Author: rogercaiazza

I am a meteorologist (BS and MS degrees), was certified as a consulting meteorologist and have worked in the air quality industry for over 40 years. I author two blogs. Environmental staff in any industry have to be pragmatic balancing risks and benefits and (https://pragmaticenvironmentalistofnewyork.blog/) reflects that outlook. The second blog addresses the New York State Reforming the Energy Vision initiative (https://reformingtheenergyvisioninconvenienttruths.wordpress.com). Any of my comments on the web or posts on my blogs are my opinion only. In no way do they reflect the position of any of my past employers or any company I was associated with.

Pragmatic Environmentalist of New York Principle 13: Pareto Principle

The Pareto principle  or 80-20 rule is a “phenomenon primarily used in business and economics that explains how 20% of efforts or inputs can yield 80% of results or outputs.”   It should also be used for environmental policy because it “helps identify and focus on the crucial factors to create maximum value while delegating the least important ones”. It can also be thought of  in the context of environmental risks: 20% of the efforts remove 80% of the risks.

In the context of environmental policy, the proper pragmatic approach is to use risk management principles when making policies.  The key to a proper risk management strategy is to not aim for safest but rather safer.  New York’s Climate Act and all net-zero energy transition policies ignore this principle because the over-riding rationale is the precautionary principle that has been interpreted to mean that we have to eliminate all risks as a precaution.

The pragmatic approach to climate change would be to use the Pareto principle for decarbonization strategies.  If we could accept the environmental risks of nuclear energy and natural gas combustion, then we could get significant reductions in emissions and all the associated benefits but we would not risk the reliability and affordability of a complete re-vamped energy system.

NY-Sun Mythical Claims

Led by Governor Andrew Cuomo, New York’s solar ambitions are a key component in his agenda for to ensure “vital progress on the climate” is continued. This is a post on the claims made by New York State for the NY-Sun program. The opinions expressed in this post reflect my personal opinion.

Introduction

NY-Sun is supposed to make solar affordable for all New Yorkers. According to the NY Sun section on the NYS website Leading on Climate Change and Protecting our Environment:

  • NY-Sun is developing a sustainable, self-sufficient solar industry in the State by incentivizing New Yorkers, businesses, and communities to invest in solar energy.
  • The Governor’s $1 billion NY-Sun program has grown solar power in New York State by nearly 800% since 2011, and has reduced greenhouse gas emissions by nearly 25%.
  • The program aims to add more than 3 gigawatts of installed solar capacity in the State by 2023, enough solar energy to power 400,000 homes.

I will address each of these claims in this post.

Self-Sufficient NY Solar Industry

My interpretation of self-sufficient solar industry is one where solar manufacturing provides New York solar farms with the panels it needs. I think this is a reference to the SolarCity gigafactory in Buffalo, NY. According to a May 2016 CNBC article:

The Queen City is the crown jewel in Gov. Andrew Cuomo’s multibillion-dollar business-development strategy to revitalize economically depressed Upstate New York by turning it into a 21st-century manufacturing powerhouse. His Buffalo Billion (as in dollars invested) project — although the subject of federal and state bid-rigging probes — is highlighted by a 1.2-million-square-foot “gigafactory” that will be run by Elon Musk‘s SolarCity and fabricate up to 10,000 solar panels per day. In late May, New York’s Public Authorities Control Board unanimously approved a $485.5 million grant, part of the total $750 million the state will spend to construct and equip the humongous facility. New York will retain ownership and lease it to SolarCity in a deal negotiated by Albany-based SUNY Polytechnic Institute, the state university known as SUNY Poly.

An update on February 11,2019 from CleanTechnica is titled “The Latest News from the Tesla Gigafactory 2 in Buffalo Isn’t Good”. The lead to the article admits that they are “one of the biggest cheerleaders for Elon Musk and Tesla” but admits that the factory is “a disaster waiting to happen”. I encourage you to read that article but the key point relative to the NY-Sun claim that NY solar development would be self-sufficient is that one of the recently laid off employees claims ““Some weeks we produced enough solar modules for zero homes and probably the best I saw was maybe four homes in a week, so that is alarmingly scary to obviously be a part of a company who doesn’t have any sense of urgency to tackle these issues and get them working correctly”.

Reduced Greenhouse Gas Emissions 25% since 2011

I have previously evaluated New York State CO2 emission reductions and the claim that NY solar power has reduced CO2 emissions by nearly 25% immediately set off my BS detector. The Solar Generation CO2 Reductions table checks this claim. The New York State Energy Research and Development Authority (NYSERDA) Patterns and Trends – New York State Energy Profiles: 2002-2016 document includes a table that provides the generation by fossil-fired sources and solar and another table that lists CO2 emissions but the data only goes through 2016. I downloaded the annual CO2 emissions from the EPA Clean Air Markets Division through 2018 for your information.

Solar generation reduces CO2 by displacing fossil-fired generation. Assuming that solar only displaces fossil-fired generation means that we can calculate the CO2 displacement by multiplying the solar heat input by the fossil-fired CO2 rate in mass per heat input. In 2016 using the EPA data or the NYSERDA data exclusively indicates that solar is only responsible for 0.21% of the observed reduction. That is two orders of magnitude less than the claim that NY-Sun solar power has reduced CO2 emissions by nearly 25%.

On the other hand the total CO2 reduction from 2011 to 2018 is 25% so that may be where the number came from. However, that reduction is mostly due to fossil-fired fuel switching. CO2 from coal is down 93%, residual oil is down 55%, diesel and other oil is down 59% while natural gas is up 10%. It is worthwhile to note that coal and petroleum usage is down so low now that only small further reductions are possible due to fuel switching.

Three gigawatts power 400,000 homes

According to the US Energy Information Administration, in 2017, the average annual electricity consumption for a U.S. residential utility customer was 10,399 kilowatthours (kWh). At that rate, 400,000 homes would require 4,160 GWh of energy. Three gigawatts of solar operating 24 -7 would produce 26,280 GWh. The capacity factor is the ratio of the actual to the maximum possible generation and in this example it would have to be 15.8% to power 400,000 average homes.

The NYSERDA New York Solar Study in includes a table of Projected New York capacity factors. The highest values listed are 14.96% for MW-scale systems in Downstate NY. I calculated the number of average homes for three gigawatts of solar using their capacity factors. If all the homes were powered by residential scale systems in Upstate only 316,654 homes would be powered by 3 gigawatts. If all the homes were powered by utility scale systems downstate 378,076 homes would be powered by 3 gigawatts. NY Sun is funding all four types of installations across the state so the best number would be somewhere in between.

Myth Scorecard

NY-Sun is developing a sustainable, self-sufficient solar industry in the State by incentivizing New Yorkers, businesses, and communities to invest in solar energy.

Depending on your definition of sustainable, self-sufficient there may be some validity to this claim but if the claim is taking credit for the Tesla Gigafactory 2 in Buffalo it appears very unlikely that this facility will provide much if any support for New York solar installations.

The Governor’s $1 billion NY-Sun program has grown solar power in New York State by nearly 800% since 2011, and has reduced greenhouse gas emissions by nearly 25%.

There is no way to salvage this statement. It implies that solar power growth has led to CO2 reductions in New York and that is simply not true.

The program aims to add more than 3 gigawatts of installed solar capacity in the State by 2023, enough solar energy to power 400,000 homes.

If the NY-Sun uses a different value for the energy needed by an average home then 400,000 may be legitimate. However, if you use the US EIA value then the capacity factor used by NY-Sun is higher than acceptable.

