(ref. conservationvalue.blogspot.com) Gerald Hane, Ph.D. President and CEO, Battelle-Japan October 29, 2009 1
Overview of Major Laboratories Managed by Battelle Pacific Northwest Idaho Columbus Brookhaven Lawrence Livermore West Jefferson NBACC Oak Ridge National Renewable Energy Lab BEST Center $5.2 billion R&D volume 23,000 staff 31 scientific user facilities 2
Outline Context of the Green New Deal Content of the Green New Deal Progress Challenges Addressing the Scale of the Problem - Will it be Big Enough? 3
Context of the Green New Deal - Assess in Two Parts Green New Deal 4
Green Was A Central Obama Priority 5
Context of a New Deal WWII Distressed economy Sense that the free market alone cannot deliver timely recovery Larger government role with a sense of mission Offering people a different government vision which creates different options moving forward 6
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New Deal Green New Deal 10
Green Policy Themes Provide immediate relief from cost of energy Incentivize markets Regulations and standards Portfolio goals Tax incentives Provide financing Invest in research and development Improve energy infrastructure 11
New Energy for America Provide Short-term Relief to American Families Crack Down on Excessive Energy Speculation. Swap Oil from the Strategic Petroleum Reserve to Cut Prices. Eliminate Current Imports from the Middle East and Venezuela within 10 Years Increase Fuel Economy Standards. Get 1 Million Plug-In Hybrid Cars on the Road by 2015. Create a New $7,000 Tax Credit for Purchasing Advanced Vehicles. Establish a National Low Carbon Fuel Standard. A Use it or Lose It Approach to Existing Oil and Gas Leases. Promote the Responsible Domestic Production of Oil and Natural Gas. Create Millions of New Green Jobs Ensure 10 percent of US Electricity Comes from Renewable Sources by 2012, and 25 percent by 2025. Deploy the Cheapest, Cleanest, Fastest Energy Source Energy Efficiency. Weatherize One Million Homes Annually. Develop and Deploy Clean Coal Technology. Prioritize the Construction of the Alaska Natural Gas Pipeline. Reduce US Greenhouse Gas Emissions 80 Percent by 2050 Implement an economy-wide cap-and-trade program to reduce greenhouse gas emissions 80 percent by 2050. Make the U.S. a Leader on Climate Change. 12
New Energy for America The Apollo Jobs Report (2004) The New Apollo Project - Increasing energy diversity Expand renewable energy development Plan for a hydrogen future Investing in the industries of the future Promote advanced technology and Hybrid cars Invest in more efficient factories Promoting high performance building Enhance financing, codes, standards Increase use of energy efficient appliances Rebuilding public infrastructure Modernize electrical infrastructure Improve transportation options Reinvest in smart urban growth Strengthening regulations Strengthen regulatory protections to encourage energy diversity, safety, and consumer choice $313 billion in energy investment will provide $1.43 trillion in GDP growth 13
New Apollo Project (2) An 80% reduction in greenhouse gas emissions by 2050 A 100% auction cap-and-trade program, estimated to raise $646 billion in revenue by 2019 Significant spending on alternative energy, efficiency research and implementation Reengagement with the UN Framework Convention on Climate Change (UNFCCC) A new forum for large greenhouse gas emitters including the G-8 nations plus Brazil, China, India, Mexico and South Africa A new focus on reforestation and carbon sequestration. 14
20 Percent Wind Power by 2030 (DOE 2008) (Ref. US DOE,July 2008) 15
Wind Power Becomes Major Source of New Electricity Generating Capacity in the U.S. In 2007, wind power accounted for 47% of the 11,122 MW of new electricity capacity put online in the U.S. (Natural gas accounted for most of the remainder.) In 2008, wind power accounted for 42% of new electrical generating capacity. 16
New Deal Boost from the Economic Stimulus Package 17
New Deal Economic Stimulus Programs in Energy The American Recovery and Reinvestment Act included more than $80 billion in clean energy investments. 18
Distribution of DOE Funding from Economic Stimulus 19
(Ref. Clean Law and Buisness.com) 20
Tax Incentives, Financing Expand tax incentives for renewable energy facilities. $14.0 billion Provide additional financing for Innovative Energy Loan Guarantee program - projects that "avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases, $6.0 billion Increase tax credits for residential energy efficiency improvements. $2.0 billion Incentive for alternative vehicle, increase the tax credit for purchasing plug-in hybrid vehicles to $7,500. $2.0 billion Incentive for advanced energy investment. Establish a new 30 percent investment tax credit for manufacturers of advanced energy property. $1.6 billion Support battery manufacturing. $2.0 billion Provide consumers rebates for energy-efficient appliances $300 million Expand tax incentives for residential renewable energy properties. Remove dollar caps on the 30 percent residential credit for solar thermal, geothermal and small wind property. $268 million Incentive for alternative fuel pumps. Increase tax credits for gas stations and other businesses that install non-hydrogen, alternative fuel pumps to 50 percent through 2010, for up to $50,000. $54 million 21
