Renewing America’s Economy From Crisis to Opportunity
description
Transcript of Renewing America’s Economy From Crisis to Opportunity
Steve ClemmerResearch Director, Clean Energy Program
Union of Concerned Scientistswww.ucsusa.org
The Southeast & Mid-AtlanticRegional Wind Summit
Raleigh, NCSeptember 19, 2005
Renewing America’s EconomyFrom Crisis to Opportunity
The problem: Surge of new natural gas plants…
Annual Additions to Electric Generation Capacityby Fuel, 1950-2002
0
10
20
30
40
50
60
70
80
Gig
awat
ts
Coal and Other FuelsOil and Gas
Source: EIA, Annual Energy Outlook 2004
While US gas productivity declines…
28% Decline in 2003
Source: Richard Levitan: IHS Energy, Petroleum Information Corp., EOG Resources
…Helping to drive gas higher & higher
Hurricane Katrina
8.8 Bcf or 17% of U.S. natural gas production capacity initially lost due to Hurricane Katrina
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Nom
inal
$/M
MB
tu (
Hen
ry H
ub)
Source: LBNL
NYMEXnatural gas futures strip
from 09/13/2005
Daily price history of 1st-nearbyNYMEX natural gas futures contract
High gas prices are hurtingthe economy
EIA: 52% increase in total consumer natural gas expenditures this upcoming winter
– 71% increase in gas home heating bills for the Midwest– 31% increase in fuel oil costs for the Northeast– 17% increase in residential electricity bills for the South
Cut U.S. economic growth by 2.1% a few years ago– Federal Reserve Bank of Dallas
Forcing industrial users like the petrochemical industry to move their operations overseas.
– U.S. chemical workers lost ~78,000 jobs between 2000-2004.– Wall Street Journal, 2/17/04.
Farmers are also feeling the pain because natural gas accounts for 90 percent of fertilizer costs
Increasing dependence on gas imports from overseas…
-1
0
1
2
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1990 1995 2000 2005 2010 2015 2020 2025
History Projections
Canada
LNG
Mexico
Source: EIA, Annual Energy Outlook 2004.
U.S. Natural Gas Net Imports, 1990-2025
New LNG terminals and tankers will increase our vulnerability
Leading to new coal plant proposals and higher carbon emissions
17 advanced IGCC plants
No plans to capture and store CO2
Economic risk of future CO2 limits
Coal has other importantfuel cycle impacts
Mountaintop removal mining in West Virginia
Coal mining jobs declining…
http://www.eia.doe.gov/oiaf/aeo/figure_105.htmlSource: EIA
*
Coal imports a drainon many state economies
$>1 billion$601 million - $1 billion
0-$200 million
$201-$600 million
*Data not availableSource: EIA
Expenditures for imported coal for electricity
Source: Archer C, Jacobsen M, 2003
Myth: The Southeast isn’t windyWind Power Class at 80m
Class 7
Class 6
“The greatest previously uncharted reservoir of wind power in the continental United States is offshore and near shore along thesoutheastern and southern coasts”
North Carolina has significantwind potential
Offshore Wind Technical Potential
Source: Musial W, Butterfield S., 2004
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50,000
100,000
150,000
200,000
250,000
300,000
shallow deep shallow deep
5-20 nautical miles 20-50 nautical miles
MW
New England Mid Atlantic California Pacific NW
Total – Shallow: 97,975 MW (8.0% U.S. electricity)
Deep: 809,725 MW (66.0%)
Offshore Wind Costs are Falling
Source: NREL/DOE Wind Program????
Renewable Electricity StandardsNevada: 20% by 2015, solar 5% of annual
Hawaii: 20% by 2020
Texas: 5,880 MW (~4.2%) by 2015
California: 20% by 2017
Colorado: 10% by 2015
New Mexico: 10% by 2011
Arizona: 1.1% by 2007, 60% solar
Iowa: 2% by 1999
Minnesota: 19% by 2015*Wisconsin:2.2% by 2011
New York:24% by 2013
Maine: 30%by 2000
MA: 4%by 2009
CT: 10% by 2010
RI: 16%by 2019
Pennsylvania:8% by 2020
NJ: 6.5% by 2008
Maryland:7.5% by 2019
21 States + D.C.
*Includes requirements adopted in 1994 and 2003 for one utility, Xcel Energy.
**No specific enforcement measures, but utility regulatory intent and authority appears sufficient.
Washington D.C:11% by 2022
Montana:15% by 2015
DE: 10% by 2019
Illinois: 8%by 2013**
Most New Wind Capacity Installedin States with Renewable Standards
223
537
207
634
1,264
50
0.1
1
470
44
66
1293.6
176
283
235
2830.2
Source: UCS & AWEA
114
12
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48
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0.2 66
53
74% (3,620 MW) in states with RES
New Wind Capacity, 1998-2003 (MW)
Renewable energyexpected from state standards*
*Projected development assuming states achieve annual RES targets. **Assumes regulatory enforcement of voluntary RES.
