Minnesota, New Mexico propose clean car rules as Trump attacks California standards

AUTHOR: Catherine Morehouse, @cmorehouse10

PUBLISHED UTILITY DIVE
Sept. 26, 2019

Dive Brief:

• States and cities across the country are fighting back against the Trump administration’s proposed rule for a singular vehicle emissions and fuel economy standard across the country.
• Minnesota Gov. Tim Walz, D, on Wednesday and New Mexico Gov. Michelle Lujan-Grisham, D, on Tuesday announced their states would adopt clean car standards that exceed the proposed federal standards. And last Friday, attorneys general from 23 states and the District of Columbia, as well as Los Angeles and New York City filed a lawsuit against the administration’s actions.
• The federal proposal, issued Sept. 19, would prohibit states from opting out of its fuel standard. State and city leaders, as well as local utilities worry this could impact electric vehicle rollout momentum.

Dive Insight:

Spurring the electric vehicle market has become a growing priority for state and local leaders looking to cut transportation emissions, and utilities have an increased interest in growing EV markets as they look to diversify their loads.
The Department of Transportation (DOT) and the Environmental Protection Agency (EPA) emphasized affordability in their rollout of the Safer, Affordable, Fuel-Efficient (SAFE) rules, which they say will save over $500 billion by 2029 in “societal costs” as well as create certainty for automobile manufacturers.

“One national standard provides much-needed regulatory certainty for the automotive industry and sets the stage for the Trump administration’s final SAFE rule that will save lives and promote economic growth,” EPA Administrator Andrew Wheeler said in a statement.

But car makers are not necessarily in line with the administration’s thinking on regulatory certainty.
Ford, Honda, BMW and Volkswagen had a deal with California that would have allowed them to meet lower emissions standards while encouraging EV rollouts. And the federal proposal threatens to impede the progress of state Zero Emission Vehicle (ZEV) programs, say states, utilities and market experts.

New Mexico and Minnesota are now proposing to join 11 other states in setting their own vehicle emission standards. But the Trump administration’s proposed rule would reject those standards and threaten states’ ZEV rebate programs, which some say is the most impactful program for reducing transportation sector emissions.

“It’s so hard to get to reduce vehicle miles traveled throughout the country. Most people are struggling with it. And so if you don’t do low emission vehicles and you don’t do ZEV there aren’t a whole lot of other really effective programs,” Sandra Ely, New Mexico environmental protection division director told Utility Dive. Lujan Grisham said New Mexico would adopt its standards by the end of 2020.

“It is environmentally and economically counterproductive to stall fuel economy standards as contemplated by the proposed federal rollbacks,” she said in a statement. “While President Trump threatens to rob New Mexico and indeed all states of a valuable tool for combating air pollution and decreasing greenhouse gas emissions, New Mexico will stand up and deliver on our commitment to environmental leadership.”

The governor in January also signed an executive order that directs state agencies to produce plans to reduce emissions across the power and transportation sectors.
Minnesota’s clean car standard is intended to drive EV investment and increase the number of zero or low-emissions vehicles on its roads, as well as evaluate regional EV charging corridor options, according to the state. The Minnesota Pollution Control Agency plans to begin its rulemaking process in October, and it’s expected to last 15 months.

The following plaintiffs joined the suit against the DOT, EPA and the National Highway Traffic Safety Administration: California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Rhode Island, Vermont, Washington, Wisconsin, Massachusetts, Pennsylvania, Virginia, Michigan, the District of Columbia, Los Angeles and New York City.

Fixed block solar and storage power solution

PUBLISHED

Sept. 16, 2019

Utility Dive

As the world shifts to a cleaner energy future, corporate entities are increasingly looking to cement the additionality and net impact of their power sourcing, with some leaders looking to more closely match renewable production with load consumption. At the same time, such leaders have become increasingly astute in electrical power pricing and commodity risk, including the understanding of market volatility risk; not only around peak and off-peak, but specific pricing hours.

As solar photovoltaic and battery energy storage costs fall, one emerging solution is solar-plus-storage. The economic prospect of solar-plus-storage is particularly enticing in this moment as the Investment Tax Credit lowers the cost of both technologies and puts it on par with natural gas prices. “Clean energy portfolios (CEP), optimized combinations of WSS (wind, solar, storage) and demand-side management, are now similar in cost to new gas-fired power plants and can reliably meet grid needs”, as reported in the Rocky Mountain Institute (RMI)’s 2019 report, The Growing Market for Clean Energy Portfolios.

