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Climate Action Team PresentationClimate Action Team PresentationPeggy Duxbury
Seattle City LightSeptember 12, 2007
(206) [email protected]
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I. Overall objectives: Seattle City Light’s views
II. Leading By Example: Seattle’s voluntary carbon reduction strategy
III. Fed / Regional Action & NW
Climate Change: Seattle City LightClimate Change: Seattle City LightClimate Change: Seattle City LightClimate Change: Seattle City Light
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• Climate change is real & action needed
• Mandatory reductions needed
• Flexible ways to reach goals: “harness market forces”
• Recognize cost to inaction
I.I. Views of City LightViews of City LightI.I. Views of City LightViews of City Light
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Seattle Times, Nov 1, 2006
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City Light’s carbon reduction path
Conservation: Almost a silver bullet
667 Mayors in US / 28 in WA Support Mayor Nickels’ Climate Protection agreement
II.II. Leadership Through ExampleLeadership Through Example II.II. Leadership Through ExampleLeadership Through Example
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Step 1: Conservation: 580,000 tons avoided annually
Step 2: Divest of Centralia coal plant: 611,000 tons eliminated
Step 3: Purchased new renewables (Wind) 230,000 tons avoided annually
Step 4: Purchase Offsets: 200,000 tons annually
Success! 2005 / 2006 Seattle City Carbon Neutral – First and only in US
The Path to Carbon NeutralityThe Path to Carbon NeutralityThe Path to Carbon NeutralityThe Path to Carbon Neutrality
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Wall Street’s Favor: Moody’s improved recommendation for SCL bonds based upon low carbon emission profile
First-mover advantage: Locked in long term wind before west coast mandates = higher costs
Cost effective for customers: Conservation = lowers bills / Offsets cost less than $1 per year for residential customers
• Catalyst for Change: Biofuels / Port Electrification
Benefits of Climate NeutralityBenefits of Climate NeutralityBenefits of Climate NeutralityBenefits of Climate Neutrality
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SURE! If all utilities reduced carbon emissions 10% (proxy for City Light’s program) CO2 would be reduced 250 million tons
= 46 million cars!
Can this work for other utilities?Can this work for other utilities?Can this work for other utilities?Can this work for other utilities?
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Characteristics of NW Power
• WA Over 70% hydro
• Large Role of Public Power & BPA
• Conservation achieved 40% load growth
• Major investments in new renewables
• Diminished reliance on coal
III:III: Voluntary Not Enough: NW Issues Voluntary Not Enough: NW Issues around Cap and trade around Cap and trade III:III: Voluntary Not Enough: NW Issues Voluntary Not Enough: NW Issues around Cap and trade around Cap and trade
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Northwest Efficiency AchievementsNorthwest Efficiency Achievements1978 – 20051978 – 2005
Northwest Efficiency AchievementsNorthwest Efficiency Achievements1978 – 20051978 – 2005
0
500
1,000
1,500
2,000
2,500
3,000
3,500
Avera
ge M
egaw
att
s
1978 1982 1986 1990 1994 1998 2002
BPA and Utility Programs Alliance Programs State Codes Federal Standards
Since 1978 Utility & BPA Programs, Energy Codes & Federal Since 1978 Utility & BPA Programs, Energy Codes & Federal Efficiency Standards Have Produced Efficiency Standards Have Produced OverOver 3100 aMW of Savings. 3100 aMW of Savings.
SOURCE: NW Power and Conservation Council, 2007
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Highest ranking states: VT, CT, CA, MA, OR, WA, NY, NJ, RI
Lowest ranking states (number higher due to ties): ND, WY, MS, SD, AL, MO, AR, OK, TN, AK, IN, LA, GA, VA, KY, WV, NE
Source: The State Energy Efficiency Scorecard for 2006, ACEEE, June, 2007
Energy Efficiency Scorecard
6
55021
4925
18
1
48
9
27 15
4424
11
35
15
38
4330
35
30
38
33
2741
35
45
46
12
2613
41
34
23
4049 46
29
Maine 15
New Hampshire 18
Vermont 1
Massachusetts 4
Rhode Island 9
Connecticut 1
New York 7
Pennsylvania 14
New Jersey 8
Delaware 30
Maryland 20
Dist. Columbia 22
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1,500 lbs/MWh
2,000 lbs/MWh
1,000 lbs/MWh
LOWEST EMISSION RATES IN USLOWEST EMISSION RATES IN US(lbs of CO(lbs of CO22 per mwh of electricity produced) per mwh of electricity produced)
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• “Coal generation has diminished in utility IRPs to the point where only one utility has a coal plant in its plan.” - IRP Status Memo, Michael Schilmoeller, Power Division, NW Power and Conservation Council, July 31, 2007
• I 937 & HB 6001 along w/ similar standards in CA & OR, favor renewables, conservation & natural gas over coal
Coal Not Key to NW Resource PlansCoal Not Key to NW Resource PlansCoal Not Key to NW Resource PlansCoal Not Key to NW Resource Plans
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• Allocation Matters! Historic Emissions penalize the NW more than any region in US
• R&D money must focus equally on non coal technologies to better fit NW planning
• Encourage (or don’t penalize) conservation
• When CA Sneezes, NW catches cold
Federal / Regional PrioritiesFederal / Regional PrioritiesFederal / Regional PrioritiesFederal / Regional Priorities
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Emission-Based Gives Many Allowances to Few Emission-Based Gives Many Allowances to Few Source: “Benchmarking Air Emissions of the 100 Largest Electric Generation Owners -2004”
*CO2 allowance allocation based on total electricity output, including fossil, renewable, and incremental nuclear output (relative to 1990).
0
50,000,000
100,000,000
150,000,000
200,000,000
250,000,000
300,000,000
350,000,000
400,000,000
NM UT OR AZ WA CA 6-stateregion
CO2 based allocation
Output based allocation
Load based allocation (electricity sales)
Tons
0%
25%
50%
75%
100%
6 producers
18 producers
50 producers
(
100 largest producers
all others
AEP TVASouthern XcelDuke Ameren
MidAmericanDominion Edison InternationalProgress EnergyTXU
FPLE.ON First EnergyAllegheny EnergyAES
DTE EnergyTexas Genco LLC
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CO2 Allocation Comparison: Emissions-Based vs. Output-Based* vs. Load-Based Source: EIA 2004 & 2005 data
*CO2 allowance allocation based on total electricity output, including fossil, renewable, and incremental nuclear output (relative to 1990).
Tons-
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
140,000,000
WA ID OR 3-state region
CO2 based allocation
Output based allocation
Load based allocation (electricity sales)
Difference between emission and
performance/output approaches
@ $5/ton = $479 million
@ $7/ton = $671 million
@ $10/ton = $959 million
avoided emissions due to conservation of 3100MW (coal) in 3-state region
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• Hydro most vulnerable power system from unchecked climate change
• Wall Street beginning to see financial value of utilities w/ low carbon emissions
• Time for mandatory action & regulatory certainty
CONCLUSIONCONCLUSIONCONCLUSIONCONCLUSION
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