Use of Renewable Use of Renewable Energy and Energy Energy and Energy Efficiency to Efficiency to Reduce Regional Reduce Regional Haze Haze in the West in the West Air Innovations Conference Air Innovations Conference Chicago, Illinois Chicago, Illinois August 10-12, 2004 August 10-12, 2004 Rick Sprott Rick Sprott Director Director Utah Division of Air Quality Utah Division of Air Quality
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Use of Renewable Energy and Energy Efficiency to Reduce Regional Haze in the West Air Innovations Conference Chicago, Illinois August 10-12, 2004 Rick.
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Use of Renewable Energy Use of Renewable Energy and Energy Efficiency to and Energy Efficiency to Reduce Regional HazeReduce Regional Haze
in the Westin the WestAir Innovations ConferenceAir Innovations Conference
Utah Division of Air QualityUtah Division of Air Quality
Today’s Presentation:Today’s Presentation:
• • What is Regional Haze?What is Regional Haze?
•Grand Canyon Visibility Transport Commission (GCVTC) Grand Canyon Visibility Transport Commission (GCVTC) and the Western Regional Air Partnership (WRAP)and the Western Regional Air Partnership (WRAP)•WRAP Pollution Prevention Forum WRAP Pollution Prevention Forum •Estimating Costs and Benefits of Renewable EnergyEstimating Costs and Benefits of Renewable Energy•ConclusionsConclusions
Regional Haze Rule and Regional Haze Rule and Renewable EnergyRenewable Energy
((Section 309 (d) (8): Pollution Prevention)Section 309 (d) (8): Pollution Prevention) •Identify state RE and EE programsIdentify state RE and EE programs
Investments in RE and EE Lowers Investments in RE and EE Lowers SOSO22 Compliance Costs Compliance Costs
• 10/20 goals and EE will 10/20 goals and EE will reduce the need for reduce the need for scrubber capacity by scrubber capacity by 1200 MW to 1700 MW 1200 MW to 1700 MW by 2018by 2018
• Cuts compliance cost by Cuts compliance cost by about $10 million or 7%about $10 million or 7%-
2,0002,000
4,0004,000
6,0006,000
8,0008,000
10,00010,000
12,00012,000
2018
Scr
ub
ber
Cap
acit
y (M
WS
cru
bb
er C
apac
ity
(MW
)
BAU 10/20 Goals 10/20 Goals + EE With EE
Summary of Modeling ResultsSummary of Modeling Results
• RE strategies reduce haze-causing pollutantsRE strategies reduce haze-causing pollutants
• Visibility improvements not largeVisibility improvements not large– SO2 capSO2 cap– ““Cleaner” gas-fired generation is displacedCleaner” gas-fired generation is displaced
• Secondary benefits beyond regional hazeSecondary benefits beyond regional haze– Downward pressure on gas pricesDownward pressure on gas prices– Lowers SO2 compliance costsLowers SO2 compliance costs
– Significant COSignificant CO2 2 reductionsreductions
• Small positive or no impact on region’s jobs, Small positive or no impact on region’s jobs, income and economic activity.income and economic activity.
The FutureThe Future309 RH SIPs good start, but not typical309 RH SIPs good start, but not typical
– REEE is a REEE is a regional goalregional goal, not a single state RFP , not a single state RFP enforceable measureenforceable measure
• Need EPA & State vision to:Need EPA & State vision to:– CatalyzeCatalyze, not just encourage RE/EE in SIPs & more, not just encourage RE/EE in SIPs & more– New RE/EE Guidance good, but still has barriersNew RE/EE Guidance good, but still has barriers– Find different yardsticks to accept and measure Find different yardsticks to accept and measure
effectivenesseffectiveness
• We all need to think regionallyWe all need to think regionally– Power, like pollution, doesn’t stop at state linesPower, like pollution, doesn’t stop at state lines
(except in Texas)(except in Texas)– Encourage multi-state collaborationEncourage multi-state collaboration
• Create the market…hardware will followCreate the market…hardware will follow
RE is coming soon…RE is coming soon…
……EE is coming too…EE is coming too…
……Voila!!!!Voila!!!!
