Comments Off on Regret-ready: A briefing on United Kingdom proposals for the mandating of ‘hydrogen-ready’ gas boilers
The government of the United Kingdom is currently consulting on whether it should mandate that all new gas boilers sold from 2025 be ‘hydrogen-ready’ — that is, they can potentially be converted to run on pure hydrogen in case the gas network is ever converted. This policy change has been proffered as a ‘low-regrets’ policy change.
The government is expected to take a decision on the use of hydrogen heating in 2026. Until such a decision is made, the mandating of ‘hydrogen-ready’ boilers seems to be a case of putting the cart before the horse. The vast majority of independent analysis suggests only a niche role for hydrogen in heating, with heat pumps and heat networks by far the most cost-effective technologies. Far from a ‘low-regrets’ option, the proposed mandate could create risks for heat decarbonisation and long-term disadvantages for consumers. There is a major risk of greenwashing leading to consumer confusion and delay, a risk that boiler prices increase and the potential for government to end up in a heat decarbonisation ‘blame-game.’
This brief details the risks of a ‘hydrogen-ready’ boiler mandate being made before the government’s decision on the use of hydrogen heating. The brief suggests that if hydrogen heating should be found favourable in 2026, only then should mandates around hydrogen boilers be considered and even then only in conjunction with a heatmapping process. Until such time, the proposed mandate of ‘hydrogen-ready’ boilers is also ‘regret-ready.’
Comments Off on To Serve Everyone, IRA’s Climate Grants Need Inclusive Participation
As expansive and even overwhelming as the Inflation Reduction Act (IRA) seems to be, it is important to remember that the IRA authorizes a number of different programs that will benefit states — programs, for example, that may come out of the Department of Energy to state energy offices, or from the Environmental Protection Agency (EPA) to state environmental agencies.
The EPA’s Climate Pollution Reduction Grants program (CPRG) is likely to be some of the first IRA funding that states will see. The CPRG will provide states with a significant springboard to reduce their carbon emissions. Before suggesting how states can make the most of this, let’s take a moment and outline the program.
What Is Clear: An Opportunity for States
The CPRG is a two-part program. Part 1 ($250 million) provides formula grants to every state. This will support states to develop a carbon reduction plan. Part 1 is on its way; the announcement and guidance will be coming out on March 1, and a Notice of Intent to Participate from states will be due March 31.
Part 2 ($4.6 billion) sets out a program of additional grants, funding for states to carry out elements of their plans and will probably roll out in early 2024. While Part 1 provides every state money for planning, Part 2 will require states to compete for funding to support the implementation of their carbon reduction programs.
For states that have yet to develop climate plans, this is an opportunity to use federal funding to explore ways to modernize your state’s economy. More specifically, this is a chance to look at the ways that your citizens, for example, manufacture products, grow crops, transport themselves, and heat and cool their homes — all sectors of your economy that produce significant carbon emissions.
In case a state doesn’t think that GHG planning is important, the CPRG provides for political subdivisions within a state, such as municipalities or local air agencies, to participate. Even where states have already developed climate action plans, these federal dollars could be very useful in updating and improving existing plans.
What Is Not Clear: Support for All Communities
While the CPRG will support states in developing carbon reduction plans, it is not clear the degree to which the program will support improving the outreach and public engagement necessary to ensure that a plan is equitable and that it will serve all communities.
This is a challenge for even successfully developed state plans. For example, in 2021, the Vermont Climate Council, spent over 10 months developing the Vermont Climate Action Plan. This was a significant undertaking by state agencies and citizens and the plan is an admirable start. However, the plan’s authors acknowledge in its preface that robust marginalized community representation was missing from the stakeholder participation:
This initial Climate Action Plan represents one of the first public processes in the State of Vermont to acknowledge and try purposefully to incorporate equity and the principles of a just transition in both its development and outcome — but we know we fell short. During our meetings and outreach, too few Vermonters had their voices lifted up to join the voices of those who have also participated in similar endeavors in the past. In our development of pathways, strategies, and actions, we faced challenges creating programs and policies organically in partnership with marginalized communities and individuals in Vermont and to envision new ways to ensure a just transition for all of us. As we continue forward, we have a strong desire to engage more Vermonters deeply and equitably in this transition, recognizing the historical and present harms and systemic injustices that are at work here in Vermont and elsewhere.
