Legislation Issues and Public Policy Committee Update

1
Legislation Issues and Public Policy Committee
Update

• David K. Owens
• Chair of Legislation Issues and Public Policy
  Committee
• America Association of Blacks in Energy
• June 13, 2009

2
Agenda

• Status of Stimulus Funding
• Legislative and Public Policy Development
• Near-Term Challenges
• Action Items for Legislation Issues and Public
  Policy Committee

3
ARRA Energy Stimulus Funding
Total 78 Billion
4
Energy Efficiency
5
State of Funding
Federal agencies submit weekly reports showing
American Recovery and Reinvestment Act funds made
available and paid out. (Amounts shown B)
Source Federal Agency Financial Activity
Reports
6
How Will The Money Flow?

• DOE Direct Expenditures
• Clean coal, carbon capture and storage demo, etc.
  
• DOE Indirect Expenditures
• State block grants, appliance matching grants,
  etc.
• DOE Loan Guarantee
• Directly To Federal Agencies Other Than DOE
• NIST - Smart Grid Interoperability Standards
• Federal Bonding Authority
• Western Area Power Marketing Administration
• Tax Breaks

7
Pending Legislation
8
Climate Policy in the 111th Congress

• H.R. 2454 The American Clean Energy and Security
  Act of 2009
• Passed by House Energy Commerce Committee
• Additional hearings contemplated
• Up to 8 committees may take it up
• Waxman wants committee process done by July 4
• Full House consideration pending
• Senate Ultimate process unclear
• Energy Committee addressed transmission and other
  energy issues
• Climate handled by Environment Committee
  schedule unknown
• Start with HR 2454 or own bill?
• Sen. Boxer formed working groups to address key
  issues
• Current focus on RES and energy, then on
  transmission and climate?

9
Key Elements of H.R. 2454

• Economy-wide
• Targets and timetables below 2005
• 3 by 2012, 17 by 2020, 42 by 2030, 83 by 2050
• Combined Renewable Energy Standard and Energy
  Efficiency Resource Standard
• 20 renewables by 2020 with 2.5 / kWh
  alternative compliance payment
• 75 must be met with renewables
• Governor can petition to meet 40 with energy
  efficiency
• Effectively allows RES at 12-18 and EERS of 2-8
• Alternative compliance payments stay within state

10
Key Elements of H.R. 2454

• Cap and Trade - Auctions and Allowances
• Exclusively for the benefit of customers
• 35 of allowances to electric sector until 2025
  with 5 yr phase-out
• 30 to local distribution companies (LDCs)
• 50 based on emissions, including purchased power
• 50 based on retail sales
• 5 to merchant coal generators and generators
  with long-term contracts (PPAs)
• Up to 3.5 for merchant coal
• PPAs get allowances equal to carbon costs

11
Key Elements of H.R. 2454

• Cap and Trade - Auctions and Allowances
  (Continued)
• Natural gas 9 for 2016-2025, 7.2 for 2026,
  5.4 for 2027, 3.6 for 2028, and 1.8 for 2029
• Home heating oil and propane 1.875 for
  2012-2013 1.67 for 2014 and 2015, 1.5 for
  2016-2025, 1.2 for 2026, 0.9 for 2027, 0.6 for
  2028, and 0.3 for 2029
• Low-income consumers 15 auctioned annually by
  the Administrator, with the proceed to fund the
  Consumer Assistance Program established in the
  legislation.

12
Key Elements of H.R. 2454

• Commercial / residential building code targets
• 30 improvement w/in 3 years, 50 improvement
  after 2016
• New energy efficiency standard for outdoor
  lighting fixtures

13
Financial Impacts of Climate Change

• EPA
• Household spending would drop by about 140 /
  year by 2020 gas prices would increase 33 cents
  / gallon by 2030
• CRAI (for National Black Chamber of Commerce)
• By 2015 730 / year less in household purchasing
  power, electric rates would increase 7.3 by
  2015 gas prices by 12 cents / gallon
• Heritage Foundation
• By 2035 electricity rates would increase by 90,
  gas prices by 74, household energy bills by
  1500
• Its ALL About the Assumptions!

