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Clean Energy Opportunities for Clean Energy Opportunities for Environmental OfficialsEnvironmental Officials

Steve Dunn, Policy Analyst

Clean Energy-Environment State Partnership

State-EPA Symposium on Environmental Innovation and Results       

January 24, 2006

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OverviewOverview

Clean energy as a resource EPA’s Clean Energy-Environment Guide to

Action Opportunities for Environmental Officials

State and Regional Energy Planning Air Quality Planning Enforcement and Permitting Quantification, tracking and reporting

Resources for More Information Web sites Staff contacts

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What is Clean Energy?What is Clean Energy?

Clean Energy provides a clean, low-cost, reliable way to meet energy demand and reduce peak electricity system loads.

• Energy efficiency

• Renewable energy

• Clean distributed generation / combined heat and power (CHP)

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Clean Energy as a Resource: Clean Energy as a Resource: Opportunities for StatesOpportunities for States Clean energy offers multiple benefits:

Reduced air emissions Multimedia benefits (e.g. water, waste) Economic benefits (reduces energy costs,

create jobs) Strong interest from some states to better

integrate clean energy into energy and air quality planning (TX, MD, NJ, GA)

A key component of a number of state innovations, including air quality programs (GA, MA, MD, NJ,

NY, TX) sustainability initiatives (IL, PA, WA), climate action plans (CT, CA, NJ, NM)

U.S. Average Electricity Generation Emission Rates

(Year 2000)

0500

1,0001,5002,0002,500

COAL OIL GAS

CO

2 (l

b/M

Wh)

0

5

10

15

COAL OIL GAS

SO

2 (l

b/M

Wh)

0123456

COAL OIL GAS

NO

x (l

b/M

Wh)

Source: E-GRID (US EPA)

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EPA Clean Energy-Environment EPA Clean Energy-Environment Guide to ActionGuide to Action The Clean Energy-Environment Guide to Action

describes 16 cost-effective clean energy policies that states have successfully implemented Builds on established state models and experiences in

designing, implementing, and evaluating clean energy programs.

includes specific action steps, best practices and lessons learned

Designed to help states develop new clean energy programs or enhance existing ones

Designed for use by state energy and environmental policymakers. Identifies action steps for air and energy officials and

utility regulators Describes role of state legislatures, executive branch

and other state agencies Includes numerous state examples and federal, state

and nonprofit resources Available soon (February 2006) on EPA’sClean

Energy Web site• http://www.epa.gov/cleanenergy/stateandlocal/

NEWREPORT

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Policy Description: Lead By ExamplePolicy Description: Lead By Example

Describes how states design and implement lead by example programs, including: Comprehensive state programs (NY, CA) Energy savings targets for existing buildings (NH, NY) and

performance standards for new buildings (OR, MA) Green power purchasing targets (CA, MA, NJ, NY) Performance contracting for state facilities (CO, TX) Purchasing ENERGY STAR products (NH, NY) Financing programs (IA, OR, TX)

Each policy description in the Guide to Action includes: A concise summary and description of objectives and benefits Details on design, implementation and evaluation issues, and best

practices Description of state agencies and stakeholders involved Information on related federal and state programs and policies State examples Action steps for states Resources for more information

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Clean Energy-Environment Guide to ActionClean Energy-Environment Guide to Action: : Opportunities for Environmental Officials Opportunities for Environmental Officials

State and regional energy planning Air quality programs and planning

• SIPs• Cap-and-trade programs• Enforcement settlements • Permitting

Quantifying, tracking and reporting emissions Multiple purposes and applications

• e.g., air quality planning, program evaluation, cost-benefit analyses, documenting and reporting environmental benefits

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State and Regional Energy PlanningState and Regional Energy Planning

A strategic effort to develop energy-related goals and objectives and formulate related policies and programs. Lays the ‘groundwork’ for achieving a broad set of

energy, economic, and environmental policy goals. Provides means for incorporating clean energy as a

cost-effective resource option States energy and environmental officials can

work together to incorporate clean energy within state and regional energy plans

For more information See Section 3.2 of the Guide to Action, State and Regional

Energy Planning

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Clean Energy Opportunities Clean Energy Opportunities Air Quality Planning: SIPs Air Quality Planning: SIPs States are incorporating clean energy into air quality planning

As part of emission baseline/projections, or As an emission reduction measure

EPA provides guidance to states Guidance on SIP Credits from Energy Efficiency and

Renewable Energy Measures (August 2004)• Flexible framework for quantifying AQ benefits

State examples: Dallas-Fort Worth, Texas; Montgomery County, Maryland;

Shreveport, Louisiana Other states are performing ground work for SIP credit

For more information, see Section 3.3 (Determining the Air Quality Benefits of Clean Energy) of the Guide to Action

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Clean Energy Opportunities Clean Energy Opportunities Air Quality Planning: Cap-and-TradeAir Quality Planning: Cap-and-Trade Set asides for EE/RE under cap and trade programs

States can distribute allowances to clean energy under the NOx trading program and CAIR in two ways:

• As a set-aside for energy efficiency and renewables• As a direct allocation

Allocating allowances to EE/RE can provide incentives and reduce compliance costs by displacing polluting generators