In developing its 2021 Climate Action Plan, Vermont saw first-hand that these working Vermonters did not have the time or capacity to participate and engage. This was not because they weren’t notified or encouraged to participate. People are busy earning a living. And their representatives are also challenged to participate because they work on many other pressing equity-related topics besides climate mitigation, including housing, transportation, policing, food, racism, and education. Frontline advocates generally recognize the importance of this work, but simply don’t have the bandwidth or the means to meaningfully participate.
Hearing from and consulting with marginalized communities isn’t just a matter of equitable inclusion — it’s essential to achieve the goals of climate policies, period. We need programs that are able to deliver GHG savings in all communities and to all income levels. Greater inclusion in planning will yield better, more comprehensive initiatives, in addition to more equitable program designs and benefits.
So, hopefully the EPA will recognize this need and enable states to provide direct support for community participation in CPRG-funded state planning efforts. The agency will have to make that determination.
If the EPA determines that the IRA does not allow for this, then hopefully the agency will still recognize the need and identify any other resources that it might have to help states to support this critical piece of carbon planning. The EPA may have available other funding for communities that are disproportionately impacted by air pollution and climate change. For example, there is air monitoring funding, along with environmental and climate justice block grant opportunities, that may support this work and can be stacked with CPRG funding. Finessing support for intermediaries like civic organizations or faith-based groups might also be helpful in incorporating the voices of frontline communities.
Apart from the question of the federal funding for state carbon planning, states agencies could still ask whether or not their public engagement is as thorough as it might be or whether it needs to be more welcoming to the public to be truly representative. RAP’s Public Access and Participation Plans: A Starter Kit for State Agencies is a document that outlines simple steps that state agencies can take to improve their outreach, and public participation.
Comments Off on Staying the course: Keeping the key role of the energy savings obligation in focus as negotiations reach their endgame
As we move towards the endgame in the Energy Efficiency Directive (EED) revision, what should negotiators be considering as they recraft the key energy saving provisions — the energy savings obligation?
The right level of ambition …
As part of their response strategy to the energy crisis, EU legislators have committed to finalise the revision of the EED, the main legislation to deliver energy savings. Legislators are planning to meet on 2 March to advance this discussion. Last year, the Commission proposed a 13% energy efficiency target for 2030 and urged legislators to align the energy savings obligation (Article 8) with the REPowerEU goals.
The Russian invasion of Ukraine, the consequent disruption in fossil fuel supplies and the resultant increase in energy prices make action on energy efficiency more urgent than ever. The Council’s position is to gradually increase ambition over time, when what is needed is a ramp up in ambition now.
As political deadlines to resolve negotiations loom, it is important that last minute, seemingly innocuous changes do not undermine the good work put in over the preceding months.
This is particularly problematic with provisions such as Article 8, with its highly technical measurement processes set out in Annex V of the directive. The one non-negotiable technicality is the principle of additionality to EU law. Without this principle, the energy savings obligation will not play its role in meeting the Fit for 55 and REPowerEU targets, endangering their achievement. For example, energy savings from EU product and equipment standards require minimum energy performance levels that cannot be counted towards Member States obligations.
As political deadlines to resolve negotiations loom, it is important that last minute, seemingly innocuous changes do not undermine the good work put in over the preceding months.
The introduction of a new EU Emissions Trading System (ETS) does not significantly impact the delivery of energy efficiency policy measures under Article 8. During the most recent obligation period (2014-2020), countries reported numerous policy measures that saved energy covered by the current EU ETS — amongst both energy intensive industries and electricity consumers. The ETS meant that subsidy rates might have been a little lower than otherwise needed.
The extension of emissions trading to other energy sources used in buildings, transport and industry, will not significantly shrink the amount of savings that Member States can achieve through their national energy efficiency schemes. Indeed, Article 8 is the perfect complement to ETS 2. Emissions trading internalises the external costs of carbon, while Article 8 tackles the other market failures and barriers affecting energy efficiency take-up.
Removing indefensible fossil fuel subsidies
In its Net Zero by 2050 strategy, the International Energy Agency said that there should be no new fossil fuel boiler sales after 2025. The EED proposal moves in this direction by excluding energy savings from fossil fuel combustion technologies in its proposal. This makes a lot of sense, especially in the buildings sector, where the continued subsiding of fossil fuel boilers creates stranded assets that will need to be removed before the end of their lifetimes as carbon emissions becomes scarcer in the 2030s.