With prices falling and demand for renewable energy increasing, there are solutions that might help meet business needs. One is a procuring a fixed block of solar power on a set schedule, with block intervals set at every 15-minutes or every hour, as has been traditionally procured by commercial and industrial entities in deregulated power markets for decades. Such blocks can eliminate the risks borne the power buyer, either directly or priced-in by its load-serving entity (LSE), by the short-term market exposures for shortages or overages against expected generation in a typical as-generated power purchase agreement (PPA).

Another solution is the use of storage co-located and charged by their solar facilities, which provides similar benefits of fixed solar-only blocks, but also the ability to fix those blocks in shapes substantially different than the average solar production profile.

Power markets can be challenging to optimally hedge around due to the riskiest market pricing hours. For example, August 2019 saw the ERCOT market hit its design cap price of $9,000/MWh over a few 15-minute pricing periods during a couple of sweltering afternoons. Physical hedging with solar plus storage may be more cost-effective for such highly volatile hours than financially hedging for that hour. Often hedges are procured for entire on-peak periods, which is all day-time hours during the work week (M-F). Much of the cost of those hedges are centered around just a couple of hours, such as the late summer afternoon hours in ERCOT. Selectively physically hedging around these most volatile hours can be a smarter and cheaper way to go in the long run.

Generation capacity is the market construct for paying generation resources to be available in the future to meet forecasted peak load. We have already seen utilities with internal considerations of generation capacity value, such as Arizona Public Service, Nevada Energy, and Western Farmers Electric Cooperative, procure power from solar-plus-storage projects to help ensure peak generation capacity. Thus, fixed blocks of solar plus storage can similarly offer generation capacity value in wholesale power markets. Awarded capacity payments via wholesale power market mechanisms, such as those offered in the eastern U.S., reduce the peak-shifted power block costs to the end buyers.

As corporations take the reins of their energy usage to make an impact on the renewable energy landscape, they are looking for the right solution for clean energy production to best fit their power procurement practices, and to be as precise as possible around commodity risk management. Fixed block of solar plus storage supports both interests.

SOLAR MEANS BUSINESS

U.S. businesses are increasingly turning to solar energy as a cost-effective means of powering their operations. As of 2018, Apple leads the nation with the most solar capacity installed, followed closely by Amazon, Target, Walmart and Switch.

SEIA’s Solar Means Business Report follows solar adoption by businesses across the U.S., ranging from some of the country’s largest and most recognizable brands to the small businesses that make up our communities. For the first time, the 2018 report captures large off-site installations, as well as data on solar systems located at the site of the businesses themselves. Both installation types have grown considerably in recent years.

Through 2018, this report tracks more than 7,000 megawatts (MW) of installed solar capacity across 35,000 projects in 43 states, representing more than 70% of all commercial solar capacity installed in the U.S.

See the full Report: https://solarmeansbusiness.com/

Tesla restarts its solar-panel business, offers rental plans

US & WORLD

PALO ALTO, Calif. (AP) — Tesla is trying to spark its solar-panel business by letting consumers rent rooftop systems rather than buy them.

Tesla Inc. CEO Elon Musk announced the offering in a series of tweets Sunday.

The company will allow residents of six states to rent solar-power systems starting at $50 a month — or $65 a month in California — for a small set-up.

Musk says consumers can cancel anytime, although Tesla’s website says there’s a $1,500 charge to remove panels and restore the roof to its previous condition.

Besides California, rentals will be offered in Arizona, Connecticut, Massachusetts, New Jersey and New Mexico.

Electric car maker Tesla bought residential solar installer SolarCity for $2.6 billion in 2016 but installations have plunged in recent quarters. Tesla stopped selling systems in Home Depot stores.

Copyright 2019 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

As Rooftop Solar Grows, What Should the Future of Net Metering Look Like?