Interesting Renewable Tax Provision Tax Grant - allows businesses that invest in building renewable-energy facilities (such as wind and solar farms) to claim a government grant that covers 30 percent of the investment, rather than claiming a tax credit. Many companies cannot claim the tax credit because they have no tax liability. (The tax credits plus grants are expected to cost the government $14 billion.) 22
State and Local Funding Provide grants to cities, counties and states to increase energy efficiency. $6.3 billion Authorize more state and local bonds for energy-related purposes. Authorize an additional $1.6 billion in renewable energy bonds and $2.4 billion in energy conservation bonds to finance state and local government projects. $1.4 billion Provide grants to states for energy-efficient vehicles and infrastructure. Includes $300 million to help state and local governments purchase hybrid vehicles and $100 million to start electrical infrastructure projects that encourage the use of electric vehicles. $400 million 23
Operation and Maintenance Increase financing for home weatherization program. $5.0 billion Increase energy efficiency in federal buildings $4.5 billion Repair and modernize public housing units $4.0 billion Replace older vehicles owned by the federal government with hybrid and electric cars $300 million Improve energy efficiency in government-subsidized apartment buildings $250 million Repair and modernize about 4,200 Native American housing units. $510 million 24
Energy S&T Related Modernize the electric grid. Make the electric grid "smarter. $11.0 billion. Of this amount, $4.5 billion for R&D, pilot projects and matching funds for the program. Invest in fossil energy - near-zero emissions power plants, clean coal technology and carbon capture. $3.4 billion. Of this amount, Carbon Capture and Energy Efficiency Competitive Grants - $1.52 billion Fossil Energy R&D - $1 billion Clean Coal Power Initiative - $800 million; Renewable energy and energy efficiency research $2.5 billion Biomass - $800 million Geothermal activities and projects - $400 million Industrial energy efficiency - $500 million Provide additional funding for science and research at the Department of Energy. Includes $400 million for ARPA-e. $2.0 billion Train workers for careers in energy efficiency and renewable energy fields $500 million (Ref. New York Times, March 3, 2009, The Stimulus Package Energy ) 25
Carbon Capture and Storage CCS Led by FutureGen Alliance World s first coal-fueled, near zero emission plant. DOE has already made available $1.1 billion Largest and most developed CCS project globally, 275 MWe 26
ARPA-E On April 27, 2009, ARPA- E asked for preliminary ideas for the first $150 million of grants to be given from the $400 million received from the economic stimulus package. 3,500 concept papers in first round. ARPA-E expects to fund fewer than 2% of the 3500 proposals Sample first round projects Liquid Metal Grid-Scale Batteries Bacteria for Producing Direct Solar Hydrocarbon Biofuels CO2 Capture using Artificial Enzymes Low Cost Crystals for LED Lighting 27
Other Energy/Environment Policy Measures Increasing fuel economy standards - for the first time in more than a decade, for Model Year 2011 for cars and trucks. Increasing appliance efficiency standards Presidential memorandum to implement more aggressive efficiency standards for household appliances as dishwashers and refrigerators. Over the next three decades, the US will save twice the amount of energy produced by all the coal-fired power plants in America in any given year. Reducing mercury emissions -Supporting the first steps of a legally-binding treaty to reduce mercury emissions worldwide. Increasing off-shore energy - On Earth Day 2009 (April 22), the President unveiled a program to develop the renewable energy projects on the waters of the US Outer Continental Shelf that produce electricity from wind, wave, and ocean currents. 28
Federal Government October 5, 2009 - Executive Order on Federal Greenhouse Gas Emissions The Executive Order requires Federal agencies to set a 2020 greenhouse gas emissions reduction target within 90 days; increase energy efficiency; reduce fleet petroleum consumption; conserve water; reduce waste; support sustainable communities; and leverage Federal purchasing power to promote environmentally-responsible products and technologies. The Executive Order also requires agencies to meet a number of energy, water, and waste reduction targets, including: 30% reduction in vehicle fleet petroleum use by 2020; 26% improvement in water efficiency by 2020; 50% recycling and waste diversion by 2015; 95% of all applicable contracts will meet sustainability requirements; Implementation of the 2030 net-zero-energy building requirement; Implementation of the storm water provisions of the Energy Independence and Security Act of 2007, section 438; and Development of guidance for sustainable Federal building locations in alignment with the Livability Principles put forward by the Department of Housing and Urban Development, the Department of Transportation, and the Environmental Protection Agency. 29
Innovation Systems Approach Increase Discovery Speed Adoption Improve Infrastructure Stimulate Markets Impact Energy and Climate Goals $21.5 Billion +70 Billion Research Funding Prototype Demos Smart Grids Hybrid Vehicle Infrastructure Education Tax Incentives Loans Regulations Standards Energy Efficient Grants Change in Efficiency and Fuel Types 30