For Member States wishing to fulfil their energy savings obligations through buildings sector policy measures, the fossil fuel exclusion makes very little difference. The most efficient fossil fuel boilers are only slightly more efficient than the minimum standard boilers required through EU Ecodesign regulations. Policy measures that persuade consumers to switch to electrically powered heat pumps deliver around 15 times the energy savings than even the most efficient boilers, making electrification policies a no-brainer from an energy efficiency standpoint.
Delivering a more equitable energy transition
The one area where the negotiators’ positions appear to converge is on the benefits of targeting energy efficiency actions amongst vulnerable groups. The Commission’s proposal requires a minimum proportion of energy savings to be made amongst energy poor, vulnerable or households living in social housing. This aligns well with the social objectives of the Fit for 55 Package, including the use of ETS 2 revenues through the Social Climate Fund.
All these issues must be considered as negotiators move towards finalising the legal text in March. Energy efficiency policies lie at the heart of a cost-effective and equitable Fit for 55 Package. An ambitious energy savings obligation is the way to ensure this happens.
Comments Off on Better, faster, stronger: A look into further electricity market reforms
The European energy crisis was not caused by the electricity market. But it sure made people pay closer-than-usual attention to its design. That is not a bad thing. The electricity market becomes ever more important as large swaths of the economy further electrify. The electricity market therefore needs to be fit-for-purpose. In this briefing, RAP lays out how the electricity market can deliver better, faster and stronger for the energy transition and the people living it.
Any follow-up to the crisis should aim to speed up the replacement of fossil fuels with renewables, demand-side flexibility, storage and energy efficiency. The focus of market reform induced by this crisis should be to elevate the demand side on par with supply-side resources and improve hedging in the market to alleviate the remainder of the ongoing crisis and prepare for the next. This requires boosting a new portfolio of longer-term market features to share risks and benefit consumers.
Here, RAP discusses the following advances in market design:
Short-term markets see location and scarcity
Forward markets allocate risks
Contracts for Difference are carefully designed and procured
Infrastructure planning and operation integrates sectors
Windfall profit taxation as the exception
Capacity remuneration mechanisms fit for flexibility
Comments Off on Review of Integrated Resource Planning and Load Forecasting Techniques in India
Accurately forecasting electricity demand in India is imperative for governments, utilities and industries when it comes to investment and planning decisions. Over the years, forecasting has becoming even more challenging as planners must take into account changes in technology, load profiles, consumer energy end-use, and economic growth. The changes are the leading cause of uncertainty when it comes to future electricity demand.
In Review of Integrated Resource Planning and Load Forecasting Techniques in India, the authors provide an overview of India’s system of load research and integrated resource planning (IRP), describe related experiences in other developing countries, and deliver recommendations that could strengthen the process in India. The goal is to enable India’s power sector to reliably, efficiently and sustainably meet the country’s demand for electricity.
Comments Off on Public Access and Participation Plans: A Starter Kit for State Agencies
State government agencies are becoming aware that there is more that they can do to reach communities that may be underserved by agency programs — communities of color, indigenous communities, and low-and moderate-income communities. This policy brief describes steps that agencies can take to engage these communities more meaningfully as partners and stakeholders in government decision-making.
This “starter kit” looks at the typical aspects of government agency contact with the public and provides suggestions for how agencies can take simple steps to improve their engagement. Specifically, it discusses ways to improve public meetings, how to make agency websites more accessible, elements of staff training, and the importance of ongoing improvement. Two appendices look at mission statements and equity statements. In each section, a summary and notes on the topic are followed by model language an agency’s public access and participation plan might include, along with useful resources.
Comments Off on Discom Business Models Require Changes to Promote Distributed Energy Resources
In this third part of our distributed energy resources (DER) in India series, we look at changes to the current distribution company (discom) business models. These models can overcome the financial disincentives DERs often face. Instead, discoms can embrace and promote DERs to improve system efficiency, increase consumer savings, and address climate change goals.
This short paper discusses the reasons the current discom model should change and how regulators should listen to concerns many discoms have when it comes to the changes associated with promoting DERs.
