Following months of negotiation, President Obama is due to announce the next round of fuel-economy standards this Friday, according to the White House.
"This program, which builds on the historic agreement achieved by this administration for model years 2012-2016, will result in significant cost savings for consumers at the pump, dramatically reduce oil consumption, cut pollution and create jobs," White House spokesman Jay Carney said at Wednesday's press briefing.
According to individuals familiar with the plan, auto fleets will have to average 54.5 CAFE mpg by 2025, representing about a 40 percent cut in fuel consumption and a 50 percent reduction in carbon pollution from today’s vehicles.
The White House had, for the past few weeks, been pushing for a 56.2 mpg by 2025 standard. That proposal, however, came under fire from the Alliance of Automobile Manufacturers and the Michigan congressional delegation, which called it “overly aggressive and not reasonably feasible.”
The easing of the standard arises from concessions to makers of light trucks, including SUVs, which would be permitted a slower rate of fuel economy improvement—3.5 percent annually from 2017 to 2021, and 5 percent annually from 2022 to 2025. Cars would still have to meet 5 percent annual increase beginning in 2017 under the plan.
Thursday, July 28, 2011
Wednesday, July 27, 2011
FERC Issues Landmark Rule to Encourage Building of New Transmission Lines
The Federal Electricity Regulatory Commission (FERC) issued a major rule last Thursday, Order No. 1000, that revamps the agency’s guidelines for planning and allocating costs of new transmission lines (for more background on the ruling, see last Thursday’s post).
“This rule is an important step forward, building on FERC’s successful market reforms over the past 15 years,” said FERC Chairman Jon Wellinghoff.
The 620-page rule, which was approved by a 5-0 vote, aims to facilitate the building of transmission lines, particularly in tricky cases where the lines may cut across states and electricity jurisdictions.
Such issues have become increasingly prevalent as states seek to integrate renewable energy, typically generated far from load centers in cities, into their energy mix—twenty-eight states and the District of Columbia have renewable portfolio standards.
“While these state policy choices will necessarily shape future energy supply, existing planning rules do not always allow for these policy choices to be considered as drivers of transmission needs,” said FERC Commissioner Cheryl LaFleur.
The new rule removes that impediment by helping regions account for all the benefits new transmission provides in determining cost allocation including, for the first time, those that arise from meeting state clean energy standards.
“This rule is an important step forward, building on FERC’s successful market reforms over the past 15 years,” said FERC Chairman Jon Wellinghoff.
The 620-page rule, which was approved by a 5-0 vote, aims to facilitate the building of transmission lines, particularly in tricky cases where the lines may cut across states and electricity jurisdictions.
Such issues have become increasingly prevalent as states seek to integrate renewable energy, typically generated far from load centers in cities, into their energy mix—twenty-eight states and the District of Columbia have renewable portfolio standards.
“While these state policy choices will necessarily shape future energy supply, existing planning rules do not always allow for these policy choices to be considered as drivers of transmission needs,” said FERC Commissioner Cheryl LaFleur.
The new rule removes that impediment by helping regions account for all the benefits new transmission provides in determining cost allocation including, for the first time, those that arise from meeting state clean energy standards.
Tuesday, July 26, 2011
Despite Hysteria over Strong CAFE Standards, More Good News about Advanced Vehicle Technologies
As we reported last week, the Alliance of Automobile Manufacturers (AAM) is back to attacking the White House proposal to set a 56.2 mpg CAFE standard for 2025. But their allegation that the standard would have detrimental consequences for “preserving jobs, affordability, safety and vehicle choice” continues to be undermined:
1. The United Auto Workers, along with a coalition of other unions and NGOs, submitted a joint letter to the President supporting “strong standards.”
2. Hyundai Motor America and GM North America have strayed from the official AAM-party line—GM North America president Mark Reuss painted the proposed standard as tough, but achievable and issued the reminder that this “is a volume scale industry. What was very expensive in the past is no longer very expensive.”
3. In line with this last statement, the technology and business of clean vehicles keep moving forward:
From Autoblog Green: Toyota sets 2012 Prius Plug-in U.S. sales target at 16,000+
According to Toyota spokesman John Hanson, Toyota expects U.S. sales of its new Prius Plug-in to hit at least 16,000 in 2012.
“We think it's going to be a strong seller and we'll deliver to whatever level the market wants,” Hanson told Bloomberg News.
1. The United Auto Workers, along with a coalition of other unions and NGOs, submitted a joint letter to the President supporting “strong standards.”
2. Hyundai Motor America and GM North America have strayed from the official AAM-party line—GM North America president Mark Reuss painted the proposed standard as tough, but achievable and issued the reminder that this “is a volume scale industry. What was very expensive in the past is no longer very expensive.”