German Compendium for a Sensible Energy Policy

The German Energiewende or energy transition is a plan to move away from fossil fuels and nuclear to a low carbon energy supply. Advocates of New York’s Reforming the Energy Vision (REV) often point to this as a model for the New York transition. However, a recent paper, Vernunftkraft, Bundesinitiative für vernünftige Energiepolitik or Compendium for a Sensible Energy Policy, produced by a group of German energy experts, engineers and technicians, eviscerates those claims for its success. Their full study is available to be downloaded in PDF here.

I am a numbers and history guy. If you can produce numbers or show examples where a policy has worked elsewhere then I can determine whether I can support that policy. My fundamental problem with REV is that I have not seen where any jurisdiction has been able to move away from fossil fuels without markedly increasing costs. Furthermore, there are very few places where the amount of renewable energy proposed in REV has been implemented so it is not clear to me whether that much renewable energy can actually be implemented without threatening the reliability of the grid.

I believe that the Compendium for a Sensible Energy Policy should be a cautionary tale for New York. The review produced by this group is intended to inform public debate to try to bring a reconsideration of Germany’s energy policy. Most of the discussion topics in the introduction of the Compendium are directly applicable to New York and REV. It is troubling that rather than learning from the results of the German experience we seem to be headed down the same path.

Introduction from the Compendium for a Sensible Energy Policy

’But where should the electricity come from’ is usually the immediate question to someone who takes a critical position on the expansion of wind and solar power plants. Our problem description in section 1. focuses on this simple question. It shows that wind and solar energy, which seem to promise a quick fix, are not simple alternatives to fossil fuels. Indeed, they are not even part of the answer; as their deployment becomes widespread, they become a problem in themselves and make it even more important to find sensible solutions.

It is often claimed that all that is needed is a sufficiently large and sufficiently widely distributed network of wind farms (’the wind is always blowing somewhere…’); ‘smart grids’ and grid-scale energy storage will then compensate for the intermittency of the power supplied. Section 2. On the technological aspects shows that these hopes are unrealistic.

A widespread view is that if a measure is designed to protect the climate or the environment, then we should see no sacrifice or technical challenge involved in putting it in place as too great. In fact, however, this attitude is based on false premises, as section 3. on the ecological aspects of the renewable energy question shows. Instead of delivering the promised protection of the climate, current energy policy is causing a biodiversity disaster. The protection of nature and wildlife is suffering, and populations of endangered wild animals have been decimated. These sacrifices are all the more tragic because they are completely pointless. There are easier, and much less painful ways to reduce carbon dioxide emissions.

The energy transition is a ‘blessing for rural regions’, claimed the former head of the German Chancellery, Peter Altmaier, a few years ago. Poorer regions would be given a new boost through their involvement in renewable energy production. There were also high expectations that Germany would take the lead in developing many of the new technologies and would benefit from a ‘green jobs’ boom. Section 4. on the economic aspects measures these expectations against reality. It reveals that renewables are being given perverse economic incentives, giving rise to undesirable developments that pose considerable risks to economic growth and prosperity in Germany.

The social effects and the losses in health and quality of life that the expansion of ‘green electricity’ facilities will have, are hardly noticeable in the large cities. Dramas are taking place in the countryside that remain hidden from the Energiewende enthusiasts, most of whom live in the cities. Our section 5. on social and health aspects examines these negative impacts.

A great deal needs to change in energy policy. We therefore conclude this paper with a list of demands, addressed to the future German Federal Government – whoever they may be.

The list of demands in the conclusion:

  • The idea of meeting our country’s energy needs with wind power and solar energy has proven to be an illusion. At present, around 29,000 wind turbines and 1.6 million photovoltaic systems together account for just 3.1 % of our energy requirements. Although their share of electricity is higher, their direct and systemic costs are gigantic.
  • The cardinal problems – weather-dependence and low energy density – are unsolved or unsolvable. The idea often put forward by the government that expanding the areas covered in renewable systems will reduce natural volatility contradicts mathematical laws and has also been clearly refuted empirically.
  • To compensate for the lack of reliability of wind and sun and to be able to actually replace conventional power generation, gigantic amounts of electricity storage would be required. The replacement of controllable power generation with a fluctuating power supply is impossible without storage and unaffordable with it.
  • As a result of the rapid expansion of ‘renewable energies’, electricity prices have risen steadily and further cost increases are inevitable. Germany as a desirable location for business is suffering. The social imbalance is getting worse and worse. There is a locational disadvantage for the manufacturing industry. At the same time, the redistribution from ‘bottom’ to ‘top’ is continuously increasing.
  • The present energy policy does not serve the alleged climate protection. CO2 emissions are rising instead of falling. The ‘dirty secret’ of producing ‘green electricity’ is not a transitional phenomenon, but a systemic one. Through emissions trading, a (global) tax and open-technology research funding, the target of CO2 reduction could be achieved much more cost-effectively. Instead of’ climate protection’, the incentive system of the EEG induces environmental crime, sows discord and causes unprecedented landscape damage and destruction of nature.

 

NYS Energy Efficiency Fatal Flaw

In Governor Cuomo’s 2018 state of the state address he announced a plan to create new energy efficiency targets and appliance standards and on Earth Day new energy efficiency targets were announced. This is all part of the effort needed to meet the Reforming the Energy Vision (REV) 80 by 50 goal. The study New Efficiency New York describes the new efficiency target, the “utility-leveraged action” to drive energy efficiency, market enabling actions and other aspects of the program. This post addresses one aspect of the program that I consider a fatal flaw: widespread implementation of air-source heat pumps at the same time the state is pushing renewable energy, particularly solar.

Air-Source Heat Pumps

In order to meet the REV reduction goal carbon dioxide emissions from the home heating sector need to be reduced by replacing oil and natural gas furnaces with electricity. Heat pumps are the recommended choice for home heating electrification in no small part because they can be used for both heating and cooling. According to the Department of Energy (DOE):

An air-source heat pump can provide efficient heating and cooling for your home. When properly installed, an air-source heat pump can deliver one-and-a-half to three times more heat energy to a home than the electrical energy it consumes. This is possible because a heat pump moves heat rather than converting it from a fuel like combustion heating systems do.

Air-source heat pumps have been used for many years in nearly all parts of the United States, but until recently they have not been used in areas that experienced extended periods of subfreezing temperatures. However, in recent years, air-source heat pump technology has advanced so that it now offers a legitimate space heating alternative in colder regions.

Note that there are two types of heat pumps: air source and ground source. Both extract heat from outside the building to warm the inside. Air-source heat pumps extract it from the atmosphere where the efficiency is affected by air temperature but it is relatively easy to duct the pump to the source. On the other hand ground-source heat pumps use stable ground temperature so are uniformly more efficient. The tradeoff is that developing the ground system is much more complicated. As a result, an air-source heat pump can be retrofitted into an existing structure much more easily than a ground-source heat pump.

The reason that heating electrification is included in the energy efficiency policy is related to peak loads. Section 7.2 of New Efficiency New York is entitled “Support Heat Pump Adoption to Decarbonize Heating and Cooling”. The rationale for advocating heat pumps is based on the observation that the value of energy efficiency is higher when it reduces demand during a utility system’s peak load hours. The report notes that a Lawrence Berkeley National Laboratory study of the time-varying value of electric efficiency concluded “that of five common measures modeled, residential central air conditioning in summer-peaking systems has the most significant added value”.

Peak Loads

Peak loads are a problem that are a primary driver of political agenda of REV. Electricity demand varies with time. In the middle of the night the residential use drops when people sleep but it peaks in the later afternoon when everyone is awake and using electricity. The electrical grid uses power from different sources at different rates to cover this normal variation. The peak problem is that when there is abnormally warm and cold weather energy use increases a lot. The existing system is designed to provide power for these abnormal periods but that requires the use of additional facilities that only run during peak load periods. The problem is that those additional sources are expensive so prices peak too. The theory is that if the peak load could be shaved then you would not need those expensive sources and the prices would be reduced.

