Download - Regional Greenhouse Gas Initiative
Regional Greenhouse Gas InitiativePresentation to
American Council of Engineering Companies of New HampshireJanuary 15, 2008
New Hampshire Department of Environmental Services Commissioner
Thomas S. Burack
2
Climate ChangeImpacts on New Hampshire
• Trends indicate NH is experiencing impacts now
• Extreme storm events
• More rain in winter• Less snow cover
Average Winter Temperature in the Northeast 1899-2000
Time series represent areally weighted average of 56 meteorological stations.
Flooding in NH
October 2005 May 2006April 2007
• Peak flows in many rivers greater than 100 year flood
• Millions of dollars in state and individual losses
4
Future Economic Impacts to New HampshireNortheast Climate Impacts Assessment (2007)
By late in the century (without reducing GHG emissions)
• Winter snow season cut in half• Sea-level rise up to nearly three feet• More than 60 days with temperatures over 90°F in
most cities • 4 to 28 days with temperatures over 100°F
(compared with one or two days per year historically).
5
What if we don’t act now to reduce green-house gases?
6
Global Cost of No Action(Stern Review UK Treasury 2006)
• Extreme weather alone – 0.5-1% world GDP annually• Total cost of taking no action equivalent to reduction
in consumption per head of 5-20% annually• Less costly to take actions now than to delay• Risk to world economy on the order of multi-national
world conflict• Insurance market already reacting
7
NH CO2 (equivalent) Emissions by Sector
2004
Electric Utilities
34%
Commercial
8%Industrial
7%
Residential
15%
Transportation
34%
Agriculture,
Forestry and
Waste
2%
Transportation
Residential
Industrial
Commercial
Electric Utilities
Agriculture, Forestry
and Waste
8
RGGI Cap & Trade Program
• Regional cap on emissions from fossil fuel-fired power plants >25 megawatts
• Cap (10 state region) 188 million allowances • 1 allowance = 1 ton• NH Budget 8.6 million allowances• Majority of allowances will be sold in regional
auction
9
RGGI Cap Levels
• 2-Phase CO2 Caps (gradual, keeps cost low)– stabilization 2009 – 2014 (no absolute
reductions, but reductions from business-as-usual)
• Phase I Regional Cap = 188,076,976 tons• Phase I NH Budget = 8,620,460 tons
– 10% reduction 2015 - 2018 • (2.5% per year for 4 years)
• Built-in Review of Program in 2012
10
Compliance
• Power plants must have enough allowances to equal their emissions by the end of the three year period
• Can buy allowances (regional auction) or offset allowances
• Unlimited banking of allowances
11
RGGI Offset Projects
• 1st set – methane capture, SF6 (electric insulator), afforestation, end-use efficiency
• Initially limited to 3.3% of each source’s emissions• Offsets may come from RGGI region or from another
US state at 1:1• Safety valves built in to increase use of offsets for
economic relief if necessary
12
RGGI impact on NH
• 9 other states going forward with RGGI
• Regional energy prices will be affected by RGGI whether NH participates or not
• Only way to mitigate costs is to participate and use auction revenues
13
Regional Leadership
• Driving federal action• Western Climate Initiative includes Arizona, California, Montana,
New Mexico, Oregon, Utah, Washington, British Columbia, and Manitoba and 10 observers including 3 Canadian provinces and Sonora, Mexico
• Midwestern Greenhouse Gas Reduction Accord includes Illinois, Iowa, Kansas, Michigan, Minnesota, Wisconsin, and Manitoba (Indiana, Ohio, and S. Dakota also signed as observers)
• Investment in more efficient energy market is positive for NH regardless of climate change
W CI960 MTons (US) / 13% US Midwest Group
1027 MTons (US) / 14% USRGGI
766 MTons (US) / 10% US
Total Emissions and Percentage of Total U.S.Emissions of Regional Cap-and-Trade Initiatives
Notes:1. B ritish Colum bia and M anitoba Canada are m em bers of W CI.2. M anitoba Canada is a m em ber of the M idwest G roup.3. C ross-hatching indicates observer status (4. Kansas is a m em ber of the M idwest G roup and an O bserver for W C I.5. O ntario , Q uebec, and Saskatchewan Canada, and Sonora M exico are O bservers of W CI.Source: W orld Resources Institu te, Novem ber 2007
RGGI Cap 188 MTons (US) (Electric Sector Only)
- W CI - M idwest G roup).
15
Is RGGI Significant?
