Appendix Putting H.R. 2454 in Context

President Obama’s Energy / Environmental Views Climate Change Renewable Portfolio Standards 80% reduction by 2050 25% by 2025 H.R. 2454 83% reduction by 2050 H.R. 2454 20% by 2020 Energy Efficiency Smart Grid Overhaul of Federal Efficiency Codes Increased Government Support In H.R. 2454 and stimulus package In H.R. 2454

Benefits of Allocations Reduces customer cost impact significantly Customers pay for costs of carbon reductions, but not for cost of allowed emissions Benefits all electricity users, including business and commercial customers Can target low-income customers Accommodates regional differences in cost and electricity use

Auctioning Allowances Would Sharply Increase Costs to Customers

Financial Impacts of Climate Change EPA Household spending would drop by about $140 / year by 2020; gas prices would increase 33 cents / gallon by 2030 CRAI (for National Black Chamber of Commerce) By 2015; $730 / year less in household purchasing power, electric rates would increase 7.3% by 2015; gas prices by 12 cents / gallon Heritage Foundation By 2035 electricity rates would increase by 90%, gas prices by 74%, household energy bills by $1500 It’s ALL About the Assumptions!

Percentage Black Population-Electricity Costs By State This map superimposes the concept that the states with the greatest concentration of African Americans are in the southeastern part of the US. These are the same dates with the lowest average per family income. Retail Cost Per kWh ME 0.6 WA 3.3% MT 0.3% ND 0.6% MN 4.1% OR 1.7% ID 0.3% WI 5.7% SD 0.8% MI 14.% WY 0.8% PA 10.% IA 2.2 NE 3.6% IN 8.1% OH 11.7% NV 6.9% IL 14.7% CA 6.2% UT 0.8% 5.0¢ CO 4.0% VA 19.3% KS 5.1% MO 11.2% KY 6.8% NC 21% TN 16.3% OK 7.1% SC 28.9% NH 0.8% VT 0.5% MA 6.0% RI 5.5% CT 9.3% NY 15.8% NJ 13.1% DE 19.8% MD 28.5% DC 57.8% AZ 3.0% NM 2.3% AR 15.% ¢ = average retail price per kilowatt hour through CY 2006 AL 26.0% GA 28.7% MS 37% TX 11.0% LA 32.5% FL 15.1 < 6.5¢ > 6.5¢ - < 8.0¢ > 8.0¢ - < 9.5¢ > 9.5¢ - < 11.0¢ > 11.0¢ Hydro 20.7¢ 12.9¢ Source: Energy Information Administration – March 2007

Important Issues Needing Attention Targets & timetables Timing of transition to full auction Price collar / safety valve Offsets Combined efficiency and renewable energy standard

Planned capacity additions reflect state RPS requirements US Generation Capacity in 2008 (1,061 GW in Service) Planned Capacity Additions to 2020 (352 GW) Hydro 9% Gas 41% Coal 30% Nuclear 10% Oil 6% Non-Hydro Renewable 4% Hydro 16% Gas 23% Coal 14% Nuclear 13% Oil 0% Non-Hydro Renewable 34% Source; Ventyx Global Energy and Bernstein Analysis Non-hydro renewables make up 4% of US capacity today but 34% of planned capacity additions through 2020.

Wind dominates proposed renewable capacity additions Planned Renewable Capacity Additions to 2020 Wind 78% Solar Thermal 8% Small Hydro 6% Wood 2% Solar PV Waste Geo Source; Ventyx Global Energy and Bernstein Analysis Wind accounts for 78% of planned renewable capacity additions. Solar thermal accounts for 8% and solar photovoltaic for another 2%. The tendency of wind to blow during off-peak hours limits its usefulness on power grids, motivating utilities to explore ways of increasing the use of solar resources available during hours of peak demand.

U.S. Renewable Resources Source: National Renewable Energy Laboratory Source: National Renewable Energy Laboratory

Transmission Congestion Dramatically Increasing

Energy Efficiency Can Lower Bills Help Address Climate Change Average US household owns 24 consumer electronic products 2 DVRs use as much energy in 1 year as a refrigerator Play Station and X-Box use more electricity than a PC PCs and TVs now account for 10% of a home’s electricity usage 99% of these products must be plugged in or recharged 42” Plasma TV uses more than twice as much as a standard 27” TV More efficient use of energy could significantly reduce energy bills Need to educate all consumers about how to save energy and use it more efficiently

Intensified National Commitment To Energy Efficiency Is Needed Aggressive campaign for technologies Smart buildings Smart appliances Smart electric meters and grid Smart rates Commercializing plug-in hybrid electric vehicles

Total U. S. utility spending on energy efficiency programs: $2 Total U.S. utility spending on energy efficiency programs: $2.5 billion in 2007 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 2000 2001 2002 2003 2004 2005 2006 2007 $1,000,000,000 Total Utility Spending on EE & LM (2000-2007) - Source: EIA Form 861 Source: The Edison Foundation – Institute of Electric Efficiency

Carbon Capture and Storage Challenges 9/18/2018 12:34 AM Carbon Capture and Storage Challenges Capture Develop cost-effective means of capturing CO2 from combustion Transport Ability to access current gas and CO2 pipeline structure Regulatory framework Liability concerns Storage Permitting and siting Full-scale demonstration projects Public education and acceptance Thurs_GS_Energy_Obama

Smart Grid … Sensing and Measurement Advanced Sensors Remote Monitoring of Expensive Equipment (e.g. Transformers) Smart Meters

Smart Grid … Integrated Communications Examples: Powerline Broadband over Powerline (BPL) Cellular Radio Frequency (RF) Satellite

Smart Grid … Advanced Control

What is the Smart Grid? An advanced, telecommunication / electric grid with sensors and smart devices linking all aspects of the grid, from generator to consumer, and delivering enhanced operational capabilities that : Provide CONSUMERS with the information and tools necessary  to be responsive to electricity grid conditions (including price and reliability) through the use of electric devices and new services (from smart thermostats to PHEV) Ensure EFFICENT use of the electric grid (optimizing current assets while integrating emerging technologies such as renewables and storage devices) Enhance RELIABILITY (protecting the grid from cyber and natural attacks, increasing power quality and promoting early detection and self correcting grid “self-healing”)

Opportunities - Green Jobs Energy Independence and Security Act of 2007 $125 million / year to create a worker training program, special focus on opportunities for low income people American Reinvestment and Recovery Act (Stimulus Bill) Significant funding for a broad range of programs – including energy efficiency, renewables, climate change, smart grid Workforce training Renewables - Roof-top solar heating, water, energy Meeting the increasing state, federal and consumer requirements Energy Efficiency Energy audits, retrofits, new technologies, green building standards Efficiency management – data mining

Opportunities - Green Jobs Smart meters / smart grid Replacing legacy systems with new technologies Demand response Provide consumers and utilities with new tools to manage demand Plug-in Hybrid Electric Vehicles Need programs to develop and attract new talent