Transcript National Home Performance Council

Clean Air Act 111(d)
VAEEC Spring Meeting
Thursday, May 29
Richmond, VA
Kara Saul Rinaldi
National Home Performance Council/
Home Performance Coalition
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THE NATIONAL HOME
PERFORMANCE COUNCIL
• National, non-profit, 501c3 organization
• Supports whole-house upgrade programs through
research and convening projects
• Addresses challenges and barriers to advancing the
home performance industry and whole-house,
energy efficiency programs.
2
Emergence of the
Home Performance Coalition
Merged with ACI
• State energy offices
• Program implementers
• Utility Sector
• Manufacturers
• Non-profit stakeholders
• Contractor Connection: Efficiency First
3
THE DEVELOPMENT OF THE RULE
 2007 Supreme Court ruling in Massachusetts v. EPA , which said the
agency has the authority under the Clean Air Act to limit emissions
of greenhouse gases from vehicles
 2009 - American Clean Energy and Security Act of 2009 (ACES)
Waxman-Markey Legislation – passed house, not Senate
 December 7, 2009 – The U.S. Environmental Protection A gency
(EPA) announced that greenhouse gases (GHGs) threaten the public
health and welfare of the American people
 2012, a three-judge panel of the U.S. Cour t of Appeals for the
District of Columbia Circuit concluded that the EPA was
"unambiguously correct" in using existing federal law to address
global warming.
COPENHAGEN ACCORD
2009 Copenhagen Conference of the Parties of the United
Nations Framework Convention on Climate Change to
reduce U.S. emissions of greenhouse gases by about :
17% below 2005 levels by
2020, 42% by 2030, 83% by
2050
15 th session of the Conference of the Par ties (COP 15) to the United
Nations Framework Conventions on Climate Change (UNFCCC) and
the 5th session of the Conference of the Par ties ser ving as the
meeting of the Par ties (CMP 5) to the Kyoto Protocol
THE ADMINISTRATION’S CLIMATE
ACTION PLAN (JUNE 25, 2013)
 limiting carbon emissions from both new and existing power
plants;
 continuing to increase the stringency of fuel economy
standards for automobiles and trucks;
 continuing to improve energy efficiency in the buildings sector;
 reducing the emissions of non -CO 2 greenhouse gases through a
variety of measures;
 increasing federal investments in cleaner, more efficient
energy sources for both power and transportation; and
 identifying new approaches to protect and restore our forests
and other critical landscapes, in the presence of a changing
climate.
THIRD NATIONAL CLIMATE ASSESSMENT
(MAY 2014)
 M ay 2 014 : e f fe c t s o f g l o b a l wa r m i n g h a d " m ove d fi r m l y i n to t h e p r e se n t . “
 T h e r e c e n t U . S . c o n t r i b ut i on to a n n ua l g l o b a l e m i ssi o n s i s a b o ut 1 8 % , b ut t h e
U . S . c o n tr i buti o n to c um ul a t i ve g l o b a l e m i ssi o n s ove r t h e l a st c e n t ur y i s m uc h
h i g h e r.
 T h e r e i s n o "o n e - si ze fi ts a l l ” a da pta ti on , but th e r e a r e si mi l a r i tie s i n
a ppro a c h es a c ro ss r e g i o n s a n d se c to r s. S h a r i n g b e st p r a c t i ce s, l e a r n i n g by
do i n g , a n d i te r a t i ve a n d c o l l a b or a t ive p ro c e sse s i n c l ud i n g st a ke h o ld er
i nvo l ve me nt, c a n h e l p sup p o r t p ro g r e ss.
 Ca r bo n di ox i de i s r e m ove d f ro m t h e a t m o sp h e r e by n a t ur a l p ro c e sse s a t a r a te
th a t i s ro ug h l y h a l f o f t h e c ur r e n t r a te o f e m i ssi o n s f ro m h um a n a c t i v i t i e s.
T h e r e fo r e , mi ti g a t i on e f fo r t s t h a t o n l y st a b i l i z e g l o b a l e m i ssi o n s w i l l n ot r e d uc e
a tmo sph e r i c c o n c e nt r a t io ns o f c a r b o n d i ox i d e , b ut w i l l o n l y l i m i t t h e i r r a te o f
i n c r e a se. T h e sa m e i s t r ue fo r ot h e r l o n g - l ive d g r e e n h o use g a se s.
 To me et th e l owe r e m i ssi o n s sc e n a r i o (B 1 ) use d i n t h i s a sse ssm e n t , g l o b a l
mi ti g a ti o n a c ti o n s wo ul d n e e d to l i m i t g l o b a l c a r b o n d i ox i d e e m i ssi o n s to a
pe a k o f a ro un d 4 4 b i l l i o n to n s p e r ye a r w i t h i n t h e n ex t 2 5 ye a r s a n d d e c l i n e
th e r e a f te r. I n 2 01 1 , g l o b a l e m i ssi o n s we r e a ro un d 3 4 b i l l i on to n s, a n d h ave
be e n r i si n g by a bo ut 0 .9 bi l l i on to n s pe r ye a r fo r th e pa st de c a de . T h e r e fo r e, th e
wo r l d i s o n a pa t h to exc e e d 4 4 b i l l i o n to n s p e r ye a r w i t h i n a d e c a d e.
 Ca r bo n di ox i de a c c o un ted fo r 8 4 % o f tot a l U . S . g r e e n h o use g a s e m i ssi o n s i n
2 01 1 .
