catch-all2

A Year Ago on Zero Resource – September 2010

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PG&E Smart Grid Plan

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(Image credit: Wikimedia Commons)

On June 30, PG&E posted a notice on its website that it posted a plan for “modernizing its electric infrastructure to deliver a host of energy and cost savings to PG&E customers across Northern and Central California.”

For those interested in reading the plan, you can access it via the news release or open the PDF directly here.

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California’s Clean Energy Future, Part 1

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On Tuesday, January 25, I was in the audience at the SPUR Urban Center in San Francisco as Panama Bartholomy, California Energy Commission (CEC), and Emma Wendt, PG&E, gave presentation about California’s clean energy future.

The post below consists of Part 1 of my record of the presentation – the first part of Panama Bartholomy’s presentation. All portions are included in chronological order.

An ellipsis (…) indicates that I was not able to capture the words or thoughts skipped. The presentation is transcribed as accurately as possible – punctuation choices are mine. I also added any photos or images.

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The speakers were introduced by Raphael Sperry and Geoff Danker.

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Panama Bartholomy

I’m honored to be here… Obviously, I’m a bureaucrat. All my life I’ve wanted to be a bureaucrat. It’s true… … So I have achieved my dreams – I work for the state of California… I am here to talk about what I hope are some of our shared goals… building a  future that’s healthy for our economy, our environment, and our communities… …

I was supposed to talk about, and will talk about, California’s Clean Energy Future…  big ambitious goals. A massive document describes the process of how we’re all going to reach these goals… and how the agencies are going to work on it. In brief, it outlines very ambitious energy goals. It calls for zero net energy buildings… ways to shave peak demand… want to build carbon capture and storage in California by 2020… also want 1 million electric vehicles in California by 2020. So these are the goals. So I’m going to talk about the programs and activities behind the goals to make them a reality…

… … …

I have to give some background, then talk about efficiency…  then major market barriers around energy efficiency and what’s stopping a strong retrofit market, then renewables. Finally, I’ll talk about what’s coming from the Brown administration… …

So some energy context… I’m only going to talk about electricity and natural gas… One of the jobs of the CEC is to measure energy demand and project demand into the future… [looking at a chart] Here, you can see impacts of downturns in the economy… We’re expecting that the economy will pick up later this year or early next, then we will see about 1.2% growth in demand a year. Much of that is from the building sector… We expect to see continued increases in demand, especially from the commercial and residential sectors.

So we have several options. Do nothing. Then we get demand exceeding supply. Or we can build power plants. Or we can find ways to reduce demand… Efficiency is by far our most cost-effective choice in terms of how to meet demand.

Going back to natural gas… California only produces 13% percent of our own natural gas – the rest comes from other areas. We are at the end of the line when it comes to natural gas delivery. We are starting to compete more and more with Nevada, Arizona and New Mexico… …

Overarching a lot of activity on energy efficiency, I have to talk about California’s new climate policy… … AB 32 calls for us to reduce our economy-wide emissions levels to 1990 levels by 2020. This is about a 25-30% reduction in GHG emissions… The big player is transportation. Also, we have to look at electricity generation. The 1/4 of our electricity that we import is equal in GHG emissions to the 3/4 that we produce in-state. The built environment is the second largest wedge when we add the bits together. The built environment dictates how we need to get around, so it has a big impact… We have some work to do…

(Image credit: CA Climate Change Portal)

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Part 2 and Part 3 will be posted soon.

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Assorted Links

Here’s a quick round-up of some of some of the latest stories on the controversy surrounding the installation of SmartMeters in California, especially by PG&E.

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According to an independent report by the California Council on Science and Technology, the intensity of the SmartMeters’ radiation falls well within federal limits for wireless devices.

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Pacific Gas & Electric Co. does not plan to comply with Marin County’s moratorium on the installation of its controversial wireless utility meters (aka SmartMeters).

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Marin County sherriffs announce that they will not enforce the SmartMeter ban.

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Two women were arrested in Rohnert Park, California today for blocking a truck carrying smart meters. The arrests follow two earlier, similar ones in the area.

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Assorted Links

GM and PG&E reassure us that electric cars won’t bring down the grid (assuming we get smart grid communications).

