This presentation will track the major policy, market, and economic changes that have occurred between June 2016 and June 2017 and their broad impact on U.S. Clean Energy programs. The paper will identify how significantly U.S. energy policy and markets can change----or not--------over a year.
2017 clean energy presentation dodenhoff y20170608 linked in nonotes
1. Jim Dodenhoff,
Regional Business Development Director, IPERC
June 8, 2017
CLEAN ENERGY POLICY AND THE CLEAN
ENERGY MARKET IN AMERICA: WHAT A
DIFFERENCE A YEAR MAKES
2. A THOUGHT EXPERIMENT: WHAT IF?
The
Primaries
June 6,
2016
The
Conventions
August 1,
2016
The
Election
November
11, 2016
The
Inauguration
January 20,
2017
First 100 Days
January 21-
April 21, 2017
NOW
June 8,
2017
3. Level setting on terminology
Clean Energy...Defined
Policy vs. Politics
Resiliency and Reliability
4. THE CLEAN POWER PLAN-CIRCA JUNE 2015
The EPA used the four building blocks to determine state emission goals
They are also tools for states to design and implement their own emissions reduction
plans
5. THE CLEAN POWER PLAN-WHAT HAPPENED?
The
Conventions
July 2016
US DC Circuit
Court Hears
case
September
2016
Administration
Budget Defunds
CPP
Executive Order
Issued to
Review CPP
March 2017
US DC Circuit
Court holds case
in abeyance for 60
days
April 2017
NOW
June 8,
2017
President
Speech to
Congress
March 2017
August-2015
27 States Petition US
Appeals Court for Stay
February 2016
Supreme Court Halts
Enforcement Pending
Lower Court Ruling
The Election
November 8,
2016
6. WHAT IS THE FATE OF THE PARIS CLIMATE CHANGE
ACCORD?
Conventions
August 2016
US Deposit of
Instruments of
Ratification
September 3,
2016
192 Countries
Signed, 147
Ratified
December 2016
G7 (less U.S.) reaffirm
commitment to
implement Paris
Climate Agreement
May 2017
U.S.
Withdraws
from the Paris
Climate
Agreement
June 1, 2017
Election
November 8,
2016
Final Wording,
Adopted by Consensus
December 2015
Global Agreement
and U.S.
Commitment
Enters into Force
November 4, 2016
U.S. and 174
other parties
signed, April
2016
8. THE TRUMP EFFECT: EXECUTIVE ACTIONS
Executive Action Key Provisions
EO 13766-Expedited Environmental
Reviews for Infrastructure Projects
(01/27)
Expedited Executive Agency review for infrastructure--
-inclusive of electrical grid improvements
EO 13771-Reduced Regulation and
Regulatory Costs (01/27)
Issuance of any new regulation must be accompanied
by proposal to repeal two regulations
EO 13777-Enforcing the Regulatory
Reform Agenda (03/01)
Lower Regulatory Burdens by appointing a Regulatory
Reform Officer (RRO) and Regulatory Reform Task
Force for each agency
EO 13788-Reviewing the “Waters of
the United States” Rule (03/03)
Ensure that the Nation's navigable waters are kept
free from pollution, while at the same time promoting
economic growth
EO 13783-”Promoting Energy
Independence and Economic Growth”
(03/28)
1) Review Estimates of the Social Cost of GHG’s; 2)
Review All Agency Actions that Potentially Burden the
Safe, Efficient Development of Domestic Energy
Resources. 3) Rescind past EO’s and PM’s. 4)
Review of Clean Power Plan & Related Rules &
suspend, revise, or rescind, as appropriate 5) Lifting
of Federal Coal Leasing Moratorium
9. THE TRUMP EFFECT:EXECUTIVE ACTIONS
Executive Action Key Provisions
EO 13795-”Implementing an America-
First Offshore Energy Strategy” (04/28)
Encourage energy exploration and production,
including on the Outer Continental Shelf. Assure
annual lease sales in the Outer Continental Shelf
Planning Areas; Planning for future potential for
offshore energy development;
EO 13800-”Strengthening the
Cybersecurity of Federal Networks and
Critical Infrastructure”
Support cybersecurity risk management efforts of
owners & operators of Nation’s critical