3. In line with this last statement, the technology and business of clean vehicles keep moving forward:
From Autoblog Green: Toyota sets 2012 Prius Plug-in U.S. sales target at 16,000+
According to Toyota spokesman John Hanson, Toyota expects U.S. sales of its new Prius Plug-in to hit at least 16,000 in 2012.
“We think it's going to be a strong seller and we'll deliver to whatever level the market wants,” Hanson told Bloomberg News.
Friday, July 22, 2011
Fuel Economy Standard Debate Heating Up: A Round-up
The White House wants a framework deal on fuel economy by the end of the week. But the debate is as heated as ever, with the Auto Alliance and the Michigan congressional delegation painting the 56.2 mpg CAFE standard as a death knell. Meanwhile, California has approved millions of dollars to promote the purchase of clean vehicles and demand for fuel-efficient cars is reportedly helping to drive an auto-industry hiring spree. That and more in this week’s round-up:
Letter from the Michigan Congressional Delegation to President Obama
The White House has floated a CAFE standard of about 56.2 mpg by 2025 but Michigan’s congressional delegation believes such a standard is "overly aggressive".
They sent a letter to the White House late Thursday night detailing their objections to the standard in which they called the 56 mpg target “not reasonably feasible.” Citing the findings of the June Center for Automotive Research (CAR) report, they claimed such a standard would hurt both consumers and the US auto industry.
The CAR report was thoroughly rebutted by the NRDC and the ICCT, who found it to be “fundamentally flawed by improper use of data, incorrect methodologies, erroneous assumptions, and unsound appraisal of technological and other tendencies.” Nevertheless, it has been extensively circulated in the media.
Letter from the Michigan Congressional Delegation to President Obama
The White House has floated a CAFE standard of about 56.2 mpg by 2025 but Michigan’s congressional delegation believes such a standard is "overly aggressive".
They sent a letter to the White House late Thursday night detailing their objections to the standard in which they called the 56 mpg target “not reasonably feasible.” Citing the findings of the June Center for Automotive Research (CAR) report, they claimed such a standard would hurt both consumers and the US auto industry.
The CAR report was thoroughly rebutted by the NRDC and the ICCT, who found it to be “fundamentally flawed by improper use of data, incorrect methodologies, erroneous assumptions, and unsound appraisal of technological and other tendencies.” Nevertheless, it has been extensively circulated in the media.
Thursday, July 21, 2011
Developing New High Voltage Transmission: FERC, Cost Allocation & the U.S. Senate
Last June, the Federal Energy Regulatory Commission (FERC) proposed a set of rules [PDF] that would revamp the process for developing new high-voltage transmission lines. Renewable energy developers have come out strongly for the reforms but others, including Sen. Corker (R-TN), have expressed concern about how the costs of expanded transmission will be allocated.
While FERC is due to address the thorny issue at a meeting today, we provide here more background ("The 411", if you will) concerning the ruling and the controversy it has provoked.
FERC’s authority to regulate interstate transmission is derived primarily from Sections 205 and 206 of the Federal Power Act (FPA). Section 205 provides that, where FERC holds jurisdiction, all rates and charges for the transmission of electricity, as well as rules and regulations affecting those rates, must be “just and reasonable,” and that no public utility’s rates “unduly discriminate” against any customers. Upon finding that the existing rates or practices are “unjust, unreasonable, unduly discriminatory, or preferential,” Section 206 permits FERC to make (just and reasonable) changes to those rates or practices.
Cost allocation was unlikely to cause argument prior to the 1970s, when restructuring of the electric power generation and transmission industries began. Both the Public Utility Regulatory Policies Act of 1978 and the Energy Policy Act of 1992 included the goal of introducing competition into generation service, which was generally controlled by monopolistic investor-owned utilities. To promote the ability of non-utility generators to access the transmission grid, in 1996 FERC issued Orders 888 and 889.
While FERC is due to address the thorny issue at a meeting today, we provide here more background ("The 411", if you will) concerning the ruling and the controversy it has provoked.
FERC’s authority to regulate interstate transmission is derived primarily from Sections 205 and 206 of the Federal Power Act (FPA). Section 205 provides that, where FERC holds jurisdiction, all rates and charges for the transmission of electricity, as well as rules and regulations affecting those rates, must be “just and reasonable,” and that no public utility’s rates “unduly discriminate” against any customers. Upon finding that the existing rates or practices are “unjust, unreasonable, unduly discriminatory, or preferential,” Section 206 permits FERC to make (just and reasonable) changes to those rates or practices.
Cost allocation was unlikely to cause argument prior to the 1970s, when restructuring of the electric power generation and transmission industries began. Both the Public Utility Regulatory Policies Act of 1978 and the Energy Policy Act of 1992 included the goal of introducing competition into generation service, which was generally controlled by monopolistic investor-owned utilities. To promote the ability of non-utility generators to access the transmission grid, in 1996 FERC issued Orders 888 and 889.
