“Volatility in natural gas prices, including the huge spikes following Russia’s invasion of Ukraine, has certainly contributed to some price increases on the supply side. But the transmission and distribution costs have actually been going up at twice the rate of inflation nationwide, the report’s author, Brendan Pierpont, told me.
“That trend of increasing transmission and distribution costs is something that is noticeable all across the country, and so I think it’s an underlying factor in rate increases everywhere,” Pierpont said.
Utility companies have a lot of freedom in setting rates for transmission and distribution — and that directly contributes to how much profit they make. Utilities get to pick what gets upgraded when, and they also have an incentive to spend heavily, thanks to regulations that allow them to collect return on investment, usually around 10 percent, for those expenditures. This is actually built into the price most people pay for electricity.
Here’s how it works: Every year, utility companies ask regulators to approve a “revenue requirement,” which is basically a budget for what the utilities think it will cost to deliver enough electricity to their customers. Those estimates include spending on new equipment but not the cost of repairing old equipment. It also includes that return on investment, or profit, which regulators regularly approve. In Pierpont’s words, “That rate of return has a direct link to the costs that customers pay for electricity.”
What utilities don’t seem to be doing, however, is expanding the grid in a way that would benefit clean energy producers, the Energy Innovation report finds. Investments tend to cover local upgrades, like installing new metering equipment, rather than installing the high-voltage transmission lines that renewable energy sources need to connect to the grid. Meanwhile, consumers are facing more frequent outages that last longer, while utilities keep making more money for installing new, potentially unnecessary equipment.
“It’s like the utilities have a rewards credit card,” said Joel Rosenberg of Rewiring America, a nonprofit focused on electrification. “And they get to keep the rewards for how much they spend, and the [customers] have to pay off the bill, even if that bill takes 80 years to pay off.”
This plays right into the misconception that investment in renewables leads to higher rates.
Many of the states leading the way to clean energy are actually seeing lower energy prices than the rest of the country. Data from the US Energy Information Administration shows that 17 states, including California and Massachusetts, have increased their share of renewable energy sources by more than 20 percent since 2010. And with the exception of California, all of those states have seen the price of residential rate increases rise more slowly than inflation. The higher rates in California can be explained, in part, by rate increases to account for wildfire prevention. In Massachusetts, natural gas is the problem.
States where residents are seeing electricity bills that outpace inflation tend to be the ones with the highest reliance on natural gas, as highlighted in the Energy Innovation report. Some states in New England, including Massachusetts, have depended on natural gas for around 60 percent of electricity generation since 2020 and have seen prices increase by around 10 percent in the same period. Volatility in the price of natural gas also means that some of the highest price spikes are spread out over several years, so there could be more high prices in these states’ futures.”
“Right now, nearly all of the existing hydrogen produced in the US today isn’t clean at all. Ninety-five percent of it is “gray hydrogen,” produced using a method called steam methane reforming. This process uses steam to heat methane derived from natural gas until it separates into a mixture of carbon monoxide, carbon dioxide, and hydrogen gas molecules. This process is incredibly energy-intensive and gives the gray hydrogen production industry a carbon footprint the size of the United Kingdom and Indonesia combined. Gray hydrogen is mostly used for industrial purposes like refining petroleum and metals as well as producing chemicals, fertilizer, and in rarer cases, fuel for vehicles.
Blue hydrogen is a tiny but growing subset of the industry. Similar to gray hydrogen, blue hydrogen production uses steam methane reforming, which means that it also relies on natural gas. But for blue hydrogen, carbon capture and storage and other monitoring attempts are introduced to limit leakage of methane, a powerful greenhouse gas, which in theory minimizes its impact on climate change. And carbon capture and storage technologies haven’t been proven at the scale for blue hydrogen to capture over the 90 percent of emissions needed to deliver climate benefits.
A third and very buzzworthy option is green hydrogen. Producing green hydrogen employs a process called electrolysis, which uses an electrolyte, anode, and cathode to create a chemical reaction that splits water into hydrogen and oxygen molecules. No carbon capture is needed here, as no fossil fuels are involved in the process. As the name implies, this is the cleanest way to produce hydrogen — if it relies entirely on renewables for the electricity to power the process. It is currently very expensive and requires subsidies to compete with dirtier hydrogen options.
