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Arizona’s Electricity Future
Nancy LaPlaca
LaPlaca & Associates
laplaca.nancy@gmail.com
480-359-8442
November 14, 2013
Who Am I?
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ASU: Bachelor Fine Arts, J.D., College of Law
3.5 years as Policy Advisor to AZ Corporation
Commissioner Paul Newman
Staff co-chair for the Environment Committee
at the National Association of Regulatory
Commissioners
3 years as public interest intervener at
Colorado Public Utilities Commission
5 years Congressional staff for AZ
Representatives Morris K. Udall and Karan
English
6 years (total) at AZ Court of Appeals, AZ
Supreme Court, State Senate, Criminal
Justice Commission
Management and technology consulting
Love to hike, swim, sing and play guitar and
piano; read and listen to books.
Agenda
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Background and Key Concepts
AZ's Electricity Mix
The AZ Corporation Commission (ACC)
What does electricity "cost“?
Coal and Natural Gas in AZ
Huge Jobs Potential -- and Possible Threats-- to AZ’s
Clean Energy Future
Regional Clean Energy: Integrating Large Amounts of
Distributed and/or Clean Energy
The ACC and the public sector
Five Things To Remember
1.
2.

3.

4.

5.

Net/Energy Available for Work” declining.
AZ imports 90% of electricity fuels. No one knows
what fuel will cost in the future, can rise quickly.
Solar, wind have higher up-front but lower longterm costs, less risk.
Electricity production: from large, central-station to
distributed, closer to load; business models
under growing stress.
Damages from “externalities” such as water and
air pollution, mortality, lost work days, childhood
asthma are known; a range of costs could be
included in the “cost” of electricity.
Background: Key Concepts
ENERGY v CAPACITY
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Energy = kWh, MWh – usable energy
Capacity Factor = output over time

Why is this important? Because power plants
have different capacity factors:
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Nuclear: 93% Capacity Factor (CF)
Coal:
80% CF
Wind: 30-40% CF
Solar: 20-23% CF (in AZ)
Geothermal: 92% CF
Energy, Electricity and “Net” Energy
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Energy: liquid transportation fuels
Electricity: coal, natural gas, nuclear, solar, wind, hydropower
 Currently not much overlap, but will change as we “electrify”
transportation with light rail, electric cars, etc.
Net Energy = the energy left after using energy to drill, mine,
transport, compress, combust, build, etc.
Also called E-ROI (Energy Return on Investment)
Energy costs are going to rise: Do we invest in renewables,
with higher capital costs, or fossil fuel plants, with increasing fuel
costs and high Operation and Maintenance?
“Externalities” increasingly important: global warming, water
scarcity; also enormous health effects from fossil fuels we’ve
ignored for decades
Environmental justice issues: local, U.S., global
The easiest-to-get
resources are extracted
first. Example:
deepwater v. onshore
drilling for oil.
Energy Slaves?
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~8 calories of oil embedded in every
single calorie of food delivered

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Renewable energy (solar, wind) not as
dense, not ‘on demand,’ need storage.

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We will likely electrify transportation

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One Barrel Oil = 25,000 hrs human labor

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25,000 hrs human labor = 12.5 yrs work

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At $20/hr = $500,000 of labor/barrel

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Oil at $110/barrel = 6 cents/kWh, or 500
times cheaper than human labor.
Agenda
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Background and Key Concepts
AZ's Electricity Mix
The AZ Corporation Commission (ACC)
What does electricity "cost“?
Coal and Natural Gas in AZ
Huge Jobs Potential -- and Possible Threats-- to AZ’s
Clean Energy Future
Regional Clean Energy: Integrating Large Amounts of
Distributed and/or Clean Energy
The ACC and the public sector
What Is AZ’s Electricity Mix?
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Total in-state generation: ~27,000 MW (27GW)
Total in-state consumption: ~16,000 MW
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40-50% coal
~30% natural gas
~22% nuclear
~4% hydro

AZ: less than 2% of electricity
used in-state is solar
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Total in-state solar: 1,300-2,000 MW
However, ~50% of the output is sold to California
AZ: Electricity by Source 2012

Lots of coal electricity!

Solar electricity generation: not enough!
AZ: Only 1-2% of Non-hydro Generation
is Renewable in 2011

17 states were
less than 1% RE in
2001, including AZ

Only 4 states
less than 1% RE
in 2011,
including AZ!
http://www.eia.gov/todayinenergy/detail.cfm?id=5750
Includes
GHGs
from
exported
power.

Arizona Republic, CO2 Pollution Soars in Ariz., new study says, Shaun McKinnon,
11/13/09; http://www.azcentral.com/arizonarepublic/news/articles/2009/11/13/20091113air-carbon1113.html
Agenda
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Background and Key Concepts
AZ's Electricity Mix
The AZ Corporation Commission (ACC)
What does electricity "cost“?
Coal and Natural Gas in AZ
Huge Jobs Potential -- and Possible Threats-- to AZ’s
Clean Energy Future
Regional Clean Energy: Integrating Large Amounts of
Distributed and/or Clean Energy
The ACC and the public sector
AZ Corporation Commission (ACC)
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One of 7 states with a constitutional Comm’n
One of 13 states with an elected Comm’n
The ACC has absolute authority over energy policy
Most states: Governor appoints Utilities
Commissioners
In my experience, nearly every other state has more
transparency, and easier access to information.
Complex process, need a lawyer or a lot of time,
energy and guts to participate meaningfully.
Key: it’s all about underlying assumptions such as
fuel costs, discount rates, cost of capital, value of
‘externalities.’
Agenda
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Background and Key Concepts
AZ's Electricity Mix
The AZ Corporation Commission (ACC)
What does electricity "cost“?
Coal and Natural Gas in AZ
Huge Jobs Potential -- and Possible Threats-- to AZ’s
Clean Energy Future
Regional Clean Energy: Integrating Large Amounts of
Distributed and/or Clean Energy
The ACC and the public sector
$ = Financing Costs

G
A
S
F
U
E
L

C
O
A
L

$
$
$

$
$
$

$
$
$

NUCLEAR FUEL

Fuel Costs

Source: Energy Darwinism, Citi GPS: Global Perspectives &
Solutions, October 2013
Lazard’s Levelized Cost of Energy Analysis 2012, Subsidized v Unsubsidized
Adding Up The Costs of ALL Coal Regulations
Would Triple the Cost of Coal Power....
But see next slide…

http://www.raponline.org/event/the-importance-of-effective-energy-efficiency-cost-effectiveness
0

APS’ RW Beck Study on the Value
Of Distributed Energy
Operating Impacts and Valuation study

