Indiana Governor Mike Pence: Allows SEA 340 to become law; Calls for new direction on energy efficiency in Indiana

Posted by Laura Arnold  /   March 28, 2014  /   Posted in 2014 Indiana General Assembly  /   No Comments

Governor Mike Pence

FOR IMMEDIATE RELEASE March 27, 2014

Contact: Kara Brooks, kbrooks@gov.in.gov                                                                                                                                    

 

GOVERNOR PENCE CALLS FOR NEW DIRECTION ON ENERGY EFFICIENCY IN INDIANA

Seeks recommendations for energy efficiency program in 2015

 

Indianapolis — In announcing his intention to allow SEA 340 to become law without his signature, Governor Pence issued the following statement:

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[Editor's Note: Governor Pence was not in Indianapolis last when this statement was released by his office. Instead he was  participating  in the First Annual Forbes Reinventing America Summit at JW Marriott in Chicago.

A Government of Growth: Politics and Policy that Foster Innovation
So what is the role of government in all this? How can Washington and the states create policies that allow the new industrial revolution to thrive? Our panelists will debate the right—and wrong—strategies for fostering innovation.

A. Paul Alivisatos, Ph.D., Director, Lawrence Berkeley National Laboratory
The Honorable James S. Gilmore III, President & Chief Executive Officer, AmericanOpportunity.org; Governor, State of Virginia 1998-2002
The Honorable Michael Pence, Governor, State of Indiana
The Honorable Rick Snyder, Governor, State of Michigan
The Honorable Thomas Vilsack, Secretary, U.S. Department of Agriculture

Moderator: Steve Forbes, Chairman & Editor-in-Chief, Forbes Media
Floor Moderator: Dan Bigman, Managing Editor, Forbes Media

It would interesting to obtain a copy of Governor Pence's prepared remarks.]

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“Low-cost energy is an essential element of Indiana’s economic development and prosperity. The simple fact is that higher energy costs will cost Indiana jobs.  By reducing our need for electricity, we reduce our need to build expensive power plants at a cost to Hoosier ratepayers. For this reason, I believe that energy efficiency is an important part of our ‘all of the above’ energy strategy.

 

“As such, I was disappointed that the General Assembly chose to eliminate the energy efficiency program established by the previous administration without offering a viable alternative. For that reason, I have declined to sign this bill and acknowledge that this bill will become law without my signature.

 

“I could not sign this bill because it does away with a worthwhile energy efficiency program. I could not veto this bill because doing so would increase the cost of utilities for Hoosier ratepayers and make Indiana less competitive by denying relief to large electricity consumers, including our state’s manufacturing base.

 

“To ensure that Indiana’s energy policy continues to include sound efficiency programs that lower electricity usage and support economic growth, I am calling on the Indiana Utility Regulatory Commission to immediately begin to develop recommendations for a new energy efficiency program that would include an opt-out for large electricity consumers.

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 [Editor's Note: The Indiana Utility Regulatory Commission (IURC) already opened an investigation Cause No. 44441 on 01/15/14 to address this issue.

44441 Order creating DSM Opt-out Docket dated 2014-01-15

An excerpt is below:

On December 9, 2009, the Indiana Utility Regulatory Commission ("Commission") issued its Phase II Order in Cause No. 42693 ("Phase II Order") wherein it found, among other things, that demand side management ("DSM") must be available to all customer classes to ensure that every Indiana energy consumer has the opportunity to benefit from energy cost reductions that can be achieved through energy efficiency improvements. Phase II Order at 29. Consequently, the Commission established annual energy savings goals for all jurisdictional electric utilities designed to meet an overall goal of 2% annual cost-effective DSM savings within ten years. Id at 30-31. The energy savings goals, while not mandates, were established to ensure all DSM opportunities for all customer classes were fully pursued. We explained that such a broad approach should help ensure that significant reservoirs of untapped cost-effective energy efficiency potential were not omitted from consideration. Id at 30. Nonetheless, the Commission specifically indicated that it was not foreclosing possible consideration of opt-out provisions at some future date. Id

