The Value of Compromise: Senate Revives S. 2012
On Wednesday, April 20, the United States Senate passed the Energy Policy Modernization Act, or S. 2012, which is being billed as the “first significant federal energy bill” since the George W. Bush administration.
That bill, the Energy Independence and Security Act of 2007 or H.R.6, was primarily aimed at increasing renewables; promoting energy efficiency in federal government buildings and consumer products like appliances, vehicles and housing; boosting biofuel production; and developing effective and affordable carbon capture and storage (CCS) technologies.
It was largely successful on points one and two, not so much on biofuels (and S. 2012 does not offer much beyond a tribal pilot project). Carbon capture continues to be a Holy Grail without map coordinates, at least in the U.S., in spite of annual DOE funding of an average $300 million per year since 2004, not counting $3.4 billion in 2009 in Recovery Act dollars.
This newest effort, S. 2012, treads old ground and covers some new terrain. It languished in limbo for several months while the Senate debated a Democrat-sponsored measure to fund the Flint, Michigan drinking water crisis. By the end of the second full week in April, the Democrats caved on the Flint proposal and the bill – sponsored by Senators Lisa Murkowski (R-Alaska) and Maria Cantwell (D-Washington) – was passed 85 to 12. The vote was a remarkable achievement, aligning Democrats and Republicans on a traditionally divisive issue: energy policy.
The next step for S. 2012 is to get House approval or achieve a compromise with the House’s own 2015 measure, H.R.8, the North American Energy Security and Infrastructure Act – a measure that opponents say will reduce building energy efficiency by attaching a cost/benefit analysis on a per-project basis.
The final step is a presidential signature – in an election year no less, but Sens. Murkowski and Cantwell have promised to keep up the pressure.
S. 2012 not only aims to improve building energy efficiency (BEE), via a bipartisan effort by Senators Rob Portman (R-Ohio) and Jean Shaheen (D-New Hampshire), but to review the various systems and codes by which buildings are certified as energy efficient. The goal is a system that “incorporates life-cycle assessment” – a stipulation that could shrink or expand the BEE certification space, though the U.S. Green Building Council’s (USGBC’s) LEED metric and the Environmental Protection Agency’s (EPA’s) Energy Star rating system will likely weather that storm.
Is S.2012 a step up from 2007, even if it achieves consensus with H.R.8? Critics say no, and charge Senators Murkowski and Cantwell with evading the difficult issues – climate change, and oil and gas exploration.
Not only does S. 2012 ignore the critical issues, opponents argue, but it reaffirms such seemingly improbable causes as CCS for mitigating coal-fired emissions (SEC. 3401-03).
First put forward in 2005 under the Energy Policy Act, CCS has gone through a number of incarnations (SaskPower’s Boundary Dam project in Weyburn Field, FutureGen, etc.). The latter project was defunded in early 2015. This newest incarnation – an example of the sorts of across-the-aisle compromises that made S. 2012 possible – could signal coal’s revival, especially at the rate of funding S. 2012 proposes (about 3.5 billion, by this writer’s estimate: Sec. 962 (b)(1)).
The technology is not impossible, and further R&D will no doubt bring down costs. There are several, operational, coal-fired, post-combustion CCS plants both locally and worldwide. Boundary Dam is one. A larger one, the Kemper County IGCC plant, failed to meet an important DOE deadline and was forced to pay back $133 million, but continues to forge ahead. Globally, the largest plant is Shangdong Province, China.
On the bright side, the DOE’s Lawrence Berkeley National Laboratory recently announced the development of a porous, layered crystal lattice capable of absorbing enormous amounts of CO2. Investors may want to take this as a note that coal – currently a “don’t buy” – is still a “don’t dump” (Sec. 962 (b) (1)).
Another source of contention re S. 2012 is the sweeping provision for biomass to assume a role as a renewable energy resource, even though environmentalists argue that it is not emissions-free like solar and wind. They also warn that putting biomass in the same class as solar and wind could lead to widespread deforestation. Nonetheless, S. 2012 encourages private investment in forests and biomass, both up and down the supply chain.