The paper also discusses the steps regulators can take when it comes to transforming the current discom business model, including:
Require discoms to evaluate non-wires alternatives to meet system needs where practical and cost effective
Require discoms to create distribution system platforms
Require discoms to modify tariff design to send unbundled granular price signals to facilitate DERs
Require discoms to develop DER programs
Develop a process to effectuate changes to the discom business model
Comments Off on Electricity market reform, beyond the gas crisis
In the past, power market reform happened to increase efficiency, to reduce greenhouse gas emissions, or to improve reliability and security of supply. Today in Europe, the desire to further change the market stems from the ongoing energy crisis. As the European Union introduces a new round of electricity market reforms, RAP explores where new market regulation would usefully tackle the root causes of the ongoing energy crisis, meet consumer needs and help Europe move away from fossil fuels.
The current energy crisis is a gas crisis. It is a nightmarish scenario stemming from the Russian invasion of Ukraine and the resulting supply disruption of cheap pipeline gas, converging with decommissioning of nuclear capacity and low hydro output. Hedging strategies by energy suppliers and consumers fell short and unprecedented wholesale market prices for fossil gas made consumer gas and electricity bills explode.
Strategies must therefore improve hedging in the market if Europe is to mitigate the energy crisis – and prepare for the next. To this end, RAP recommends replacing the role of fossil gas with renewables, demand-side flexibility and energy efficiency. More precisely, this requires:
Recognising and promoting demand-side resources as a vital system resource.
Building out more solar and wind, and doing so better and faster.
Protecting basic consumer needs better than in the past.
For policymakers weighing whether to implement these actions, the authors explain the various considerations.
Comments Off on Standards for EV smart charging: A guide for local authorities
The electrification of road transport is happening – and it is already having a profound impact on the energy system and our cities. As more and more people drive electric, smart charging can ease the integration of the newcomers into the grid.
Smart charging enables charging to automatically happen at times when electricity costs are lowest – without compromising the needs of vehicle owners. As a result, smart charging creates a powerful opportunity to use more renewable energy and better utilise existing grids, accelerating the energy transition while reducing costs for all.
Cities are essential actors in making smart charging happen at a large scale. Every time they publish a public procurement procedure and every time they issue permits for EV infrastructure, it is in their hands to make smart charging work better — now and in the years to come.
But how can local authorities deploy a future-proof, robust smart charging network, with technology rapidly evolving?
Important standards supporting smart charging – such as vehicle-to-grid (V2G) – are not yet available for charging stations built today. To avoid becoming obsolete before the end of its expected lifetime, infrastructure must be ready for future upgrades.
Authors Luka De Bruyckere of ECOS and Jaap Burger from RAP offer a guide for local authorities to help ensure that cities can take these standardisation developments into account when procuring charging infrastructure.
Comments Off on Power Outage Rapid Response Toolkit
Interruptions in electricity supply – ‘the lights going out’ – make for arresting headlines and capture public attention. Yet it is strikingly rare for any kind of electricity generation shortfall to trigger blackouts: major reliability events are nearly always the result of grid failure incidents such as wires frying or being damaged by trees.
Furthermore, none of the recent events that have occurred in markets with high shares of renewables have been caused by over-reliance on renewables to provide sufficient electricity supplies. In spite of this, the fossil energy industry has a track record of seizing on any opportunity to promote the narrative that more fossil generation is needed and that the growing shift to renewables is undermining and driving up the cost of secure supplies.
To dispel many of the myths surrounding the causes of recent significant power outages, the toolkit looks at four case studies: Texas 2021, California 2020, Great Britain 2019 and South Australia 2016.
These case studies prove it is important that advocates for a clean energy transition can set the record straight quickly, credibly and substantively. This package equips advocates with information and tools to respond quickly to the misinformation that spreads rapidly in the wake of power grid reliability events, and in particular:
introduces the advocate to reliability events, and their causes and consequences;
provides a checklist for advocates to understand and analyse emerging reliability events (a separate, interactive checklist can be downloaded here: Power Grid Rapid Response Checklist);
provides holding lines for advocates during the information vacuum that normally proceeds a reliability event;
explains why large-scale reliability events are almost always caused by network failures and not renewable electricity generation.
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