One other consideration with these types of hydrogen is the energy needed to produce them. Both blue and green hydrogen could be used in similar ways and work as a clean energy solution, except a lot rides on how the hydrogen is made. If energy derived from fossil fuels powers the production of any type of hydrogen, that could undermine carbon cuts. For green hydrogen, specifically, electrolysis is a problem area because it’s so power-hungry. So it’s essential that the electricity that powers the process comes from renewables, like solar, wind, and nuclear. It also matters where the renewables come from. One worry environmentalists have is that new hydrogen facilities will simply draw from existing solar and wind, eating up a lot of the clean electricity we already have.”
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“There are even more colors of hydrogen, each of which refers to a different production method. So while the phrase “clean hydrogen” is thrown around a lot, it’s not always clear what it’s referring to.”
“The clean energy subsidies that undergird President Joe Biden’s climate agenda have just prompted one Norwegian manufacturer to choose Michigan, not Europe, as the site of a nearly $500 million factory that will produce the equipment needed to extract hydrogen from water. And other European-based companies are being tempted to follow suit, people involved in the continent’s hydrogen efforts say — making the universe’s most abundant substance the latest focus of the transatlantic trade battle on green energy.
The Norwegian firm, Nel, announced its decision in May, nine months after Congress approved Biden’s flagship climate law, the Inflation Reduction Act. The move takes 500 new jobs to the other side of the Atlantic, despite the European Union’s efforts to position itself as the obvious place for clean tech investment.”
“Clean energy is rapidly rising on the Texas power grid, but regulators in the Lone Star State are now considering a plan that could give fossil fuels a boost.
The zero greenhouse gas emissions trio — wind, solar, and nuclear energy — provided more than 40 percent of electricity in the state in 2022. It was a year when several Texas cities experienced their hottest summers on record, driving electricity demand to its highest levels ever as fans and air conditioners switched on. Winter proved stressful too, with freezing temperatures last month pushing winter electricity peaks to record-high levels, narrowly avoiding outages.”
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“Texas leads the US in oil and natural gas production, but it’s also number one in wind power. Solar production in the state has almost tripled in the past three years. Part of the reason is that Texas is particularly suited to renewable energy on its grid. Wind turbines and solar panels in Texas have a high degree of “complementarity,” so shortfalls in one source are often matched by increases in another, smoothing out power production and reducing the need for other generators to step in. That has eased the integration of intermittent energy sources on the grid.
Coal, meanwhile, has lost more than half of its share in Texas since 2006. For a long time and across much of the country, the story was that cheap natural gas from hydraulic fracturing was eating coal’s lunch on the power grid. Coal was also facing tougher environmental regulations like stricter limits on mercury, requiring coal power plants to upgrade their equipment, and raising electricity production costs.”
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“in Texas, natural gas’s share of the electricity mix has been holding around 40 percent for more than a decade. On the other hand, renewable energy has surged as coal withered. Wind alone started beating out coal in 2019 and is now the second-largest source of electricity behind natural gas in the state.
An important factor is that the state has its own internal power grid, serving 26 million customers and meeting 90 percent of its electricity demand. It’s managed by the nonprofit Electric Reliability Council of Texas, or ERCOT. In the freewheeling Texas energy market, the cheapest sources of electricity become dominant, and wind and solar — with low construction costs, rapid build times, and zero fuel expenses — have emerged as winners.”
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“Some lawmakers are now working to tilt the balance toward fossil fuels. “There are different political figures who are trying to incentivize gas power plants or deny, prohibit, or inhibit renewables,” Webber said.
Last year, the Texas legislature passed a law that would prevent the state’s retirement and investment funds from doing business with companies that “boycott” fossil fuels.
Texas Lt. Gov. Dan Patrick said one of his legislative priorities for this year is to secure more support for natural gas-fired generation. “We have to level the playing field so that we attract investment in natural gas plants,” Patrick said during a press conference last November. “We can’t leave here next spring unless we have a plan for more natural gas power.””
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“While wind and solar power are ascendant, they are intermittent, and regulators want to make sure there is enough dispatchable power like natural gas to ramp up on still, cloudy days. The new proposal would create a credit scheme that would encourage more of these dispatchable plants to come online and extend a lifeline to some existing generators that are struggling to compete. But it would also raise the costs of electricity production.
Environmental groups like the Sierra Club noted that the proposal leaves the door open for other tactics for balancing electricity supply and demand, like energy storage, increasing energy efficiency, and demand response.”
“The initiative would connect participants in a federal program that subsidizes energy costs for low-income residents with developers of community solar projects, which sell subscriptions to households for renewable power with the promise of lowering their monthly electricity bills.