On February 27,2013, the Commission issued an Order initiating an investigation in Cause No. 44310 to consider "whether to pursue the adoption of a 'structured' self-direct DSM program for certain large customers. Specifically, whether the DSM expense allocated to certain large customers for Core and Core Plus Programs should be utilized to fund a self-direct DSM program whereby these quaifying customers may access the funds, or receive credits, to complete defined energy efficiency projects that are subject to evaluation, measurement and verification." (Order at 1). In
establishing the procedural schedule for the investigation, the Presiding Officers' March 28,2013 Docket Entry specifically provided that, "related issues, such as opt-out programs and the energy savings goals established in Cause No. 42693, will not be addressed .... "

Now further informed by the various positions of the parties in the Cause No. 44310, and concerned that the efforts which would be required to effectuate a structured self-direct DSM program after an order establishing the reasonable parameters for such an offering would not be insignificant, the Commission is persuaded that administrative efficiency is best served by more fully exploring alternative solutions beyond the stated purpose of that proceeding. Although we remain convinced that cost-effective DSM offerings must be available to all customer classes and market segments, we recognize that economic drivers outside the present model may serve as powerful
incentives toward that objective. Therefore, we open this investigation to undertake a critical review on the continued reasonableness of certain large customer participation in utility sponsored and Commission regulated DSM programs. This investigation will occur on an expedited basis to ensure continued implementation of the Phase II Order requirements for the submission of three-year DSM plans by the regulated electric utilities and the continued offering of Core Programs. The investigation will also consider any associated and necessary revisions to the energy savings goals
established in the Phase II Order.

...

IT IS THEREFORE ORDERED BY THE INDIANA UTILITY REGULATORY
COMMISSION that:
1. An investigation is hereby commenced to allow the Commission to consider and
review the reasonableness of continuing to require the participation of certain large customers in utility sponsored and Commission regulated DSM programs and any associated impacts on the energy savings goals established in the Phase II Order.
2. A Preliminary Hearing and Prehearing Conference to establish a procedural schedule is set for February 3, 2014 at 9:30 a.m. local time in Room 222 of the PNC Center, 101 West Washington Street, Indianapolis, Indiana.

Editor's Note: So why does Pence say:  "I am calling on the Indiana Utility Regulatory Commission to immediately begin to develop recommendations for a new energy efficiency program that would include an opt-out for large electricity consumers." Wasn't the IURC already doing that?]

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“In addition, I have informed leaders of the General Assembly of my actions and my intention to bring energy efficiency legislation during the 2015 legislative session. I look forward to working with legislators to develop a new energy efficiency program for our state that will encourage conservation and promote a strong Indiana economy.”

 

 

 

Christy Denault

Communications Director

Office of Governor Mike Pence

cdenault@gov.in.gov

317/233-9997 (Office)

317/775-1170 (Cell)

 

Former US DOE Secretary Steven Chu Says Utilities Should Get Into Rooftop Solar to Save Themselves from Death Spiral

Posted by Laura Arnold  /   March 26, 2014  /   Posted in Uncategorized  /   No Comments
  16,477 views

Jeff McMahon

, Contributor

Steven Chu Solves Utility Companies' Death Spiral

[Updated with comment from Hawaiian Electric Company.]

Utility companies have been looking for new regulations and higher connection charges to save them from a “death spiral” spurred by a surge in rooftop solar installations. Instead, says former Energy Secretary Steven Chu, they should get into the rooftop solar business.

“The cost of modules has plummeted. In California where I live, that means for $10,000 you can generate a lot of electricity. The cost of batteries is plummeting, so that in five maybe 10 years at the outside, a $10,000 or $12,000 system will allow me to go, on average, 80 percent off grid.

“That’s pretty exciting. So this is a technology that could be disruptive to electricity production and generation.”

The industry-funded Edison Electric Institute warned utilities of this scenario in a January 2013 report called “Disruptive Challenges: Financial Implications and Strategic Responses to a Changing Retail Electric Business” (pdf). Wall Street Journal reporter Liam Denning described this scenario, in which solar becomes increasingly attractive to the customers who can afford it, as a ”death spiral” in December, and utility insiders have been echoing that phrase.