The New York Independent System Operator (NYISO) provides peak load data for New York State (NYS) for the hour in the summer and winter when electricity usage was highest. The following data are for coincident peak demand which refers to simultaneous load peaks between different sectors. For example, residential and commercial heating will peak at the same time during cold weather. There are two significant electric load peaks during the year: summer when air conditioning use is highest and winter when heating demand is highest (Figure 1: NYISO Gold Book Actual and Project Coincident Peak Demand Generation. Over the last 20 years (1998-2017) the summer peak averaged 6,760 MW larger than the winter peak. Figure 1 also includes forecasts from the 2008 Gold Book and 2018 Gold Book. The discontinuity between 2017 and 2018 represents the changeover between the two forecasts.

The Table NYISO Gold Book Coincident Summer Peak and Winter Peak Average Demand by Zone – MWaverages load data for three periods: the last five years, a five year period 20 years ago and 2026 to 2030 at the first target date of REV. NYISO divides the state up into 11 load zones. Note that there is tremendous variation across the zones. Three downstate zones I, J and K accounted for 55% of the summer load and 48% of the winter zone in the most recent five years. Note that in zones D and E winter load is greater than summer load. I have been unable to track down older data but I believe that in the past that was the situation for more zones.

Fatal Flaw

The latest state-wide report on NYS load, NYISO Power Trends 2018, states that:

Distributed energy resources — such as rooftop solar — are transforming historical patterns of consumption, and affecting consumer reliance on electricity provided by the bulk power system. For instance, energy usage from New York’s bulk power system is expected to decline over the next decade at a rate of 0.14% per year. Peak demand — a critical element to reliable system planning that establishes the total amount of capacity that must be procured to meet reliability standards — is projected to decline at a pace of 0.13% per year, through 2028.

However, nowhere in that document is there any mention of the plan to electrify residential home heating as a necessary component of the REV carbon reduction goal. To date all the NYS plans discuss summer peak demand reduction and have ignored the potential for an increase in winter demand.

I believe that overlooking the impact of electrifying the residential and commercial winter heating could be a fatal flaw. The Department of Energy claims that the preferred air source heat pump technology is a legitimate alternative and the Northeast Energy Efficiency Partnerships, an organization whose overview goal is “Assisting the Northeast/ Mid-Atlantic Region in reducing total carbon emissions 80% by 2050”, notes that the more efficient heat pumps provide cost savings. Unfortunately air-source heat pumps only work when they move heat and when it is cold enough there is no heat in the air to move.

The American Council for an Energy-Efficient Economy published a paper that documents the problem: Field Assessment of Cold Climate Air Source Heat Pumps (ccASHP) (https://aceee.org/files/proceedings/2016/data/papers/1_700.pdf). The report describes a Center for Energy and Environment field study in Minnesota where cold climate air source heat pumps were directly compared to propane and heating oil furnaces. The report notes that “During periods of very cold temperatures when ccASHPs do not have adequate capacity to meet heating load, a furnace or electric resistant heat can be used as backup.” For example, the figure Energy use versus outdoor air temperature method from ASHP Site 2 shows that as temperature decreases the energy use for an air-source heat pump goes up. Below 20 deg. F the efficiency of the air-source heat pump decreases to the point where the system cuts back and a backup system is needed. Below zero the air-source heat pump does not operate well enough to use.

The unanswered question is how these initiatives will be reconciled. Although air source heat pumps are more efficient, widespread implementation will exacerbate the winter peak load. If distributed rooftop solar is supposed to provide a significant portion of that load what happens when it snows for 66 straight hours and there is record cold? When the temperatures are that cold then home heating has to use something other than an air source heat pump. The fact is that either home owners will have to maintain their original furnace or invest in a radiant electric heating system. The economics of maintaining two furnaces does not seem likely to lead to widespread adoption. However a radiant heating system is far less efficient so the peak in electric use that cannot be covered by solar renewable energy will be exacerbated.

Several related issues have to be addressed. As more and more renewable energy is brought on to the system less and less energy is produced by fossil-fired generating facilities. The first issue is how much load will be required for the winter peak when the recommended alternative for heating electrification, air source heat pumps, must be supplanted with much less efficient radiant heating. Secondly, where is this energy going to come from? Depending upon rooftop solar for residential heating in the Upstate NY winter is clearly not viable so what is the renewable solution? Absent a magical solution the system is going to have to depend upon fossil-fired facilities to prevent people from freezing to death. However, widespread implementation of rooftop solar and other renewable energy alternatives has to negatively affect the economic viability of existing or new fossil-fired facilities. The final issue is to determine what will be necessary to incentivize the backup power needed when the subsidized energy from rooftop solar is unequal to the task of keeping the heat on. The potential fatal flaw is that identifying and reconciling all these issues takes time and it may not be possible to prevent a severe reliability problem before it occurs.

NYSERDA 2018 Renewable Energy Awards – Inconvenient Facts

On March 9, 2018 Governor Cuomo announced the “single largest commitment to renewable energy by a state in U.S. history at $1.4 billion, which will advance 26 large-scale renewable energy projects across New York.”   This sounds great in a news release but when you look at the numbers in more detail there are some inconvenient facts.

Per usual the details are sparse but there is a summary that says the New York State Energy and Research Development Authority (NYSERDA) request for renewable energy standard bids resulted in 26 agreements to develop 1,383 MW of new, clean energy capacity throughout New York State. The total funding committed through the request for proposals is approximately $1.4 billion, and the weighted average price for these contracts was $21.71 for each Tier 1 Renewable Energy Credit. The successful proposals include a hydroelectric project, three wind projects (including one with energy storage), and several solar projects. They also claim 1.6 million metric tons of reductions from these projects.

The NYSERDA Greenhouse Gas Inventory 1990-2014 contains an inventory of historical greenhouse gas emission data from 1990-2014 for New York State’s energy and non-energy sectors. According to this, New York State Greenhouse Gas (GHG) emissions were 235.8 million metric tons in the baseline year of 1990 for the REV goal so the 80% reduction is 188.7 million metric tons and 2050 emissions will only total 47.2 million metric tons if the goal is met. In 2014 total GHG emissions were 217.7 million metric tons so the reduction so far from 1990 is 18.1 million metric tons or only 10% of the 2050 goal.

I believe that one of the weaknesses of the REV process is that there isn’t clear, concise summary with a roadmap to meet the ambitious goal. In order to meet the 80% target NYS emission reductions will have to average over 4.7 million metric tons per year until 2050. If renewable energy standard bids were the only mechanism for achieving reductions, this year’s awards only gets a third of the annual reduction needed and we have to do this for 32 more years. However, the implementation plan combines both reductions in emissions and reductions in loads so this is not a correct comparison.

The New York State Department of Public Service Staff’s White Paper on the Clean Energy Standard did project what renewable energy was needed to meet the interim Reforming the Energy Vision and State Energy Plan goal of 50% renewable energy by 2030. According to the white paper:

To achieve the SEP 50 by 30 goal Staff has initially determined that in order for this goal to be met, slightly more than 33,700 GWh of incremental renewable generation must be added to the State’s fuel mix. Staff arrived at this calculation by determining projected 2030 load statewide. Staff adjusted the projected load growth for expected energy efficiency gains. We then noted that in 2014 the State had approximately 26% renewable energy in its power generation mix, net of exports, or 41,300 GWh of renewable energy. We then calculated that the CES program will be required to add an additional 33,700 GWh of renewable energy to meet the 50% by 2030 mandate.