CNN Money on what the election means for renewable energy.

National Geographic looks at why solar energy is so expensive.

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Election Day 2010 – Go Vote!

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So… it’s finally Election Day 2010. There are a couple propositions on the California ballot – Prop 23 and Prop 26 – that have implications for energy and transportation policy. Statewide ballot measures just need a majority to pass.

Image credit: Wikimedia Commons

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Proposition 23

Who is funding Prop 23?

According to MapLight.org:

Total Contributions in Support of Prop 23: $10,654,560

Total Contributions in Opposition to Prop 23: $31,245,543

Top Contributors in Support of Prop 23:

Valero Services, Inc. $5,075,315
Tesoro Companies $2,040,637
Flint Hills Resources $1,000,000
Marathon Petroleum Company LLC $500,000
Adam Smith Foundation $498,000
Occidental Petroleum Corp. $300,000
Tower Energy Group $200,000
CVR Energy Inc. $150,000
Howard Jarvis Taxpayers Assoc. $102,568
National Petrochemical & Refiners Assoc. $100,000
World Oil Corp. $100,000

Image credit: MapLight.org

Top Contributors in Opposition to Prop 23:

Thomas Steyer & Kathryn Taylor $5,099,000
National Wildlife Federation $3,000,000
L. John & Ann Doerr $2,100,000
The League of Conservation Voters $1,250,000
Vinod Khosla $1,037,267
Gordon Moore $1,000,000
James Cameron $1,000,000
Robert J. Fisher $1,000,000
ClimateWorks Foundation $900,000
Sierra Club $855,890
The Nature Conservancy $800,000
Bill Gates $700,000
Claire Perry $500,000
Green Tech Action Fund $500,000
John P. Morgridge $500,000
Julian H. Robertson Jr. $500,000
Pacific Gas & Electric $500,000
Wendy Schmidt $500,000

Image credit: MapLight.org

What is Prop 23?

From the Official Voter Information Guide:

SUSPENDS IMPLEMENTATION OF AIR POLLUTION CONTROL LAW (AB 32) REQUIRING MAJOR SOURCES OF EMISSIONS TO REPORT AND REDUCE GREENHOUSE GAS EMISSIONS THAT CAUSE GLOBAL WARMING, UNTIL UNEMPLOYMENT DROPS TO 5.5 PERCENT OR LESS FOR FULL YEAR. INITIATIVE STATUTE.

  • Suspends State law that requires greenhouse gas emissions be reduced to 1990 levels by 2020, until California’s unemployment drops to 5.5 percent or less for four consecutive quarters.
  • Suspends comprehensive greenhouse-gas-reduction program that includes increased renewable energy and cleaner fuel requirements, and mandatory emissions reporting and fee requirements for major emissions sources such as power plants and oil refineries.

Summary of Legislative Analyst’s Estimate of Net State and Local Government Fiscal Impact:

  • The suspension of AB 32 could result in a modest net increase in overall economic activity in the state. In this event, there would be an unknown but potentially significant net increase in state and local government revenues.
  • Potential loss of a new source of state revenues from the auctioning of emission allowances by state government to certain businesses that would pay for these allowances, by suspending the future implementation of cap-and-trade regulations.
  • Lower energy costs for state and local governments than otherwise.

Why does Prop 23 matter?

According to the Natural Resources Defense Council:

Proposition 23 would stop progress on curbing global warming emissions and transitioning to clean energy by “suspending” California’s landmark law, AB 32, until unemployment is below 5.5 percent for four consecutive quarters.  This unemployment threshold has only been reached 3 times in the past forty years.  Prop 23 would pull the rug out from the one sector of our economy that is actually growing – clean technology and clean energy – and create loads of uncertainty for businesses that have already made investments and are looking to expand.

According to the supporters of Prop 23:

We all want to do our part for global warming, but implementing our current plan is not the way to go. Families and businesses simply cannot afford to pay fifty percent or more in higher electricity and utility costs, and even more at the gas pump. A Yes vote on Proposition 23 temporarily postpones a new, costly program until our economy stabilizes and people are back to work, making it easier for families to make ends meet.New rules, regulations, and fines are about to take effect under California’s Global Warming Solutions Act (AB 32), which will increase energy costs by billions of dollars and destroy more than a million jobs. Proposition 23 would suspend those new rules until the economy improves and unemployment drops.