Utilities like Exelon owned ComEd and Pacific Gas & Electric are looking to regulators to save them by changing pricing structures so they can recoup more of the costs of maintaining the grid infrastructure.

“They think they’ve got it solved,” Chu said, but if utilities charge customers more to connect to the grid, those charges will also spiral—upward—as more customers install solar.

“They’re in a flat to shrinking business, and as solar and batteries get cheaper and cheaper, they’re going to see their customer base of the best customers” install solar, he said.

A Hawaiian utility has tried to slow the growth of solar. In December, Hawaiian Electric Company shut down rooftop solar installations, citing “grid stability.”

(Hawaiian Electric disputes Chu’s 2 percent figure, and spokeswoman Lynn Unemori says the company has not halted solar installations, but has adopted “a more cautious approach to applications for new PV systems on circuits with a large amount of PV already installed, solely for reasons of safety and reliability.” See her statement in the comments below.)

“Instead of that, you need a better business model,” Chu said. “So I’m telling utility companies, this is coming down the line, so let’s think of a new business model where you can profit from this.”

In Chu’s business model, utilities will borrow money—because “utility companies get to borrow money as inexpensively as just about anyone in the United States”—to buy rooftop solar modules and batteries. Then they’ll partner with private rooftop-solar installation firms—”because I don’t expect a utility company to figure out how to do that”—to install rooftop panels and batteries at customer homes.

The utility will own the panels and batteries and sell electricity to the customers at a much lower rate.

Customers would not only get lower rates, they would get solar power without having to pay for installation, Chu said, and they would get a battery backup that can keep the lights on and the refrigerator running for up to a week in a power outage.

Utility companies, meanwhile, would benefit from a distributed network of panels and batteries “where they need it the most, at the end of the distribution system, for grid stability.”

Chu said he began talking to utilities about this issue in roundtable discussions two years ago. He said he has received three kinds of responses:

  1. “Tell us what to do.”
  2. “Deer in the headlights.”
  3. “We’re going to fight this.”

(I’ve sent an email to the Edison Electric Institute to see what they think of Chu’s idea. I’ll add their comments to this story when they respond.)

“This is not a radical model,” Chu said, “this is the old telephone system model, where the telephone companies owned the phone, they rented you the phone for so long, they maintained it.”

Chu made his remarks at an appearance at the University of Chicago in which he also skewered cable companies for wasting electricity in set-top boxes and lamented the Washington media for sensationalist reporting.

Follow Jeff McMahon on Facebook, Google Plus, Twitter, or email him here.

Energy Secretary Chu Visits Appalachian State ...

Energy Secretary Chu Visits Appalachian State University’s Solar Decathlon House (Photo credit: Dept of Energy Solar Decathlon)

Wind farm plan dropped for LaGrange County because of lack of landowner interest

Posted by Laura Arnold  /   March 26, 2014  /   Posted in Uncategorized, wind  /   No Comments
3/11/2014 12:42:00 PM
Wind farm plan dropped for LaGrange County because of lack of landowner interest
Patrick Redmond, News-SunTOPEKA — A proposal to build a large wind farm operation in the southwest corner of LaGrange County is dead.Rob Propes, development manager for Apex Clean Energy, said in an email sent to Bob Shanahan, LaGrange County planning administrator, said Apex had decided not to pursue the Clear Spring Wind Energy project in LaGrange County due to “a lack of landowner participation.”Apex Clean Energy Inc. is a leading U.S.-based developer of commercial-scale renewable energy facilities such as wind farms in North America. The company is headquartered in Charlottesville, Va.

Propes said in his letter that while many people in the area were supportive of wind energy, the expected growth rate of smaller farms in the area made many landowners hesitant to commit to 20- to 25-year leases needed to make the project feasible.

A preliminary plan called for installing as many as 100 wind turbines in the area, Shanahan said. That portion of the county was selected for wind energy production after testing revealed the winds were sufficient to produce wind energy. A major electrical transmission line also runs through the area.