State examples Massachusetts, Indiana, New Jersey, New York, Ohio

EPA Tools to help Guidance for establishing set-aside Report on state NOx set-aside programs

Model rule under CAIRFor more information, see Sections 3.3 (Determining the Air Quality

Benefits of Clean Energy) and 3.4 (Funding and Incentives) of the Guide to Action

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More Clean Energy Opportunities: More Clean Energy Opportunities: Enforcement and PermittingEnforcement and Permitting Enforcement: Supplemental Environmental Projects

(SEPs) An environmentally beneficial project that is a voluntary part

of an enforcement settlement EPA’s SEP Toolkit provides practical information, guidance,

and resources for states to pursue EE/RE through SEPs

Permitting: Output-based environmental regulations Promotes efficient production of energy by relating

emissions to the output of energy State examples: Connecticut, Indiana, Massachusetts,

Texas EPA provides assistance to air officials

• Output-based Regulations handbook • In-house expertise and technical assistance

For more information, see Sections 3.4, Funding and Incentives, and 5.3, Output Based Environmental Regulations, of the Guide to Action

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Emissions Quantification, Tracking Emissions Quantification, Tracking and Reportingand Reporting States are quantifying energy savings, emissions reductions from clean

energy for multiple purposes: Support energy planning Provide input to cost-benefit analyses Track and report progress toward state goals Communicate the environmental benefits of clean energy to

policymakers and stakeholders EPA provides Guidance, technical assistance and expertise to states

Provide peer exchange, communications, and tech. assistance• Technical forum on emissions quantification, M&V approaches

Working with Texas A&M’s Energy Systems Laboratory• Developing emissions quantification methods and tools (eCalc)

For more information: see Section 3.3 of the Guide to Action: Determining the Air Quality

Benefits of Clean Energy

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Quantification: Key IssuesQuantification: Key Issues

Identify purpose Level of rigor will vary depending on purpose (i.e., reporting

progress reporting versus a SIP submittal) Incorporating in a SIP

Determine what gets displaced, where, and how When do emission reductions occur?

• e.g., during the ozone season? The location of reductions matters

• emission reductions need to be reasonably applicable to the non-attainment area

Cap-and-trade areas must retire allowances or obtain through other means (e.g., set-

asides, voluntary agreement) to claim emissions reductions Measure and verify emission reductions

Verify the expected energy savings and emissions reductions actually occurred

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SummarySummary Clean energy provides many opportunities to meet

energy, environmental and economic goals States are developing innovative, integrated

approaches State Environmental Officials play an important role

Engaging in state and regional energy planning Incorporating clean energy as part of air quality

strategies Promoting clean energy through enforcement and

permitting activities Quantifying emissions reductions

EPA HQ and Regions are providing tools, guidance and technical assistance to states

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For More Information – Web sites For More Information – Web sites Clean Energy-Environment Guide to Action

(available early February 2006) http://www.epa.gov/cleanenergy/stateandlocal/

EPA Guidance Documents Incorporating EE/RE in SIPs

• http://www.epa.gov/cleanenergy/stateandlocal/guidance.htm andhttp://www.epa.gov/ttn/airinnovations/

Cap-and-trade / set-aside programs• Guidance:

http://www.epa.gov/cleanenergy/pdf/ee-re_set-asides_vol1.pdf• Survey of state set-aside programs:

http://www.epa.gov/cleanenergy/pdf/eere_rpt.pdf

Supplemental Environmental Projects SEP Toolkit

• http://www.epa.gov/cleanenergy/pdf/sep_toolkit.pdf

Output-Based Environmental Regulations Handbook for Air Regulators and fact sheet

• http://www.epa.gov/chp/state_resources/output_based_reg.htm

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Additional Web sitesAdditional Web sites

EPA Air Innovations Web site• http://www.cleanairinfo.com/airinnovations2005/

EPA Clean Energy Technical Forum Materials Quantification, M&V; NOx set-asides

• http://www.keystone.org/html/documents.html

Energy Systems Lab, Texas A&M, College Station • Emissions calculator (eCalc): http://ecalc.tamu.edu/

DOE Technical Assistance Program (TAP)• http://www.eere.energy.gov/wip/informationresources/

Tap.htmlSIPs

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EPA Staff ContactsEPA Staff Contacts

Clean Energy-Environment Guide to Action Steve Dunn dunn.stevev@epa.gov

Quantification, SIPs: Art Diem – diem.art@epa.gov David Solomon, OAQPS solomon.david@epa.gov Jim Yarbrough, EPA Region 6 yarbrough.jim@epa.gov

Cap and trade, NOx set-asides: Edgar Mercado – mercado.edgar@epa.gov Joe Bryson – bryson.joe@epa.gov

State and regional energy planning: Sue Gander – gander.sue@epa.gov

Output-based environmental regulations Katrina Pielli pielli.katrina@epa.gov

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Which states might consider Clean Which states might consider Clean Energy measures for AQ purposes?Energy measures for AQ purposes?

2015: Projected areas of non-attainment after CAIR

8 hr Ozone non-attainment areas

PM 2.5 non-attainment areas