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Proposition 26

Who is funding Prop 26?

According to MapLight.org:

Total Contributions in Support of Prop 26: $18,306,433

Total Contributions in Opposition to Prop 26: $6,547,122

Top Contributors in Support of Prop 26:

California Chamber of Commerce $3,937,323
Chevron Corporation $3,750,000
American Beverage Association $2,450,000
Philip Morris USA Inc. * $2,250,000
Anheuser-Busch Companies, Inc. * $925,000
ConocoPhillips $525,000
Cypress Management Company, Inc. * $500,000
Howard Jarvis Taxpayers Association $432,948
Wine Institute * $381,093
Aera Energy LLC $350,000
MillerCoors $350,000

* Includes contributions from the Small Business Action Committee

Image credit: MapLight.org

Top Contributors in Opposition to Prop 26:

Democratic State Central Committee of California $1,326,674
Thomas F. Steyer $1,000,000
League of Conservation Voters (Prop. 23 Committee) $900,000
California Teachers Association $505,050
California State Council of Service Employees $500,000
John Doerr $400,000
Ella Baker Center $350,000
SCOPE S.I. $250,000
A.L.L.E.R.T. $200,000
California Public Securities Association $150,000
State Building and Construction Trades Council of California $150,000

Image credit: MapLight.org

What is Prop 26?

From the Official Voter Information Guide:

REQUIRES THAT CERTAIN STATE AND LOCAL FEES BE APPROVED BY TWO-THIRDS VOTE.FEES INCLUDE THOSE THAT ADDRESS ADVERSE IMPACTS ON SOCIETY OR THE ENVIRONMENTCAUSED BY THE FEE-PAYER’S BUSINESS. INITIATIVE CONSTITUTIONAL AMENDMENT.

  • Requires that certain state fees be approved by two-thirds vote of Legislature and certain local fees be approved by two-thirds of voters.
  • Increases legislative vote requirement to two-thirds for certain tax measures, including those that do not result in a net increase in revenue, currently subject to majority vote.

Summary of Legislative Analyst’s Estimate of Net State and Local Government Fiscal Impact:

  • Decreased state and local government revenues and spending due to the higher approval requirements for new revenues. The amount of the decrease would depend on future decisions by governing bodies and voters, but over time could total up to billions of dollars annually.
  • Additional state fiscal effects from repealing recent fee and tax laws: (1) increased transportation program spending and increased General Fund costs of $1 billion annually, and (2) unknown potential decrease in state revenues.

Why does Prop 26 matter?

According to the Natural Resources Defense Council:

Proposition 26 is another disastrous measure for California’s environment, public health and local communities.  It would eliminate the ability of a majority of the legislature to enact fees on industries that pollute our air and water and endanger our health.  Currently, a simple majority vote can enact a fee (used to remedy a specific harm), but a tax (used for general purposes) requires a two-thirds vote.  Prop 26 would make it much harder to ensure that polluters are held accountable for the harm caused by their activity.  But Prop 26 goes farther – it also dictates what local governments should do by requiring cities and counties to run costly elections and reach a 2/3 majority to enact a fee.  Prop 26 would make it nearly impossible for local communities to deal with issues like traffic and public safety for large events and would shift the burden to taxpayers for cleaning up hazardous waste and other pollution.  A broad coalition of environmental and health groups, local governments, civic organizations and public safety professionals have come together to defeat this initiative.

According to the supporters of Prop 26:

State and local politicians routinely circumvent the state Constitution’s requirements by disguising taxes as fees because fees are easier to pass than tax increases.  At the state level, the Legislature calls many taxes “fees” so they can pass or increase the tax with a bare majority vote – not the two-thirds vote required for taxes.  At the local level, politicians call taxes “fees” so they can avoid voters and our Constitutional right to vote on most tax increases… Prop. 26 will give voters more control to stop the politicians from using gimmicks to impose hidden taxes on California families just by calling them fees.  No longer will the politicians be able to hide new or higher taxes under the name of a “fee” to try to get more taxpayer money with a bare majority vote of the Legislature – or without any public vote at all at the local level.