Shanahan said it was “a real shame” the energy company killed the proposal.

Propes concluded his letter to Shanahan by saying that he was “sorry that we were not able to fully develop a project that would have provided many landowners with supplemental income and generated property taxes for the county.”

MN PUC ALJ Selects Solar Over Natural Gas in Competitive Bidding Process

Posted by Laura Arnold  /   March 26, 2014  /   Posted in Uncategorized  /   No Comments

Proposed solar farms endure new criticism

Advocates for the Geronimo project gear up to state case

Mar. 21, 2014   |
24 Comments
Village Relies Only On Alternative Energy Sources

The Geronimo solar project was one of five proposals Xcel Energy submitted to state regulators as part of a competitive bidding process to meet future electricity needs. / Getty Images

Written by
Kirsti Marohn

PUC timeline

The state Public Utilities Commission is scheduled to hear oral arguments on the competitive bidding process for new energy resources at 9:30 a.m. Tuesday. The commission will deliberate the matter at 9:30 a.m. Thursday. 
The meetings are broadcast live at http://puc.state.mn.us.

When an administrative law judge chose a solar project over competing natural gas proposals last December, it was heralded by environmental groups as a landmark opinion.

Since then, Judge Eric Lipman’s recommendation of Geronimo Energy’s proposal to build 100 megawatts of new solar farms around the state has been criticized by utilities and a state agency.

That hasn’t come as a surprise to Betsy Engelking, vice president of Edina-based Geronimo, who will argue in favor of the Aurora Solar Project before the state Public Utilities Commission next week.

Despite objections by Xcel Energy, other utilities and the state Department of Commerce, Engelking remains adamant that her company’s proposal is superior and should be the PUC’s choice.

“We still believe strongly that our project is the best project that was offered, not just from an economic standpoint ... but it’s also the only project that meets all of the state policy goals in terms of energy resource expansion,” Engelking told the Times this week.

The Geronimo solar project was one of five proposals Xcel Energy submitted to state regulators as part of a competitive bidding process to meet future electricity needs.

Geronimo would build 20-25 large solar arrays around the state, including three in Stearns County and one in Benton County.

Each solar farm would range from 2-10 megawatts of expected production, with two of the biggest near Albany and Paynesville and smaller ones near Brooten and Sauk Rapids.

Lipman recommended the Geronimo proposal, saying it is the most reasonable and prudent alternative to meet Xcel’s needs.

Typically, an administrative law judge’s recommendation carries weight with the PUC, but the commission isn’t required to follow the recommendation.

Taking heat

Critics of Lipman’s report, including Xcel and the commerce department, disagree that the Geronimo project is the most cost effective compared to the natural gas proposals.

The commerce department has supported solar energy, but it contends that Geronimo’s proposal should compete against other solar projects in a separate bidding process.

Lipman calculated a significant cost savings with the solar project related to transmission costs, said Jim Alders, Xcel’s regulatory strategy consultant. But Xcel contends that adding solar doesn’t change how much new transmission capacity would be needed.

Xcel is advocating that the commission instead choose its proposal to build a natural gas plant at its Black Dog plant in Burnsville, plus one of the other natural gas projects.

Alders said Xcel isn’t rejecting solar. In fact, the utility recently announced it would be seeking to add up to 150 megawatts of large-scale solar in its Upper Midwest territory by the end of 2016.

Xcel also questions the value Lipman assigned to renewable energy credits associated with solar power, Alders said. Xcel argues there’s no way for the utility to recoup that revenue unless the credits are sold, but then they can’t be used to meet the state’s new solar energy mandate.

A law passed last year requires investor-owned utilities including Xcel to generate 1.5 percent of their energy from the sun by 2020.

Engelking said Geronimo proposed the solar project as a way to meet Xcel’s need for more electricity, not to meet the solar standard. She notes that state law requires that renewable energy projects be given preference unless the utilities can show that they are not in the public’s best interest.