Note that this white paper defines the needed renewable generation in output with units of GWh. That number is calculated by summing the hourly power produced by a generating facility over a year. After digging around for a while I found that the Frequently Asked Questions link for the 2017 Renewable Energy Standard Results notes that “Once operational, the 26 projects awarded in this RES solicitation are expected to generate more than 3.2 million MWhs annually.” Note that this converts to 3,200 GWh.

Here’s the first inconvenient fact: The “single largest commitment to renewable energy by a state in U.S. history at $1.4 billion” gets less than ten percent of the renewable energy needed by 2030 for the interim 30 by 50 goal. Simple extrapolation means that another $10 billion will be needed for the 2030 renewable energy goal.

Another inconvenient problem is the timing. According to the Frequently Asked Questions link, the target commercial operations date for these projects is 2022. In order to meet the 33,700 GWh projection the annual rate of project developments will have to be greater than the 2018 award level.

There is another inconvenient issue: permitting. Of the 26 projects, eight are large enough (>25 MW) to fall under the NYS Article Ten permitting process. This is an onerous and time-consuming process and it is interesting how many projects fall just short of the threshold capacity limit. Of the eight that have to go through that process, the Article Ten Projects Under Review link indicates that only one has submitted its application and another two have submitted scoping statements. As a result, I believe those three facilities could have their permits within a year or two. Frankly I would be shocked if any of the other five applicants could get through these permitting requirements in less than three years which only leaves a single year for construction.

In addition to the timing issue I have a particular concern relative to the implicit message sent when an award is announced for any project before it is permitted. There is a chance under the Article Ten permitting program that a project could be rejected due to local concerns and home rules. However, in this instance, the Cuomo Administration picks the judges and jury for that decision so it seems that the decision is pre-ordained in favor of the developer.

Moreover, deliberately sizing the project to skirt the Article Ten rules means that 18 local jurisdictions will have to address them and there maybe local issues that have to be addressed. For example, the Middletown recordonline web site describes the surprise of local officials about four projects. Of the four projects, two developers have contacted the town where the facility will be built but have not started the permit application process, one has not started work with the local agency, and the fourth has not even contacted the town. This could affect the viability of any project because, for example, one project does not fit the requirements of the proposed solar law the town is considering. The draft solar law allows for projects of up to 20 acres, generating 2 megawatts of power. The proposed project wants to use 95 acres to generate almost 25 megawatts of power. I think this puts undue and unfair pressure on the towns to approve permitting as quickly as possible because the Cuomo Administration has “approved” these projects.

In conclusion there are inconvenient facts related to this announcement:

  • The investment of over $1 billion covers only ten percent of the 2030 interim goal;
  • The size of the award is smaller than the annual amount necessary to meet the 2030 interim goal;
  • The schedule for this award is ambitious relative to permitting requirements;
  • In addition this timing issue will make subsequent investments successively more difficult to be permitted and constructed in time for the 2030 target deadline; and
  • The announcement of the awards to unpermitted projects puts undue pressure on the affected jurisdictions.

REV and the Cuomo Administration

One of my biggest concerns about Reforming the Energy Vision (REV) is that the Cuomo Administration is so invested in it that they consider any criticism as heresy and respond accordingly. As evidence consider the Richard Kaufmann letter to the New York Independent System Operator (NYISO) regarding the NYISO Comments on Clean Energy Standard July 2016.

Richard Kaufman is Governor Cuomo’s energy czar. According to his New York State Energy and Research Development Authority (NYSERDA) biography: “Mr. Kauffman oversees and manages New York State’s entire energy portfolio, including the New York State Department of Public Service, the New York Power Authority, the Long Island Power Authority, and the New York State Energy Research and Development Authority.” He also “leads” the REV initiative. While his work history includes impressive positions at the U.S. Department of Energy and big businesses, his education (Bachelor’s degree in African History from Stanford University, a master’s degree in international relations from Yale University, and a master’s degree in public and private management from the Yale School of Management.) does not include any background in science and technology.

The Kaufmann letter to NYISO July 2016 states that the filing “reveals an alarming lack of developed analysis and understanding of the imperative to address climate change by transitioning to a clean electric system, and how a modern grid can be developed and operated.” He goes on to chastise the NYISO because they don’t understand that their “paradigm of analysis is outdated”.

So what did the “engineers, operators, analysts, economists, and technologists” of the independent source of “factual information to policymakers, stakeholders, and investors in the power system” at the NYISO say to earn this response? They dared to suggest that adding the amount of solar panels and wind turbines to the grid needed to achieve the Clean Energy Standard could overload the transmission system. They also explained that meeting the goal would require the state to dramatically increase the amount of reserve capacity it sets aside.   Even though NYISO was careful to point out that it supports Cuomo’s vision, they said New York would have to add a large amount of new transmission lines and would have to study more how to manage the added renewable electricity generation, which is naturally intermittent, that would be added to the grid. Ultimately they estimated that the Clean Energy Study could require “nearly 1,000 miles of new bulk power transmission.”

Clearly, Kaufmann has no technical background for his criticism of the NYISO. So he must rely on the staff of the Department of the Public Service whose mission is to “ensure affordable, safe, secure, and reliable access to electric, gas, steam, telecommunications, and water services for New York State’s residential and business consumers, while protecting the natural environment.” Unfortunately, Cuomo has refashioned the Public Service Commission “into an organ of executive power in ways that critics find unprecedented and potentially troubling”. In particular, Cuomo has filled the Commission mostly with allies who rarely if ever defy his wishes on energy policy and I believe that attitude has filtered down to the agency staff. Any staff professional in the DPS, or for that matter any agency in Albany, who has doubts about any aspect of Cuomo’s energy plans need only look at the response of Kaufmann to a well-qualified independent organization and decide that discretion is a better career path than to object to the language in the letter.

Offshore Wind Costs

My biggest concern with Reforming the Energy Vision (REV) is cost and the consequent lack of specific numbers that can be used to compare with alternatives. Consider for example the ambitious plans for New York State to develop offshore wind.

Governor Cuomo’s 2018 State of the State message describes the plan but does not mention cost:

In the 2017 State of the State, Governor Cuomo took the bold step of establishing a target of up to 2.4 gigawatts of offshore wind by 2030, the largest commitment to offshore wind power in U.S. history. To position New York as the leading offshore wind market in the United States and to drive competition, reduce costs and create new well-paying jobs, this year Governor Cuomo is calling for a procurement of at least 800 megawatts of offshore wind power between two solicitations to be issued in 2018 and 2019, resulting in enough clean, renewable energy to power 400,000 New York households. These solicitations will be the first in a set schedule to reach the 2030 target, will create competition among developers to build some of the largest offshore wind projects in the United States, and will ensure that the resulting jobs and economic development benefits accrue across the state.

In addition, Governor Cuomo is directing NYSERDA to invest $15 million in clean energy workforce development and infrastructure advancement to train workers for jobs in this good-paying industry, including offshore wind construction, installation, operation, maintenance, design and associated infrastructure. To attract private investment in port infrastructure and supply chain activities, Governor Cuomo is further directing NYSERDA to work with Empire State Development and other state agencies to determine the most promising public and private offshore wind port infrastructure investments. These new actions will jumpstart project development, drive job growth and industry investments, and secure New York’s status as the undisputed home for the emerging offshore wind industry in the U.S.

