Vol. 8: Issue 6 | June 2020
New Jersey is weighing legislation to create an Office of Clean Energy Equity at the New Jersey Board of Public Utilities. If enacted, the bill would direct the office to establish solar and energy efficiency programs that benefit 250,000 or 35% of low-income households (whichever is greater) and ensure that at least 400 megawatts of storage is established in overburdened (low-income minority) communities by 2030. The state Department of Community Affairs would also mandate that all newly constructed buildings in overburdened communities be solar-ready and give preference to clean energy projects or those involving women-owned or minority businesses. The bill would also require that the Department of Labor and Workforce Development establish a grant program to support community organizations and diversity-focused nonprofits developing clean energy workforce programs that train at least 2,500 people from overburdened communities by 2025.
Several states passed new bills in 2020 that support charging infrastructure for electric vehicles. Florida enacted SB 7018 this month, designed to expand the electric vehicle charging infrastructure along the state’s highways. The bill also encourages the use of charging infrastructure to help serve evacuation routes in the event of hurricanes or other emergency events. Colorado’s HB 1155, awaiting the governor’s signature, requires a homebuilder to offer a buyer of a new home one of the following: an electric vehicle charging system; prewiring for the future installation of a system; or a plug-in receptacle in an area accessible to where the vehicle parks. And in Utah, HB 259 requires the state Department of Transportation, in consultation with relevant private entities, to develop a statewide electric vehicle charging network plan.
The Maryland General Assembly moved quickly during the first half of 2020 to pass two pieces of energy workforce legislation. SB 224 expands the list of clean energy careers under the state’s Clean Energy Workforce Account youth apprenticeship programs to include energy efficiency and geothermal. It also provides $750,000 in funding for clean energy workforce apprenticeship and job training program recruitment, including for recruiting veterans and those who were formerly incarcerated. SB 603 directs the public service commission to establish a training program for energy suppliers with input from electricity and gas suppliers and other interested stakeholders.
New York and Colorado enacted ambitious climate laws in 2019. A year later, both have failed to deliver on programmatic requirements. In New York, the state’s new Climate Action Council tasked with implementing New York's greenhouse gas reduction targets has met once since being formed, and working groups designed to guide the Council have not been staffed. This leaves key aspects of the new law up in the air, such as updating the state’s greenhouse gas inventory and developing a social cost of carbon. The law requires that both be completed by the end of 2020. It also undermines the law’s many initiatives designed to expand engagement across stakeholder groups, including environmental justice communities. In Colorado, regulators point to the state’s near-term progress as a sign that they are meeting requirements under recently enacted climate legislation, but a report by MJ Bradley & Associates paints a different picture. That analysis shows the state is not on track to meet its 2025 or 2030 targets. While some stakeholders argue that Colorado’s adoption of zero-emission vehicle standards and its phaseout of hydrofluorocarbons is moving the state in the right direction, others say more is required under the state’s new climate laws.
One of the first responses by states and utilities to the economic hardship presented by the COVID-19 pandemic was to suspend utility disconnections for nonpayment. More than 30 states either established temporary moratoriums or asked utilities to suspend that type of disconnection, while many utilities did so on their own. Most policies were in effect through June, but there are concerns that with record numbers of Americans still unable to return to work, the bans on disconnections may need to be extended. Recently, Dominion Energy in Virginia asked the state public utilities commission (PUC) to grant the state’s utilities the option of extending the disconnection suspensions another four months. Earlier in the year, the PUC indicated that the moratoriums are not sustainable, with the cost of outstanding utility bills racking up. Certainly, the question of how to account for that lost revenue has gone unanswered, although more utilities are beginning to file for rate-recovery with PUCs.
Hurricane Arthur arrived early—a full two weeks before the official start to the 2020 Atlantic Hurricane season. Unfortunately, that’s the trend: each of the past six years has seen a hurricane form before the June 1 start to the season. The other trend is toward bigger, slower storms that dump more water. Earlier this year the National Oceanic and Atmospheric Administration (NOAA) published a review of its data from tracking billion-dollar disasters. The agency noted that the 2010s were the most devastating decade for natural disasters in the U.S.—both in terms of economic and societal impacts. From 1980 through 2009, the U.S. averaged under five of these “billion-dollar disasters” each year. Over the past decade, the nation has averaged nearly 12 disasters of that magnitude every year. Hurricanes have played a large part in that trend. As for 2020, NOAA predicts another above-average season, with between 13 and 19 named storms, and 6 to 10 hurricanes. Three to six of those hurricanes could be major storms with winds over 110 mph.
After Hurricane Maria wiped out much of Puerto Rico’s electric grid, national and territorial policymakers decided to reimagine a resilient and reliable energy system. While much of the focus has been on renewables and batteries, a less-publicized initiative has focused on considering the potential role of nuclear power. The Nuclear Alternative Project recently published a feasibility study funded by DOE, which looks at how advanced small modular reactors (SMRs) and microreactors could provide dispatchable and resilient power to the island. One of the primary components of Puerto Rico’s new grid is that it will be decentralized, consisting of eight regional grids that can isolate themselves or work in tandem. The study argues that SMRs and microreactors could integrate with renewables and help anchor these regional systems with carbon-free, stable power. One of the biggest obstacles appears to be swaying public opinion. However, the study surveyed over 3,000 residents, with more than 90% saying they are open to Puerto Rico exploring nuclear technologies. In other energy news from the island, the government announced that it had reached a deal with a consortium of U.S. and Canadian firms to operate the territory’s transmission and distribution system. The contract is valued at $1.5 billion.