RW Beck
study says
the value of
distributed
solar is 7.9
to 14.11
cents/kWh
in avoided
costs for
fuel, transmission,
line losses,
etc.
Why Do the Costs of Electricity Vary
So Much?
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Different “capacity factor” for each type of
plant: solar generates electricity during the
day, natural gas has high and volatile fuel
costs, coal compliance costs are increasing.
How much are fuel costs increasing/yr?
How much will nuclear decommissioning?
How much will the cost of solar, wind and
other clean energy solutions decrease?
What about water supplies?
Two-thirds of Energy From Coal Plants Lost as
Heat; Natural Gas Combined Cycle More Efficient
Waste

Generation
and
distribution

Waste

Inefficient gas
appliances

Waste
Inefficient
electric
appliances

Fuel for
electricity

Natural
gas

Power,
light,
and
usable
heat

Source: A Micro-Grid with PV, Fuel Cells, and Energy Efficiency, Tom Hoff, Clean Power Research.com
02458605

National Renewable Energy Laboratory

Innovation for Our Energy Future
AZ Imports 90% of Fossil Fuels
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Imports all natural gas; $1.5 to 2.5 billion/year on
natural gas for electricity and heating
Imports 66% of coal; coal imports $500 million/year;
total coal costs $900 million/year
AZ TOTAL electricity fuel costs/year:

$2.5 - 3 billion


Retail electricity costs in AZ 2010:

$7 billion
http://www.eia.gov/state/seds/data.cfm?incfile=/state/
seds/sep_sum/html/rank_pr_cl_es.html&sid=AL
Agenda
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Background and Key Concepts
AZ's Electricity Mix
The AZ Corporation Commission (ACC)
What does electricity "cost“?
Coal and Natural Gas in AZ
Huge Jobs Potential -- and Possible Threats-- to AZ’s
Clean Energy Future
Regional Clean Energy: Integrating Large Amounts of
Distributed and/or Clean Energy
The ACC and the public sector
ARIZONA AVERAGE COAL COSTS
2004-2011

The average cost
of coal in AZ is up

8%/year from 2004-2011
Coal By The Numbers
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U.S. utilities purchase ~$40 BN/yr coal
$40 BN coal = $160 BN coal-fired
electricity
$160 BN/yr in coal-fired electricity = $187
BN/yr in health damages alone, plus
$530BN/yr total damages for life-cycle of
coal per Harvard School of Public Health
Study

•http://thinkprogress.org/climate/2011/02/16/207534/life-cycle-study-coal-harvard-epstein-health/
Coal’s Externalities / True Costs
Coal-fired power plants produce 50% of U.S. electricity.
Coal costs the U.S. $500B annually over its life cycle
(extraction, transport, processing, and combustion)
•$74B in public health burdens in Appalachian communities
•$187.5B from health costs of cancer, lung disease, and
respiratory sickness in other parts of the U.S.
•$29.3B from mercury impacts
•$205B from carbon emissions’ climate impacts on land use,
energy consumption, and food prices
•$18B from the costs of cleaning up spills of toxic waste,
the impact of coal on crops, property values, and tourism

Externalities would raise costs of electricity from coal-fired
plants, from $0.10 / kWh to $0.28 / kWh, shifting it from one of
the cheapest sources of electricity to one of the most expensive.
Dr. Paul Epstein, Harvard study, Feb. 2011
“Full Cost Accounting for the Life Cycle of Coal”,
Cost of Natural Gas More Volatile Since 2000

Hurricane Katrina
Oil at $147/barrell

NYMEX
Cost
Of
Natural
Gas
11/13/13:
$3.61
Coal, Electric Utilities Spend Heavily on
Lobbying

http://www.motherjones.com/environment/2012/04/beyond-coal-plant-activism?page=
Health Effects from Burning Fossil Fuels
are Enormous
Health Benefits = 30x Cost of Clean
Air Emissions Controls
Benefits
Costs
http://www.epa.gov/air/sect812/feb11/graphicsstack.pdf
$72.5 billion
for Fossil
Fuels
$12.2
billion for
Wind and
Solar
Total 10-year spending: $645 million
AZ Renewable Energy Standard
(RES) is 15% by 2025
AZ’s RES means that 15%
of the kilowatt-hours
generated by regulated
utilities come from ‘clean
energy’: solar, wind,
biomass, solar hot water,
concentrating solar etc.
by 2025…
AZ’s RES is far lower than
Colorado (30% by 2020),
California (33% by 2020),
Nevada (25% by 2025)
New Mexico (20% by 2020)

Year

Requirement

2008

1.75 %

2011

3.00 %

2014

4.50 %

2017

7.00 %

2020

10.00 %

2024

14.00 %

After 2024

15.00 %
Renewable Portfolio Standards
RPS Policies

www.dsireusa.org / February 2012
WA: 15% x 2020*

MN: 25% x 2025

MT: 15% x 2015
OR : 25% x 2025

(Xcel: 30% x 2020)

SD: 10% x 2015 WI : Varies by utility;

CO: 30% by 2020

(IOUs)

10% by 2020 (co-ops & large munis)*

UT: 20% by 2025*

MA: 22.1% x 2020
New RE : 15% x 2020
(+1% annually thereafter)

~10% x
IA: 105 2015 statewide

RI: 16% x 2020

NY: 29% x 2015

CT: 27% x 2020

OH : 25% x 2025 †

PA: ~ 18% x 2021 †

MW

IL: 25% x 2025
CA: 33% x 2020

NH: 23.8% x 2025

x 2015*

5% - 10% x 2025 (smaller utilities)

NV : 25% x 2025*

New RE: 10% x 2017

MI: 10% & 1,100 MW

ND: 10% x 2015

(large utiliti es )*

ME: 30% x 2000

VT: (1) RE meets any increase
in retail sales x 2012;
(2) 20% RE & CHP x 2017

KS: 20% x 2020

IN: 15% x 2025†

WV: 25% x 2025*†
VA: 15% x 2025*

NJ: 20.38% RE x 2021
+ 5,316 GWh solar x
2026
MD: 20% x 2022

M O: 15% x 2021

AZ: 15% x 2025

OK: 15% x 2015

NM: 20% x 2020 (IOUs)

NC : 12.5% x 2021

(IOUs)
10% x 2018 (co-ops & munis)

10% x 2020 (co-ops)

TX: 5,880 MW x
HI: 40% x 2030

Solar water heating eligible

DC

DC: 20% x 2020
PR: 20% x 2035

2015

29 states ++
29 states

Renewable portfolio standard
Renewable portfolio goal

DE: 25% x 2026*

*
†

Minimum solar or customer-sited requirement
Extra credit for solar or customer-sited renewables
Includes non-renewable alternative resources

DC and PR
DC and PR
have an RPS
have an RPS

(8 states have goals)
(8 states have goals)
24 States Generate More Clean Electricity
Than AZ!
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Why?
Because the U.S. has nearly 6 times more wind
than solar – 60 GW wind v. 10 GW solar PV and
CSP or Concentrating Solar Power).
In most other states, solar is far more expensive
than in AZ because they don’t generate as much
electricity per installed watt of solar.
See www.dsireusa.org/library by Justin Barnes,
3/6/12, RPS Update at Renewable Energy Markets
Association webinar.
Solar in New Jersey v. Arizona
New Jersey
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1,119 MW of solar energy currently installed
2012: $1.3 billion invested
Average installed price down 27% from last year.