14
Transmission Siting

• Many perceive EPACT 2005 FERC backstop authority
  as ineffectivelimited by Piedmont Environmental
  Council v. FERC (4th Circuit)
• Several Senate bills would give FERC more
  transmission siting authority for facilities
  above 345 KV. Will they
• Require interconnection-wide planning?
• Apply to facilities that primarily serve only
  renewables?
• Address cost allocation issues?
• Expand PMAs?
• Waxman-Markey avoids transmission, other than to
  encourage planning

15
What Are AABEs Concerns?

• Climate Change
• Potential impacts of climate change legislation
  on African-Americans and other minorities?
• How do you minimize compliance costs on
  low-income consumers?
• What must U.S. climate change legislation and
  carbon management strategy include to ensure
  economic growth and energy security and avoid
  unfairness?
• Energy Efficiency
• How significant of a role can energy efficiency
  play in the future?
• How can African-Americans benefit and actively
  participate in energy efficiency programs from
  the residential and commercial perspectives?
• Renewable Technology
• How much can increased renewable capacity
  contribute going forward? How can renewables be
  utilized without substantially raising energy
  bills for low- and fixed-income households?

16
Key Elements of AABE Climate Change Principles

• AABE supports
• Cost effective GHG reductions
• Inclusion of all sectors of the economy and all
  sources of GHG
• Consistency of compliance timetables w/
  technology development
• Balancing economic improvements with economic
  development
• Ensuring low / fixed income consumers are not
  disproportionately impacted
• Cost containment measures
• Green jobs, economic development, maintain trade
  balances
• Preserving all energy options energy
  efficiency, renewables, advanced nuclear, carbon
  capture and storage
• Public / private partnerships research,
  development deployment
• Use of alternative fuels and needed infrastructure

17
Key Elements of AABE Energy Efficiency
Principles

• ABBE supports
• Enhancements to US energy infrastructure for the
  development and implementation of energy
  efficient technologies
• Focused national, regional and local effort to
  educate and make available to all consumers a
  broad range of options to encourage energy
  efficiency
• Aggressive campaign for the promotion of energy
  efficiency technologies including smart
  buildings, appliances, grid and electric meters
• Optimizing domestic and foreign energy resources
  while promoting energy security, economic
  prosperity and environmental solutions
• Government and commercial suppliers making
  necessary energy efficiency upgrades to
  residential and commercial customers

18
Key Elements of AABE Renewables Principles

• AABE supports
• Renewables as part of an overall strategy for
  meeting energy and climate change challenges
• Renewable programs that carefully balance the
  availability of renewable technologies, their
  cost effectiveness and environmental benefits
• Recognition of renewable energy standards being
  developed at the state level
• Research, education and training for
  African-Americans to expedite the development of
  renewable energy solutions
• Renewable and alternative fuels and needed
  infrastructure
• Working with regional and local communities on
  renewable programs

19
Some Near-Term Challenges

• Full funding of Low Income Energy Assistance
  Program (LIHEAP)
• Educate and inform consumers about stimulus
  package and access to funding for weatherization
  and related programs
• Support Energy Efficiency Programs
• Educate consumers on how to use energy more
  efficiently to lower bills
• Ensure low- and fixed-income customers
  participation
• Secure funding for programs to assist low- and
  fixed-income families
• Promote understanding of implications of Climate
  Change laws
• Recognize the potential impacts on economic
  growth and energy security
• Minimize impact on low- and fixed-income
  consumers (cost containment)
• Ensure fairness and equity (environmental
  justice)
• Support national commitment / action to
  accelerate needed technologies

20
Some Near-Term Challenges

• Promote understanding of implications of
  Renewable Energy Standards
• Impact on energy bills
• Enhancing economic development
• Expediting development of renewable technologies
• Encourage Green Jobs
• Support minority- and women-owned businesses
  (supplier diversity)
• Mobilize economic development in communities
• Support cooperative effort with government,
  business and industry
• Create excitement around Engineering, Mathematics
  and Science
• Support programs to replace the aging workforce
  and to develop technical and strategic leaders
• Support scholarships, internships and mentorships

21
New-Term Action Items

• Congressional Outreach (July December 2009)
• Congressman Charles B. Rangel (D-NY)
• Chairman, Ways and Mean Committee
• Vice Chair, Joint Taxation Committee
• Congressman Henry A. Waxman (D-CA)
• Chair, Energy and Commerce Committee
• Congressman Edward J. Markey (D-MA)
• Energy and Commerce Committee
• Chair, Select Energy Independence and Global
  Warming
• Others

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New-Term Action Items

• Webinar on H.R. 2454 (July 2009)
• Overview of key provisions relating to climate
  change, energy efficiency, and renewables.
• Energy Summit (September 2009)
• Dialogue with key public policy leaders and
  coalition building. Could include, EPA
  Administrator Lisa Jackson, Majority Whip James
  Clyburn and such groups as the Joint Center for
  Political and Economic Studies and the National
  Black Chamber of Commerce.
• Participate in Congressional Black Caucus
  Foundation Dialogue in Tunica, MS
• Develop and Implement Community Outreach Program