The New York State Energy Research and Development Authority (NYSERDA) Frequently Asked Questions about New York State offshore wind document does include the question “What will offshore wind cost?” The response:

New York State is committed to advancing offshore wind in a way that maximizes competitive bidding and ensures the lowest cost, while stimulating economic development and fostering local job creation. With achievement of the 2,400 MW goal contributing to similar scale economies in the U.S. Northeast, NYSERDA projects that by 2030, the cost to obtain offshore wind will be lower than the cost to procure land-based renewables in the State. Offshore wind, therefore, has the potential to lower the cost of meeting the State’s mandate that 50 percent of its electricity come from renewable resources by 2030. To initially develop the offshore wind market in New York, a near-term incremental program cost is estimated to be less than a 0.3 percent bill impact (or less than $0.30 per month) for the typical residential customer for the more cost-effective procurement options.

I am disappointed that there isn’t a response that translates into anything that can be compared to other renewable energy costs. If we parse the last sentence we can try to develop a number. I assume that “To initially develop the offshore wind market in New York” refers to the call for a “procurement of at least 800 megawatts of offshore wind power between two solicitations to be issued in 2018 and 2019”. The dollar amount is cryptically described as “less than a 0.3 percent bill impact (or less than $0.30 per month) for the typical residential customer”.  The NYSERDA Patterns and Trends document lists the total number of residential customers, 5,582,292 in 2015 and Electricity Local states that the average monthly residential electricity bill in New York is $106 so we can estimate that near-term incremental program cost to residential consumers is less than $21,305,842. However, that is not a number that can be used to compare other forms of energy because total costs would be amortized over the lifetime of the project (25 years), this does not include commercial and industrial customers, and it is not clear if this is the all in cost including transmission or just the cost of the offshore turbines.

There is another more complicated cost factor. In the project cost projections task summary in the New York Offshore Wind Master Plan the explanation of that task notes that “The objective of this task is to produce data on the expected costs and levelized cost of energy (LCOE).” Paul Joskow addressed the use of LCOE and “demonstrates that this metric is inappropriate for comparing intermittent generating technologies like wind and solar with dispatchable generating technologies like nuclear, gas combined cycle, and coal.” Read the paper for the full rationale but it basically boils down to the fact that wind is intermittent and cannot be relied upon whenever power is needed. Importantly the analysis also concludes that wind generating technologies are over-valued relative to solar generating technologies.

The bottom line on costs for this program is that there are not any that are available.

Most remarkable to me is this statement: ”With achievement of the 2,400 MW goal contributing to similar scale economies in the U.S. Northeast, NYSERDA projects that by 2030, the cost to obtain offshore wind will be lower than the cost to procure land-based renewables in the State.” The Science of Doom blog evaluated the costs of offshore wind and concluded that “As a rule of thumb consider offshore capex wind costs to be “about double” onshore wind costs, and offshore maintenance costs to be somewhat unknown, but definitely higher than onshore costs”. I can see nothing in that analysis nor am I aware of any other analysis that claims something much different. If I were a betting man I would bet the ranch that the cost to obtain offshore wind will never be less that the cost of land-based renewables.

Cuomo State of the State 2018: Climate Agenda

Governor Cuomo unveiled a comprehensive agenda to combat climate change by reducing greenhouse gas emissions and growing the clean energy economy in the 2018 State of the State. This is directly related to Reforming the Energy Vision (REV), his plan to “rebuild, strengthen and modernize New York’s energy system. The ultimate goal of REV is to change the energy system of New York to reduce greenhouse gas (GHG) emissions 80% from 1990 levels by 2050 (“80 by 50”). In order to achieve that goal specific programs have to be implemented and this agenda lists another round. I will address each of the seven items in the aptly named agenda.

 Expand Regional Greenhouse Gas Initiative (RGGI) and Reduce Emissions Equitably From the Highest-Polluting, High Demand “Peaker” Power Plants

According to the announcement: “In 2013, Governor Cuomo led the nine RGGI states in reducing the cap on greenhouse gas emissions from power plants 50 percent by 2020. Since that time, RGGI has continued to exceed expectations, providing over $2 billion in regional economic benefits and public health benefits of $5.7 billion while reducing emissions more than required by the declining cap. In August 2017, the other RGGI states agreed to Governor Cuomo’s 2017 State of the State call to reduce the cap another 30 percent by 2030.”

RGGI is a pollution control program that auctions authorizations to emit each ton of CO2 from power plants. New York took the lead in recent revisions to the operating rules of RGGI that include an additional 30% reduction in emissions from 2021 to 2030. In my other blog I have posted technical evaluations of various aspects of RGGI. In late 2017 the Department of Environmental Conservation (DEC) and the New York State Energy Research and Development Authority (NYSERDA) released and asked for comment on documents that I used to determine the potential effectiveness of programs that use auction revenues to, in Cuomo’s words, “fight climate change and protect our environment, while supporting and growing 21st century jobs in these cutting-edge renewable industries.” I found that the program investments will only provide 10% of the reductions that Cuomo agreed to. Fuel switching from coal and residual oil to natural gas was the primary reason emissions dropped since 2005 and the problem is that there are limited opportunities for further reductions. Given that simply using their own numbers to determine the effectiveness of their investments does not portend well for this aspect of the State of the State climate agenda.

The agenda also includes a component to include peaker units in RGGI. Currently, RGGI only covers power plants with a capacity of 25 megawatts or greater, leaving out many smaller but “highly-polluting, high demand ‘peaking’ units, which operate intermittently during periods of high electricity demand”. There are approximately 100 of these peaking turbines in New York City and on Long Island. My initial estimate is that those turbines emit about 1.4% of the total CO2 emissions from units already covered by RGGI. The term much ado about nothing springs to mind.

Issue Solicitations in 2018 and 2019 to Develop at Least 800 MW of Offshore Wind Projects and Foster Offshore Wind Industry and Workforce in New York State

According to the announcement: “In the 2017 State of the State, Governor Cuomo took the bold step of establishing a target of up to 2.4 gigawatts of offshore wind by 2030, the largest commitment to offshore wind power in U.S. history. To position New York as the leading offshore wind market in the United States and to drive competition, reduce costs and create new well-paying jobs, this year Governor Cuomo is calling for a procurement of at least 800 megawatts of offshore wind power between two solicitations to be issued in 2018 and 2019, resulting in enough clean, renewable energy to power 400,000 New York households.”

Cuomo’s offshore wind proposals are pretty vague about the costs. Steve Gorham notes that “the Deepwater Wind Block Island project of Rhode Island takes first prize for outrageous renewable electricity cost. The five-turbine offshore system went into operation in 2016 at a contracted price of 23.6 cents per kW-hr, with an annual increase of 3.5 cents, placing the future price at over 40 cents per kW-hr.” According to the Energy Information Administration the October 2017 New York City wholesale electricity prices annual range was between 2.1 cents per kW-hr and 12.1 cents per kW-hr. Another analysis of offshore wind concluded as a rule of thumb “offshore wind capex wind costs to be about double onshore wind costs, and offshore maintenance costs to be somewhat unknown, but definitely higher than onshore wind costs.” The fact that the State has not provided costs is troubling but I fear these costs will significantly affect ratepayer costs.

 $200 Million Investment to Meet Unprecedented Energy Storage Target of 1,500 Megawatts by 2025 In Order to Increase Transmission of Clean and Renewable Energy

According to the announcement: “The Governor is also proposing a commitment of at least $200 million from NY Green Bank for storage-related investments to help drive down costs and to strategically deploy energy storage to where the grid needs it most. Finally, the Governor is directing NYSERDA to invest at least $60 million through storage pilots and activities to reduce barriers to deploying energy storage, including permitting, customer acquisition, interconnection, and financing costs.”

