February 2009 Archives

For Congress' top two leaders, the effort to cap greenhouse gas emissions begins at home. Or at least at the home office.

In a letter Thursday, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid urged the acting architect of the Capitol to begin steps to convert the Capitol Power Plant from coal to natural gas. ''The switch to natural gas will allow the CPP to dramatically reduce carbon and criteria pollutant emissions, eliminating more than 95% of sulfur oxides and at least 50% of carbon monoxide,'' they wrote.

As federal lawmakers and policymakers ratchet up the rhetoric on federal authority over states, state interests are struggling with what, if anything, to try doing about it.

"Trump" is one of those words to be avoided, generally, in negotiations. But Senate Majority Leader Harry Reid used it Monday in talking about federal versus state authority to site transmission lines. Referring to state utility regulators' opposition to federal preemption of that authority, Reid said, "Whatever we pass at the federal level trumps all that." Then there's also the federal stimulus bill's prescription for state regulatory action to remove utilities' disincentives to take energy efficiency action. And there's the prospect that the same kind of provision could be in legislation requiring deployment of renewable power.

Charles Gray, executive director of the National Association of Regulatory Utility Commissioners, suggested Tuesday that all this activity is regulated utilities' way of getting some things done that states simply have not done.

The White House push is on for a carbon dioxide market program that auctions all the CO2 allowances right off the bat. This could go down hard with utilities and other industries.

And by 2012? By putting $79 billion of CO2 allowance revenue in the 2012 budget, the Obama administration is putting lawmakers' feet to the fire. If the revenue were marked for deficit reduction, it would be more urgent; instead, the budget outline says the funds would go to help consumers with effects of the program and to promote low-carbon energy development. But still, putting the 2012 marker there could make Congress look like a laggard if it doesn't get the job done in the next year.

Newly minted Energy Secretary Steven Chu's early swings through the Washington energy press corps have been a bit bumpy.

While the Nobel Prize winning physicist has been extremely comfortable talking, at some length, about the emerging technologies and advanced research surrounding hot energy issues, he has been notably less so when presented with broader, policy-based questions from reporters.

A friend was talking today about Playmobil's great toy sets, and how the train set comes with a coal car. With coal, I think. And you can buy little bags of coal to go with it. It got me to thinking that while this toymaker seems to have thought of just about everything, in the energy department they haven't gotten past coal. It also got me to thinking how much I miss playing with the Legos, Playmobil and other put-it-together stuff that can be one of the little joys of parenthood. But that's another whole train of thought.

The Federal Energy Regulatory Commission and the Department of Energy are starting right away to plan a big expansion of the transmission system, acting FERC Chairman Jon Wellinghoff told our colleague Joel Kirkland Friday. As part of the $80 million project ordered up by the stimulus bill, Wellinghoff said, DOE and FERC will be reaching out to states, regional planners and companies as soon as possible. But apparently the administration will be tackling transmission more broadly as well.

Carol Browner, who heads the Obama administration's energy/environment agenda, said at the National Governors Association meeting Sunday that the administration was considering a multi-agency "siting team" that would be a one-stop shop to speed construction of transmission lines, according to our colleague Alex Duncan. Not only Energy, but also Interior and its agencies, would be part of the team. Interior Department land is a big issue out West. Idaho Governor Butch Otter said he wanted to build a four- to five-mile-wide corridor for pipelines and transmission lines, but with 65% of the state controlled by Interior, a route that avoids that federal land is hard to find. So federal coordination would be useful, he said.

The Clinton administration launched a big crackdown on coal-fired power plants at the end of the 1990s, and the lawsuits it filed against a host of power companies played out in various ways through the Bush administration. So-called new source review provisions of the Clean Air Act were the subject, and Bush officials, while they pursued the suits and settlements, did not have their hearts in it.

But it looks as though the assault is back, some say. One former Environmental Protection Agency official told our colleague Alex Duncan this week that up to 30 power plants could be targeted. One industry attorney, Richard Alonso of Bracewell & Giuliani, said it sounds as though government prosecutors "are starting out where they left off in 2000. Everybody's nervous about it, obviously."

