Secure State Energy Actions 2010 UPDATE

Transcription

1 Clean and Secure State Energy Actions 2010 UPDATE

2 The National Governors Association (NGA), founded in 1908, is the instrument through which the nation s governors collectively influence the development and implementation of national policy and apply creative leadership to state issues. Its members are the governors of the 50 states, three territories and two commonwealths. The NGA Center for Best Practices is the nation s only dedicated consulting firm for governors and their key policy staff. The NGA Center s mission is to develop and implement innovative solutions to public policy challenges. Through the staff of the NGA Center, governors and their policy advisors can: Quickly learn about what works, what doesn t and what lessons can be learned from other governors grappling with the same problems; Obtain specialized assistance in designing and implementing new programs or improving the effectiveness of current programs; Receive up-to-date, comprehensive information about what is happening in other state capitals and in Washington, D.C., so governors are aware of cutting-edge policies; and Learn about emerging national trends and their implications for states, so governors can prepare to meet future demands. For more information about NGA and the Center for Best Practices, please visit ACKNOWLEDGEMENTS This report was authored by Rachel Escobar and Sue Gander of the National Governors Association Center for Best Practices (NGA Center), with writing and research assistance from Greg Dierkers, Devashree Saha, Andrew Kambour, and Katherine George, also of the NGA Center.

3 Energy Efficiency Building Energy Codes Utility Demand-Side-Management Utility Rate Realignment Energy Savings Targets/Energy Efficiency Resource Standards Public Benefits Funds Residential: 2006 IECC and 2006 IRC with state specific amendments, mandatory statewide Commercial: 2006 IECC and 2006 IBC with state specific amendments, mandatory statewide Department of Housing, Building and Construction (DBHC) will adopt a building code that achieves energy savings equivalent to the latest IECC (residential) and ANSI/ASHRAE/IESNA (commercial) and a plan to achieve compliance The DHBC estimates that 2009 IECC will be adopted by January 2011 New 2009 Energy Code training program will provide energy efficiency code inspections in new construction, both commercial and residential, throughout the Commonwealth Utilities file DSM programs with the Kentucky Public Service Commission for cost recovery of approved activities Governor Steve Beshear requested that the Kentucky Public Service Commission Chairman consider appropriate steps consistent with Kentucky law, American Recovery and Reinvestment Act (Section 410), and relevant PURPA requirements to implement appropriate incentives for energy efficiency programs The state, through a contract with an outside vendor, conducted a study to determine potential financial, social, and economic impacts of alternative rate design structures and ratemaking methodologies Legislation enacted in 2008 directs a study of adoption of energy efficiency standards, with a report due November 30, 2008 The Kentucky Public Service Commission (PSC) issued its report, Electric Utility Regulation and Energy Policy in Kentucky, with their findings and recommendations In response to the report, Kentucky published their Energy Plan, Intelligent Energy Choices for Kentucky s Future, which sets a target of meeting 18% of Kentucky s projected 2025 energy demand with increased efficiency Set the High Performance Building Standard that requires LEED certification of newly built or renovated state government buildings (200 KAR 6:070) The state will give priority to projects that include an expansion of existing energy efficiency programs including building and industry retrofits, as well as an expansion of existing programs to support renewable energy projects and deployment activities Legislation enacted in 2008 directs, as part of an RPS study, funding mechanisms for financing incentives for energy efficiency and renewable energy, including evaluation of public or benefit funds utilized by other states As part of the Kentucky Energy Plan, will determine the impact, surcharge amount, and cost of establishing a public benefit fund 64 Clean and Secure State Energy Actions

4 Legislation enacted in 2008 establishes residential and commercial energy efficiency income tax credits for a percentage of installed costs of upgraded insulation, energy efficient windows and doors, and HVAC systems; also establishes tax credits for builders of ENERGY STAR homes and purchasers of Energy Star manufactured homes; the state allows a sales tax exemption for manufacturers on the amount of sales or use tax paid on the purchase of new or replacement equipment for an energy efficiency project The Green Bank of Kentucky provides low-interest loans to state institutions for education, engineering analyses and building improvements that enhance energy efficiency - The repayment of the loan is intended to come from future reduced energy usage Issuing approximately $4 million in rebates to residents who purchase ENERGY STAR home appliances to replace older, less energy-efficient models beginning April 2010 and continuing until the funding runs out Financial Incentives Loans, Rebates, Taxes, Bonds, Etc. The Governor s Office of Agricultural Policy is using ARRA funds to supplement tobacco settlement funding grants to multi-county collaboratives to enhance and advance renewable energy production at the farm level Awarding energy efficiency and renewable energy grants to industries locating or expanding operations in Kentucky that create or retain green jobs while saving energy and reducing carbon emissions Grants for local governments to improve the energy efficiency of local government buildings Kentucky s Public Service Commission will seek to implement a general policy that ensures utility financial incentives are aligned with helping customers use energy more efficiently and provides the utility with timely cost recovery and a timely earnings opportunity The Governor s Office of Agricultural Policy On-Farm Energy Efficiency and Production Program works to increase energy efficiency and opportunities for renewable energy improvements on Kentucky s farms and in farming communities Kentucky Housing Corporation (KHC), the State Housing Finance Agency, in partnership with the Kentucky Department for Energy Development and Independence (DEDI), and Kentucky Revenue Cabinet has created KY Home Performance, a statewide $6.1 million dollar single family energy efficient retrofit program targeting households at 200% of poverty and above Kentucky Pollution Prevention Center performs energy analyses at industrial, commercial and institutional firms or organizations Establishing a program in partnership with electric utilities to explore development of smart grid concepts and their possible application in Kentucky Clean Electricity Renewable/Alternative Energy Portfolio Standards and Goals Legislation enacted in 2008 directs a study of adoption of Renewable Portfolio Standards; report was due November 30, 2008 Renewable and efficiency portfolio standard (REPS) denotes that 25% of Kentucky s energy needs will be supplied by 7% renewable energy sources and 18% reductions through energy conservation and efficiency (Kentucky s energy plan, Intelligent Energy Choices for Kentucky s Future) Set a target of producing 1000 MW of renewable energy by 2025 Pending legislation regarding the enactment of a Clean Energy Portfolio Standard (HB 408, HB 3) 2010 UPDATE 65

