Clean Energy at Coal Prices

by Bruce Goodman, Energy Lawyer

The ARPA-E conference today had many speakers, lots of statistics, and even more good ideas for driving the cost of clean energy down.  Former Governor Schwarzenegger challenged the gathering to focus on areas of agreement (clean energy is good) rather than on areas of disagreement (has mankind contributed to global warming).  Phrases that could be bumper stickers abounded:  Clean energy is the light bulb of the 21st century; energy security = national security; invest in clean energy that we can make locally and sell globally.  Very optomistic speakers on the ability to accelerate energy innovation.  And it only took a visit to the basement displays to make a believer out of me.  Innovative battery technology, biofuels, LED lighting, wind turbine design, engine design, and the list goes on and on.   Today was an energy attorney’s delight.

Waiting for ARPA-E Conference to Commence

by Bruce Goodman, Energy Lawyer

The main events for the second annual Advanced Research Projects Agency – Energy (ARPA-E) Conference start tomorrow, March 1.  I have checked into the Gaylord National Convention Center Hotel and perused the agenda.  How exciting!  Topics ranging from rare earths to advanced fuels to zero carbon power will be discussion topics.  This is America ingenuity at its best.  Efforts to attract talent, both foreign and domestic, to the energy challenge.  Funding cutting edge research and development, knowing that some will fail miserably, but hoping a few ideas succeed spectacularly.  It is Sputnik time again for the United States.  Let’s hope we respond as successfully.

Does/Will/Can Michigan have an Energy Policy?

by Bruce Goodman 

What does it take for a state (that is not California) to have an energy policy?  The question is timely because elections are approaching and one would hope the candidates would address all the important issues.  But will anyone take a public stand on unresolved energy issues: increasing the renewable portfolio standard percentage; new coal-fired generation; feed-in tariffs; standby rates; recommendations of the Great Lakes Wind Council or the Climate Action Council?  I suspect not.  Thus come January we are likely to continue with state energy policy “on the fly”, with a dash of gridlock and pinch of skepticism.  Let the Feds make the hard decisions on GHG regulation and renewable energy standards.  Term limits have done their job—left Michigan with a legislature with little institutional memory and little legislative expertise to address complicated issues such as energy.  Hey, how about energy platforms and energy debates in all the state races so that we can get these issues on the table.  Watt would be wrong with that?

Coal Put On Hold in Michigan

by Bruce Goodman

The MDNRE has denied Wolverine Power Supply Cooperative’s air permit application for a new 600-megawatt power plant in Rogers City to be fueled by petroleum coke and coal. The decision was based on MPSC findings that the plant was not needed to meet future supply needs and would increase electricity rates by more than 59% to over 20 cents per kwh.  The MPSC analysis suggested that Wolverine had alternatives to supply electricity to its customers at a fraction of the cost of a new power plant.  Separately, Consumers Energy announced deferral of its  development of a 830-megawatt coal-fired power plant near Bay City that it planned to have in operation in 2017. The reasons given included reduced customer demand for electricity due to the recession, forecasted lower natural gas prices due to recent developments in shale gas recovery technology, and projected surplus generating capacity in the Midwest market.

Reducing GHG by Converting it to Carbon Monoxide

 by Bruce Goodman

Research at U of M has led to a recent discovery in understanding how to chemically break down the greenhouse gas carbon dioxide into a useful product–carbon monoxide. The studies have figured out a way to efficiently make this chemically occur using sunlight. Carbon monoxide is a desirable chemical that can be used in processes to produce electricity or hydrogen. Alternatively, it has significant fuel value and can be converted by catalysts into hydrocarbons or methanol for use as a liquid fuel. It also serves as a source of energy and biomass for microbes.