infrastructure; inclusive of electricity disruption
incident response capabilities
PM #5-Regarding Construction of the
Dakota Access Pipeline (01/30)
Pipeline Approval Review; Review and Grant
required waivers; and issue easements or rights of
way
PM#6-Regarding Construction of the
Keystone XL Pipeline (01/30)
Facilitate expeditious review and approval of
TransCanada Keystone Pipeline Application
DOE MEMO: Study Examining Electricity
Markets and Reliability (04/14/2017)
Study to explore the “erosion of critical baseload
resources”. How power is dispatched; diminishing
diversity of fuel sources, and implications for
baseload power and grid resilience. Study will help
DOE formulate policies to protect electric gridNo Significant Federal Energy Legislation has been Passed in 2017
11. KEY AREAS OF PROPOSED BUDGET CUTS
•50 agency programs/3200 jobs
•35% cut to Science & Technology Programs (off $733 MM base)
•Air and Energy Research-67% cut from $91 MM base)
•Federal Vehicle and Fuel Standards and Certification-20% cut from $93 MM base
•Notable Program Eliminations: AgStar, Energy Star, Combined Heat & Power
Partnership, State & Local Climate Energy Program, EPA Homeland Security,
Greenhouse Gas Reporting
EPA (31.4%)
•70% cut to Office of Energy Efficiency & Renewables (from 2.0 B Base)
•42% cut to Office of Electricity Delivery and Energy Reliability ($200 MM base)
•29% cut to Office of Nuclear Energy
•55% cut to Office of Fossil Energy Research & Development ($632 MM base)
•Eliminated Programs: Weather Assistance Program, State Energy Program,
ARPA-E Program, Advanced Technology Vehicle Manufacturing Loan Program
DOE (5.6%)
•Elimination of funding for all international climate change programs
•Green Climate Fund
•Clean Technology Fund
•Strategic Climate Fund
•Global Climate change Initiative
•Eliminates funding for USAID bilateral activities with partner countries to directly
address climate change
STATE(29.1%)
12. U.S. NATURAL DISASTERS & CLIMATE CHANGE
JUNE-DECEMBER 2016
Regional Drought in West, NE, and SE
• June – December 2016
• $3.5 Billion
Hurricane Matthew
• October 2016
• $10.1 Billion
• 49 Deaths/1000+ Haiti
Louisiana Flooding
• August 2016
• $10.1 Billion Damage
• 13 Deaths
Rockies and NE Severe Weather
• July 2016
• $1.5 Billion Damage
Source: National Centers for Environmental Information, National Oceanic and
Atmospheric Administration
13. U.S. NATURAL DISASTERS & CLIMATE CHANGE
JANUARY – JUNE 2017
Source: National Centers for Environmental Information, National Oceanic
and Atmospheric Administration
Midwest Tornado Outbreak
• March 2017
• $1.5 Billion
• 2 Deaths
Central/Southeast Tornado Outbreak
• March 2017
• $1.2 Billion
• 6 Deaths
Southern Tornado Outbreak
• January 2017
• $1.1 Billion Damage
• 24 Deaths
14. SOLAR & WIND ENERGY:
A BUYER’S MARKET
Tesla
Announces
Solar City
Acquisition
August 2016
Verengo
Solar BK
Filing
September
2016
Sungevity BK
Filing
March 2017
Suniva BK
Filing
April 2017
NOW
June 8,
2017
Trump
Administration
Issues
Infrastructure
Plan as Part of
2018 Budget
May 2017
Tesla closes
SolarCity
Acquisition
November 2016
SunEdison
Bankruptcy
April 2016
Extension of
Renewables
Investment Tax
Credit
December 2015
16. KEY CHANGES IN CRUDE OIL, NATURAL GAS, AND OTHER
KEY ENERGY MARKETS
Crude Oil vs Natural Gas Prices (May 2016-May 2017)
Post Election
Period
17. KEY CHANGES IN CRUDE OIL, NATURAL GAS, AND OTHER
KEY ENERGY MARKETS
Crude Oil vs Natural Gas Prices (May 1995-May 2017)
18. COAL PRICES VS NATURAL GAS PRICES
(June 2016-June 2017)
Post Election
Period
19. COAL PRICES VS NATURAL GAS PRICES
Coal Prices vs Natural Gas Prices (2007 – 2017)
20. THE STATE OF THE U.S. FRACKING
INDUSTRY IN 2016-2017
Capex recovery from the 2014-2015 bust