5 Net Metering and Interconnection Standards Advanced Coal and Clean Coal Public Benefits Funds Legislation enacted in 2008 expands the state s net metering laws by raising the cumulative cap that a utility needs to allow from 0.1% of load to 1% of load, adding power from wind, water and other renewables to the solar allowable systems, and requiring the development of standardized rules for interconnecting Small generators (up to 30kW) of wind energy, hydroelectric power and biomass or bio-gas power were included in the already existing net metering policies for solar The Kentucky Public Service Commission issued an order establishing interconnection and net metering guidelines applicable to all jurisdictional electric utilities in the state (KY PSC Order ) Utilities were required to file net metering tariffs and application forms to comply with these guidelines The Public Service Commission is required to approve certain long-term contracts by utilities for synthetic gas from coal; 2007-enacted legislation also stipulates that coal gasification projects that are eligible for incentives under the Incentives for Energy Independence Act must be carbon capture ready; 2007-enacted legislation also provided funding for carbon capture and storage research; additional funding appropriated by 2008-enacted legislation will be directed toward research on carbon capture from coal-fired electric generating units Developing carbon capture and sequestration projects so that 50% of the state s coal-based energy facilities will have these management technologies by 2050 State funds are appropriated annually for research projects relating to clean coal, new combustion technology, thin-seam coal extraction, safety, tracking and communication devices, coal slurry disposal, synthetic natural gas produced from coal through gasification processes, and the development of alternative transportation fuels produced by processes that convert coal or biomass resources or extract oil from oil shale, and other coal research Legislation enacted in 2008 directs, as part of an RPS study, funding mechanisms for financing incentives for energy efficiency and renewable energy, including evaluation of public or benefit funds utilized by other states As part of the Kentucky Energy Plan, will determine the impact, surcharge amount and cost of establishing a public benefit fund Provides low interest loans for the installation of solar water heaters Legislation enacted in 2008 establishes the State Income Tax Credits for a percentage of installed costs of active and passive solar space heating systems, solar water heating systems, wind turbines, and solar photovoltaic systems Incentives to companies that build or renovate facilities that utilize renewable energy Financial Incentives Loans, Rebates, Taxes, Bonds, Etc. Incentives for energy efficient alternative fuel facilities that make fuel from densified feedstock coal, waste coal or biomass that have higher energy content than the feedstocks without densification (HB 552 and 589, 2010, and KRS to ) The Public Service Commission will study natural gas retail competition programs to determine if benefits can be derived from these programs (HB 542) The Kentucky New Energy Venture Fund (KNEV) supports the development and commercialization of alternative fuel and renewable energy products, processes, and services across the state 66 Clean and Secure State Energy Actions