It’s a “WRAP”It’s a “WRAP”
GCVTC Renewable Energy GCVTC Renewable Energy RecommendationRecommendation
““The Commission promotes the transition to The Commission promotes the transition to power production based on renewable power production based on renewable resources …[T]the goal of the states in the resources …[T]the goal of the states in the Transport Region should be to achieve Transport Region should be to achieve annual additions in order that renewables annual additions in order that renewables will comprise 10% of the regional power will comprise 10% of the regional power needs by 2005 and 20% by 2015.”needs by 2005 and 20% by 2015.”
GCVTC FindingsGCVTC Findings
GCVTC concluded that renewable energy GCVTC concluded that renewable energy and efficiency can be effective tools to and efficiency can be effective tools to reduce haze and if adopted could result in reduce haze and if adopted could result in “…emissions reductions, improvements in “…emissions reductions, improvements in visibility, and provide secondary visibility, and provide secondary environmental and economic benefits to the environmental and economic benefits to the region.” region.”
(Report of the GCVTC to the U.S. Environmental Protection Agency: Recommendations (Report of the GCVTC to the U.S. Environmental Protection Agency: Recommendations for Improving Western Vistas, June 1996, pg. 28)for Improving Western Vistas, June 1996, pg. 28)
Regional Haze RuleRegional Haze Rule• Final rule issued July 1999Final rule issued July 1999• Targets 156 Class I air shedsTargets 156 Class I air sheds• Applies to all statesApplies to all states• SIPS must demonstrate “reasonable SIPS must demonstrate “reasonable
• Examine policies that can overcome Examine policies that can overcome market barriers,market barriers,
• Quantify emissions reductions, and Quantify emissions reductions, and economic impacts, and economic impacts, and
• Recommend a portfolio of policies and Recommend a portfolio of policies and “best practices” to states and tribes.“best practices” to states and tribes.
Renewable Energy Generation Renewable Energy Generation Mix in 2018Mix in 2018
23%
64%
13% 0%
Existing Renewables
New Wind
New Geothermal
New Landfill Gas
Renewables lncrease Regional Renewables lncrease Regional Electricity Production Cost 2% - 5%Electricity Production Cost 2% - 5%
Lev
eliz
ed A
nnua
l Pro
d uc t
ion
Co s
t (2 0
0 5 –
2 02 2
)L
evel
ize d
An n
ual P
rodu
ctio
n C
o st (
2 00 5
–2 0
2 2)
$17.4 $17.7
$18.3
$-0
$5,000$5,000
$1010,000,000
$15,000$15,000
$20,000$20,000
BAUBAU 10/20 Goals10/20 Goals No Improvements in No Improvements in wind technologywind technology
Mill
ion
2001
$M
illio
n 20
01 $
SOSO2 2 EmissionsEmissions
200200
400400
600600
800800
20052005 20072007 20102010 20152015 20182018
SO2 ('000 tons)
Because of the trading program, there will be no changes in SO2 emissions under the 10/20 goals or EE
Emissions limited through the regional SO2 trading program
COCO2 2 Emissions of Utility Sector Emissions of Utility Sector
Reduced by 10%Reduced by 10%
-
55
1010
1515
2020
2525
3030
3535
4040
20052005 20152015 20182018Mil
lion
Met
ric
Ton
s of
CO
2 S
aved
Mil
lion
Met
ric
Ton
s of
CO
2 S
aved
NONOx x Emissions of Utility Sector Emissions of Utility Sector
Reduced by 1%Reduced by 1%
-
22
44
66
88
1010
1212
1414
1616
20052005 20152015 20182018Th
ousa
nd
Ton
s of
NO
x S
aved
Th
ousa
nd
Ton
s of
NO
x S
aved
Final ObservationsFinal Observations• Energy efficiency cost-effective emissions control Energy efficiency cost-effective emissions control
strategy strategy • Cost of meeting 10/20 renewables goal lower than Cost of meeting 10/20 renewables goal lower than
expected.expected.• Federal actions (e.g., production tax credit, RPS) Federal actions (e.g., production tax credit, RPS)
can help can help • Regional action desirableRegional action desirable
– Need regional RE credit trading system Need regional RE credit trading system – Need regional action on transmission reform Need regional action on transmission reform – Don’t exclude out-of-state RE power in state RPS’sDon’t exclude out-of-state RE power in state RPS’s
• Environmental policy benefits from a balanced Environmental policy benefits from a balanced energy policy.energy policy.