Arizona
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1,250 MW of solar currently installed
2012: $590 million invested
Average installed price down 1% from last year.

Why?
 NJ PUC committed to solar, Hurricane Sandy driving more clean
energy, higher rebates even though AZ solar generates
electricity 20-23% of hours/year v. NJ 15% of hours/year.

http://www.seia.org/policy/state-solar-policy
AZ’s Commercial Sector
Small Relative to CA and NJ
Total Installed Solar Power Per Million
People Low In the U.S. Relative to
Germany, Spain, Czech Republic –
even Canada!
Worldwide Solar Installations 2011
Germany has 15x
more solar per person
than the U.S.!

Saa
http://cleantechnica.com/2012/12/11/renewable-energy-big-pic-including-34-charts-graphs/
Installed Cost of Solar PV Lower in
Germany Than the U.S.
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German installed cost of solar $1.34/watt
U.S. installed cost of solar $2.00-$5.00/watt.
$EU10.9 billion: cost of Feed-in-Tariff
$EU7.1 billion: savings on fossil imports
$EU4.6 billion: peak savings from renewables

Source: Solar Power Begins to Shine as Environmental Benefits Pay Off,
by Diana S. Powers, 11/11/13, New York Times
http://www.circleofblue.org/waternews/
2013/world/since-1900-the-u-s-haslost-enough-groundwater-to-fill-lakeerie-twice/
http://www.snl.com/InteractiveX
/Article.aspx?cdid=A25354226-13358
http://www.businessspectator.com.au/article/2013/11/25/policy-politics/newspaperembraces-lomborg-while-dumping-climate-reporter?
utm_source=exact&utm_medium=email&utm_content=527549&utm_campaign=cs_daily
&modapt=
Power Plants Accounted for 72 Percent
Of Greenhouse Gases Reported in 2010

Source: Bloomberg BNA: Power Plants Accounted for 72 Percent Of
Greenhouse Gases Reported in 2010 http://www.bna.com/powerplants-accounted-n12884907225/ Thursday, January 12, 2012
http://news.nationalgeographic.com/news/2013/08/1308

Colorado River
1999

National Geographic
8/16/13
Feds Slash Colorado River
Release to Historic Lows
Colorado River
2013
http://cdn.photo.lasvegassun.com/media/img/photos/2013/09/18/Waterlevels_web__.jpg
CO River, Hoover Dam, Lake Mead:
Water and Power Lifeline for 30 Million


Lake Mead levels at ~45%

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In 2010, was at 1,084 feet, the lowest since 1956
Level will hit the lowest since the 1930’s when dam was built
Power generation is ~23% lower; power reduced by 5.7 MW for every 1 foot loss in the
lake level

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

Experts don’t know what will happen if water drops below 1,050





Power output reduced from 2,080 MW to 1,617 MW
Every 1 MW power loss = ~ 1,000 homes

Turbines could be damaged if not enough pressure so would be turned off.
“If Lake Mead were to drop to that level, it would be devastating,” Joseph Mulholland,
Executive Director of the AZ Power Authority, which markets Hoover power.

Climate change means less water and more evaporation.






Study by Tim Barnett and David Pierce predicts that by 2017 Lake Mead level will be
too low for power production; and by 2021 a 50% chance of going dry.
Hoover and Glen Canyon Dam on Lake Powell handle 80% of peak power regulation
in 5 Western states and parts of 2 others.
Electricity from Hoover Dam:



28.5% Metropolitan Water District of Southern California
23% Nevada, 18% AZ; remaining to Los Angeles and others.

Source: Low Water May Halt Hoover Dam’s Power, Brett Walton, Circle of Blue, 201
AZ Reservoirs: at 45.7% Capacity

http://climas.arizona.edu/swco/sep2013/arizona-reservoir-volumes
NM Reservoirs: at 16% Capacity

http://climas.arizona.edu/swco/sep2013/new-mexico-reservoir-volumes
Lake Mead: Minimum Depth for
Generating Power: 1065-1050 Feet


http://serc.carleton.edu/earth_analysis/image
_analysis/introduction/day_5_part_1.html
Water To Cool Power Plants = 50% of
U.S. Water Withdrawals








The U.S. Geological Survey (USGS) reports that
53% of all fresh surface water withdrawn for human
use in 2005 was used by power plants.
In 2009 the water footprint of U.S. electricity was
approximately 42 gallons per kilowatt hour (kWh)
produced.
Average U.S. household requires 39,829 gallons of
water for electricity; five times more than direct
residential water use.
13% of total electricity used to move, treat and heat
water.
Public Supply: 11%
Domestic: Less than 1%

Irrigation: 34%

Livestock, Mining and
Aquaculture:
Less than 1% each
Industrial: 5%

USGS:
Thermoelectric
Power 48-53%
of Total U.S.
Water
Withdrawals

Thermoelectric Power: 48%
http://pubs.usgs.gov/circ/2004/circ1268/htdocs/text-total.html
Source: Burning Our Rivers, The Water
Footprint of Electricity, by Wendy Wilson et al
April 2012
http://www.rivernetwork.org/sites/default/files/BurningOurRivers_0.pdf
s

C

Source: Western Resource Advocates
“The Energy-Water Nexus: A Case Study of the Arkansas River Basin” 2008

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Water Water Intensity of Electricity Generation
Intensity of Electricity Generation
Emerging
Technologies

1,500

Renewables

500
Agenda











Background and Key Concepts
AZ's Electricity Mix
The AZ Corporation Commission (ACC)
What does electricity "cost“?
Coal and Natural Gas in AZ
Huge Jobs Potential -- and Possible Threats-- to
AZ’s Clean Energy Future
Regional Clean Energy: Integrating Large Amounts of
Distributed and/or Clean Energy
The ACC and the public sector
Local v.
Out-of-State
Dollars
$73 of $100
spent
on locallyowned biz
stays local;
while only $43
stays if nonlocal.
AZ Solar Economic Potential:
6,000 -8,000 MW


6,000 – 8,000 MW x
$2.5 to 3 million/MW
= $15-18 BILLION



To put this in
perspective, AZ
spends $2-3
BILLION/year on
fuel



Solar would displace
fuel costs forever!