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Peter Darbee, CEO of PG&E – Part 3

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On Tuesday, August 31, I was in the audience at the Haas School of Business at UC Berkeley as Peter Darbee, CEO of Pacific Gas & Electric Co., responded to moderator questions about the energy industry and the company’s stance on climate change.

The post below consists of Part 3, the final part, of my record of the conversation – all portions are included in chronological order. Read the previous posts on the conversation – Part 1 and Part 2.

An ellipsis (…) indicates that I was not able to capture the words or thoughts skipped. Moderator questions are paraphrased. Responses are included as accurately as possible – punctuation choices are mine. The moderators were Bev Alexander (BA) and Joey, a student.

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Joey

SmartMeters – I saw your talk at the CPUC  – there were protesters saying Dumb Meters. Talk about the backlash.

Peter Darbee

In California, there has been a tier system of rates… Tiers depend on how much power you use. Originally the tiers were not so steep…all of the rate changes have been amplified in tiers 3-5. In Bakersfield last year…had 17 days over 100 degrees. The previous year had 6… And I’m talking about in July. So folks get rocketed into the higher tiers. There were some folks who didn’t have SmartMeters… Some had SmartMeters for a year and hadn’t had issues until that July… Then they held hearings… And this whole outcome is an inadvertant result of government, freezing the first 2 tiers.

… … ….

… But PG&E could have done better at communications… We kind of assumed they were infrastructure… We assumed that people didn’t give a lot of thought about the meters on the side of the house… We were wrong.

Bev Alexander

In California, it’s a very activist state – you came out in support of AB 32, PG&E advocated decoupling, used to support shareholder incentives for energy efficiency, has a very aggressive RPS at 33% – combined with the federal level, there’s potential for overlapping and conflicting mandates – what works? Why these positions?

Peter Darbee

I’ve done a lot of thinking about climate change…and where is the public on climate change…and they have concerns it may happen…but they don’t want to pay a lot…have to be very attentive to the cost concerns of our customers. What this says is energy efficiency is a no brainer.

…AB 32 envisions a cap and trade system…time to transition to cleaner technologies…for utilities benefits pass through to customers.

… … …

Climate change is a planetary issue, and if a state rigs the system to help themselves, it gets expensive… If we do it in a very expensive way, the people of Ca will revolt, and it will set us back tremendously.

Joey

How did you teach your kids about energy efficiency? What advice do you have for future leaders on climate change?

Peter Darbee

The kids would leave the lights on, the stereo on…in every single room… I instituted a policy that if you leave the lights on, and you’re not in the room, it’s 25 cents…went up as they got older… We now have kids that are tremendously concerned about the environment…

The challenge of climate change will fall more greatly on you and your children…

Write your obituary… The way you create transformational change is you put a stake in the ground for the future…an attractive future…then plan from future back to present. You have a choice.

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This exchange was followed by a question and answer session with the audience.

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Peter Darbee, CEO of PG&E – Part 2

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On Tuesday, August 31, I was in the audience at the Haas School of Business at UC Berkeley as Peter Darbee, CEO of Pacific Gas & Electric Co., responded to moderator questions about the energy industry and the company’s stance on climate change.

The post below consists of Part 2 of my record of the conversation – all portions are included in chronological order. Read Part 1 here.

An ellipsis (…) indicates that I was not able to capture the words or thoughts skipped. Moderator questions are paraphrased. Responses are included as accurately as possible – punctuation choices are mine. The moderators were Bev Alexander (BA) and Joey, a student.

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Joey

I want to go back to a shareholder value article in the Wall Street Journal – a professor from Michigan says we should focus exclusively on profit. Why worry about corporate responsibility?

Peter Darbee

I used to have that view – I lived and breathed Milton Friedman… It’s tragic that more people haven’t continued the journey of being realistic… What [the professor] is saying is that if you maximize profit each quarter…line up the quarters…then that will maximize profit forever… But you cut back on expenditures that are needed… There’s such a time between when policies are set and it comes home to roost…

I want to make sure PG&E is here 100 years from now and I’m setting up good people and good culture…

I couldn’t disagree with that teacher more…it’s rubbish.

Bev Alexander

The direction the industry is headed will call for a lot of innovation. How are you shifting the culture? How will the utilities integrate new technology?