The Bureau of Ocean Energy Management, a division of the Interior Department, recently released a study on the cumulative impact of Vineyard Wind, the first major offshore wind development planned off Martha's Vineyard, Massachusetts. The study finds that the 22 gigawatts of planned offshore wind along the Eastern Seaboard could have significant effects on commercial fisheries by creating navigational hazards and potential problems for fishing nets. There is concern that the administration’s increased scrutiny of wind could further hamper offshore wind development. There is also concern that this study—coming at a time when federal agencies are being allowed to expedite environmental reviews for infrastructure and energy projects—may not be impartial.
With another wildfire season approaching, the California Public Utilities Commission has just ordered large investor-owned utilities to accelerate the deployment of microgrids, which allow buildings, homes, blocks or towns to continue operating during the failure of the larger power grid. California utilities are working hard on this effort, with Pacific Gas and Electric planning to have 73 operational microgrids by the end of 2020. These efforts are part of a multi-pronged approach to increase wildfire resiliency.
The Mandan, Hidatsa and Arikara Nation (MHA) have long lived along the Missouri River and held property rights to the riverbed located within the Fort Berthold Reservation. Departing from several decades of agency precedent, the Interior Department recently issued an opinion transferring ownership of the riverbed and its oil and gas rights to the state of North Dakota. The MHA chairman issued a statement highlighting the department’s departure from well-established legal precedent and its failure to consult the tribes. The statement also raises issues regarding DOI’s actions in light of treaty obligations and the federal government’s fiduciary duty to “protect the MHA Nation’s Missouri River property rights.”
The initial comment period closed for a petition filed by the New England Ratepayers Association (NERA) arguing that the Federal Energy Regulatory Commission has jurisdiction over state net metering policies, an area traditionally regulated by state utility commissions. The comment period revealed broad and bipartisan opposition to the petition from federal lawmakers, state regulators, environmental advocates and industry groups. Of note, a number of utilities that filed to intervene in the proceeding refrained from commenting on the petition and have not come out either for or against NERA’s arguments. Among the commenters were the National Association of State Energy Officials and the National Association of Regulatory Utility Commissioners. Both strongly oppose the petition.
President Donald Trump signed an executive order instructing the Transportation, Interior, Agriculture and Defense departments to use emergency and other authorities to accelerate infrastructure projects designed for environmental, energy, transportation, natural resource and other uses. The order relies on a National Environmental Policy Act (NEPA) provision that allows federal agencies to determine “alternative arrangements” for complying with the environmental review requirements of NEPA during a national emergency. Courts are also weighing in on major energy infrastrucure projects. The U.S. Court of Appeals for the 9th Circuit ruled that it will not freeze a previous decision by the Montana District Court prohibiting the Army Corps of Engineers from using a nationwide water permit for oil and natural gas infrastructure projects. The ruling means that without intervention from the U.S. Supreme Court, construction on such infrastructure projects, including the Keystone XL pipeline, will likely be suspended until the 9th Circuit rules on the full merits of the case in 2021. In a separate but related case, Chief Judge Brian Morris of the U.S. District Court in Montana ruled that a 2018 Bureau of Land Management (BLM) instruction memorandum violated a 2015 BLM rule concerning the recovery of sage grouse populations. The ruling, if not overturned, will require the BLM to reclaim 440 leases covering 336,000 acres in Montana and Wyoming with both the federal government and the states having to return funds to the companies that acquired the land as part of the leases. In a third case, the 9th Circuit ruled that local governments can continue seeking climate-related damages from oil companies in state courts.
The Federal Energy Regulatory Commission (FERC) issued a new rule altering its permitting procedures for natural gas pipelines that will prevent projects from starting construction until the commission has rejected all appeals to its approval. The rule comes in response to an ongoing lawsuit before U.S. Circuit Court of Appeals for the District of Columbia. That case concerns FERC's practice prior to this rule allowing pipeline projects to seize land via eminent domain and begin construction before a landowner could sue in federal court if FERC had not yet ruled on the landowner’s appeal. Although the new rule prevents construction from starting, pipeline developers would still be able to seize land using eminent domain process. A ruling from the court is expected later this year.
NCSL hosted the last webinar in its Natural Resources and Infrastructure (NRI) Committee Spring Webinar Series. It focused on how states are using the U.S. Environmental Protection Agency’s Exceptional Events Rule as they face increasing pollution and health risks associated with wildfires and other “exceptional events.” The recording for this webinar and all the others offered as part of this series are available online.
Five state legislators—Illinois Senator Dave Koehler, Kansas Representative Mark Schreiber, Nevada Senator Pat Spearman, Pennsylvania Representative Chris Rabb, Utah Representative Steve Handy—and Glen Andersen of NCSL joined the Public Utilities Fortnightly team in a virtual roundtable to discuss the electric industry's transformation and state clean energy efforts before, during and after the pandemic.
COVID-19 is creating new financial challenges for utilities and regulators that could push electricity rates higher for utility customers. Join the Society of Utility and Regulatory Financial Analysts (SURFA) for a free webinar on July 8 called “Getting Ahead of the Curve: Reducing Utility Rate Increases Caused by COVID-19.” The webinar includes Colorado Senator Chris Hansen and other experts as they explore potential solutions.