If fuel costs stayed at $3
billion/year, and solar costs
continued to fall, AZ could pay for
the build-out with 5 years of fuel
payments!

Source: http://thinkprogress.org/climate/2012/04/30/473744/three-charts-that-illustrate-why-solar-has-hit-a-true-tipping-point/
Cracks in the Current System


Germany: 59% renewable peak, grid fine. 10/30/13





Germany's RWE: “massive erosion of…prices caused
by solar PV” “may…threaten the company's survival.”




RWE's share price has lost one-third of its value over 3 years.

Coal replaces natgas when the cost is $3.504.00/MMBtu.




Solar/wind means less power from coal, nuclear; don’t “cycle.”
Solar steals peak demand, along with peak profits.

Natgas at $3.61 on 11/12/13.

Net Metering is a big battle in many states: Idaho,
Georgia, California, Texas and Colorado.



Idaho and Georgia PUC made pro-solar decisions.
AZ still in the balance, likely to add $20/month fee for solar.

Source: http://www.greentechmedia.com/articles/read/Germany-Hits-59-Renewable-Peak-Grid-Does-Not-Explode
Cracks in the Current System





Lots of talk about the utility “death spiral” and the need
for a new business model.
Utility profits based on volume rather than value.
Very high fixed costs for utilities:






Nuclear has high labor costs; coal has high compliance costs;
production costs rising.
As more people put on solar, less people to pay for coal.

Fukushima: Huge unresolved issue with spent fuel that
needs to be moved; very difficult and potentially
dangerous. 23 U.S. nuclear plants with same design.

http://www.renewableenergyworld.com/rea/news/article/2013/10/major-european-utility-set-fordramatic-transformation?cmpid=WNL-Friday-November1-2013
Cracks in the Current System




Solar is ‘stealing’ peak demand, which is
where utilities make the most profit
Once renewables are paid for, “almost zero”
operating cost.

Source: Citi GPS: Global Perspectives and Solutions, Energy Darwinism, October 2013, XXXX
What Are the Obstacles to More Clean
Energy in AZ?






Determine what is a solar kWh “worth”? 4 cents
(utilities) or 22 cents (solar)
Monopoly utilities “own” geographic territories, so
reduced competition.
AZ’s Renewable Energy Standard is very low.
Utilities currently lose money on clean energy and
energy efficiency, so have no financial incentive.
Economics of solar/wind different than coal, nuclear or
natural gas: clean energy costs are all up-front, while
fuel-related costs are ~70% of lifetime fossil plant costs.
What Are Possible Solutions?



Provide access to the Grid: Community Solar, who
owns?
Provide access to Capital








Utilities: rate-base (own) solar and get a higher
rate of return for clean electrons
Include Cost of Environmental/Health Externalities




Support PACE (Property Assessed Clean Energy)
Support Extension of Federal Section 1603 Cash-in-Lieuof-Tax-Benefit (30%)
Solar securitization happening

Pay now or pay later

Consider re-evaluating “avoided cost” for utilities



Doesn’t include value of water, health benefits
Doesn’t include time-value of solar
What Are Possible Solutions?











Increase the REST from 15% by 2025 to ?
Level the playing field for subsidies
Use Life-Cycle Analysis
When Modeling, Use a Range of
Costs/Risks/Discount Rates
Allow the use of Master Limited Partnerships for
clean energy – not just oil, gas and biofuels.
Increase Pilot Programs for Solar Hot Water,
Combined Heat and Power, Biodigesters etc.
Solar Hot Water is a HUGE unused resource.
Section 1603: $581 Million Worth of
Projects in Arizona To Date


Section 1603 is a cash grant in lieu of taking a 30% solar tax
investment tax credit.



Section 1603 expired on 12/31/11.



AZ has rec’d $581 million in Section 1603 projects, mostly
solar. http://www.treasury.gov/initiatives/recovery/Pages/1603.aspx



The Solar ITC (Investment Tax Credit) expires in 2016 and
should be extended.

http://www.pv-magazine.com/news/details/beitrag/us-congress-pulls-the-plug-on-section-1
Agenda











Background and Key Concepts
AZ's Electricity Mix
The AZ Corporation Commission (ACC)
What does electricity "cost“?
Coal and Natural Gas in AZ
Huge Jobs Potential -- and Possible Threats-- to AZ’s
Clean Energy Future
Regional Clean Energy: Integrating Large Amounts
of Distributed and/or Clean Energy
The ACC and the public sector
Regional Clean Energy: What Does It
Mean?




Lots of studies going on right now, very complex
issues in predicting what will happen if power is
shared regionally
April 2013 report on Energy Imbalance Market
(Western states) that sharing power regionally would
save $94-$294 million the first year.






Why? Because when utilities share power they need less
‘reserves’, i.e. backup power.
With more geographic diversity and in greater amounts,
solar and wind are more reliable.

Bottom line: sharing power can reduce a utility’s
need for more power plants; thus reduce profits.
http://www.westgov.org/PUCeim/meetings/2013sprg/briefing/present/m_milligan.pdf
The Solar “Duck” Graph

http://www.caiso.com/Documents/Apr5_2013InitialCommentsWorkshopIssuesR11-10-023.pdf
Agenda











Background and Key Concepts
AZ's Electricity Mix
The AZ Corporation Commission (ACC)
What does electricity "cost“?
Coal and Natural Gas in AZ
Huge Jobs Potential -- and Possible Threats-- to AZ’s
Clean Energy Future
Regional Clean Energy: Integrating Large Amounts of
Distributed and/or Clean Energy
The ACC and the public sector
The ACC and the Public Sector





Need more transparency, better website,
ability to track dockets more easily
Need more stakeholder processes
LOTS at stake!





Jobs
Water
Climate change
Cost of electricity
Wrap-Up







AZ in-state electricity: 2% solar, 50% coal
AZ sends $2.5-3 billion/year out of state for
coal/natural gas.
Net Metering debate: what is the 'value' of a
solar kWh?
Clean Energy needs:




Access to capital
Access to the grid
Stable, predictable policies
Thank You!