Natural Gas “Play”

by Bruce Goodman

The opinion page of the Wall Street Journal recently claimed that “unconventional natural gas” may well revolutionalize the challenges and opportunities for alternative energy. The natural gas previously locked in impermeable shale around the nation is now becoming available due to hydraulic fracturing techniques. Thus the domestic gas supplies are increasing, and at a much lower unit cost than previously thought possible. The author suggests that this makes gas fired electric generation more available to back up intermittent energy from solar or wind generation. That is the optimistic perspective. The more realistic outcome is that cheap natural gas will lead to natural gas generation being preferred ahead of alternative energy supplies, unless some sort of carbon tax makes that option less desirable. After all, the natural gas that was locked up contains the carbon that climate change is all about.

Midwest Governors’ Energy Roadmap

by Bruce Goodman

At its recent meeting in Detroit earlier this month, seven of the eleven states in the Midwestern Governors Association (including Michigan) signed an accord that provides a road map of work to be done to transition the region toward less reliance on fossil fuels. Key elements include:  

• working together on upgrading the region’s infrastructure to facilitate more renewable energy (improvements to transmission lines); •
• reducing electricity and natural gas use; 
• targeting a 25% RPS by 2025 (30% by 2030); energy efficiency building codes;
• a low-carbon fuel standard to encourage locally produced biofuels; and
• restructuring utility regulations to ensure energy efficiency is incorporated into a utility’s profit motive.

It would be interesting to know how much of this can be accomplished by regulation, and how much depends on legislation. To date the region’s efforts at coordinating energy policy has been somewhat uneven.

Tom Friedman in Grand Rapids

by Bruce Goodman

Early in October Tom Friedman from the New York Times spoke in Grand Rapids. He addressed a crowd of 700 on many of the messages contained in his most recent book Hot, Flat and Crowded: Why We Need a Green Revolution. His was an optimist message — no matter the problem(s), if we start solving them now they can be solved in time. He left somewhat to the imagination what constituted “in time”, having earlier stated that Al Gore got it all wrong on global warming. It fact it was happening faster and more severely than the former vice president predicted.

Not surprisingly his call for a carbon tax as a price signal that makes dirty fuels more expensive and clean fuels relatively cheaper did not get a lot of applause, even though it makes sense. He called on the crowd and the nation to be diligent and innovative in searching for sources of abundant, cheap, clean reliable electricity generation. He ended his presentation with his motto: “Change your leaders, not your light bulbs, because leaders write the rules. Rules shape the markets and markets give you scale. It starts there.”

Many more interesting and thought provoking comments. He could start a revolution.

Climate Action Council Recommendations to be Implemented

by Bruce Goodman

By Executive Order dated July 30, 2009, Governor Granholm put into motion the climate action plan recommended by the Michigan Climate Action Council. She set goals of a 20% reduction in greenhouse gas emissions below 2005 levels by 2020, and an 80% reduction by 2050. The MDEQ was directed to begin tracking progress toward this goal beginning in 2012. Implementation measures include developing:

• Building codes to adopt higher energy efficiency standards;
• Strategies for reducing vehicular congestions; 
• An eco-driver program to improve driving patterns and practices;
• Practices for implementing carbon sequesteration practices in agriculture and forestry; 
• A statewide truck idling program; and 
• Adaptation plans for state.

54 climate mitigation actions form the basis of the climate action plan.

Climate Change Response Requires Innovation

 by Bruce Goodman

There is little doubt that the energy resources to be developed in Michigan are dependent on the state and national response to climate change and global warming.  Energy and greenhouse gases are inextricably linked.  It is disapointing to see that the international community is unable to coalesce around targets and strategies on glabal warming which is turn would provide direction and guidance for energy policies around the world. 

Meanwhile, in the vacuum that currently exists, the U.S. and the State of Michigan need to take the lead in this challenge.  Author Tom Friedman’s clarion call in his recent writings has correctly linked energy policy and climate change when he calls for a global energy technology revolution to address supply and demand of energy, the decline of natural resources, climate change, energy poverty and biodiversity.  The solution he suggests is abundant, cheap, clean, reliable electrons, with the admonition – “invent, baby, invent.”  Michigan’s contribution to the development of low emission vehicles is the right thing to be doing at the right time.  R&D on electric generation and other transportation components (e.g. jet engines) that will provided by Michigan research (such as the new GE facility) will put Michigan in the middle of the innovation that is needed.