Wind-power webinars? Biofuel blogs? Transmission twittering? Fuel rods on Facebook?

Why not?

A study released today by Microsoft and Accenture shows that the oil- and gas-producing industry loses about a half-billion dollars annually because of a lack of job-related ''social networking.''

Suedeen Kelly's view prevails. She said her fellow members of the Federal Energy Regulatory Commission were misinterpreting the Energy Policy Act in the rule they approved for taking on the siting of transmission lines that state authorities had not approved. Yesterday, the 4th Circuit US Court of Appeals agreed.

The court said FERC had used a thesaurus instead of a dictionary when it wrote that transmission applicants could approach it after state authorities had withheld approval for more than a year. FERC said in its rule that "withheld approval" meant not only that a state had failed to act, but also that it had denied an application. Kelly dissented on that point.

There is really nothing like a NARUC meeting to make you understand how tied together are dozens of power industry interests. Especially at a time like this.

No matter when members of the National Association of Regulatory Utility Commissioners meet -- Saturday, Sunday morning, 8:30 to 6 on legal holidays -- not only do state utility commission staffers attend with brains engaged, but commissioners do, too, as do representatives of federal agencies, Washington lobbying groups, utility companies, public power groups, national, regional and state advocacy groups, customer groups, and more.

Google's splashy entry into the smart grid space (not to be completed until later this year, actually) puts a new dimension to a field where companies have been laboring pretty obscurely for a long time. Taking the software directly to the people, for free, could make a big difference in power-consumption behavior.

President Obama has been pleased to remark on it, as have others: what a strong presence California has in environment-energy policymaking all of a sudden. Chief Executive Jim Rogers of Duke Energy has taken note, too, and today in Houston he said he's worried about it.

Speaking at the always-consequential CERAWeek event, Rogers said he is concerned that climate change law backers will take a "my way or the highway" attitude, and "ideology will trump common sense." Our colleague Jeff Ryser reports that Rogers -- who has been a fairly out-front advocate of climate change action, certainly for a heavily coal-dependent company -- noted how California-based much of the new leadership is. But "is California a microcosm of the US?" he asked.

Boutique Houston investment firm Tudor Pickering Holt, whose energy analysts' notes read like Hemingway channeled through David Letterman, wants to know how you'd spend the nearly $1 trillion in the fiscal stimulus bill.

In laying out their own fantasy spending spree, the analysts went whole hog and still could only blow half a trillion in a week -- and that was after completely rejuvenating US education ($164 billion) and saving the world ($280 billion). Along the way they played golf with Tiger Woods at Augusta with Phil Mickleson, carrying Tiger's bags ($2.1 billion, purchase of Augusta included).

Until now, the grim economy hasn't appeared to have slowed gas pipeline companies' efforts to build new capacity to energy-hungry markets. But that could be changing if what's happening in Lone Star, Texas, is any indication.

We wrote the other day about a distributed solar power project that is being promoted as a substitute for a 350-mile power line in Maine. Its being in Maine still is a head-scratcher, but the sponsor plans on fossil-fueled backups.

The whole idea of distributed power versus central-station power is one of those almost philosophical debates, and for some people, the time for serious attention to that debate is now. Amory Lovins is one of them.

Carbon capture and sequestration, i.e. clean coal: reality, many say. If so, when? An American Electric Power executive got a bit of questioning today in Houston about that.

AEP is burning coal at a 20-MW pilot facility in West Virginia, and capturing the carbon dioxide with a chilled ammonia process, then burying it on site. The next step, said Nick Akins, executive vice president of generation, is to bump up the generation capacity to 235 MW in 2011 or 2012. CCS will probably be widely deployed after 2020, he told the McCloskey coal conference associated with Cambridge Energy Research Associates' enormous annual conference.

But he got questions about that 2020 date.

The marker has moved. State interests have been the roadblock to giving transmission-line siting authority to the federal government, and now the organization of state utility regulators has made a big move.