Please don’t hesitate to call or email me
I love these issues and am happy to explain
I believe in AZ’s clean energy future!
Nancy LaPlaca
Laplaca.nancy@gmail.com
480-359-8442
“The future’s so bright, I gotta wear shades.”
Timbuk 3

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Az's energy current and future-climas-nov 2013-v4-final

  • 1. Arizona’s Electricity Future Nancy LaPlaca LaPlaca & Associates laplaca.nancy@gmail.com 480-359-8442 November 14, 2013
  • 2. Who Am I?         ASU: Bachelor Fine Arts, J.D., College of Law 3.5 years as Policy Advisor to AZ Corporation Commissioner Paul Newman Staff co-chair for the Environment Committee at the National Association of Regulatory Commissioners 3 years as public interest intervener at Colorado Public Utilities Commission 5 years Congressional staff for AZ Representatives Morris K. Udall and Karan English 6 years (total) at AZ Court of Appeals, AZ Supreme Court, State Senate, Criminal Justice Commission Management and technology consulting Love to hike, swim, sing and play guitar and piano; read and listen to books.
  • 3. Agenda         Background and Key Concepts AZ's Electricity Mix The AZ Corporation Commission (ACC) What does electricity "cost“? Coal and Natural Gas in AZ Huge Jobs Potential -- and Possible Threats-- to AZ’s Clean Energy Future Regional Clean Energy: Integrating Large Amounts of Distributed and/or Clean Energy The ACC and the public sector
  • 4. Five Things To Remember 1. 2. 3. 4. 5. Net/Energy Available for Work” declining. AZ imports 90% of electricity fuels. No one knows what fuel will cost in the future, can rise quickly. Solar, wind have higher up-front but lower longterm costs, less risk. Electricity production: from large, central-station to distributed, closer to load; business models under growing stress. Damages from “externalities” such as water and air pollution, mortality, lost work days, childhood asthma are known; a range of costs could be included in the “cost” of electricity.
  • 5. Background: Key Concepts ENERGY v CAPACITY   Energy = kWh, MWh – usable energy Capacity Factor = output over time Why is this important? Because power plants have different capacity factors:      Nuclear: 93% Capacity Factor (CF) Coal: 80% CF Wind: 30-40% CF Solar: 20-23% CF (in AZ) Geothermal: 92% CF
  • 6. Energy, Electricity and “Net” Energy        Energy: liquid transportation fuels Electricity: coal, natural gas, nuclear, solar, wind, hydropower  Currently not much overlap, but will change as we “electrify” transportation with light rail, electric cars, etc. Net Energy = the energy left after using energy to drill, mine, transport, compress, combust, build, etc. Also called E-ROI (Energy Return on Investment) Energy costs are going to rise: Do we invest in renewables, with higher capital costs, or fossil fuel plants, with increasing fuel costs and high Operation and Maintenance? “Externalities” increasingly important: global warming, water scarcity; also enormous health effects from fossil fuels we’ve ignored for decades Environmental justice issues: local, U.S., global
  • 7. The easiest-to-get resources are extracted first. Example: deepwater v. onshore drilling for oil.
  • 8. Energy Slaves?  ~8 calories of oil embedded in every single calorie of food delivered  Renewable energy (solar, wind) not as dense, not ‘on demand,’ need storage.  We will likely electrify transportation  One Barrel Oil = 25,000 hrs human labor  25,000 hrs human labor = 12.5 yrs work  At $20/hr = $500,000 of labor/barrel  Oil at $110/barrel = 6 cents/kWh, or 500 times cheaper than human labor.
  • 9. Agenda         Background and Key Concepts AZ's Electricity Mix The AZ Corporation Commission (ACC) What does electricity "cost“? Coal and Natural Gas in AZ Huge Jobs Potential -- and Possible Threats-- to AZ’s Clean Energy Future Regional Clean Energy: Integrating Large Amounts of Distributed and/or Clean Energy The ACC and the public sector
  • 10. What Is AZ’s Electricity Mix?   Total in-state generation: ~27,000 MW (27GW) Total in-state consumption: ~16,000 MW      40-50% coal ~30% natural gas ~22% nuclear ~4% hydro AZ: less than 2% of electricity used in-state is solar   Total in-state solar: 1,300-2,000 MW However, ~50% of the output is sold to California
  • 11. AZ: Electricity by Source 2012 Lots of coal electricity! Solar electricity generation: not enough!
  • 12. AZ: Only 1-2% of Non-hydro Generation is Renewable in 2011 17 states were less than 1% RE in 2001, including AZ Only 4 states less than 1% RE in 2011, including AZ! http://www.eia.gov/todayinenergy/detail.cfm?id=5750
  • 13. Includes GHGs from exported power. Arizona Republic, CO2 Pollution Soars in Ariz., new study says, Shaun McKinnon, 11/13/09; http://www.azcentral.com/arizonarepublic/news/articles/2009/11/13/20091113air-carbon1113.html
  • 14. Agenda         Background and Key Concepts AZ's Electricity Mix The AZ Corporation Commission (ACC) What does electricity "cost“? Coal and Natural Gas in AZ Huge Jobs Potential -- and Possible Threats-- to AZ’s Clean Energy Future Regional Clean Energy: Integrating Large Amounts of Distributed and/or Clean Energy The ACC and the public sector
  • 15. AZ Corporation Commission (ACC)        One of 7 states with a constitutional Comm’n One of 13 states with an elected Comm’n The ACC has absolute authority over energy policy Most states: Governor appoints Utilities Commissioners In my experience, nearly every other state has more transparency, and easier access to information. Complex process, need a lawyer or a lot of time, energy and guts to participate meaningfully. Key: it’s all about underlying assumptions such as fuel costs, discount rates, cost of capital, value of ‘externalities.’
  • 16. Agenda         Background and Key Concepts AZ's Electricity Mix The AZ Corporation Commission (ACC) What does electricity "cost“? Coal and Natural Gas in AZ Huge Jobs Potential -- and Possible Threats-- to AZ’s Clean Energy Future Regional Clean Energy: Integrating Large Amounts of Distributed and/or Clean Energy The ACC and the public sector
  • 17. $ = Financing Costs G A S F U E L C O A L $ $ $ $ $ $ $ $ $ NUCLEAR FUEL Fuel Costs Source: Energy Darwinism, Citi GPS: Global Perspectives & Solutions, October 2013
  • 18. Lazard’s Levelized Cost of Energy Analysis 2012, Subsidized v Unsubsidized