Under another related heading the announcement notes: “The Governor is also proposing a commitment of at least $200 million from NY Green Bank for storage-related investments to help drive down costs and to strategically deploy energy storage to where the grid needs it most. Finally, the Governor is directing NYSERDA to invest at least $60 million through storage pilots and activities to reduce barriers to deploying energy storage, including permitting, customer acquisition, interconnection, and financing costs. In addition to utility procurements and regulatory changes, these investments will be critical to jumpstart the market and support robust and cost-effective project development on the way to achieving the 1,500 megawatt goal.”

Because renewable energy is intermittent, storage is an absolute requirement to provide dispatchable power when the wind is not blowing and the sun is not shining. I suppose that the “plan” is to use renewables to replace the high demand peaker turbines. As noted there are about 100 of these turbines and they are at least 20 MW each for a total output of 2,000 MW. More importantly those turbines can run as long as needed to cover the peak generation requirements. If that is just four hours that means they produce 8,000 MWh. I have been unable to find out the equivalent output for the batteries but strongly suspect that it is short. For example the much acclaimed giant Tesla battery just installed in Australia has a capacity of 100 MW but only 129 MWh. So the question is just how much capacity will these investments get?

 Create the Zero Cost Solar for All Program for 10,000 Low-Income New Yorkers

According to the announcement: “Reducing the energy burden of low-income households and ensuring their participation in the clean energy economy are central goals in Governor Cuomo’s energy policies. The Governor’s REV strategy aims to ensure that the economic, environmental and health benefits of clean energy are accessible to New Yorkers who are most in need. In 2016, Governor Cuomo also unveiled the Energy Affordability Policy to limit energy prices and provide direct cost relief for low-income New Yorkers, and expanded it the following year to bring the total program benefits to $260 million.”

The testimony of William D. Yates, CPA for the Public Utility Law Project of New York, on August 25, 2017 in the Niagara Mohawk Power rate case listed the poverty rates of Upstate New York cities. For example the City of Albany has a poverty rate of 26.8%. The population of Albany is 97,856 so there are 26,255 low-income New Yorkers in Albany alone. As a result the 16,255 New Yorkers in Albany that don’t get the zero cost solar for all benefits will have to subsidize those that do. Raising energy prices is amounts to a regressive tax that is particularly harmful to those least able to pay. Claiming that “reducing the energy burden of low-income households” is clearly not going to happen overall.

 Reconvene Scientific Advisory Committee on Climate Change Disbanded by the Federal Government

According to the announcement: “In June 2017, Governor Cuomo formed the U.S. Climate Alliance with the Governors of California and Washington State to ensure that New York State and other willing partners continue to meet or exceed the targets of the Paris Agreement on climate change. After announcing its withdrawal from the Paris Agreement, the federal government took another misguided step by disbanding the Federal Advisory Committee for the Sustained National Climate Assessment, a group of leading scientists and stakeholders tasked with providing recommendations to the federal government on scientific information to support state and local governments, communities, and the private sector in planning for the effects of climate change. In the absence of guidance from the Advisory Committee, decision-makers will have limited ability to know how climate change will impact their organizations and communities, and what they can do to better plan for those impacts. Therefore, Governor Cuomo, as co-chair of the U.S. Climate Alliance and in collaboration with partners, will reconvene the Advisory Committee to develop recommendations to navigate the challenges of climate change. As a result, the Advisory Committee will continue its critical work without political interference and provide the guidance needed to adapt to a changing climate.”

The scientists on the scientific advisory committee have provided fodder for Cuomo’s agenda so it is not surprising that they have figured out a way to continue that work. Personally, because it was a political decision to stop funding the committee that existed only to fan the flame of catastrophe as a rationale for all the programs, claiming that it will continue its work “without political interference” is laughable.

 Governor Directs the Establishment of Energy Efficiency Target by Earth Day

According to the announcement: “Building on the progress made through utility programs and cutting-edge work to reduce energy use in state facilities, Governor Cuomo launched the $5 billion Clean Energy Fund in 2016 to support investment in energy efficient technologies. This initiative is already demonstrating significant progress across New York State, from Upstate farms and greenhouses to commercial buildings in Manhattan. These activities are expected to save New Yorkers a remarkable $39 billion in energy costs over the next 10 years while significantly reducing greenhouse gas emissions.”

 I support energy efficiency programs because it represents a “no regrets” policy and because it can be targeted for the low-income ratepayers most in need of reducing their energy bills from what I see as inevitable major increases with these renewable energy policies. Unfortunately, New York has been pushing energy efficiency for years so I suspect that most of the low-hanging fruit available for big reductions has already been picked. I also note that I understand that the weatherization assistance program has an over four year waiting list for services. Therefore, despite my reservation I believe this is the best of the options proposed by the governor.

 Regulations to Close all Coal Plants to be Adopted

According to the announcement: “Moreover, in order to immediately reduce emissions from New York’s highest-polluting power plants Governor Cuomo directs the DEC to adopt regulations ending the use of coal in the state’s power plants by 2020. At the same time, Governor Cuomo created the Electric Generation Facility Cessation Mitigation Fund to address the needs of the local communities affected by any closure.”

Normally a Governor asks the DEC to propose regulations but note that Cuomo has directed DEC to adopt the regulations. Needless to say even if Moses brought down an eleventh commandment saying ye shall not close the coal plants that or any other argument would sway DEC from its political directive to shut down coal. I have worked in New York for over 35 years and we used to be proud of the fuel mix of hydro, coal, natural gas, oil and nuclear. Those fuels enabled the power plants to provide dispatchable power (i.e., supply energy whenever needed whatever the weather) and play off one fuel against the other to give NY residents cheaper power. The shale gas revolution (despite the Governor’s ban on NY drilling) has flipped that approach completely upside down but I think it would be more appropriate to let the market dictate fuel use rather than the politicians. It also should be pointed out that now the state is very reliant on natural gas. Aside from the real threat of a supply disruption from some unforeseen event (an earthquake could affect pipelines) the Governor has also been blocking the development of natural gas infrastructure even to the point of blocking a pipeline to a nearly complete power plant.

Appendix A DPS REV Staff Report Wholesale Market Products

Reforming the Energy Vision (REV) is Governor Cuomo’s plan to “rebuild, strengthen and modernize New York’s energy system.  The REV DPS Staff Report and Proposal (available at DPS Staff Reports April 24, 2014) contains a very good description of the wholesale electric market in Appendix A (reproduced below). In order for REV to be successful the services described below must be maintained.

In order to understand the rationale of REV you have to understand how electricity generated at power plants gets to your home. Before the New York electric system was de-regulated, your power company was responsible for generating power, transmitting it over the big transmission lines to your neighborhood where the distribution power lines delivered it to your home. After de-regulation your power company is no longer responsible for generating[1] the power only delivering it.

In the de-regulated system the New York Independent System Operator regulates the generation of power to the system where it can be sent to your home. Appendix A (quoted below) describes the wholesale market products that are used to govern those transactions. Day to day power needs are met with a couple of products. Energy markets balance electrical power needs against the power generating plants capabilities to insure that the power needed is available. The Day Ahead Demand Response Program is an option where instead of turning on an additional generating unit a facility offers to use less power instead.

In addition to the day to day power variations there are seasonal variations with the main reliability issue being a peak load day. Capacity Markets guarantee that when the peak loads occur that there are enough generating plants available to provide the necessary power where and when it is needed.