Cash flow remains elusive
Supported by $40+ Crude Oil Prices
Continued efficiency improvements/
lower breakeven costs
Continued downward pressure on avoided
cost calculations impacting EE/DSM
By Loadmaster (David R. Tribble) - Own work, CC BY-SA 3.0,
https://commons.wikimedia.org/w/index.php?curid=4025872
21. JOBS FROM THE POWER GENERATION SECTOR
Source: NY Times, “Today’s Energy Jobs Are in Solar, Not Coal”, April 25, 2017; The
Department of Energy’s U.S. Energy and Employment Report; The Solar Foundation;
Bureau of Labor Statistics
22. GEOGRAPHIC BREAKOUT OF ENERGY JOBS BY
TYPE OF FUEL
Source: NY Times, “Today’s Energy Jobs Are in Solar, Not Coal”, April 25, 2017; The
Department of Energy’s U.S. Energy and Employment Report; The Solar Foundation;
Bureau of Labor Statistics
24. MY CRYSTAL BALL
CPP on Life Support √
Reduced Subsidies
for Renewables ???
Cuts to Clean Energy
Initiatives √
Fossil Fuel prices
flat or down-NOPE
The Natural Gas “bridge” gets
much longer √
Energy Security a top Fed Priority
???
Tesla-Solar City Deal bad for
shareholders-NOPE
CPP will die/No
Renegotiation of PCA
States, Cities,
Corporations will lead
Coal industry will not be
revived
Not so fast on Clean
Energy = Infrastructure
Resiliency trumps energy
security
Clean Energy Markets
stabilize vs 2016-2017
$’s and the courts will be
policy drivers
Predictions
July - November 2016
Predictions
June 2017-June 2018
26. ABSTRACT
Clean Energy Policy and the Clean Energy Market in America:
What a Difference a Year Makes
This presentation will track the major policy, market, and economic changes that have occurred between June 2016 and June 2017
and their broad impact on U.S. Clean Energy programs. The paper will identify how significantly U.S. energy policy and markets
can change----or not--------over a year. Focus areas to be tracked will include the following:
• What has been the fate of the Clean Power Plan in a highly politicized environment and a deadlocked Supreme Court?
•Has the bankruptcy and financial distress of large renewable players had a major impact on the renewables industry, or did
other players pick up the slack?
• How have countries' commitments to GHG reductions translated into actual reductions in 2016-2017 and a possible expedited
timetable for future reductions? How, if at all, has this impacted U.S. EE/DSM programs?
• What are the major natural disasters that have occurred from 2016-2017 and how are they related to climate change?
• What has happened to crude oil prices? How has this impacted EE/DSM programs from an economic standpoint?
• Does the U.S. fracking industry remain depressed and how has the health of the fracking industry impacted state and federal
energy policy?
• Has there been policy or economic "unknown unknowns" in 2016-2017 that have dramatically impacted the EE/DSM outlook
in the U.S.?
• How has the U.S. Presidential Election and related House and Senate races changed the energy outlook for the U.S.?
This paper's one year longitudinal analysis intends to provide insights into how policy and economic developments relate to and
impact Clean Energy programs. The author will review to what degree these developments were predictable---even if only on a
directional basis------and how this might have impacted program planning and implementation efforts.
The policy and economic parameters will also be analyzed using a risk/reward framework, establishing a linkage between year over
year changes and whether they have created benefits or increased risks to the Clean Energy industry. Finally, the author will offer
insights around possible go-forward policy and economic issues that may significantly impact energy efficiency, renewables, and
demand side management in the 2017-2018 time period