Additional proposals – like combining coal and biomass to achieve "net-negative carbon emissions”, have also come under attack, largely because the EPA’s Science Advisory Panel waffled in its final profiling of biomass. Is biomass carbon neutral when burned because it has taken up carbon dioxide before releasing it, or is it not? Even scientists like Kevin Anderson, deputy director of the Tyndall Centre for Climate Change Research at the University of Manchester, aren’t sure:
“(That technology) is still at the conceptual stage of development, which means scientists who rosily predict that the world can meet its emissions goals (via biomass) are ‘choosing to censor their own research’."
One of the biggest sections of S. 2012 deals with grid reliability. Owners and operators will be required to provide greater opportunity for electric co-ops, Federal power marketing entities, and state utilities to “self-supply” electricity based on service obligations like renewable energy. This drive toward “community solar” – when customers subscribe to a portion of renewable resources in their electricity supply – suggests more investment not only in wind and solar, but in utility-scale energy storage and transmission models designed to incorporate renewable energy at all levels.
S. 2012 also addresses federal land management and provides for a “cadastre” (inventory) and updated valuation of all federal land holdings – the inventory to be made public on the Internet in a “geoenabled and searchable format,” presumably to facilitate further oil, gas, and mineral exploration.
To offset this Republican measure, Subtitle D, Sec. 1301 resurrects the Vehicle Innovation Act, which provides $339 million-per-year funding, through 2020, for “green” vehicles. Sometimes you have to give something to get something back.
Lastly, for those who frown on fossil fuels and love the wilderness, the bill authorizes, in perpetuity, The Land and Water Conservation Fund – encouraging news for hunters, hikers, campers, (and city dwellers, for whom green spaces may be the key to survival).
Companies to Watch:
WattJoule Corporation, a DOE, DOD, NSF-funded startup, offers ElectriStor™, a redox flow battery system that uses an affordable, water-based proprietary liquid electrolyte. The unit will be offered to system integrators as the preferred core component for storing large amounts of solar and wind energy, since it reduces energy storage costs to $150 per kilowatt-hour using only a first-generation prototype. The global market demand for storage is estimated to be greater than $10B by 2020. Watch for an IPO.
Renewable Energy Systems (RES), working with Exelon Corporation (NYSE: EXC), recently signed an agreement to build and oversee a 20-megawatt battery storage facility that will connect to the PJM grid in Ohio. RES currently operates 47.6 MW of energy storage projects using RESolve, a proprietary energy storage platform.
Sunvault Energy, Inc. (OTC: SVLT) is planning a 500-home sustainable energy community, using a 1.2-megawatt distributed solar array, the largest in British Columbia. The project is based on SVLT’s acquiring a 25-percent stake in Firefly Development Corp.
Lockheed Martin Corporation (NYSE: LMT) may be new to the energy storage game, but it’s old hat at making aerospace and tech, and making it work. A market cap of more than $69 billion won’t hurt, either, but count on the expertise of its employees – all 100,000 of them.
Tecogen Inc. (NASDAQ: TGEN) offers efficient, affordable and earth-friendly HVAC and hot water solutions, as well as a cost-effective combined heat and power option for residential, commercial and industrial use. The latter is a particular focus of S. 2012.
Jeanne Roberts is an award winning freelance writer covering the environment, sustainability, social justice, health, politics, and the natural world. She has roots in the corporate world as a California reporter and a communications specialist at a large public utility and has spent the past 10 years working as an editor for a small-cap stock site, and as an environmental/political/social justice blogger for The Panelist, Celsias,Cooler Planet, DeSmogBlog, Energy Boom, SolveClimate.com, the Clean Tech Blog,EarthTechling, and various other online publications. Ms. Roberts has written a book on alternative energy sources, sustainable home building, and environmental initiatives for homeowners available on Amazon.