conservation:Many still do little / no conservation:Many still do little / no conservation:

Comparison of Emission-Based Allocation Comparison of Emission-Based Allocation To Top Ten Emitting Utilities v NW StatesTo Top Ten Emitting Utilities v NW States

*Utility allowance allocation based on 2004 data reported in Ceres, Natural Resource Defense Council, and Public Service Enterprise Group, Benchmarking Air Emissions of the 100 Largest Electric Power Producers in the United States 2004, (April 2006). State allowance allocation based on 2004 and 2005 EIA data.

Tons

CO2 levels had 3,100 MW of conservation been coal-fired generation

Emission-Based Give Many Allowances to Few Emission-Based Give Many Allowances to Few Source: “Benchmarking Air Emissions of the 100 Largest Electric Generation Owners -2004”

*CO2 allowance allocation based on total electricity output, including fossil, renewable, and incremental nuclear output (relative to 1990).

0

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

300,000,000

350,000,000

400,000,000

NM UT OR AZ WA CA 6-stateregion

CO2 based allocation

Output based allocation

Load based allocation (electricity sales)

Tons

0%

25%

50%

75%

100%

6 producers

18 producers

50 producers

(

100 largest producers

all others

AEP TVASouthern XcelDuke Ameren

MidAmericanDominion Edison InternationalProgress EnergyTXU

FPLE.ON First EnergyAllegheny EnergyAES

DTE EnergyTexas Genco LLC

Lowest ranking states Lowest ranking states (number higher due to ties):(number higher due to ties): ND, WY, ND, WY, MS, SD, AL, MO, AR, OK, TN, AK, IN, LA, GA, VA, KY, WV, NEMS, SD, AL, MO, AR, OK, TN, AK, IN, LA, GA, VA, KY, WV, NE

Source: The State Energy Efficiency Scorecard for 2006, ACEEE, June, 2007

Energy Efficiency ScorecardEnergy Efficiency Scorecard Highest ranking states: VT, CT, CA, MA, OR, WA, NY, NJ, RIHighest ranking states: VT, CT, CA, MA, OR, WA, NY, NJ, RI

66

5550502121

49492525

1818

11

4848

99

2727 1515

44442424

1111

3535

1515

3838

43433030

3535

3030

3838

3333

27274141

3535

4545

4646

1212

26261313

4141

3434

2323

40404949 4646

2929

Maine 15

New Hampshire 18

Vermont 1

Massachusetts 4

Rhode Island 9

Connecticut 1

New York 7

Pennsylvania 14

New Jersey 8

Delaware 30

Maryland 20

Dist. Columbia 22

Maine

New Hampshire

Vermont

Massachusetts

Rhode Island

Connecticut

New York

Pennsylvania

New Jersey

Delaware

Maryland

District of Columbia

Western Regional Climate Action Western Regional Climate Action InitiativeInitiative

Regional Greenhouse Gas InitiativeRegional Greenhouse Gas Initiative

California motor vehicle COCalifornia motor vehicle CO22

emissions standards emissions standards

RPS requirement or goal RPS requirement or goal Florida GHG target

AB 32

Regional and State Climate InitiativesRegional and State Climate Initiatives

• Hydro most impacted power system from climate change

• Allocation matters!

• Emission-based allocation:– Disadvantages the NW– Rewards behavior we should discourage

• NW leadership should be recognized

CONCLUSIONCONCLUSIONCONCLUSIONCONCLUSION