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6,000
12,000
18,000
24,000
30,000
36,000
42,000
Me
ga
wa
tts
Hawaii
California
Nevada
IA & WI
New Jersey
CT & RIMAMaine
Minnesota
AZ & NM
New York
Texas
New renewable energy supported:- 32,000 MW by 2017
CO2 reductions: 77.1 Million Metric Tons
Equivalent to:- 3.7 billion more trees- 11.5 million less cars
Maryland
CO & MT
Pennsylvania
Illinois**
DC & DE
Texas Wind Spurs New Jobsand Rural Development
Source: Virtus Energy Research Associates, 2002.Source: Virtus, 2003
Texas standard resulted in 913 MW of new wind in 2001
supported 2,500 jobs $11.7 mil./yr in tax revenues to
school districts in 10 counties
Wind Power CreatesNew Manufacturing Jobs
90 companies in 25 states currently mfg wind turbine components
Southeast & Mid-Atlantic have potential to create 38,260 new jobs
– Assuming 50 GW of wind capacity in US– 9 states in top 20
Foreign companies are building wind turbine mfg plants in US
• Spanish company Gamesa is building new plant in PA, creating 1,000 new jobs over next 5 years & $40 mil. in new investment
• Gamesa CEO credits PA renewable standard, creating market for up to 3,600 MW of new wind
GE manufactures blades in Pensacola FL and has office in Greenville, SC
South Carolina, 4,964
North Carolina, 4,661Tennessee,
4,233
Alabama, 3,571
Georgia, 3,532
Virginia, 3,386
Florida, 3,371
New Jersey, 2,920 Pennsylvania,
7,622
REPP, 2004
Wind dominates under national renewable electricity standard
Wind generation = 6-10% of US electricity use by 2020
Wind Capacity under a National Renewable Electricity Standard
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2005 2010 2015 2020 2025
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20% by 2020 RES
10% by 2020 RES
Source: UCS, using EIA model
Renewable Energy Creates Jobs
Nearly twice as many jobs as fossil fuels
98,960
190,180
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50,000
100,000
150,000
200,000
Renewable Energy Fossil Fuels
Jo
bs
20% by 2020 RES 10% by 2020 RES
Source: UCS, using EIA model
Renewable energy conserves natural gas supplies
= 1/4 of residential gas use
Source: UCS, using EIA model
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20% by 2020 RES
10% by 2020 RES
Renewable energy saves electric & natural gas consumers money
Cumulative Natural Gas and Electricity Bill Savings (10 percent by 2020 RPS)*
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Bill
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2002
$
Natural Gas Bill Savings
Electricity Bill Savings
*Excludes Transportation.
$5.4 billion gas savings
$22.8 billion electricity savings
Source: UCS, 2004.
Savings in all customer classes:Res.: $7.9 bilComm.: $11.3 bilInd.: $9 bil
EIA: 10% RES saves $23 billion20% RES saves $49 billion by 2020
All regions of thecountry save money
Total cumulative savings = $38 billion by 2025
Source: UCS, 2004.
Mid-Atlantic$4.0 billionMountain:
$2.8 billion
California: $4.3 billion
Northwest: $1.7 billion
East South Central: $1.6 billion
East North Central: $6.1 billion
West North Central: $1.8 billion
West South Central: $10.5 billion
South Atlantic: $4.0 billion
New England: $1.4 billion
(10 percent by 2020 RES)Cumulative Energy Bill Savings* by U.S. Census
Region,
Renewable Energy Reduces Emissions and Compliance Costs
Carbon Dioxide Emissions, U.S. Power Plants
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2005 2010 2015 2020
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O2
Business as Usual
20% by 2020 RES
Source: UCS, using EIA model
Reduces growth in U.S. CO2
emissions by 59%
More votes for renewable fuels vs.electricity standard
Both policies require a percentage of energy from renewable sources…but they have received different levels of support at the federal level:
*Votes in favor of the Domenici amendment.
**Votes in favor of the Bingaman/Coleman amendment.
RES** - 52 VotesRFS* - 70 Votes
Two Votes One Vote No Votes
Senate votes to amend the 2005 Energy Bill:
The RFS by 2012 was passed with the final Energy Bill. The RES was rejected by the House in conference committee.
Conclusions
Wind and other renewable energy sources can conserve natural gas supplies and provide a hedge against future prices increases and supply shortages
Wind power can provide insurance against future limits on greenhouse gas emissions
Wind power can provide significant energy diversity and security benefits
Wind power can strengthen the US economy and rural areas Renewable energy can meet a significant portion of US electricity
needs and save consumers money Efficiency AND renewables = best combination. UCS Clean
Energy Blueprint: up to 31% less natural gas; 27% reduction in gas price
Any policy evaluation of RE should extend beyond the power sector, to include gas sector impacts as well