Tuesday, July 19, 2011
Shipping Industry Adopts First-of-its-Kind GHG Reduction Requirements
Following more than ten years of debate, the International Maritime Organization (IMO) has released details regarding new requirements aimed at reducing greenhouse gas (GHG) emissions from international shipping. These measures constitute the first mandatory global greenhouse gas reduction regime for an international industry.
The regulations, with numerous loopholes to expedient implementation, resulted in only muted praise from the environmental community. "This much delayed action puts into question if the IMO want to be part of the solution in a carbon constrained future or risk becoming climate laggards," said Svend Soeyland of the Bellona Foundation, an Oslo, Norway-based international environmental NGO.
International shipping accounts for between 2.7 and 3.3 percent of global greenhouse gas. If left unregulated, this figure is expected to reach 6% of global emissions by 2020 and shipping emissions could double or triple by 2050, according to a 2009 IMO analysis.
The amendments make mandatory the Energy Efficiency Design Index (EEDI) for new ships and the Ship Energy Efficiency Management Plan (SEEMP) for all ships. The regulations apply to all ships exceeding 400 gross tonnes and are expected to enter into force on January 1, 2013. Under SEEMP, new and existing ships will be required to keep on board a ship-specific energy use management plan during operation.
The regulations, with numerous loopholes to expedient implementation, resulted in only muted praise from the environmental community. "This much delayed action puts into question if the IMO want to be part of the solution in a carbon constrained future or risk becoming climate laggards," said Svend Soeyland of the Bellona Foundation, an Oslo, Norway-based international environmental NGO.
International shipping accounts for between 2.7 and 3.3 percent of global greenhouse gas. If left unregulated, this figure is expected to reach 6% of global emissions by 2020 and shipping emissions could double or triple by 2050, according to a 2009 IMO analysis.
The amendments make mandatory the Energy Efficiency Design Index (EEDI) for new ships and the Ship Energy Efficiency Management Plan (SEEMP) for all ships. The regulations apply to all ships exceeding 400 gross tonnes and are expected to enter into force on January 1, 2013. Under SEEMP, new and existing ships will be required to keep on board a ship-specific energy use management plan during operation.
Friday, July 15, 2011
Brookings Quantifies the Clean Economy, Finds More Jobs Than Fossil Fuel Sector
In his State of the Union address in January, President Obama spoke of “the promise of renewable energy” and the clean economy to “strengthen our security, protect our planet, and create countless new jobs for our people.” But the state of the clean economy, let alone its progress, remains hard to assess; with no standardized definitions and data, it can be difficult to quantify its size, nature, and growth at the regional level.
A new report and interactive website from the Brookings Institution attempts to bring clarity to some of these issues. The study, conducted in partnership with the Technology Partnership Program of research and development company Battelle, covers the years 2003 to 2010 for every county in the United States.
According to the report, “Sizing the Clean Economy” [PDF], the clean economy now employs some 2.7 million U.S. workers—300,000 more than the fossil fuel sector and 1.3 million more than the biosciences sector.
Most clean economy jobs reside in mature segments, such as wastewater and mass transit. But the fastest-growing segments are in the clean energy sector. These segments, which include the wind, photovoltaic, smart grid, biofuel, and battery industries, grew 8.3 percent annually from 2003 to 2010, far outstripping the 4.2 percent rate for the national economy.
An unusually large share of these jobs—26 percent—are in manufacturing, compared to just 9 percent of jobs in the economy as a whole. And, on a per job basis, the clean economy is about twice as export-oriented as the national economy—$20,129 worth of exports is sold for each job in the clean economy, versus just $10,390 in exports for the average U.S. job. The biofuels industry, the most export-oriented segment, generates an estimated $189,000 in exports per job.
A new report and interactive website from the Brookings Institution attempts to bring clarity to some of these issues. The study, conducted in partnership with the Technology Partnership Program of research and development company Battelle, covers the years 2003 to 2010 for every county in the United States.
According to the report, “Sizing the Clean Economy” [PDF], the clean economy now employs some 2.7 million U.S. workers—300,000 more than the fossil fuel sector and 1.3 million more than the biosciences sector.
Most clean economy jobs reside in mature segments, such as wastewater and mass transit. But the fastest-growing segments are in the clean energy sector. These segments, which include the wind, photovoltaic, smart grid, biofuel, and battery industries, grew 8.3 percent annually from 2003 to 2010, far outstripping the 4.2 percent rate for the national economy.
An unusually large share of these jobs—26 percent—are in manufacturing, compared to just 9 percent of jobs in the economy as a whole. And, on a per job basis, the clean economy is about twice as export-oriented as the national economy—$20,129 worth of exports is sold for each job in the clean economy, versus just $10,390 in exports for the average U.S. job. The biofuels industry, the most export-oriented segment, generates an estimated $189,000 in exports per job.
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