Peter Darbee

Utilities have been very conservatively run and prone to not changing…but the environment is of new technology and changing regulation… You could say the risk is that utilities won’t change quickly enough… … Utilities react to their commissions…can be punished for change… … Our commission has been open to change and promoted change…

How do we create innovation? An organization is the shadow of its leader…and of the leaders that have come before… The people who have the best ideas are the people closest to the work…want to create an environment for trial and looking into things.

We had an opportunity to invest in solar in space…structure the risk…so that we only pay for the power if it’s delivered…ensure that they are abiding  by the rules of government. The two principle objections went away.

Bev Alexander

Other technology you’re working with – robust energy efficiency, electric cars, renewables – what are the most important? What are choke points on the grid that need to be addressed?

Peter Darbee

… If we’re going to deal with the carbon problem, we’re going to need all the tools in the arsenal…nuclear, renewables, the first fuel should always be energy efficiency, demand management, carbon capture and sequestration… We’re going to need chips on all the squares… What’s scary is we need a lot from each…from energy efficiency to renewables.

… We’re going to need nuclear… I know a lot of people aren’t keen on nuclear… The storage issue is far less than the challenge of climate change.

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Part 1 was posted yesterday. Part 3 will be posted on Monday.

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Assorted Links

The CPUC has released an action plan for getting to net zero energy in the commercial sector by 2030.

The independent organization retained by the CPUC to examine PG&E’s SmartMeters says that the meters worked properly.

California legislature failed to pass SB 722, the 33% renewable portfolio standard, in this legislative session. Schwarzenegger may call a special session to try to pass it.

California state senators rejected a proposed plan to ban plastic bags statewide.

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profile

Peter Darbee, CEO of PG&E – Part 1

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On Tuesday, August 31, I was in the audience at the Haas School of Business at UC Berkeley as Peter Darbee, CEO of Pacific Gas & Electric Co., responded to moderator questions about the energy industry and the company’s stance on climate change.

The post below consists of Part 1 of my record of the conversation – all portions are included in chronological order.

An ellipsis (…) indicates that I was not able to capture the words or thoughts skipped. Moderator questions are paraphrased. Responses are included as accurately as possible – punctuation choices are mine. The moderators were Bev Alexander (BA) and Joey, a student.

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Bev Alexander

Over the last decade, you’ve led the industry through major turmoil…

Peter Darbee

I go different places, around the world and country, and I hear that a utility gets a guaranteed return, so anyone can run that place. Then why were we in financial distress ten years ago?

What’s happening in the industry is very dynamic…deregulation, reregulation…customer choice provides opportunity for others to take over…When government dramatically changes rules, there’s a mad scramble. And there’s the introduction of new technology all the time…these are disruptive technologies. This demands the most of management…

Bev Alexander

You’ve distinguished yourself on the issue of climate change…but you’re a business leader. Why is this a top priority?

Peter Darbee

You have to talk to your conscience. On January 1, 2005, I thought about the awesome responsibility of running a huge company… The question of climate change came up…

How would you feel if you were running this huge company and it had a dramatically negative impact on the planet?… How could you live with yourself if…you did not do everything you could to mitigate your impact?

Also, I owe a fiduciary responsibility to shareholders…so need to reconcile the two. So if we emit as much carbon as we can, and someone sues…the questions could be a problem… I have to do everything I can within the context of my role to reduce carbon emissions… We learned as much as we could about the issue and tried to change the industry… So what we did is called together some of the greatest scientists…put together top people in the country…tried to get to the bottom of the issue…came up with the statement “The earth is warming, mankind is responsible, and the time for action is now.”

Joey

I read your paper on climate change, but other folks in the audience might be concerned – why aren’t other companies on board?

Peter Darbee

… … … Why other companies don’t feel the same way… They love to moan, and say it’ll be horrible if we have to make that change… Folks at PG&E complained 30 years ago about decoupling… Everyone overreacts and creates a boogeyman… But this issue has become so political that we can’t have a conversation about it…and this is true in my own family.

… … I’ve never known anything good to happen when people are screaming at each other…and have lost the ability to listen.

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Part 2 will be posted tomorrow. Part 3 will be posted on Monday.

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