  • 19. Adding Up The Costs of ALL Coal Regulations Would Triple the Cost of Coal Power.... But see next slide… http://www.raponline.org/event/the-importance-of-effective-energy-efficiency-cost-effectiveness
  • 20. 0 APS’ RW Beck Study on the Value Of Distributed Energy Operating Impacts and Valuation study RW Beck study says the value of distributed solar is 7.9 to 14.11 cents/kWh in avoided costs for fuel, transmission, line losses, etc.
  • 21. Why Do the Costs of Electricity Vary So Much?      Different “capacity factor” for each type of plant: solar generates electricity during the day, natural gas has high and volatile fuel costs, coal compliance costs are increasing. How much are fuel costs increasing/yr? How much will nuclear decommissioning? How much will the cost of solar, wind and other clean energy solutions decrease? What about water supplies?
  • 22. Two-thirds of Energy From Coal Plants Lost as Heat; Natural Gas Combined Cycle More Efficient Waste Generation and distribution Waste Inefficient gas appliances Waste Inefficient electric appliances Fuel for electricity Natural gas Power, light, and usable heat Source: A Micro-Grid with PV, Fuel Cells, and Energy Efficiency, Tom Hoff, Clean Power Research.com 02458605 National Renewable Energy Laboratory Innovation for Our Energy Future
  • 23. AZ Imports 90% of Fossil Fuels    Imports all natural gas; $1.5 to 2.5 billion/year on natural gas for electricity and heating Imports 66% of coal; coal imports $500 million/year; total coal costs $900 million/year AZ TOTAL electricity fuel costs/year: $2.5 - 3 billion  Retail electricity costs in AZ 2010: $7 billion http://www.eia.gov/state/seds/data.cfm?incfile=/state/ seds/sep_sum/html/rank_pr_cl_es.html&sid=AL
  • 24. Agenda         Background and Key Concepts AZ's Electricity Mix The AZ Corporation Commission (ACC) What does electricity "cost“? Coal and Natural Gas in AZ Huge Jobs Potential -- and Possible Threats-- to AZ’s Clean Energy Future Regional Clean Energy: Integrating Large Amounts of Distributed and/or Clean Energy The ACC and the public sector
  • 25. ARIZONA AVERAGE COAL COSTS 2004-2011 The average cost of coal in AZ is up 8%/year from 2004-2011
  • 26. Coal By The Numbers     U.S. utilities purchase ~$40 BN/yr coal $40 BN coal = $160 BN coal-fired electricity $160 BN/yr in coal-fired electricity = $187 BN/yr in health damages alone, plus $530BN/yr total damages for life-cycle of coal per Harvard School of Public Health Study •http://thinkprogress.org/climate/2011/02/16/207534/life-cycle-study-coal-harvard-epstein-health/
  • 27. Coal’s Externalities / True Costs Coal-fired power plants produce 50% of U.S. electricity. Coal costs the U.S. $500B annually over its life cycle (extraction, transport, processing, and combustion) •$74B in public health burdens in Appalachian communities •$187.5B from health costs of cancer, lung disease, and respiratory sickness in other parts of the U.S. •$29.3B from mercury impacts •$205B from carbon emissions’ climate impacts on land use, energy consumption, and food prices •$18B from the costs of cleaning up spills of toxic waste, the impact of coal on crops, property values, and tourism Externalities would raise costs of electricity from coal-fired plants, from $0.10 / kWh to $0.28 / kWh, shifting it from one of the cheapest sources of electricity to one of the most expensive. Dr. Paul Epstein, Harvard study, Feb. 2011 “Full Cost Accounting for the Life Cycle of Coal”,
  • 28. Cost of Natural Gas More Volatile Since 2000 Hurricane Katrina Oil at $147/barrell NYMEX Cost Of Natural Gas 11/13/13: $3.61
  • 29.
  • 30. Coal, Electric Utilities Spend Heavily on Lobbying http://www.motherjones.com/environment/2012/04/beyond-coal-plant-activism?page=
  • 31. Health Effects from Burning Fossil Fuels are Enormous
  • 32. Health Benefits = 30x Cost of Clean Air Emissions Controls Benefits Costs http://www.epa.gov/air/sect812/feb11/graphicsstack.pdf
  • 34. Total 10-year spending: $645 million
  • 35. AZ Renewable Energy Standard (RES) is 15% by 2025 AZ’s RES means that 15% of the kilowatt-hours generated by regulated utilities come from ‘clean energy’: solar, wind, biomass, solar hot water, concentrating solar etc. by 2025… AZ’s RES is far lower than Colorado (30% by 2020), California (33% by 2020), Nevada (25% by 2025) New Mexico (20% by 2020) Year Requirement 2008 1.75 % 2011 3.00 % 2014 4.50 % 2017 7.00 % 2020 10.00 % 2024 14.00 % After 2024 15.00 %
  • 36. Renewable Portfolio Standards RPS Policies www.dsireusa.org / February 2012 WA: 15% x 2020* MN: 25% x 2025 MT: 15% x 2015 OR : 25% x 2025 (Xcel: 30% x 2020) SD: 10% x 2015 WI : Varies by utility; CO: 30% by 2020 (IOUs) 10% by 2020 (co-ops & large munis)* UT: 20% by 2025* MA: 22.1% x 2020 New RE : 15% x 2020 (+1% annually thereafter) ~10% x IA: 105 2015 statewide RI: 16% x 2020 NY: 29% x 2015 CT: 27% x 2020 OH : 25% x 2025 † PA: ~ 18% x 2021 † MW IL: 25% x 2025 CA: 33% x 2020 NH: 23.8% x 2025 x 2015* 5% - 10% x 2025 (smaller utilities) NV : 25% x 2025* New RE: 10% x 2017 MI: 10% & 1,100 MW ND: 10% x 2015 (large utiliti es )* ME: 30% x 2000 VT: (1) RE meets any increase in retail sales x 2012; (2) 20% RE & CHP x 2017 KS: 20% x 2020 IN: 15% x 2025† WV: 25% x 2025*† VA: 15% x 2025* NJ: 20.38% RE x 2021 + 5,316 GWh solar x 2026 MD: 20% x 2022 M O: 15% x 2021 AZ: 15% x 2025 OK: 15% x 2015 NM: 20% x 2020 (IOUs) NC : 12.5% x 2021 (IOUs) 10% x 2018 (co-ops & munis) 10% x 2020 (co-ops) TX: 5,880 MW x HI: 40% x 2030 Solar water heating eligible DC DC: 20% x 2020 PR: 20% x 2035 2015 29 states ++ 29 states Renewable portfolio standard Renewable portfolio goal DE: 25% x 2026* * † Minimum solar or customer-sited requirement Extra credit for solar or customer-sited renewables Includes non-renewable alternative resources DC and PR DC and PR have an RPS have an RPS (8 states have goals) (8 states have goals)
  • 37. 24 States Generate More Clean Electricity Than AZ!     Why? Because the U.S. has nearly 6 times more wind than solar – 60 GW wind v. 10 GW solar PV and CSP or Concentrating Solar Power). In most other states, solar is far more expensive than in AZ because they don’t generate as much electricity per installed watt of solar. See www.dsireusa.org/library by Justin Barnes, 3/6/12, RPS Update at Renewable Energy Markets Association webinar.