WHAT IS 111D
Clean Air Act Section 111(d)
Regulate carbon emissions from existing power plants
“best system of emissions reductions ” - EPA can deploy a
systemic approach to reducing pollution from power plants
Flexibility: EPA can look beyond each individual source in
isolation to find the "best," most cost -effective system for
reducing pollution.
Location Matters: Inside and Outside “the fence”
WILL IT WORK?
 EPA and the states used section 111(d) to implement emission
guidelines for fluorides from phosphate fertilizer plants
(1977), sulfuric acid mist from sulfuric acid plants
(1977), sulfur from kraft pulp mills (1979), and fluoride from
primary aluminum plants (1980).
 Results were reductions in emissions from the sources of 75%
fluoride emissions, almost 80% of sulfuric acid emissions, 82%
of sulfur, and up to 78% of fluoride emissions.
 Carbon is different. But it can be done.
STAKEHOLDER POSITIONS
State Air and Utility Regulators from CA, CO, CT,
DE, IL, ME, MD, MA, MN, NH, NY, OR, RI, VT and WA :
…We encourage EPA to develop a stringent but
flexible framework that equitably achieves
meaningful reductions in carbon pollution from the
electricity sector while recognizing that states may
employ a variety of strategies, including successful
state programs already in force, to achieve these
goals.
Kentucky
NASEO/NARUC/NACAA (3Ns)
BIG QUESTIONS
 What is the amount of reductions required? By When?
Compared to What Baseline?
 New York Times, 20%
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Cap and Trade
Auction
Registry
Where Measured
By Ton or by Rate
Compliance Mechanisms
Flexibility
COMPLIANCE
CHALLENGES FOR ENERGY EFFICIENCY
 Compensation Model May Change
Deemed and Modeled Savings
Metered and Measured Savings
 QA and QC will be more vigorous
Professions Certifications, Third Party Inspections, Annual
Performance
 Large Aggregations will be Vetted
 Convincing States Energy Efficiency Works!
OPPORTUNITIES FOR ENERGY
EFFICIENCY
TIMELINE
“ the most significant opportunity for energy efficiency
advancement in our lifetime ”
Timeline:
June 2014 Comment Period
June 2015 Final Rules Released
June 2016 State SIPs Developed
June 2017 Compliance.
COST-EFFECTIVENESS TEST REFORM
• Current Five tests (CA SPM):
• Societal Cost Test (SCT)
• Total Resource Cost Test (TRC)
• Program Administrator Cost Test (PACT)
• Ratepayer Impact Measure Test (RIM)
• Participant Cost Test (PCT)
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WHAT’S WRONG WITH CURRENT
COST-EFFECTIVENESS TESTING?
• Systematically unbalanced: often all costs, but
not all benefits, considered
• Wide variation in methods, not all in
accordance with best practices
• No systematic consideration of public policy
goals
• Result: inaccurate information that is used as
the basis for decisions
RECOMMENDATIONS
Recommendations for Reforming Energy Efficiency CostEffectiveness Screening in the United States
• Frames tests with key question: is a program in the
Public Interest?
• RVF principles recommend that all tests:
• Address energy policy goals
• Account for hard-to-quantify benefits
• Ensure transparency and balance
• Use best practices
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TRANSPARENCY AND SYMMETRY
Test Your Test!
Use a worksheet to make assumptions and
inputs explicit
Ensure that if a category of costs is considered,
that the corresponding benefits are also
considered
• Incorporate hard-to-quantify benefits
• Take public policy into account
• Address the public interest
INCORPORATE HARD-TO-QUANTIFY
BENEFITS
If it’s clear that a particular type of benefits exist,
they should be adequately accounted for
Range of methods:
•Monetization
•Quantification
•Proxy adders
•Alternative screening benchmarks
If benefits clearly exist but are not accounted for, the
corresponding costs should not be considered. You may be
using the wrong test.
ENSURE THAT POLICY GOALS ARE
CONSIDERED
Most (all) states have goals policy goals affected by energy
efficiency programs
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Assisting low-income customers
Diversifying energy resources
Reducing price volatility
Water savings
Job creation
Carbon reduction
May be in the form of executive orders, statutes,
regulations, etc.
These policies should be taken into account in the test
IMPLEMENTING THE RVF
• Decide which overall perspective is appropriate for the
state: a utility perspective or a societal perspective
• Identify the state’s energy policy goals that are relevant
to, and might be affected by, energy efficiency resources.
• Identify a method of accounting for those energy policy
goals in the state’s screening test.
• Develop a standard template to explicitly identify the
components of its screening test, and to document the
assumptions and methodologies used to account for
those components
BEST PRACTICES ALSO IMPORTANT
• Ensure avoided costs are fully accounted for
• Use an appropriate discount rate
• Use appropriate measure lives
• Test at the appropriate level
COST EFFECTIVENESS TEST
CAMPAIGN
• NHPC Launched national campaign in support of
recommendations at NARUC 2013
• Build the national Energy Efficiency Screening
Coalition (http://www.nhpci.org/campaigns.html)
• Target states for adoption of recommendations
• NY, MD, OR, ??
Thank you!
National Home Performance Council
(Home Performance Coalition)
Kara Saul-Rinaldi
Executive Director
[email protected]
202.276.1773
www.nhpci.org
http://www.nhpci.org/campaigns.html
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