• RGGI would represent the seventh highest emitting developed country
• The RGGI cap (188,076,976 tons) is similar to the emissions of Australia, France, or Italy
• There is no “silver bullet” but RGGI is part of the “silver buckshot”
16
Benefits of HB 1434• Helps to mitigate long-term energy costs via greater
investment in energy efficiency
• Creates a market signal that encourages development of cleaner and, in many cases, more local energy sources
• Increases our energy independence with more local energy sources: keeping more dollars local
• Starts to mitigate our GHG emissions to avoid the most deleterious projections of climate change impacts
17
Downside of not joining RGGI• Roughly half of NH’s supply is purchased from the regional
market
• As a consequence, NH electric prices will be affected by RGGI
• No benefit of sale of NH allowances
• No seat at table – no influence on program
18
Estimated Impact to Business Electricity Costs
2006 average monthly bill(UNH estimate from FERC Form 1)
Small $308 (81,000 accounts)
Large $38,000 (350 accounts)
Not joining RGGI Increase to average monthly bill
2009 2012 2015 2018
Small $1.15 $2.38 $3.72 $5.16
Large $142 $292 $458 $636
% Change
0.4% 0.8% 1.2% 1.7%
19
Potential Mitigation of Monthly Business Electricity Costs
2009 2012 2013 2015 2018
Small Business
$1.29 $(0.20) $(1.90) $(4.00) $(9.78)
Large Business
$159 $(25) $(234) $(493) $(1,205)
% Change 0.4% -0.07% -0.6% -1.3% -3.2%
Net change from investment in energy efficiency compared to not joining RGGI
20
Energy Efficiency – Regional Priority
• Record peak demand in summer >28,000 MW• Peak demand increase twice as fast as average load
growth• Costly new capacity may be needed to meet demand
reached for only a few hours or days our of the year• Reducing electricity use by 5% during peak times
will save consumers $580 million a year (ISO – NE June 2006)
21
Major Potential for Energy Efficiency Improvements
• RGGI bill proposing a “fuel-neutral” fund
• Technology continuing to improve
• Recognize opportunities vary
• Increased energy efficiency overall – can avoid costly new capacity – reducing everyone’s energy costs
22
Light Bulb Evolution
Incandescent CFL CFL Cold Cathode LEDElectric Demand 100 Watts 25 Watts 18 Watts 8 Watts 2.2 WattsHours Use 4 hrs/day x 365 4 hrs/day x 365 4 hrs/day x 365 4 hrs/day x 365 4 hrs/day x 365Annual kWh Usage 146 37 26 12 3Annual kWh Savings 110 120 134 143Annual Cost (@ $0.149) $21.75 $5.44 $3.92 $1.74 $0.48Annual $ Savings $16.32 $17.84 $20.01 $21.28
Annual CO2 Reduction (lbs) 121 133 149 158
23
Fluorescent Light Evolution
34–40 Watts 32 Watts 28 Watts
1950’s – 1980’s late 1980’s – 1990’s Last 5 yrs
24
UNH Economic Analysis 2007
• NH participation is lower cost overall to NH than not joining
• Lowest long-term net utility cost is to auction allowances and put revenues into energy efficiency
• Positive impact on employment and the overall NH economy
25
Opportunity for Economic Development
• NH tradition of innovation and leadership
• NH needs to foster R&D development of new technologies and related ancillary services
• Current examples – Power Span
– GT Solar
26
What’s the Ultimate Source of Greenhouse Gases?
ENERGY DEMANDfor
Electricity, Heating/Cooling and Transportation
• Every megawatt-hour of electricity used produces 1,100 lbs. of CO2
• Every gallon of gasoline burned produces 20 lbs. of CO2
27
Solutions
• Make your buildings ENERGY STARS (or Leed certified).
• Light up your life (with Energy Star qualified lighting products).
• Establish “turn off” and “unplug” policies for electronic equipment and lights.
• Reduce, Reuse, and Recycle (use double-sided printing and copying)
• Green your fleet and driving habits!BiodieselBiodiesel
28
• Buildings• Lighting• Appliances (dishwashers, furnaces, stoves, washer
machines)• Office Equipment• www.energystar.gov
29
Reduce fuel consumption in motor vehicles
Establish fuel economy standards for new purchases
Establish anti-idling policies
Promote carpooling and teleconferencing
Less Greenhouse Gases – Less Dependence on Foreign Oil
30
Consider the Hybrid Option
31
32
Contacts
Tom Burack [email protected]
271- 2958
Bob Scott [email protected]
271-1088
Joanne Morin [email protected]
271-5552