The National Association of Regulatory Utility Commissioners has not changed its position opposing federal siting authority, but it is circulating a discussion draft of a resolution that starts down the road of compromise. The resolution is one of a number prepared for discussion at NARUC's winter committee meetings next week in Washington. The group clearly has decided to step out in front of the process instead of being dragged along, kicking and screaming.

When asked if he was disappointed he was not picked to serve as official chairman of the Commodity Futures Trading Commission, Acting Chairman Michael Dunn laughed and responded, "No."

Dunn is preparing for a changing of the guard at the commission, quick to point out that he is simply serving in the capacity of acting chairman until a new chairman is officially confirmed. In the meantime, he is looking to lay a foundation for new regulatory responsibilities Congress is likely to require of the agency.

Hours of weekend rhetoric about the federal stimulus package didn't appear to smooth the waters; indeed, by the end of Sunday, the temperature only seemed to be hotter. Will the bill create jobs soon? Many think not. It was surprising, then, to see that the Collins-Nelson bill that is substituting for the original Senate bill retains an $80 million allocation for a transmission study.

Here is a question: how big of a work force will it take to double the country's wind capacity? The Obama administration says it wants to create jobs and double renewables like wind. So how many people will that take?

Based on the last couple of years of effort in the wind business, it looks like it takes about 10 people for every megawatt installed. Installing in the US 10,000 MW of wind power requires a workforce of roughly 100,000 people.

A thousand-mile transmission line, taking wind power from the plains to the city, and the wind stops blowing? We have an answer, and perhaps there can be an earmark in the stimulus for us, for our little idea.

Ack, sorry, no earmarks. We forgot.

The Congressional Oversight Panel is among the latest creatures of Washington with a broad portfolio and a nondescript name. With the global financial sector fearing a complete collapse after the bankruptcy of Lehman Brothers, Congress last fall authorized this small band of financial gurus to analyze the state of financial markets and suggest regulatory reforms, some of which will fall on energy markets. Housed in the Government Printing Office at a comfortable distance from the public glare, the panel includes a New York banking regulator, a labor lawyer, a Harvard law professor, a conservative member of Congress and a former Republican senator.

One might think Brad Henry, as governor of the nation's third-largest natural gas-producing state, would use his bully pulpit to promote the production and consumption of Oklahoma's vast gas resources.

Not so much.

In his State of the State address on Monday, Henry mentioned natural gas only in passing, instead choosing to focus on how Oklahoma -- home to such gas-drilling giants as Chesapeake Energy and Devon Energy -- should boost its output and consumption of fuels other than hydrocarbons.

If Washington people who know a lot about transmission and want to see miles of it built do not know what 3,000 miles of line President Obama could be referring to when he aims for it in the stimulus package -- then is it stimulus spending that can be anywhere near shovel-ready?

Maybe it is. But is it stimulus spending to devote $8 million for a study of interconnection-wide transmission needs, as the Senate bill does? Not likely. The only jobs it promises to support are jobs that already exist and probably aren't in jeopardy: positions at the North American Electric Reliability Corp., state agencies, transmission owners/operators and the National Renewable Energy Laboratory.

California State Lands Commissioner John Garamendi -- also the state's lieutenant governor -- last week fulfilled his pledge to vote against a package that would have phased out gas and oil drilling operations off the Santa Barbara coast. In doing so, he made it clear he was not going to let the state's desperate financial crisis get in the way.

He went so far as invoking the Old Testament to make his point.

"I appreciate of the immediacy" of the state's fiscal woes, Garamendi said at last week's commission meeting. "I also appreciate Genesis, where Esau sold his birthright for an immediate meal. I am not about to sell the California birthright of the most fabulous coast anywhere in this world for an immediate meal."

Central-station versus distributed power, writ small. An entrepreneur has put some sturdy little legs on a debate that's usually theoretical: what is more desirable, the central-station power model or the distributed power model. Not that it has to be either-or, though that discussion could be lively.

The case in point is a company called GridSolar, which has proposed a project to Maine regulators for installation of enough 2.5-MW photovoltaic units to get 100 MW altogether -- and this would eliminate the need for a 350-mile transmission line that lots of people don't want.