Energy Law 7 – Renewables Fall 2014 October 14, 2014 Alan Palmiter Not for distribution- for study purposes only

Topic roadmap 1.Renewables in the energy mix – Compared to other energy sources – What is sustainable energy? 2.Renewables production / transmission – Wind, solar, geothermal – Transmission issues 3. Regulation of renewables – Permitting and siting – Development on federal land – Promotion (state, federal and international levels) 4.Future of renewables – Part of energy mix – Distributed generation – International perspective

1. Nuclear power in energy mix 7 7 Energy Flow, 2011 (Quadrillion Btu)2011Energy Flow, 2013 (Quadrillion Btu)

Energy Sources  Uses

Energy Sources

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1.True or false? As a percentage, more renewable energy goes to producing electricity than to any other end use. 2.Which is true – a.Power production from hydro power has increased every year since b.Power production from renewable sources, other than hydro, has increased every year since c.Power production from hydro power sources is at an all- time high. d.Power production from renewable sources, other than hydro, has been flat. 3.Which is false - a.In 2011, wind turbines in the United States generated about 3% of total electricity. b.In 2011, oil accounted for more power generation in the United States than renewables. c.Of all renewable sources of power, solar accounted for the largest percentage of electricity generation in d.The United States accounts for 5% of the world’s population and ~20% of the world’s CO2 emissions. 4. True or false? Renewable energy can only be used to produce electricity. Pop Quiz Renewables in energy mix Answers: 1-T / 2-b / 3-b / 4-F

EIA: Renewables production by stateRenewables production by state 2. Renewable energy production / transmission

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Source: NREL- LinkLink

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Source: NREL- LinkLink

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Source: NREL- LinkLink

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Source: NREL- LinkLink

Source: Wikimedia, LinkLink Transmission of Renewable Energy

Source: ERCOT, LinkLink Source: ISO/RTO Council, LinkLink

Renewables Pros:  Zero emissions into the atmosphere  Reduces reliance on fossil fuels - good for environment & energy security  Job stimulation  If it can be harnessed, potential is unlimited Cons:  Currently more expensive than traditional power generation  Variable power production  Requires regulatory incentives to remain competitive (given current technologies)  Location constrained

RE Production Wind, solar, geothermal – permitting and citing at state and local levels Hydro regulation unique – federal government grants licenses Interconnection – PURPA (also subject to policies of utilities) Green v. green -- federal env statutes RE Transmission Siting and permitting – state level Regional operations (interconnections / RTOs and ISOs) Markets and practices – FERC 3. Regulation of renewables

Renewable Portfolio Standard (RPS) requires utilities to use/procure renewable energy/credits Specified percentage of retail electricity sales or generating capacity specified schedule Feed-in-Tariff (FIT) performance-based incentives cash payments based on KWHs renewable energy Tax Incentives corporate tax incentives personal tax incentives property tax incentives Promotion of Renewable Energy

Renewables- timeline Clean Water Act (1972) Federal Power Act (1920) First utility scale wind turbine (1951) Solar PV developed (1954) Public Utility Regulatory Policies Act (1978) Clean Air Act (1970) Piedmont Envtl. Council v. FERC (2009) Federal Power Act Amendments (1935) Energy Policy Act of 2005 Energy Policy Act of 1992

Alexandra Klass Elizabeth Wilson Interstate Transmission Challenges for Renewable Energy: A Federalism Mismatch Challenge for renewables: transmission, transmission – Wind disbursed (rural) – Far from where used (urban) Regulation – Oil pipelines: eminent domain – Electric transmission: less so Proposal – Federal action unlikely – Coordinated state effort: wind producers + power users – Enhanced authority to spread transmission costs

No state approval for construction or for eminent domain State approval before construction BUT NOT before eminent domain State approval before construction AND before eminent domain NO eminent domain Siting / Eminent Domain - Oil Pipelines

Transmission

No state “certificate of need” for construction or for eminent domain State “certificate of need” before construction BUT NOT before eminent domain State “certificate of need” before construction AND before eminent domain Siting / Eminent Domain – Power Transmission WIND Transmission

1.True or false? The federal government has the authority to site the construction of wind turbines on private land. 1.Which is false – a.Utilities need not purchase electricity produced from renewable energy producers. b.Renewable energy generation is typically can be sited anywhere. c.The US electrical grid, a single system, stretches from coast to coast. d.States regulate interstate power transmission markets and practices. 3.Which is true -- a.A feed-in-tariff is a “demand side” mechanism for promoting renewable generation. b.A renewable portfolio standard is a “supply side” mechanism for promoting renewables. c.A feed-in-tariff is a regulatory incentive for renewable power production. d.A renewable portfolio standard is a free market mechanism for promoting renewable power production. 4. True or false? Transmission of wind generated power is likely to involve state coordination. Pop Quiz Renewables – regulation Answers: 1-F / 2-A / 3-c / 4-T

4. Future of renewables

(Source: Fresh Energy- Link)Link

Europe Electricity from renewables (2010) Source: European Commission, Eurostat, Link (2010)Link

Source: European Commission, Eurostat, LinkLink Europe Electricity from renewables ( )

Energy federalism RenewablesFederalState ProductionNone (except offshore wind)State utility rules TransmissionFERC (interstate) States (intrastate) Regional Transmission Org Distributed generation PURPAState and local Incentives / subsidies Production tax credit Renewable portfolio stds Feed-in tariffs

Class Hypo The Utilities Commission of the State of Serenity is considering whether and how to promote renewables in the state’s power grid. The Commission wants to promote local job- producing projects. Please prepare comments to the Commission outlining your views on what the Commission should do. Consider legal ramifications. Group 1: Sierra Club (seeking to promote renewable energy). Group 2: Affordable Energy Group (concerned with impact of energy prices on low-income customers). Group 3: American Legislative Exchange Council (ALEC).ALEC

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