Almost every state has been weighing changes to how homes with solar are compensated for electricity they send to the grid. The results will impact solar growth.
Like solar installers across much of America, Mark Hagerty is adapting to drastic changes in the economics of his business. His state, Michigan, is one of many that are cutting the rates rooftop solar owners receive for selling excess power to the grid.
“We’re going to do fewer jobs, and each job is going to be a smaller size,” said Hagerty, president of Michigan Solar Solutions, a solar installer based northwest of Detroit. His comments echo concerns now being voiced by solar installers in many states as new rules take effect.
The changes are part of a flurry of activity across the country as regulators and legislatures in almost every state referee a showdown between powerful utilities and a rooftop solar industry offering options that are more affordable and popular than ever. The results run the gamut, from a solar-friendly bill that became law in Maine to one that will sharply reduce the financial benefits of solar in Kentucky.
Amid the noise of competing proposals, a pattern is emerging: States are moving away from “net metering” policies that require utilities to pay solar owners the full retail rate for excess electricity sent to the grid.
The shift is happening in part because of an aggressive push by utilities to reduce what many of them see as a form of competition that could harm their bottom line. And yet, even solar advocates say these changes are likely inevitable as the electricity system adapts to the rapid rise in rooftop solar.
The question for all sides: What does a successor to net metering look like?
One possibility being explored in several states is to develop rates based on the value of rooftop solar power to the grid, including environmental benefits. Others are siding with the utilities in their push for rates for solar owners that are much lower.
As Solar Makes Inroads, Utilities Push Back
More than 1.8 million U.S. households have their own solar power systems, up from just over 137,600 households in 2010, according to the Energy Information Administration. Onaverage, a rooftop system on a house will pay for itself through utility bill savings in fewer than eight years, according to a recent EnergySage report.
Small-scale solar is still a tiny share of the country’s electricity output, just 0.7 percent last year, but utilities and regulators are looking ahead to when it may be much more.
Rooftop solar has been making inroads outside of the sunny states that were early adopters, helped by state incentive programs, falling costs and the momentum of new businesses that sell and install solar. This growth is part of the country’s transition toward a cleaner and less centralized grid, and it depends on many elements that affect the costs of systems.
“Solar is maturing,” said Sachu Constantine, managing director of regulatory affairs for Vote Solar. “We are having more penetration in more states, and, as a result, a lot of states are reconsidering the net metering structure.”
But increasingly, utilities are seeking reductions so deep that home solar systems will take much longer to pay off, making them less attractive to businesses and homeowners, he said. At the same time, a federal tax credit, currently worth 30 percent of a consumer’s costs of adding solar, is set to phase out by the end of 2021.
The solar industry would be much more anxious about the phase-out if not for countervailing factors, such as the declining costs and rising efficiency of solar panels. But the efforts to lower net-metering payments present a thornier problem.
Utilities have shown they have the political clout to overpower opposition in states such as Kentucky this year and Michigan in 2016, when lawmakers laid the groundwork for the rate changes approved last month for the state’s largest utility, DTE.
Many utilities argue that rooftop solar customers, who typically have very low electricity bills because they generate so much of their own power, are not covering enough of the costs to maintain the wires and other infrastructure of the grid, which they say shifts those costs to other customers.
Solar advocates say that is a stretch, especially in the many states where customer-owned systems remain a miniscule share of electricity generation. But it is a central theme in legislative debates almost everywhere, due in part to Edison Electric Institute, a utility trade group whose messages on net metering help to shape what utilities say on the state level, and the American Legislative Exchange Council (ALEC), a national group that supports corporate interests in statehouses.
Burcin Unel, energy policy director for the Institute for Policy Integrity at New York University’s law school, said it’s more important to look at costs in the context of broader benefits for the grid and the public.
“You need to look at what costs are avoided and what benefits we get and then ask if there is a cost shift from a societal perspective, and then ask if that’s something we’re willing to tolerate,” she said. “Just the existence of cost-shifting is not the Big Bad Wolf.”
Calculating Rates by Value of Solar
The new rules that states are now debating would replace a framework that goes back to the early 1980s, when regulators and utilities used the full retail rate to compensate owners for the excess solar power they sent to the grid largely because the full retail rate was easy to calculate and manage.
The definition of the term “net metering” varies by jurisdiction, but it often means that a customer’s electricity meter runs forward or backward depending on whether the household is importing power from the grid or exporting extra electricity produced by its solar panels at that moment. When using a single analog meter, there is no easy way to charge different rates for imports and exports, so the default was to charge the full retail rate for both.
