Transcript Intelligent Energy Choices for Kentucky’s Future

Kentucky Association of Electric
Cooperatives
KENTUCKY’S ENERGY FUTURE
Frank Moore
Director of Biofuels
Dept. for Energy Development & Independence
October 13, 2009
Intelligent Energy Choices
for Kentucky’s Future
Kentucky’s 7-Point Strategy for Energy Independence
The Strategy in a Nutshell
Stimulate economic development &
preserve energy cost relationships
for Kentuckians in a carbon-limited
environment.
Bold Efficiency & Renewable
Energy Initiatives
 Renewable and Efficiency Portfolio Standard (REPS)
 By 2025, twenty five percent of Kentucky’s energy
needs will be met by efficiency gains, and renewable
resources such as solar, wind, hydro, and biofuels.
 REPS will help us to diversify our energy portfolio, help
consumers save on energy costs, and provide “green
collar” jobs.
 REPS: Strategies 1, 2 & 3
Kentucky Fuels Our Own
Transportation Needs
 Alternative Transportation Fuel Standard (ATFS)
 By 2025, sixty percent of transportation fuels used
in Kentucky will be derived from biofuels, coalbased liquids, electricity via hybrid engine
technologies, and compressed natural gas.
 ATFS: Strategies 1, 3, and 4
Strategy 1
Improve the energy efficiency of Kentucky’s homes,
buildings, industries, and transportation fleet.
Goal: Energy efficiency will offset at least 18 percent of Kentucky’s
projected 2025 energy demand.
Energy efficiency is the fastest, cleanest, most-cost
effective way to reduce our growing demand for
energy and to address climate change issues.
Strategy 2
Increase Kentucky’s Use of Renewable Energy
Goal: By 2025, Kentucky's renewable energy generation will triple to
provide the equivalent of 1,000 megawatts of clean energy while
continuing to produce safe, abundant, and affordable food, feed and
fiber.
With less than 3 % of our electricity generated from
renewable sources today, Kentucky should aggressively
pursue renewable energy to reduce GHG emissions and
to diversify our energy portfolio.
Strategy 3
Sustainably Grow Kentucky’s Production of Biofuels
Goal: By 2025, Kentucky will derive from biofuels 12 percent of its
motor fuels demand (775 million gallons/year, which represents
approximately 20 percent of Kentucky’s current transportation fuels
demand), while continuing to produce safe, abundant, and affordable
food, feed and fiber.
Today, Kentucky uses less than 10% of its potential resources for
production of biofuels. We can significantly grow our agricultural
and forestry resources in a sustainable way to provide biofuels
for transportation.
Strategy 4
Develop a Coal-to-Liquids Industry in Kentucky to
Replace Petroleum-Based Liquids
Goal: Kentucky will develop a CTL industry that will use 50 million
tons of coal per year to produce 4 billion gallons of liquid fuel per year
by 2025.
Key to achieving energy security is use of our domestic
resources. Building on recent legislative support for CTL
facilities, Kentucky will develop a vibrant CTL industry
that will provide jobs and economic opportunities.
Strategy 5
Implement a Major and Comprehensive Effort to
Increase Gas Supplies, Including Coal-to-Gas
Goal: Kentucky will produce the equivalent of 100 percent of our
annual natural gas requirement by 2025 by augmenting in-state
natural gas production with synthetic natural gas (SNG) from coal-togas (CTG) processing.
Kentuckians have become increasingly vulnerable to
natural gas supply uncertainties and price increases in
recent years. A strong CTG industry will provide
energy security and economic development
opportunities.
Strategy 6
Initiate Aggressive Carbon Capture/Sequestration
Projects for Coal-Generated Electricity in Kentucky
Goal: By 2025, Kentucky will have evaluated and deployed
technologies for carbon management, with use in 50 percent of our
coal-based energy applications.
Kentucky’s energy future depends on the success of
carbon capture and storage projects at coal-based
facilities.
Strategy 7
Examine the Use of Nuclear Power for Electricity
Generation in Kentucky
Goal: Nuclear power will be an important and growing component of
the nation’s energy mix, and Kentucky must decide whether nuclear
power will become a significant part of meeting the state’s energy
needs by 2025.
With major increases in energy efficiency, renewables, and
cleaner coal technologies, we still will not be able to
achieve GHG reduction goals and meet projected energy
demands. Kentuckians must decide whether nuclear
power will be an option in our energy future.
In Summary:
 With this action plan, by 2025 Kentucky will:
 Maintain current per capita energy use despite major energy
growth demands.
 Fully utilize our renewable energy resources.
 Maintain coal production in Kentucky at current levels.
 Produce approximately 4 billion gallons of liquid fuels from coal.
 Produce annually 135 billion cubic feet of SNG to augment
Kentucky’s natural gas supply.
In Summary
With this action plan, by 2025 Kentucky will:
 Provide 40,000 new Kentucky jobs by diversifying our energy
sector.
 Achieve energy independence for Kentucky from imported oil.
 Reduce the net carbon emissions by 50 percent.
 Assure the viability of Kentucky’s coal industry in a carbonconstrained world.
Where do we start?
 Executive branch reorganization
 Energy efficiency & ARRA
 Focus on biofuels (Biomass Task Force)
ETHANOL HISTORY IN KENTUCKY
ETHANOL CONSUMPTION
ETHANOL PRODUCTION
160,000
E-10 MARKET SHARE
100%
95%
90%
85%
80%
75%
70%
65%
60%
55%
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
2008 ESTIMATED
150,000
140,000
130,000
120,000
110,000
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
20
08
20
06
20
04
20
02
20
00
19
98
19
96
19
94
19
92
19
90
19
88
19
86
19
84
0
19
82
1000 GAL.
100,000
Biomass Task Force:
Laying the Foundation
 Establish “official” supply-demand potential
 Estimate the economic impact and capitalization




requirements of a biomass industry
Develop a vision on how such large volumes will be
handled
Assess Kentucky’s ability to support the biotechnology
Ensure that Kentucky can make the right business structures
available
Recommend a realistic incentive package that will
encourage farmers to plant, foresters to harvest, and
developers to build.
Kentucky’s Biomass Future
RPS
15%
13.0 million tons
20%
18.2
25%
22.0
RFS
10.0
Total Biomass
23-32 million tons
Value to Producers
$1.3-$2.0 Billion
Our Vision
25 Million Tons
of Biomass by 2025
Our Challenge
$1 Billion Initiative to
get things started!!
Intelligent Energy Choices
for Kentucky’s Future
Kentucky’s 7-Point Strategy for Energy Independence