1. Presentation to the St. Louis Regional Chamber and Growth Association (RCGA) Energy and Environmental Council by Commissioner Kevin Gunn Missouri Public Service Commission SEPTEMBER 15, 2009

2. Disclaimer The opinions expressed here are mine, and mine alone, and are not those of the Commission, any Commissioner (other than myself) or any member of the Staff of the Commission. Further, nothing in this presentation should be attributed to any case or matter before the Commission, to any member of the Staff of the Commission, other Commissioners or the Commission. Further, nothing in this presentation should be attributed to any case or matter before the Commission, to any member of the Staff of the Commission, other Commissioners or the Commission.

3. Commissioner Kevin Gunn Lawyer in private practice Chief of Staff for Rep. Richard Gephardt Missouri Public Service Commissioner 2009 Eisenhower Fellow NARUC Board of Directors NARUC Water Committee

4. Climate Change What are the assumptions for this presentation? Climate change is real Climate change is real The effects of climate change will do substantial harm to the global environment and global economy The effects of climate change will do substantial harm to the global environment and global economy

5. STERN REPORT: SUMMARY 450 PPM Severe impacts on marginal Sahel region, Africa Small mountain glaciers disappear worldwide Coral reef ecosystems extensively and eventually irreversibly damaged 550PPM Failing crop yields in many developing regions Significant changes in water availability Possible onset of collapse of part or all of the Amazonian Rain forest Many species face extinction (20-50% in one study) Rising intensity of storms, fires, droughts floods and heat waves Possible increasing natural methane releases (positive feedback loop) Weakening of the Atlantic thermal Haline Circulation Onset of irreversible melting of the Greenlands ice sheets Conclusion: Aim to stabilize at 450ppm not 550ppm atm CO 2

6. Still a Skeptic? Take a Risk Management Approach: What are the consequences of believers or skeptics being wrong?

7. Transformational Impacts The transformation to a carbon restricted environment does have impacts: Cap and Trade will raise electricity rates Cap and Trade will raise electricity rates Renewable Portfolio Standards will change generation and may increase cost Renewable Portfolio Standards will change generation and may increase cost Transmission costs will rise Transmission costs will rise Jobs will be lost Jobs will be lost

8. Mitigation Growth of “Green Jobs” (not necessarily a 1 for 1 proposition) Rise in Wind/Solar/Biomass Generation Greater concentration on Demand Side rather than Supply Side Efficiency as a fuel

9. Renewable Potential in Missouri EfficiencySolarWindBiomassHydro

10. Efficiency SB 376 allows cost recovery by Utilities Spend pennies to save dollars Cheapest for utilities and ratepayers Incorporates both low-tech (insulation) and high-tech (Smart Grid)

11. Solar Required by Missouri’s Renewable Portfolio Standard There is some Solar PV potential Technology is getting more efficient every day

13. Wind Potential Missouri’s potential is in the Northwest corner Some reports say that Missouri has about 5,960 megawatts of potential wind capacity

14. National Renewable Energy Laboratory Innovation for Our Energy Future

15. Missouri’s greatest renewable potential? BIOMASS Crop residue Switch grass Switch grass Timber harvest residue Timber harvest residue Methane from Biologic Sources Landfill methane Demonstration projects in Jefferson City and St. Louis County Demonstration projects in Jefferson City and St. Louis County 6.9 trillion BTU potential 6.9 trillion BTU potential

17. Demonstration Projects Landfill Gas

18. Hydro Small turbines in Mississippi Lock and Dam system Low flow turbines Creative turbine design

19. What about Nuclear? Only renewable currently able to meet baseload generation New nuclear incredibly capital intensive (new plant cost estimates of $6-11Billion) Opposition seems to have transformed from environmental to economic

20. What are the next steps? Utilities need to encourage efficiency to mitigate impact of carbon restrictions (SB 376) Missouri needs to take advantage of natural renewable potential Economic development strategies such as tax credit programs should focus on renewable generation as high potential projects There is still time to mix old world manufacturing economy with new world green economy

21. Thank you! Questions?