As utilities install advanced meters, more options are opening up.
“I think we’ve always known that there had to be some sort of reckoning,” said Constantine of Vote Solar.
Solar advocates in several states have responded to utility proposals by saying a better approach would be to replace net metering with rates that are based on a calculation of the value of solar to the grid, including environmental benefits.
But this approach comes with plenty of its own challenges.
A ‘Value of Solar’ Test Case: Minnesota
Minnesota has been a leader in developing a system to determine the value of solar for setting rates. Five years ago, the state came up with a method based on estimates of the costs utilities are avoiding because they don’t need to generate
and deliver the electricity being produced by solar, and of savings due to emissions reductions and other environmental benefits.
So far, Minnesota uses its “value of solar” rate to pay for electricity generated by solar gardens, which are subscription-based solar developments, while retaining full-retail net metering for solar power systems owned by individual residents and businesses.
Utility companies make annual estimates of the value of solar, subject to review and approval by regulators. The rates submitted by Xcel Energy, Minnesota’s largest utility, have been lower than full retail and have had some big fluctuations from year to year.
The results raise questions about whether this is really capturing the value of solar, said Timothy DenHerder-Thomas, general manager of Cooperative Energy Futures in Minneapolis, an organization that manages and develops clean energy projects.
“There is so much statistical noise and uncertainty in how you calculate these things that I don’t know how to do it in a way that’s quote-unquote accurate,” he said. Developers are in the position of waiting until a year with a good rate, hoping to lock in the best terms.
The upshot is that regulators are still figuring out how to calculate the value of solar in way that leads to rates that are conducive to solar development.
‘A Pretty Big Transition Underway’
Already this year, officials in at least 43 states, the District of Columbia and Puerto Rico have considered measures related to customer-owned solar, according to a report by the NC Clean Energy Technology Center at North Carolina State University.
“It indicates that there’s a pretty big transition underway,” said Autumn Proudlove, the lead author and senior manager of policy research for the center. “Part of it is increasing adoption of solar and reduction of prices.”
The Kentucky law is notable as the clearest example this year of utilities successfully using an aggressive anti-solar strategy. Other attempts, such as a push for a solar fee in Iowa, were defeated. The Kentucky measure reduces the
rates paid for rooftop solar, with regulators left to decide the specifics of the new rates.
There’s a possibility that some utilities’ gains may be short-lived, based on one- sided proposals passed in recent years that led to customer backlash and reversals in some states. Nevada passed a measure cutting rates for rooftop solar in 2015 only to largely restore the old rates after an uproar from residents. Maine regulators cut solar rates in 2017, and then the old rules were restored by a law signed in April by the new governor, Janet Mills.
Policy changes are more likely to endure when they arise from compromise, said Constantine. So far this year, new laws in Arkansas and South Carolina look like they have resolved many of the concerns of the solar industry in a way that is amenable to utilities.
Arkansas legalized solar leasing, which opens up the solar market to residents and businesses that can’t afford to buy systems, while also leaving some restrictions that utilities wanted. South Carolina lifted a cap on new rooftop systems eligible for full retail net metering. It was part of a larger plan that begins a process that likely will reduce rates, but not as low as they would have been if the cap had continued.
In Michigan, Installers Feel the Impact
Solar installers and consumers, meanwhile, are trying to deal with the changes in the rules. In Michigan, this affects the territory of the utility DTE, which serves the southeast part of the state, including the Detroit area.
Under DTE’s old rates, a typical household solar system would pay for itself in 9.4 years, according to afact sheet from the Michigan Public Service Commission.
Now, under the rates approved last month, it’s 13.3 years. If DTE had gotten the rates that it wanted, that would have been 17.7 years.
So far, people shopping for systems are responding to the changes by buying smaller systems, which means they will have lower upfront costs and less excess electricity, said Hagerty, the solar installer. That’s bad for his business.
“We were working seven days a week before, and now we have to work even harder,” he said. “And the amount of work we’re putting in is leading to even less money now.”
But he also has seen an uptick in customers who want to buy solar along with battery storage because there is now a financial incentive to reduce their excess energy that would otherwise go to the utility.
The rules are so new that he doesn’t yet know how they will affect his business and the growth of solar in Michigan. But at a time when the country needs to lower its carbon footprint, he thinks the state is sending the wrong message and failing to see the larger picture.
Indeed, the debate about net metering is just part of a much larger one about how the energy system and economy will adapt to rapid changes, said Unel of New York University.
“This is not just about solar panels,” she said. “It’s about how we want to transform the grid. The grid is going to transform whether we want to or not, so we should put in the policy framework to guide the investments in the most societally beneficial way.”