The Biden administration has big aspirations for the program, projecting it could spur the development of 134 gigawatts of new solar power capacity nationwide, the agency official said. To put that in perspective, total U.S. solar capacity today sits at 97.2 gigawatts, according to the Energy Department.
And it could lead to sizable savings, too: DOE estimated participants in the five initial pilot project states and the District of Columbia alone would save more than $1 billion on their energy bills annually.”
“Somehow, Germany, a country where the government is firmly committed to “green” energy, is preparing to fire up coal-burning power plants. The move is even more remarkable given that officials stubbornly refuse to restart mothballed nuclear facilities, or even reconsider the timeline for retiring those that remain online. It’s an astonishing situation for a country that very recently boasted that it would soon satisfy all its energy needs with sunshine and cool summer breezes.”
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“Germany’s problems predate the war in Ukraine and are closely linked to the goals the country’s political class made about their energy future in the absence of a realistic plan for getting there. In 2011, after an earthquake and tsunami triggered a disaster at Japan’s Fukushima Daiichi Nuclear Power Plant, the German government recommitted itself to closing all of its nuclear plants and getting its electricity from solar and wind. The decision was motivated by public fears of nuclear power, but also by loud insistence that the energy source had no place in a sustainable future.”
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“But “nuclear power is very close to the same shade of green as that of most renewables” when you compare mining and manufacturing inputs to each approach, energy expert Gail H. Marcus wrote for Physics World in 2017. And nuclear is reliable—the sun doesn’t always shine, and the wind doesn’t always blow, which means electricity produced by those sources ebbs and flows. That’s a big problem for electrical grids that require steady supplies of energy.
“Large amounts of intermittent electricity create huge swings in supply which the grid has to be able to cope with,” Bloomberg reported in January 2021.”
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“Germany’s plight is disturbing testimony of where you can end up if you commit yourself to a vision of a “green” future that has no place in it for the most reliable source of clean-ish electricity. By contrast, neighboring France plans to build as many as 14 new nuclear reactors because of, not despite, its environmental goals. That attitude reflects energy analyst Marcus’s assessment and is shared by the inter-governmental International Energy Agency (IEA). “Long-term operation of the existing nuclear fleet and a near-doubling of the annual rate of capacity additions are required” to meet clean-energy goals by 2050, the organization specifies.
Visons of a cleaner future based on technologies that are more efficient and less polluting are praiseworthy and shared by just about everybody. But to get from here to there requires planning and realistic decisions. Unfortunately for the German people, most of their political leaders relied on strongly held wishes and pixie dust to bring a green utopia and are instead delivering literal lumps of coal.”
“The world is now 1.1 degrees Celsius — 2 degrees Fahrenheit — warmer on average than it was at the dawn of the Industrial Revolution. But baked into that seemingly small change in the average is a big increase in dangerous extreme temperatures. That’s made cooling, particularly air conditioning, vital for the survival of billions of people.”
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“These searing temperatures are just the latest in a pattern of increasingly hot weather. A heat wave that would have been a once-in-a-decade event in the 1800s is now hotter and happens nearly three times as often. Heat waves that used to occur once every 50 years are now nearly five times as frequent and reach higher temperatures. Heat records are broken so often they barely register as news. In its latest review of climate science, the Intergovernmental Panel on Climate Change said it is “virtually certain” that heat waves have become more frequent and intense across most land areas since the 1950s.
Extreme heat events are also occurring over a wider region of the globe, from the depths of the ocean to the icy reaches of the Arctic. Heat waves are now such devastating events with long-lasting wounds that some countries say they should be named like hurricanes.
But the most severe risks from high temperatures are in places like India and Pakistan, regions closer to the equator that are already hot and have dense, growing populations. They also have less wealth, so fewer can afford cooling when thermometers reach triple digits.”
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“The tactics for cooling can end up worsening the very problem they’re trying to solve if they draw on fossil fuels, or leak refrigerants that are potent heat-trapping gases. And the people who stand to experience the most extreme heat are often those least able to cool off.”
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“There are many ways to curb the climate impacts of ACs. “The answer lies first and foremost in improving the efficiency of air conditioners, which can quickly slow down the growth in cooling-related electricity demand,” wrote Fatih Birol, executive director of the IEA, in a 2018 report. With greater energy efficiency, air conditioners do more with less. Also, homes and businesses need better insulation and sealing to prevent waste.
Another method is to manufacture more air conditioners that don’t use HFCs or other heat-trapping gases. Many countries, including the US, are phasing out HFCs. The US Senate will soon vote to ratify the Kigali Amendment to the Montreal Protocol, an international treaty that commits to cutting HFCs 85 percent by 2050.
