Energy Systems

Poor Little Rich Countries: Another Look at the Resource Curse

Resource-rich countries are plagued by macroeconomic crises known as “Dutch Disease,” which is associated with the inflation of local currencies on account of a large influx of foreign exchange and a dip in labor supply for non-traded goods. In developing countries, the historical context of state formation is often such that the revenues generated by natural resource exports bolster the stability of authoritarian regimes and the dominant state actors consolidate their power by managing boom-bust cycles to avert crises. Using Mexico, Venezuela, and Angola as paradigmatic cases, this article examines the relevance of outside forces, domestic policies, and the opportunistic forms of engagement with external power chosen by local actors that produced tragic outcomes in each of these instances.

Originally published in Environmental Politics 20, no. 5 (September 2011): 617-632.

The Democratic Economy of Public Utility Commissions

Nuclear Power: Should It Have a Role?

Adequate mitigation of the risks of climate change requires rapid displacement of fossil fuels with carbon-free energy sources. This imperative has prompted a growing chorus of energy analysts, policymakers, and industry advocates to press for a resurgence of nuclear energy. Even some environmentalists are urging reconsideration of the nuclear option, so long anathema to their own movement. Yet, with critical problems unsolved—safety and cost, waste storage, and nuclear weapons proliferation—nuclear power remains a deeply problematic response to the climate challenge.

A Failed Experiment: Why Electricity Deregulation Did Not Work and Could Not Work

The massive national experiment in electricity deregulation—launched by over a dozen states more than a decade ago in the wake of the Reagan revolution—has failed on multiple counts. Intended to reduce electricity rates, deregulation instead increased rates. For the ten months through October 2006, average rates in deregulated states were 55 percent higher than in regulated states. Volatility has also increased, and reliability has decreased. This report explains why deregulation failed.

Hydrogen Transitions in a Greenhouse Gas Constrained World

In order to realize the promise of a hydrogen economy in this United States, it is essential to couple it with a simultaneous commitment to improve energy efficiency and increase the use of renewable energy. This study, which uses detailed scenario analyses for the country as a whole and for urban areas, finds that a large-scale switch to hydrogen produced by a clean energy system would lead to twice the environmental benefits compared to what would be achieved in a hydrogen transition under a business-as-usual energy mentality. By 2050, when a “clean” transition to hydrogen would be nearly complete, greenhouse gas emissions would be roughly half of what they are today, compared to about a billion tons more, even with hydrogen produced from coal and natural gas.

LEAP: Long-range Energy Alternatives Planning System User Guide

The Long-range Energy Alternatives Planning system (LEAP) is a scenario-based energy-environment modeling tool. Its scenarios are based on comprehensive accounting of how energy is consumed, converted, and produced in a given region or economy under a range of alternative assumptions on population, economic development, technology, price, and so on. With its flexible data structures, LEAP allows for analysis as rich in technological specification and end-use detail as the user chooses.

Economic Benefits and Feasibility of Strategies to Reduce Petroleum Consumption in California

This report analyzes the economic benefits and the feasibility of implementing Proposition 87, California’s Clean Alternative Energy Act (CAEA), which will create a modest extraction fee on oil produced in California and use the proceeds (estimated at $4 billion over one decade) as research and production incentives for alternative energy, alternative vehicles, energy efficient technologies, and education and training. Based on our analysis, the CAEA will achieve the expected savings of 4 billion gallons of petroleum in 2017, and total savings of 10 billion gallons over ten years between 2007 and 2017. In achieving these savings, the CAEA will reduce greenhouse gas emissions and local air pollution while stimulating the California economy.

An Approach for Better Aligning the Nation’s Clean Air and Clean Energy Goals

This study considers modifications to the Clean Air Act that would increase the number of emission allowances allocated to renewable energy generation to enable renewables to compete fairly in emission trading and clean air compliance markets, and estimates the economic and environmental benefits of these changes. This analysis provides better understanding of the benefits that would derive from a renewables role in Clean Air Act compliance regimes. The estimated impacts of these modifications are compared with those of other policies, including national renewable portfolio standards (RPS), a tighter cap for sulfur dioxide (SO2) emissions and trading, modifications to the State Implementation Plans (SIP) for (nitrogen oxides (NOx) trading), multi-pollutant cap/trade, and a combination of multi-pollutant cap/trade and RPS.

The August 14, 2003 Blackout in the United States: Technical and Regulatory Issues

The blackout that struck the Northeast and Midwest of the United States, and portions of Canada, on August 14, 2003, had no simple, single cause, as far as is currently known. However, while this blackout cannot be definitely attributed to the restructuring of the electricity industry in the Midwest, it appears that the restructuring process, especially the unbundling of certain electric services, did create conditions that led to the blackout. This report provides a detailed analysis of such impacts.