New Solar Permit Software to Reduce Costs and Expand Residential Markets

Monday, Jul 01 2019

NREL receives funding to develop automated permit software with industry and  nonprofit partners

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WASHINGTON, D.C. – The Solar Energy Industries Association (SEIA) and The Solar Foundation are joining the National Renewable Energy Laboratory (NREL), several national residential solar companies, and other nonprofit organizations to develop new automated permit software for distributed solar and storage, reducing the cost of solar installations and saving resources for local governments and taxpayers. \

REL was awarded $695,000 in new funding from the U.S. Department of Energy’s Office of Technology Transitions, Technology Commercialization Fund to develop and deploy the Solar Automated Permit Processing (SolarAPP) software platform. The intent is to dramatically reduce the time and cost of the permitting application review and approval process, which in turn will decrease customer cancellation rates and expand solar energy development and solar job growth nationwide.

The partners working with NREL on the SolarAPP software include installation companies as well as key nonprofit organizations and trade associations. Partners include the California Solar + Storage Association, Institute for Building Technology and Safety (IBTS), Solar Energy Industries Association (SEIA), The Solar Foundation, SunPower, Sunrun, Tesla, and Vivint Solar.

These groups are active participants in the SolarAPP Campaign, a national initiative of The Solar Foundation and SEIA which seeks a fundamental reshaping of solar permitting at the federal, state, and local levels. The goal is to allow most routine rooftop solar projects to receive instantaneous approval and efficient inspections, while enhancing safety and reliability. “Over the past decade, NREL research has shown that while the cost of PV modules and other hardware has declined, nonhardware ‘soft’ costs remain relatively constant. The SolarAPP software will help address key soft cost challenges by providing both AHJs and installers a standardized online portal to complete and manage permitting and inspection processes,” said Kristen Ardani, Solar Analysis Sub-program Lead at NREL. “We look forward to serving the critical role of an independent, third-party developer of the SolarAPP portal.” “The SolarAPP platform will help local governments reduce administrative burdens and make it faster and easier for customers to go solar,” said Andrea Luecke, President and Executive Director at The Solar Foundation. “At a time when accelerating the deployment of solar and storage has never been ore urgent, this platform fills a critical market need.” “Inefficient permitting can cause frustration and added costs for Americans who just want to go solar,” said Abigail Ross Hopper, President and CEO of the Solar Energy Industries Association. “A streamlined, easy-to-use solution such as SolarAPP can cut down on burdensome applications and connect solar projects to the grid faster. A more reliable permitting experience will help both inspectors and solar customers save time and money without sacrificing safety or quality. We’re thrilled to see SolarAPP get financial backing from the Department of Energy and will continue to actively support this important initiative.”

While the cost of residential solar installations has decreased more than 70% over the last ten years, costs are still much higher in the United States than in other mature markets, largely due to non-hardware “soft costs.” The direct and indirect costs of permitting, inspection, and interconnection, including efforts spent acquiring customers who cancel before a permit is issued, can add about $1 per Watt, or $7,000, to the cost of a typical residential system.

Nationwide, there are over 20,000 authorities having jurisdiction (AHJs) with distinct permitting and inspection requirements, application costs, and approval times. The SolarAPP platform will provide a streamlined process that will increase efficiency and reduce the time and cost of a solar permit, leading in turn to lower cancellation rates. “Sunrun is proud to partner with NREL, The Solar Foundation, the Solar Energy Industries Association (SEIA) and other industry partners to support the development of the Solar Automated Permit Software for Distributed PV and Battery Storage,” said Alex McDonough, Vice President of Public Policy at Sunrun. “This resource will help companies like Sunrun cut red tape and reduce their costs to deliver significantly more affordable, reliable, local clean energy solutions to communities around the country.”

“The SolarAPP will make it faster and easier for homeowners to get clean, affordable solar energy, and Vivint Solar is pleased to partner with NREL, The Solar Foundation, SEIA and other industry advocates to develop this technology,” said David Bywater, CEO of Vivint Solar, a leading national solar provider. “Vivint Solar is committed to making high quality solar more accessible to Americans by joining with the industry to cut the cost and streamline the process of solar permitting.” This platform will also benefit local governments, which face budget constraints and growing workloads to keep up with the accelerated pace of solar energy development. Automated permitting will reduce time spent and increase permit revenues, allowing AHJs to focus their resources on post-installation and inspections.