Is it Enough? Challenges Ahead Financing Carbon caps Energy pricing Increasingly persistent unemployment International participation 31
Financing After the economic stimulus is spent, will there be enough financing for domestic and international needs? 32
Gigaton Throwdown The Gigaton Throwdown Initiative was endorsed by a group primarily composed of venture capital investors. The team spent 18 months evaluating what it would take to scale up clean energy aggressively so that it has a major impact on job growth, energy independence, and climate change during the next 10 years. 33
Signatories to the Gigaton Project 34
Energy Investment Scale-up Gigaton Project Needs Projection 35
Energy Investment and Job Creation Gigaton Project Forecasts 36
Energy Investment and Avoided CO2 Gigaton Project Forecasts 37
IEA Goals The International Energy Agency said that a $10 trillion investment in renewable energy, biofuels and nuclear power over the next 20 years is necessary in order to stabilize greenhouse gas emissions. The IEA plan calls for 33 percent of energy to come from renewables, including nuclear power, by 2030 about triple today's 18 percent. That would mean constructing 18 nuclear reactors and 17,000 windmills ever year. About 60 percent of vehicles worldwide would have to be either hybrid or electric. (Ref. GENI) 38
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Clean Tech Investment Expansion Now Dependent on Cap and Trade White House: The 2010 Budget proposes investing $150 billion over 10 years from capand-trade revenues in clean energy technologies (Ref. Green Inc., July 29, 2009) 42
Carbon Emission Reduction Carbon Caps 43
Carbon Emission Reduction Bills President Obama proposed a 14 percent cut in greenhouse gases by 2020 with cap-and-trade U.S. House of Representatives proposed a 17 percent cut in greenhouse gas emissions from covered sources below 2005 levels by 2020 and 83% below 2005 levels by 2050. H.R. 2454, the American Clean Energy and Security Act of 2009 (Waxman-Markey), passed June 26, 2009 U.S. Senate proposes a 20 percent cut in greenhouse gases by 2020 and an 83% reduction by 2050. S. 1733, Clean Energy Jobs and American Power Act, currently in Committee hearings 44
Allocation of Emission Allowances House Bill - H.R. 2454, the American Clean Energy and Security Act of 2009 15 percent to be auctions 85 percent allocated gratis Liable parties energy intensive industries - 15 percent coal fired electric plants - 5 percent oil refineries - 2 percent electric utilities CCS - 2 percent Affected parties Electricity distributors 32 percent State governments 10 percent Natural gas distributors 9 percent Vehicle manufacturers 1 percent Transition assistance for other parties Preventing tropical deforestation 5 percent Domestic adaptation 2 percent International adaptation 2 percent Working training 1 percent Senate Bill to be determined 45
Regional Cap-and-Trade Initiatives in the United States (Ref. Pew Center on Global Climate Change) 46
Energy Pricing 47
Feed-In Tariffs Feed-In Tariffs - The price per unit of electricity that a utility or supplier has to pay for renewable electricity from private generators. The government regulates the tariff rate. In the US, renewable portfolio standards and tax incentives have been more common. California Public Utilities Commission approved limited feed-in tariffs in February 2008 Gainsville, Florida announced the first US solar feed-in tariff in February 2009 Washington State introduced legislation for a program in February 2009 Vermont approved feed-in tariffs, May 2009 Such states as Indiana, Minnesota, Michigan are investigating feed-in tariffs (Ref. NY Times, Feb 9, 2009) 48
Transforming Industrial Capabilities A 320-acre Ford Motor Co. plant sits idle after 52 years of assembling Lincoln Continentals, Ford Thunderbirds and other vehicles More than 435,000 automotivemanufacturing jobs have disappeared since the beginning of the decade Renewable-energy companies are working to transform the old assembly into an energy equipment manufacturing park. Xtreme Power, makes the energystorage and power-management systems, Clairvoyant Energy, develops thin-film solar production capacity using equipment from Oerlikon Solar The group has agreed to buy the space from Ford with $100 million in tax credits and funding from other government sources 49
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Persistent and Rising Unemployment 51
Meaningful International Participation World Bank Poorer economies would require $75 billion to $100 billion more per year if they are to enjoy the same level of welfare in the future world as they would have without climate change. (September 30, 2009) Participation of China? India? 52
What More? National-Level, Globally-Benchmarked Comprehensive Innovation and Jobs Policy Beyond energy Beyond IT/broadband A wide reaching assessment of innovation in the US economy including the service economy - in the context of the global economy is needed. Is this rise in base unemployment due to longerterm structural shifts in the economy? 53
To More Fully Realize the Benefits of a Green New Deal - More than Green, More than a New Deal To achieve an economic New Deal, it must be more than Green To achieve our Green goals, we need more than a New Deal. 54
Thank You 55