  • 38. Solar in New Jersey v. Arizona New Jersey    1,119 MW of solar energy currently installed 2012: $1.3 billion invested Average installed price down 27% from last year. Arizona    1,250 MW of solar currently installed 2012: $590 million invested Average installed price down 1% from last year. Why?  NJ PUC committed to solar, Hurricane Sandy driving more clean energy, higher rebates even though AZ solar generates electricity 20-23% of hours/year v. NJ 15% of hours/year. http://www.seia.org/policy/state-solar-policy
  • 39. AZ’s Commercial Sector Small Relative to CA and NJ
  • 40. Total Installed Solar Power Per Million People Low In the U.S. Relative to Germany, Spain, Czech Republic – even Canada!
  • 41. Worldwide Solar Installations 2011 Germany has 15x more solar per person than the U.S.! Saa http://cleantechnica.com/2012/12/11/renewable-energy-big-pic-including-34-charts-graphs/
  • 42. Installed Cost of Solar PV Lower in Germany Than the U.S.      German installed cost of solar $1.34/watt U.S. installed cost of solar $2.00-$5.00/watt. $EU10.9 billion: cost of Feed-in-Tariff $EU7.1 billion: savings on fossil imports $EU4.6 billion: peak savings from renewables Source: Solar Power Begins to Shine as Environmental Benefits Pay Off, by Diana S. Powers, 11/11/13, New York Times
  • 46. Power Plants Accounted for 72 Percent Of Greenhouse Gases Reported in 2010 Source: Bloomberg BNA: Power Plants Accounted for 72 Percent Of Greenhouse Gases Reported in 2010 http://www.bna.com/powerplants-accounted-n12884907225/ Thursday, January 12, 2012
  • 50. CO River, Hoover Dam, Lake Mead: Water and Power Lifeline for 30 Million  Lake Mead levels at ~45%    In 2010, was at 1,084 feet, the lowest since 1956 Level will hit the lowest since the 1930’s when dam was built Power generation is ~23% lower; power reduced by 5.7 MW for every 1 foot loss in the lake level    Experts don’t know what will happen if water drops below 1,050    Power output reduced from 2,080 MW to 1,617 MW Every 1 MW power loss = ~ 1,000 homes Turbines could be damaged if not enough pressure so would be turned off. “If Lake Mead were to drop to that level, it would be devastating,” Joseph Mulholland, Executive Director of the AZ Power Authority, which markets Hoover power. Climate change means less water and more evaporation.    Study by Tim Barnett and David Pierce predicts that by 2017 Lake Mead level will be too low for power production; and by 2021 a 50% chance of going dry. Hoover and Glen Canyon Dam on Lake Powell handle 80% of peak power regulation in 5 Western states and parts of 2 others. Electricity from Hoover Dam:   28.5% Metropolitan Water District of Southern California 23% Nevada, 18% AZ; remaining to Los Angeles and others. Source: Low Water May Halt Hoover Dam’s Power, Brett Walton, Circle of Blue, 201
  • 51. AZ Reservoirs: at 45.7% Capacity http://climas.arizona.edu/swco/sep2013/arizona-reservoir-volumes
  • 52. NM Reservoirs: at 16% Capacity http://climas.arizona.edu/swco/sep2013/new-mexico-reservoir-volumes
  • 53. Lake Mead: Minimum Depth for Generating Power: 1065-1050 Feet  http://serc.carleton.edu/earth_analysis/image _analysis/introduction/day_5_part_1.html
  • 54. Water To Cool Power Plants = 50% of U.S. Water Withdrawals     The U.S. Geological Survey (USGS) reports that 53% of all fresh surface water withdrawn for human use in 2005 was used by power plants. In 2009 the water footprint of U.S. electricity was approximately 42 gallons per kilowatt hour (kWh) produced. Average U.S. household requires 39,829 gallons of water for electricity; five times more than direct residential water use. 13% of total electricity used to move, treat and heat water.
  • 55. Public Supply: 11% Domestic: Less than 1% Irrigation: 34% Livestock, Mining and Aquaculture: Less than 1% each Industrial: 5% USGS: Thermoelectric Power 48-53% of Total U.S. Water Withdrawals Thermoelectric Power: 48% http://pubs.usgs.gov/circ/2004/circ1268/htdocs/text-total.html
  • 56. Source: Burning Our Rivers, The Water Footprint of Electricity, by Wendy Wilson et al April 2012 http://www.rivernetwork.org/sites/default/files/BurningOurRivers_0.pdf
  • 57. s C Source: Western Resource Advocates “The Energy-Water Nexus: A Case Study of the Arkansas River Basin” 2008 S g 0 , Conventional Generation g 2,000 ola Bio -bas stea m ma ed Sor P c pla s s st lar V Im ool , e e PV nt co proved Ge steam W ,w ole dGB oth am in pp d e i d Wi eooma erm lanlan t c nd th ss a t, w t, woo Ge e s l, led t b co oth rma eaim et et Ge olinGeerm l, b narpla coo y n l co otheg oth al,inbi , dr t, weed arn olin rm er y t al, ma y,ary, co g hy d o Ge bin l, b airy brid ry ling co o t h e na, olin rm ryhyb coo al, g , bin we rid ling ary t c , w oo et l i n 1,000 Co Co C, w ca al, IGal, P it h Coa ptu l re CCCww carb Co, I G , Co N G itith o al C c ca al, P CC h c aIrGnCa , C a b cC ptu C , wwt rbo onptur re i ih NG th c n e CC a ca rb ca ca rb o p ptu , w re ith on n ture ca c So rbo ap la n tur rC e SoS SP or co lalarC , we Im oi SP t pr Song CSP , wco ov ed co lar C , dr eoling t Bi olin SP y bi om om , d co g ryoli a s as s n Co, s te ste al, am aN m Oi uc l/g Nle Co c m O as uarle Ga bu il/g, s ar s, t Tu s Co ste ti asea rbi , ne mC uaon t m b mu s om tio rb Ga n i cyc s, C bine ne Co le o m b d c al in e y c ,I d le G Co al gal/MWh Water Water Intensity of Electricity Generation Intensity of Electricity Generation Emerging Technologies 1,500 Renewables 500
  • 58. Agenda         Background and Key Concepts AZ's Electricity Mix The AZ Corporation Commission (ACC) What does electricity "cost“? Coal and Natural Gas in AZ Huge Jobs Potential -- and Possible Threats-- to AZ’s Clean Energy Future Regional Clean Energy: Integrating Large Amounts of Distributed and/or Clean Energy The ACC and the public sector
  • 59. Local v. Out-of-State Dollars $73 of $100 spent on locallyowned biz stays local; while only $43 stays if nonlocal.
  • 60. AZ Solar Economic Potential: 6,000 -8,000 MW  6,000 – 8,000 MW x $2.5 to 3 million/MW = $15-18 BILLION  To put this in perspective, AZ spends $2-3 BILLION/year on fuel  Solar would displace fuel costs forever!  If fuel costs stayed at $3 billion/year, and solar costs continued to fall, AZ could pay for the build-out with 5 years of fuel payments! Source: http://thinkprogress.org/climate/2012/04/30/473744/three-charts-that-illustrate-why-solar-has-hit-a-true-tipping-point/