At the same time, there is going to be a massive market for sustainable cooling technologies. “There are billions of people that aspire to be wealthy, and as your income starts going up, you’re going to want to have access to cooling,” Kyte said.
The electricity that powers air conditioners needs to come from sources that don’t emit greenhouse gases, so dialing down coal, oil, and natural gas power on the grid and ramping up wind, solar, and nuclear energy is crucial.”
“The European Union is dependent on Russia for almost half of its natural gas and a quarter of its oil. Germany alone imports 55 percent of the gas it consumes from Putin’s petro-state. As part of its invasion strategy, Russia thought it could use its natural gas and oil to blackmail Europe into passivity. Europe is belatedly beginning to shut off the Russian spigot, but it will pay a heavy economic price for the delay.
And for Europe’s energy switch to succeed, the United States must step up.
Just as we were the Arsenal of Democracy when fascism threatened Europe 80 years ago, today we must become the Arsenal of Clean Energy. That means we should finance and export clean energy to Europe in large quantities as quickly as possible. This approach would help protect our own security and economic interests, as well as the sovereignty, democracies, and economies of Europe, all while working to combat climate change.
Our goals should be: 1) make European energy secure; 2) help shift European countries to cleaner energy; and 3) create a massive clean energy market that strengthens supply chains and job creation in the U.S.”
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“starts with an energy version of the “Candy Bombers” who supplied Berlin during the Soviet Union’s blockade in 1948. In this case, we could provide a temporary natural gas lifeline to Europe as they wean themselves off Russian energy. America has some additional capacity, and more coming online very soon, to send liquefied natural gas to Europe. We should combine a near-term increase in U.S. gas production and exports to Europe with assistance for European countries to, over the medium-term, reduce their reliance on natural gas by switching to other, lower-carbon fuels and increased energy efficiency.
Second, to ensure this lifeline leads Europe to a safe and sustainable future, the United States needs to create an American clean energy sovereignty fund. We should commit to $10 billion per year for the next decade to finance the export of U.S. hydrogen, nuclear, and carbon capture technology that can be deployed across Europe. The new technologies should be supported by both U.S. and European supply chains and workers to ensure economic growth across both continents. This government-backed entity would provide a significant cost-share for countries importing U.S. clean energy, particularly technologies that will be primarily made in and exported from the U.S.
As we are seeing now with Germany’s reconsideration of its decision to close its nuclear plants, even renewable-heavy countries need firm clean energy provided by technologies like nuclear power. This is even more important in industrial areas of Eastern Europe that need both the steady electricity and high heat that nuclear, or hydrogen, can provide.
Finally, as all of Washington knows by now, personnel is policy. To underscore the urgency of this mission, the Biden administration should create a new, senior position at the National Security Council to manage clean, firm energy and coordinate the alphabet soup of agencies involved. This position would oversee a new “Team Energy” of public and private sector experts who can cut through the bureaucracy.”
“Electricity prices tripled in many European countries this winter, including in Germany, as renewable power supplies faltered and Russia seized the opportunity to boost the price of its natural gas exports. So, of course, the German government thought this was a fine time to permanently shutter three perfectly good nuclear power plants.
The closures are part of Germany’s famous energy transition, widely known as the Energiewende, to a low-carbon, nuclear-free economy. Germany aims to reduce its greenhouse gas emissions to net zero by 2045 chiefly by switching entirely to renewable energy generation to supply electricity to residences, factories, and transport. That goal would be much more easily achieved if the country not only kept running its carbon-free nuclear power plants, but also built more of them.”
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“How will Germany make up for the power lost from shutting down the three nuclear power plants? A new analysis by the admittedly pro-nuclear Environmental Progress activist group argues that the expected addition of solar and wind capacity will not be sufficient to make up for the loss of the German nuclear plants. Consequently, the group observes, “Next year, the share of German electricity generation coming from fossil fuels could be as high as 44 percent, compared to 39 percent in 2021 and 37 percent in 2020.”
In contrast, French President Emmanuel Macron pledged in November that France will build more nuclear power plants. The new plants, he said, are meant “to guarantee France’s energy independence, to guarantee our country’s electricity supply and achieve our objectives, in particular carbon neutrality in 2050.””
“pushing the US to electrify vehicles and get more of its energy from low-carbon sources like nuclear, wind, solar, or hydropower is likely far more important than marginal changes in density.”