6 Alternative Fuels & Vehicles Consumption Targets/Renewable Fuel Standards Financial Incentives Loans, Rebates, Taxes, Bonds, Etc. Developing an Alternative Transportation Fuel Standard (KRS ) - The Kentucky Energy Plan outlines four sources of fuel for cars made in Kentucky that will offset foreign petroleum exports by 60%: plug-in hybrids, biofuels, coal-to-liquids, and natural gas Provides production tax credits for pure biodiesel, corn-based ethanol, or cellulosic-based ethanol Provides incentives for eligible entities that construct, retrofit, or upgrade alternative fuel production or gasification facilities, under the 2007 Incentives for Energy Independence Act Lead By Example Appliance/Equipment Efficiency Building Efficiency Requires ENERGY STAR qualified products in state agency procurements where economically feasible using a life-cycle cost analysis Legislation enacted in 2008 requires that, beginning July 1, 2009, all construction or renovation of public buildings for which 50% or more of the capital cost is paid by the Commonwealth shall meet high performance building standards established in the Act, for projects that have not entered the design phase before January 1, 2009; requires properties leased by the state to meet high performance building standards (beginning July 1, 2018) The Kentucky Energy Plan sets efficiency targets for state government buildings of 15% and 25% in 2015 and 2025, respectively, using 2009 as the baseline year Governor Beshear ordered certain state-owned facilities required to reduce their energy use on nights and weekends Energy efficiency and renewable energy measures for the High Performance Sustainable Research Laboratory building at the University of Kentucky will take the building from a meets code building to a better-than-code building that will support a new state-of-the-art Advanced Battery Strategic Planning (ABSP) facility utilizing $11.8M in funds received from the National Institute for Standards and Technology (NIST) Kentucky Energy Efficiency Program for Schools (KEEPS) helps Kentucky school districts reduce energy consumption and operating expenses (HB 2, Section 16) The Kentucky School Energy Managers Program provides energy managers at the school district level with tools that will help promote and achieve the goals and objectives of the Kentucky Energy Efficiency Program for Schools The Kentucky Green and Healthy Schools program is designed to improve the knowledge base about energy and related environmental topics for students, teachers, and administrators in all Kentucky schools The Kentucky National Energy Education Development (NEED) program focuses on the scientific concepts of energy and provides objective, gradeappropriate information about conventional and emerging energy sources their use and impact on the environment, economy, and society Funding is being provided for photovoltaic systems to bring two schools to near net zero or net zero energy use Established a Green Schools Caucus (HR 24) Established a Kentucky Efficient School Design Trust Fund and required the Department of Education to develop and publish guidelines for efficient school design (SB 132) 2010 UPDATE 67

7 Alternative Fuel and Vehicle Fleets Through a 2006 Executive Order, the state has developed a strategy to replace at least 50% of the state motor fleet light-duty vehicles with energy efficient vehicles including hybrid-electric vehicles, fuel cell vehicles, and alternative fuel vehicles and to increase the use of ethanol, biodiesel, and other alternative fuels in the state motor fleet; fleet vehicles are to be fueled with either a 10% blend of ethanol (E10) or a 2% blend of biodiesel (B2) as the primary fueling option; the Transportation Cabinet is directed to maximize the use of E85 in its fleet of flexible fuel vehicles Carpool KY and flexible work options help state employees reduce their commuting costs and impact on the environment The Kentucky Energy Plan calls for efficiency targets in the state vehicle fleet of 30% below 2007 levels by 2015 and 50% below 2007 levels by 2025 GHG Emissions GHG Policies Climate Action Plan The strategic action plan released in November 2008 outlines the three key areas for reducing carbon emissions in 2025 by 50% of what they would be under business-as-usual circumstances: nuclear energy, carbon capture/ storage, and energy efficiency The Kentucky Climate Action Plan Council (KCAPC) was established to identify opportunities for Kentucky to respond to the challenge of global climate change and any federal legislation or regulation to address greenhouse gas emissions while becoming more energy efficient and energy independent, and spurring economic growth Clean Energy RD&D Partnerships, Grants, Awards, and Dedicated Funding The Kentucky Alternative Fuel and Renewable Energy Fund Program provides funding to Kentucky-based companies for research, development, and commercialization of alternative fuels and renewable energy Funding the Kentucky Geological Survey carbon sequestration research Funding the Kentucky Renewable Energy Consortium for renewable energy-related grants Green Economic Development Task Force, Workforce Development, Incentives, Analysis, Etc. Created the Energy Technology Career Track Program in April 2008 Mandates the Department for Workforce Investment to establish an energy technology career track program (HB 2, KRS ) Kentucky s Clean Energy Corps set the goal of weatherizing 10,000 modest-income homes to make them 30% more efficient Since February 2009, the state has weatherized approximately 4,200 low income housing units Formed the Kentucky Consortium on Energy Workforce Development 68 Clean and Secure State Energy Actions

8 NGA Center Divisions The NGA Center is organized into five divisions with some collaborative projects across all divisions. Economic, Human Services & Workforce focuses on best practices, policy options, and service delivery improvements across a range of current and emerging issues, including economic development and innovation, workforce development, employment services, research and development policies, and human services for children, youth, low-income families, and people with disabilities. Education provides information on best practices in early childhood, elementary, secondary, and postsecondary education. Specific issues include common core state standards and assessments; teacher effectiveness; high school redesign; science, technology, engineering and math (STEM) education; postsecondary education attainment, productivity, and accountability; extra learning opportunities; and school readiness. Environment, Energy & Transportation identifies best practices and provides technical assistance on issues including clean energy for the electricity and transportation sectors, energy and infrastructure financing, green economic development, transportation and land use planning, and clean up and stewardship of nuclear weapons sites. Health covers a broad range of health financing, service delivery, and coverage issues, including implementation of federal health reforms, quality initiatives, cost-containment policies, health information technology, state public health initiatives, and Medicaid. Homeland Security & Public Safety supports governors homeland security and criminal justice policy advisors. This work includes supporting the Governors Homeland Security Advisors Council (GHSAC) and providing technical assistance to a network of governors criminal justice policy advisors. Issues include emergency preparedness, interoperability, cyber-crime and cyber-security, intelligence coordination, emergency management, sentencing and corrections, forensics, and justice information technology.

9 John Thomasian, Director NGA Center for Best Practices 444 N. Capitol Street, Suite 267 Washington, DC