“Frankly, we just don’t think that they’ve made that showing,” Engelking said.

Public input

The Sierra Club organized a letter-writing campaign to generate support for Lipman’s recommendation and the Geronimo project. More than 1,000 people sent letters of support, said Jessica Tritsch, senior organizing representative with the Sierra Club’s Beyond Coal to Clean Energy campaign.

“I think that no matter what happens next week, there’s really exciting momentum for solar here in Minnesota,” Tritsch said.

One of those who sent a letter was Lee Klisch, a retired mechanical engineer from St. Joseph who closely follows energy policy.

Klisch wants to see the Geronimo project built as a way to generate data on solar and to encourage renewable sources of energy that don’t have the same environmental and health concerns as fossil fuels.

“We’ve got plenty of coal and natural gas out there already, a reasonable amount of wind. ... So I think that from a reliability point of view, we shouldn’t put all our eggs in one basket,” Klisch said.

Geronimo’s proposal has critics, including the city of Sauk Rapids. One of the proposed solar farm sites is in Sauk Rapids Township, in an orderly annexation area where the city had planned residential and commercial development.

Mayor Brad Gunderson sent a letter to the PUC questioning the site and noting the potential loss in tax revenue for the city.

The solar farm would generate about $10,000 annually in local property taxes, said Todd Schultz, the city’s community development director. Single-family homes would generate more than $200,000 a year in taxes, he said.

The letter also voices concern about a lack of notice for the project and questioning whether Geronimo is trying to skirt local zoning authorities by proposing a statewide project.

Engelking said Geronimo has obtained control of the property at all of the sites, either through purchase agreements or leases. However, more sites have been selected than will be needed in case problems arise, she said.

Although the company is seeking a state site permit and would not need local zoning approval, local communities can file comments and concerns with the PUC, she said.

Duke Edwardsport Appeal Filed 9/6/13; Amici Curiae Brief Filed 9/9/13; Download Documents HERE

Posted by Laura Arnold  /   March 24, 2014  /   Posted in Uncategorized  /   No Comments

Indiana Distributed Energy Alliance joined ---in an Amici Curiae brief or "friend of the court"

Amicus Curiae means literally, friend of the court. A person or in this case a group with strong interest in or views on the subject matter of an action, but not a party to the action, may petition the court for permission to file a brief, ostensibly on behalf of a party but actually to suggest a rationale consistent with its own views. Such amicus curiae briefs are commonly filed in appeals concerning matters of a broad public interest.

 

It states:

9.
Indiana Distributed Energy Alliance,. Inc. ("IndianaDG") is an Indiana non-profit corporation established for the purpose ofpromoting renewable energy resources and distributed generation in Indiana. IndianaDO works to achieve this mission by promoting renewable energy and distributed generation policies and programs that give consideration to customer owned electric-generating facilities, which present lower carbon risk and provide for greater flexibility and faster deployment ofadditional electric generation increments. More specifically,. IndianaDO has been actively engaged in proceedings before the lURe to promote renewable energy resources and distributed generation through the adoption ofvoluntary feed-in tariffs. IndianaDG supports Appellants' appeal because it understands that the review ofthe decision to invest billions ofratepayer dollars in fossil fuel electric generation must include an assessment of available alternatives including customer-owned renewable energy and distributed generation resources. While IndianaDG believes that Duke·s failure to assess the full costs ofthe Edwardsport project resulted in an unfair comparison to other, less carbon-intensive options, it is not too late for Duke to take concrete steps to diversify its resource portfolio and thereby mitigate the serious financial risks that the company and its ratepayers face from future carbon regulation.

 Edwardsport - 13-09-09 - Stamped Brief of Proposed Amici Curiae In Support of Appellants

Edwardsport - 13-09-09 File Stamped Motion for Leave to Appear as Amici Curiae and File Brief (1)

It will likely help to understand these filings when compared to Appeallant Brief filed 9/6/13 on behalf of Citizens Action Coalition, Save the Valley, Sierra Club, and Valley Watch.

Appellants Brief - signed

Copyright 2013 IndianaDG