The power generation, transmission and distribution system is connected and synchronized. In order to provide the requirements for the system to be connected and synchronized NYISO operates markets for “ancillary services.” There are five separate categories of ancillary services. Regulation services continuously balances load and power supply. Voltage support services maintain the system voltage. , Synchronous and non-synchronous reserves are used to address emergency contingencies during daily operations while black start services are used to startup the system when there is a blackout. Finally there are demand side ancillary services. These are analogous to the day ahead demand response program whereby they facilitate the use of demand side resources to meet the needs of the services described above.

 Conclusion

In summary, in order for REV to be successful all these services have to be maintained. The inconvenient issue is that some of the proposed components of REV behave markedly different than components of the existing system. Consequently providing these services at lower costs while maintaining reliability is an ambitious goal and one that must be addressed in the plans.

 

April 24, 2014 — Reforming the Energy Vision DPS Staff Report and Proposal

Appendix A Wholesale Market Products

 Energy Markets

At present, the NYISO operates a number of wholesale competitive markets. There are two distinct markets for the electric energy, the Day-Ahead market, and the Real-Time market. Approximately 98% of the electric energy used in the State is scheduled in the Day-Ahead market with the remaining 2% accounted for in the Real-Time market.

In the Day-Ahead market, the NYISO co-optimizes the Energy, Operating Reserves and regulation markets by utilizing bid-based Security Constrained Economic Dispatch (SCED) and Security Constrained Unit Commitment (SCUC). Day-ahead bids are due by 5:00 a.m. on the day before the unit will run, and the NYISO posts the day-ahead schedules and the market clearing prices by 11:00 a.m. Clearing prices are based on LBMP (Locational Based Marginal Pricing), which is the cost to supply the next MW of load at a specific location in the grid. By so doing the NYISO ensures that resources are available to satisfy loads that are forecast for the day.

The NYISO also runs Real-Time markets to efficiently and economically balance actual system loads and a large number of changes continuously taking place on the system, such as unanticipated transmission and generation outages. Real-time bids are due 75 minutes prior to the hour of operation. Differences between day-ahead schedules and actual load and generation are priced at real-time LBMPs, which are calculated every 5 minutes.

 Day Ahead Demand Response Program (DADRP)

The DADRP allows end-users to participate in the day-ahead energy market by offering load reduction bids. DADRP participants are paid at the LBMP market price for the amount of their winning bid and have a performance obligation much like winning generators. Participation in the NYISO‟s DADRP is currently limited to curtailable load. A recent FERC Order, however, ruled that behind-the-meter generation must also be allowed to participate. Eligibility is limited to providers that can demonstrate an ability to curtail at least 1 MW of load, and at present, there is a $75/MWh minimum offer floor. However, in the NYISO‟s compliance filing in response to FERC‟s Order 745, the new monthly floor will be determined through the application of a “net benefits test.”

 Capacity Markets

The NYISO establishes Installed Capacity (ICAP) requirements to ensure sufficient resources are available to adequately serve the forecasted summer peak New York Control Area (NYCA) system load. ICAP suppliers must satisfy semiannual tests of maximum output, and must meet deliverability requirements (sufficient transmission to reach load in their respective capacity regions). The NYISO operates capacity markets to facilitate the purchase, by Load Serving Entities (LSEs), of the capacity they are required to procure. In this context, “capacity” is not the electricity itself, but instead the ability to produce electricity when necessary.

ICAP requirements are set based upon projected peak NYCA load, plus an additional reserve amount to ensure the system can reliably serve peak demand even in cases of unplanned outages (known as “contingencies”). This reserve amount is known in New York as the “Installed Reserve Margin” (IRM). In addition to the Statewide IRM, the NYISO imposes minimum Locational Capacity Requirements (LCRs) in areas of the State that have limits on their ability to import power from outside areas. Thus, there are LCRs established for New York City (Zone “J”), Long Island (Zone “K”), and the newly established Lower Hudson Valley capacity zone (Zones “G” through “J”). LSEs are subject to ICAP requirements based on their respective share of coincident system peak load for the State (i.e., the IRM). Where applicable, they must satisfy part of that requirement with resources which are electrically located within their Zone.

All ICAP supplies must “clear” in the mandatory, NYISO-administered, “spot” markets, which are held monthly. LSE bids in the spot auctions are determined by administratively-set “demand curves”. Supply offers in New York City (Zone “J”) and the Lower Hudson Valley (Zones “G” through “J”) are subject to bid caps (for incumbent suppliers) and bid floors (for new entrants), under market power mitigation rules established by FERC. ICAP suppliers within a zone subject to LCRs (i.e., Zones “J,” “K,” and “G” through “J”) receive the higher of the statewide capacity price or the applicable locational price for their respective zones. The NYISO also operates voluntary forward auctions, for the summer (May-October) and winter (November-April) capability periods. Supplies obtained in the forward auctions must also be offered into and clear the spot auctions in order to satisfy LSE ICAP requirements.

 Ancillary Services Markets

In addition to the energy and capacity markets, the NYISO operates markets for “ancillary services.” There are five separate categories of ancillary services at the wholesale/bulk power system level: regulation services, voltage support services, synchronous and non-synchronous reserves, black start services, and demand side ancillary services. These will each be briefly discussed in turn.

 Regulation Services

System “regulation” is the practice of continuously balancing power supply resources with load. Regulation service is accomplished through transparent day-ahead and real-time markets which receive bids from participating, qualified energy suppliers (having automatic generation control capability), demand-side resources (also see DSASP) and energy storage resources. A bid evaluation program selects specific resources and the amount of power to be delivered on the basis of each participant’s bid price, unit response rates, location and existing transmission constraints. Updates to the desired generation levels expected from each unit, occur every six seconds.

 Voltage Support Service

Voltage Support, more formally known as Reactive Supply and Voltage Control Service (“Voltage Support Service” or VSS), is necessary to maintain transmission voltages within acceptable limits. Facilities under the NYISO control are operated to produce or absorb reactive power, as necessary, to maintain transmission voltages within acceptable limits.

VSS facilities must meet a number of criteria to be eligible to participate. For example, they must have a demonstrated the ability to produce and absorb reactive power within specific limits, be able to maintain a specific voltage level under both steady-state and post-contingency operating conditions, and be capable of automatically responding to voltage control signals. In general, eligible VSS providers are generators with automatic voltage regulators, synchronous condensers, and qualified non-generator Voltage Support Resources.

Payments to eligible providers are based on an annual VSS rate established by the NYISO. Generators that are given energy delivery schedules may be eligible to receive lost opportunity costs under certain circumstances when dispatched for voltage support reasons. VSS providers can also be assessed penalties if they fail to provide VSS as directed or if they fail to maintain their automatic voltage regulators.

 Synchronized and Non-Synchronized Reserves

To ensure reliable operation of the bulk power system, the NYISO‟s “Operating Reserve Service” provides needed reserves in the form of generation or demand response if a real time power system contingency requires emergency corrective action. The NYISO provides markets for 10-minute spinning, 10-minute non-synchronized, and 30-minute non-spinning reserves with a NYCA-wide requirement as well as an Eastern and Long Island requirement and a Long Island requirement.

The minimum reserve requirements are based on the largest single “contingency” (in MW), as defined by the NYISO. Providers of Operating Reserves must be properly located electrically and geographically to ensure the ability to deliver energy reserves as necessary. The NYISO must procure sufficient Operating Reserves to comply with applicable Reliability Rules and standards. All suppliers of Operating Reserves must be located within the New York Control Area, and under NYISO Operational Control.

The NYISO administers two ancillary services markets (Day Ahead and Real-Time) through which LSEs can procure needed resources for required Operating Reserves. Each supplier that bids into these markets must be able to provide electric energy or reduce demand when called upon.