Practical Baseline Recommendations for Greenhouse Gas Mitigation Projects in the Electric Power Sector

This report constructs a decision framework that can be applied to all electricity projects. No single methodology can suit all the potential diversity of the Kyoto Protocol’s Clean Development Mechanism projects in the electricity sector, which span a wide range of scales, fuels, and technologies and will take place in a varied set of electric sector contexts, both on and off the grid. This paper proposes a three-category framework for the different projects, with baseline and additionality methods specific to each, in order to balance the objectives of low transaction costs and environmental accuracy.

Can We Get There From Here? The Challenge of Restructuring the Electricity Industry So That All Can Benefit

The California Public Utilities Commission (PUC) has announced its intent to restructure the electricity industry in this state. The primary objective of this report is to investigate whether small customers will have a reasonable opportunity to benefit from industry restructuring. While it is not possible to predict whether small consumers will benefit from restructuring, the report investigates whether there are plausible scenarios under which small consumers are likely to benefit. In particular, it analyzes the extent to which the requirement of real-time pricing (RTP) to participate directly in wholesale markets is likely to limit individual small consumers from potentially enjoying benefits from a competitive market.

Clean Electricity Options for the Pacific Northwest

This report assesses the efficiency and renewable resources that could be tapped to meet Pacific Northwest electricity needs over the next two decades. The last regional assessment of this type was compiled for the Northwest Power Planning Council’s 4th Power Plan in 1994-96. Since then, the landscape of technologies, markets, and policy options has shifted, while growing concerns about electricity price volatility, energy security, and global climate change have increased the value of investments in efficiency and renewable resources.

Coal: America’s Past, America’s Future

As this report shows, a coal-focused national energy strategy would be fundamentally misguided. Wearing foggy and myopic lenses, one might perceive the California power crunch, high natural gas prices, and talk of “clean coal” as ample economic and technical justification for more coal. But closer and clearer examination reveals that there is a long way to go before coal will be truly, if ever, clean and an even longer way before such coal would be competitive. Policy efforts to promote coal would threaten to seriously exacerbate pollution, climate change, and health risks and would render the chances of international accord in tackling global climate change even more remote.

Using Modern Bioenergy to Reduce Rural Poverty

This report considers village-scale biomass energy as a means of providing modern energy services to the billions who lack them, thus helping to reduce poverty. It concludes that there are large opportunities for meeting this goal effectively, affordably, and sustainably. However, persistent world-wide efforts to develop and improve bioenergy systems will be needed to achieve this goal and to resolve some key problems associated with bioenergy.

The Role of Regulators: Energy Efficiency

This paper explores possible responses to the fact that unregulated generation prices are higher than hoped and few consumers are using non-utility power suppliers. It identifies regulatory access points relative to demand-side management and energy efficiency that cross-cut the various restructurings of the electric industry across the US, while pointing out how cross-cutting elements of regulatory roles vary depending on the local situation. Four major categories of leverage points are addressed: planning, retail rate-making, environmental regulation, and funding.

Originally published in Pace Environmental Law Review 18, no. 2 (Summer 2001): 295-307.

Assessment of Policies to Support Fuel Cell Buses and the Transition to the Hydrogen Economy

Fuel cells represent a promising clean and efficient energy conversion technology for urban bus fleets throughout the world. Currently, UNDP/GEF-supported demonstration projects are underway in five countries: China, Brazil, Egypt, India, and Mexico. At the end of the GEF project’s lifetime, it is expected that the FCB initiative will have helped to bring fuel cell buses closer to commercialization and make them more attractive to other donors, and—ultimately—to private investors. This report presents an approach to evaluating investments in FCBs in a subsequent commercialization phase. It provides a policy framework to assess the country context favoring the continued support of multilateral institutions and other sources of investment in fuel cell buses.

Powering America: Myths vs. Facts in the US Energy and Global Warming Debates

This report provides fact-based arguments disproving the current myths of today’s “energy crisis.” It covers such topics as foreign oil dependency, domestic production of oil, renewable energy, California’s energy crisis, and global warming.

Clean Energy: Jobs for America’s Future

In order to create a responsible, forward-looking energy policy, the United States will need to examine a number of important issues. Will the policy help meet America’s energy needs? Will it enhance national security? Will it contribute to a strong economy? Will it help meet America’s needs for a safe and healthy environment? In order to begin to answer these questions, World Wildlife Fund commissioned the Tellus Institute to consider the potential impacts of implementing a broad suite of clean energy policies over the next twenty years. This study analyzes the employment, macroeconomic, energy, and environmental impacts of implementing such policies.

Can Electric Utility Restructuring Meet the Challenges It Has Created?