  • 61. Cracks in the Current System  Germany: 59% renewable peak, grid fine. 10/30/13    Germany's RWE: “massive erosion of…prices caused by solar PV” “may…threaten the company's survival.”   RWE's share price has lost one-third of its value over 3 years. Coal replaces natgas when the cost is $3.504.00/MMBtu.   Solar/wind means less power from coal, nuclear; don’t “cycle.” Solar steals peak demand, along with peak profits. Natgas at $3.61 on 11/12/13. Net Metering is a big battle in many states: Idaho, Georgia, California, Texas and Colorado.   Idaho and Georgia PUC made pro-solar decisions. AZ still in the balance, likely to add $20/month fee for solar. Source: http://www.greentechmedia.com/articles/read/Germany-Hits-59-Renewable-Peak-Grid-Does-Not-Explode
  • 62. Cracks in the Current System    Lots of talk about the utility “death spiral” and the need for a new business model. Utility profits based on volume rather than value. Very high fixed costs for utilities:    Nuclear has high labor costs; coal has high compliance costs; production costs rising. As more people put on solar, less people to pay for coal. Fukushima: Huge unresolved issue with spent fuel that needs to be moved; very difficult and potentially dangerous. 23 U.S. nuclear plants with same design. http://www.renewableenergyworld.com/rea/news/article/2013/10/major-european-utility-set-fordramatic-transformation?cmpid=WNL-Friday-November1-2013
  • 63. Cracks in the Current System   Solar is ‘stealing’ peak demand, which is where utilities make the most profit Once renewables are paid for, “almost zero” operating cost. Source: Citi GPS: Global Perspectives and Solutions, Energy Darwinism, October 2013, XXXX
  • 64.
  • 65. What Are the Obstacles to More Clean Energy in AZ?      Determine what is a solar kWh “worth”? 4 cents (utilities) or 22 cents (solar) Monopoly utilities “own” geographic territories, so reduced competition. AZ’s Renewable Energy Standard is very low. Utilities currently lose money on clean energy and energy efficiency, so have no financial incentive. Economics of solar/wind different than coal, nuclear or natural gas: clean energy costs are all up-front, while fuel-related costs are ~70% of lifetime fossil plant costs.
  • 66. What Are Possible Solutions?   Provide access to the Grid: Community Solar, who owns? Provide access to Capital      Utilities: rate-base (own) solar and get a higher rate of return for clean electrons Include Cost of Environmental/Health Externalities   Support PACE (Property Assessed Clean Energy) Support Extension of Federal Section 1603 Cash-in-Lieuof-Tax-Benefit (30%) Solar securitization happening Pay now or pay later Consider re-evaluating “avoided cost” for utilities   Doesn’t include value of water, health benefits Doesn’t include time-value of solar
  • 67. What Are Possible Solutions?        Increase the REST from 15% by 2025 to ? Level the playing field for subsidies Use Life-Cycle Analysis When Modeling, Use a Range of Costs/Risks/Discount Rates Allow the use of Master Limited Partnerships for clean energy – not just oil, gas and biofuels. Increase Pilot Programs for Solar Hot Water, Combined Heat and Power, Biodigesters etc. Solar Hot Water is a HUGE unused resource.
  • 68. Section 1603: $581 Million Worth of Projects in Arizona To Date  Section 1603 is a cash grant in lieu of taking a 30% solar tax investment tax credit.  Section 1603 expired on 12/31/11.  AZ has rec’d $581 million in Section 1603 projects, mostly solar. http://www.treasury.gov/initiatives/recovery/Pages/1603.aspx  The Solar ITC (Investment Tax Credit) expires in 2016 and should be extended. http://www.pv-magazine.com/news/details/beitrag/us-congress-pulls-the-plug-on-section-1
  • 69. Agenda         Background and Key Concepts AZ's Electricity Mix The AZ Corporation Commission (ACC) What does electricity "cost“? Coal and Natural Gas in AZ Huge Jobs Potential -- and Possible Threats-- to AZ’s Clean Energy Future Regional Clean Energy: Integrating Large Amounts of Distributed and/or Clean Energy The ACC and the public sector
  • 70. Regional Clean Energy: What Does It Mean?   Lots of studies going on right now, very complex issues in predicting what will happen if power is shared regionally April 2013 report on Energy Imbalance Market (Western states) that sharing power regionally would save $94-$294 million the first year.    Why? Because when utilities share power they need less ‘reserves’, i.e. backup power. With more geographic diversity and in greater amounts, solar and wind are more reliable. Bottom line: sharing power can reduce a utility’s need for more power plants; thus reduce profits. http://www.westgov.org/PUCeim/meetings/2013sprg/briefing/present/m_milligan.pdf
  • 71. The Solar “Duck” Graph http://www.caiso.com/Documents/Apr5_2013InitialCommentsWorkshopIssuesR11-10-023.pdf
  • 72. Agenda         Background and Key Concepts AZ's Electricity Mix The AZ Corporation Commission (ACC) What does electricity "cost“? Coal and Natural Gas in AZ Huge Jobs Potential -- and Possible Threats-- to AZ’s Clean Energy Future Regional Clean Energy: Integrating Large Amounts of Distributed and/or Clean Energy The ACC and the public sector
  • 73. The ACC and the Public Sector    Need more transparency, better website, ability to track dockets more easily Need more stakeholder processes LOTS at stake!     Jobs Water Climate change Cost of electricity
  • 74. Wrap-Up     AZ in-state electricity: 2% solar, 50% coal AZ sends $2.5-3 billion/year out of state for coal/natural gas. Net Metering debate: what is the 'value' of a solar kWh? Clean Energy needs:    Access to capital Access to the grid Stable, predictable policies
  • 75. Thank You!    Please don’t hesitate to call or email me I love these issues and am happy to explain I believe in AZ’s clean energy future! Nancy LaPlaca Laplaca.nancy@gmail.com 480-359-8442 “The future’s so bright, I gotta wear shades.” Timbuk 3

Hinweis der Redaktion

  1. Large base load generating plants are only about 33-40% efficient. Almost 2/3 of the energy inputs are thrown off as waste, due to the technology itself. Add to that the energy required to DELIVER electricity from point of generation to point of use – line losses – and you can see that our increasingly electrified economy generates a lot of waste.