The SolarAPP platform will build on existing software capabilities at NREL to do the following:

  • Provide a flexible, web-based solar permitting tool for residential systems.
  • Encourage the standardization of permitting processes, while allowing for some flexibility to produce applications that meet the specific requirements of AHJs.
  • Evaluate applications and design plans for safety certification and code compliance.
  • Offer opportunities to incorporate energy storage and expand to other market segments, such as solar thermal and commercial systems.

The SolarAPP initiative builds on previous and existing programs to reduce soft costs, including the SolSmart program that provides designation and no-cost technical assistance for local governments to open up solar markets. For more information about the SolarAPP campaign, visit https://www.thesolarfoundation.org/solarapp/.

About SEIA®: Celebrating its 45th anniversary in 2019, the Solar Energy Industries Association® is the national trade association of the U.S. solar energy industry, which now employs more than 242,000 Americans. Through advocacy and education, SEIA® isbuilding a strong solar industry to power America. SEIA works with its 1,000 member companies to build jobs and diversity, champion the use of cost-competitive solar in America, remove market barriers and educate the public on the benefits of solar energy. Visit SEIA online at www.seia.org.

 

About The Solar Foundation®

The Solar Foundation® is an independent 501(c)(3) nonprofit

organization whose mission is to accelerate adoption of the

world’s most abundant energy source. Through its leadership,

research, and capacity building, The Solar Foundation creates

transformative solutions to achieve a prosperous future in

which solar and solar-compatible technologies are integrated

into all aspects of our lives. Learn more

at TheSolarFoundation.org.

House and Senate Introduce Legislation for 5-Year Extension of the Solar Investment Tax Credit

Thursday, Jul 25 2019

WASHINGTON, D.C. – Senator Catherine Cortez Masto (D-NV) and Representatives Mike Thompson (D-CA), Paul Cook (R-CA), and Brian Fitzpatrick (R-PA) today introduced companion bills with a five-year 30% extension of Section 48 and Section 25D Solar Investment Tax Credits (ITC). The Renewable Energy Extension Act will call for the extension of the tax credits.

Following is a statement from Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, urging lawmakers to pass this critical legislation: 

“These bills are clear, easy wins members of Congress can deliver to their constituents that create jobs, bolster the economy and address climate change. Polling shows that Americans across the political spectrum are concerned about our changing climate and they strongly support solar.

“Since 2005, when the ITC was first passed by the Republican-led Congress and signed into law by President George W. Bush, the ITC has created hundreds of thousands of jobs, sparked more than $140 billion in private investment and helped grow solar deployment by more than 10,000%.

“Now is not the time to turn our backs on this American success story. The ITC is the strongest policy there is to support clean energy development, grow the economy, create jobs, and meaningfully cut emissions.

“We are grateful to Sen. Cortez Masto, Rep.Thompson, Rep. Cook and Rep. Fitzpatrick for their leadership and are eager to build on the bipartisan support this legislation already enjoys. In the next several months, we look forward to working with all members of Congress to move this legislation over the finish line.”

###

About SEIA®: 

Celebrating its 45th anniversary in 2019, the Solar Energy Industries Association® is the national trade association of the U.S. solar energy industry, which now employs more than 242,000 Americans. Through advocacy and education, SEIA® is building a strong solar industry to power America. SEIA works with its 1,000 member companies to build jobs and diversity, champion the use of cost-competitive solar in America, remove market barriers and educate the public on the benefits of solar energy. Visit SEIA online at www.seia.org.

Media Contact: 

Morgan Lyons, SEIA’s Senior Communications Manager, mlyons@seia.org (202) 556-2872

Berkeley becomes first US city to ban natural gas in new buildings

By Sarah Ravani
San Francisco Chronicle

Berkeley became the first city nationwide to ban the use of natural gas in new low-rise residential buildings in a unanimous vote Tuesday by the City Council.

The ordinance, introduced by Councilwoman Kate Harrison, goes into effect Jan. 1, 2020, and phases out the use of natural gas by requiring all new single-family homes, town homes and small apartment buildings to have electric infrastructure. After its passage, Harrison thanked the community and her colleagues “for making Berkeley the first city in California and the United States to prohibit natural gas infrastructure in new buildings.”

The city will include commercial buildings and larger residential structures as the state moves to develop regulations for those, officials said. The ordinance allocates $273,341 per year for a two-year staff position in the Building and Safety Division within the city’s Department of Planning and Development. The employee will be responsible for implementing the ban.