Black Start Services

In the event of a partial or system-wide blackout, Black Start Capability Service is provided by generators having the ability to re-start their facilities without the need for an external supplier of electricity. Such black start generators are either under the control of the NYISO or, in some cases, under the control of the local Transmission Owner. The NYISO selects the generating resources with black start capability by considering a number of design and operating characteristics, including electrical location, startup time in response to a NYISO order to start, response rate, and maximum power output.

Generation resources providing black start service must successfully conduct and pass annual black start capability testing. Payments for service, called Restoration Services payments, are provided under the NYISO‟s Open Access Transmission Tariff. Any Generator awarded Restoration Services payments that fails a Black Start Capability Test must forfeit all payments for such services since its last successful test.

 Demand Side Services

The NYISO also administers a Demand Side Ancillary Services Program (DSASP) intended to facilitate economic use of demand side resources to meet electricity needs. Participation is allowed for interruptible loads for Spinning Reserves or Regulation. Loads with qualified behind-the-meter generation may provide Non-Synchronous Reserves. The minimum resource size is 1 MW and there is a $75/ MWh minimum bid. The payment is the Regulation or Reserve clearing price.

 NYISO Demand Response Programs

The NYISO also administers several different demand response programs. These include the Special Case Resources Program (SCR), the Emergency Demand Response Program (EDRP), and the Day Ahead Demand Response Program (DADRP)

Special Case Resources

Participation in the NYISO‟s SCR Program is open to interruptible loads or loads with a qualified behind-the-meter Local Generator. There is a minimum of 100kW reduction, and participation is mandatory during reliability events. There is a mandatory test each capability period and capacity can be sold either in a bilateral contract or through the NYISO capacity auctions. Payments are in capacity and energy payments.

Emergency Demand Response

Participation in EDRP is open to interruptible loads or loads with a qualified behind-the-meter generator. Load reduction is voluntary and there is a minimum of 100 kW reduction for participation. Participants are compensated through an energy payment equal to the greater of $500/ MWh or the applicable real-time LBMP.

[1] There are exceptions to this rule but in general your power company no longer generates its own power.

New York GHG Emissions and Energy Use Trends

Reforming the Energy Vision (REV) is Governor Cuomo’s plan to “rebuild, strengthen and modernize New York’s energy system. The ultimate goal of REV is to change the energy system of New York to reduce greenhouse gas (GHG) emissions 80% from 1990 levels by 2050 (“80 by 50”). This post summarizes the status of NY emissions and energy use.

The New York State Energy Research and Development Authority (NYSERDA) Patterns and Trends document provides both CO2 emissions and energy use data but I used the NYSERDA New York State Greenhouse Gas Inventory and Forecast report for Table 1 New York GHG Emissions, Historical and Targets. According to the Inventory report 1990 NY total GHG emissions were 235.8 million metric tons of Carbon Dioxide equivalent (CO2e). I assumed that was the total emissions used to calculate the reductions necessary to meet the 80 by 50 goal. However, note that fuel combustion accounts for 205.8 million metric tons. There is another category for “other” sources including CO2 from municipal waste combustion, cement production, limestone and soda ash use, and iron and steel production; methane, nitrous oxides, perfluorocarbons, hydrofluorocarbons and sulfur hexafluoride emissions. The report also mentions that energy-related emissions, a category calculated as part of New York’s State Energy Plan that includes fuel combustion, net electricity imports, power supply & delivery, and natural gas leakage were 212.87 million metric tons.

Figure 1 shows the trends in New York State CO2e emissions, energy (TBtu) and CO2e intensity which is the emissions divided by the energy. Note that the energy used in New York rose until 2005 and has since started to drop while the pattern of CO2e has ebbed and flowed more but has also dropped since 2005. In order to determine the viability of the 80 by 50 goals it is necessary to look at what drove those trends.

In order to reduce GHG emissions there are three direct approaches:

  1. Replace energy sources that generate GHGs with ones that don’t
  2. Energy efficiency – use energy more effectively
  3. Energy conservation – use less energy

In addition there are a couple of indirect ways: reduce the population and reduce the gross state product or economic growth. I mention those two methods to point out that neither approach is politically palatable as an approach to reduce GHG emissions and that historically the gross state product has increased and population has stayed relatively constant.

The NYSERDA Patterns and Trends document contains the energy and emissions data by sector needed to evaluate the causes of the observed reductions. Figures 2 and 3 show the trend of primary energy consumption by the residential, commercial, industrial, transportation and electric energy production sectors by total energy use (TBtu) and % of total. Residential has bounced around but is effectively the same since 1080 and the commercial sector trended up but has trended down to roughly the same levels as 1990. Given the growth in the economy it appears it appears to me that investments in conservation and efficiency have produced some results. The most notable decrease has been the industrial sector, down over 200 TBtu since 1980. While efficiency and conservation have helped with that it is more likely a result of the decline of the industrial sector in New York. Transportation energy use has grown consistently since the mid-80’s. The electricity sector grew until approximately 2005 and has since dropped. It does not appear on the basis of historic trends that energy conservation and energy efficiency will be major factors for compliance with the emissions goals.

 

That leaves carbon emission reductions to make the majority of the reductions necessary. Figures 4 and 5 show the trend of GHG emissions by the residential, commercial, industrial, transportation and electric energy production sectors and % of total. Note that these are emissions from fuel combustion only so the totals are not the same as shown before. The emissions trends for residential, commercial, industrial and transportation sectors are similar to the energy trends. Residential and commercial are roughly the same, industrial is down, and transportation is up. Electricity sector emissions are down more than the total energy.

 

Renewable wind and solar energy are supposed to make major contributions to the emissions reductions necessary for the 80 by 50 goal. As a result, we need to evaluate the sources of electricity generated in New York. Figure 6 shows the percentage of electricity provided by different sources: coal, natural gas, petroleum (residual oil and distillate), hydro, nuclear, imports, other (landfill gas & biomass), wind and solar. Coal and petroleum have gone down significantly since 1990. Natural gas has increased significantly as has imports. After Nine Mile Point unit 2 came on-line nuclear has stayed about the same as has hydro. In the past few years enough solar and wind have come on line to appear on the chart. Figure 7 shows the total energy provided by the same categories. Clearly the biggest changes have been the reduction of coal and petroleum fuel use and increase of natural gas and imports.

 

In order to determine how much carbon free renewable energy can directly affect CO2e emissions we need to look at the electric sector emissions relative to emissions from the rest of New York State. Figure 8 shows the trends and Table 2 NYS Combustion Source CO2 Emissions by Electric Sector and Rest of State shows the data. Statewide coal and electric sector oil have gone down 55 million metric tons but since 1990 natural gas has gone up. It can be argued that for the most part the major decreases in coal and oil were the result of changes in the relative cost of fuel and had nothing to do with New York State policy. Moreover, the State has drafted regulations to eliminate the use of coal so renewable energy deployment will not drive further emissions reductions from coal and there are only 3.9 million metric tons of reduction available anyway. With respect to electric sector emissions, no further oil use reductions are expected because the current levels represent the minimum emissions necessary to maintain oil as a backup and emergency use fuel. That leaves natural gas emissions.

Overall, the total emissions in 2015 are only down 18% from 1990 levels to 169.5 million metric tons and the 2030 target is 141.5 million metric tons so further reductions of 28 million metric tons are necessary in the next 15 years. If renewable energy sources completely replaced fossil emissions that would provide reductions of 29.2 million metric tons. There are significant technological hurdles to doing that so I believe that is an unrealistic goal. On the other hand the primary way to reduce emissions from the other sectors is to replace fuel combustion with electricity. The great challenge of REV is how to meet that additional expected demand without increasing CO2 emissions