Over the past five years, portions of the US electric utility industry have experienced a sweeping series of changes referred to as restructuring. These changes affect both the structure of the organizations involved in the electric utility industry and the institutional arrangements by which decisions involving planning and pricing are made. As change usually does, restructuring creates many challenges. This report identifies some of the challenges created by restructuring and then discusses the extent to which restructuring has met, or can likely meet, the challenges it has created.

Best Practices Guide: Integrated Resource Planning for Electricity

This guide is for resource planners at national and sectoral levels; for businesses or agencies providing electricity services through generation, transmission, or distribution; regulators of electricity markets; and others interested in the structuring of policies, markets, and regulations affecting electricity. It provides the analytical framework and assessment methodologies needed to promote integrated resource planning in different economic, political, and geographic settings.

Technology Learning: Wind Electric Generators, Solar Photovoltaics, and Fuel Cells

The purpose of this study is to investigate the empirical basis in recent history for cost reductions for three advanced energy technologies—solar photovoltaics, wind turbines, and fuel cells—and their prospects for further cost reductions. The report presents simple models based on manufacturing output and research and development (R&D) spending for each of these three technologies. Policymakers and modelers can use these tools to help assess policies such as the renewable portfolio standard and R&D subsidies, as well as more general policies such as emission taxes or cap-and-trade systems.

Cleaner Generation, Free Riders, and Environmental Integrity: Clean Development Mechanism and the Power Sector

This study provides a first-cut estimate of the potential carbon emissions impacts of the Clean Development Mechanism (CDM), focusing on new power plants in the power sector of non-Annex 1 countries. We conclude that while the CDM could induce some legitimate lower-emission electricity generation in host countries, it could also give rise to a considerable amount of spurious emissions allowances by crediting non-additional (“free-rider”) activities—activities that would have taken place even in the absence of the CDM. We find that under some plausible CDM regimes, the CDM could serve primarily as an instrument for generating spurious credits, and only secondarily as an instrument for economic efficiency or sustainable development.

Potential and Cost of Clean Development Mechanism Options in the Energy Sector

This report presents an assessment of the potential and cost of the Clean Development Mechanism as an instrument to partially meet the Greenhouse Gases emission limitation commitments of the Netherlands for the first budget period, 2008-2012. The mitigation potential in non-Annex I countries is significant when compared with Annex I reduction requirements. The inventory of mitigation options suggests that an annual mitigation potential in the first budget period at costs up to 1990 USD 10/ton CO2 is approximately 1.7 Gt CO2 equivalents.

Regulatory Incentives for Demand-Side Management

This review outlines the basic considerations involved in establishing incentives for demand-side management. Its purposes are to provide background material for assessing West Kootenay Power’s DSM incentive mechanism, explore modifications to that incentive structure, and record the final incentive for 2000 that was adopted based on discussions informed by an earlier draft of this report.

Scenarios of Energy and Agriculture in Africa

This chapter looks at just how fast energy needs might grow under conditions of both limited and rapid growth in Africa’s agricultural production. It examines the energy-agriculture nexus in several case study countries: Cameroon, Mali, Sudan, Tanzania, and Zimbabwe. Scenarios are then developed for the last three countries to depict possible levels of agricultural activity and their energy use implications through the year 2010.

Chapter 4 in Food and Agriculture Organization of the United Nations (FAO), Future Energy Requirements for Africa’s Agriculture (Rome: FAO, 1995).

Energy Innovations: A Prosperous Path to a Clean Environment

This study analyzes a balanced national strategy that can put the United States on an innovative, prosperous path leading to an economically and environmentally sustainable energy future. This strategy, referred to as the “Innovation Path,” is marked by a set of programs and policies that would guide our economy toward lower cost, less polluting, more secure, and more sustainable ways of producing and using energy. The approach involves setting fair performance standards, creating incentives, providing better information, and reducing transaction costs in order to foster investments in clean and efficient technologies.

Modeling Carbon Reduction Policies in the U.S. Electric Sector

The U.S. electric sector contributes about 35 percent to the nation’s total annual carbon dioxide emissions. Modeling climate change policies in the electric sector, however, poses a number of challenges. This report uses PCNEMS (1995 Version), a computer model constructed and applied by the Energy Information Administration (EIA), and ancillary analyses to assess several policies designed to reduce carbon dioxide emissions in this sector, including extension of EPACT renewables credits, system benefits charges for sustained orderly development of renewables, carbon taxes and caps, accelerated deployment of new technologies, and incentive financing.

Global Energy in the 21st Century: Patterns, Projections and Problems

This report aims to clarify the requirements of sustainable energy development. It begins by describing and contextualizing current patterns of global energy use, production, and resources. It then presents a global long-range Conventional Development Scenario for energy to the year 2050 assuming mid-range population and economic projections, gradual evolution of human and natural systems, and global convergence of technological, institutional, and cultural processes. The report identifies potential environmental, resource, and social stresses related to the conventional development path and explores the implications and limitations of such a path.