“I’m proud to vote on groundbreaking legislation to prohibit natural gas in new buildings,” Mayor Jesse Arreguín said on Twitter. “We are committed to the #ParisAgreement and must take immediate action in order to reach our climate action goals. It’s not radical, it’s necessary.” The ordinance applies to buildings that have been reviewed by the California Energy Commission and determined to meet state requirements and regulations if they are electric only, said Ben Gould, the chairman of Berkeley’s Community Environmental Advisory Commission.

Gould said he spoke as a private citizen and not as a representative of the commission.

Those buildings are low-rise residential buildings, which include single-family homes, town homes and small apartment buildings. Therefore, Berkeley’s ordinance only applies to those buildings, but as the state approves more building types, the city will follow, Gould said. The way the ordinance is written, the city’s regulations will update as the state commission approves more building models without having to return to the City Council for a vote.

“We need to find ways to move forward innovative groundbreaking climate policy,” he said. “This policy is really important and critical. It helps address one of the largest sources of emissions in Berkeley.” In 2009, the city adopted a Climate Action Plan that aimed to reduce emissions by 33% by 2020 and 80% by 2050. The plan also commits
the city to using 100% renewable electricity by 2035.

In June 2018, the council declared a climate emergency and called for a review of Berkeley’s greenhouse emission reduction strategies. The city determined in a report last year that gas-related emissions have increased due to an 18% population growth since 2000. The report also concluded that the burning of natural gas within city buildings
accounted for 27% of Berkeley’s total greenhouse gas emissions in 2016.

As the city’s population soars, the need for more housing has also increased. From 2014 to 2017, the Planning Department approved building permits for 525 residential units and 925 built units were approved for occupancy. More housing is expected, particularly with the Adeline Corridor Plan, which calls for the construction of 1,400 units along Adeline Street and a portion of South Shattuck Avenue. Electric-only buildings prevent the installation of natural gas pipes and instead install heat pumps and induction cooking, Gould said. “Think about a refrigerator and how it makes inside your refrigerator cold and blows hot air out of somewhere else,” Gould said. “A heat pump works like that, but in reverse. It takes outside air and emits cold air outside and provides hot air inside. They can also be flipped in reverse and work as an air conditioner.”

Induction cooking transfers heat directly to any magnetic cookware, including cast-iron and steel, without using radiation. “It transfers heat right to the pot,” Gould said. “It boils water faster than anything else that exists. It’s very even, very quick to respond.” At Tuesday’s meeting, Harrison’s staff demonstrated the use of an induction cooktop by making chocolate fondue. The staff placed a piece of paper between the stove and the pot to show its safety features. The pot turned hot, but the paper didn’t burn, Gould said. The ordinance restricts developers applying for land-use permits from building anything that includes gas infrastructure, including gas piping to heat water, space and food.

Accessory dwelling units — built-in basements or attics of existing homes — are exempt from the ordinance. A public interest exemption may also be allowed if the council or the Zoning Adjustments Board determines that the use of natural gas is necessary.

Sarah Ravani is a San Francisco Chronicle staff writer. Email:
sravani@sfchronicle.com Twitter: @SarRavani

The Investment Tax Credit is Back on Table

itc on the table

According to a research note issued by Credit Suisse, the ITC or Investment Tax Credit, which will sunset at the end of 2016, may not see that sunset yet. The note mentions a building momentum in Congress for it to be added to tax extenders legislation at the same time as the world meets to discuss Climate Change in Paris this week. It certainly would look good for the US to take such action at this time and show that they will put their money where there mouths are.

For more on this subject, click here.

There are other ways the ITC could be saved as well. GTM analyst Cory Honeyman said there was more than one shape for an extension to take.

“It’s my understanding that there is opportunity for an extension to the ITC in a formal, comprehensive tax extenders bill, and opportunities to put the commence construction rule in an omnibus spending bill sometime in 2016.

“There could be one-off legislation that extends the ITC on its own but that’s a harder process as opposed to being bundled with other tax extenders. There are definatly a number of periods of time until the end of 2016 and a few different mechanisms that could extend it in some kind of fashion,”  said Honeyman.

PRC Files Notice of Inquiry

The New Mexico PRC has filed a Notice of Inquiry, stating that they will be looking into whether public utilities constructing and owning distributed generation facilities that are dedicated to serving one or more specific retail customers might provide net benefits or detriments to consumers, the environment, public utilities and the public interest. They are trying to determine if the Commission should encourage or discourage such arrangements.

For the complete pdf of their filing, please click below.

15-00355-UT Notice of Inquiry 11-18-15

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