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Ce blog rassemble une partie de mes textes, créés en dehors de mes activités professionnelles. L'approche est plurilingue et interdisciplinaire. Les sujets sont internationaux et concernent notamment la politique, la durabilité, des aspects sociaux et certains secteurs de l'économie. Bonne lecture! - JJ Bürger -

Thursday, November 24, 2016

Energy in the "Empire State" of New York



Introduction: What is the REV strategy?
“Reforming the Energy Vision” (REV) is the name of the long-term energy strategy of New York State, which was developed in 2015 under Governor Andrew M. Cuomo (Source: DPS 2015), who was first elected in November 2010 and reelected in November 2014. 

Further to the REV strategy’s definition in 2015, it shall be implemented through a variety of regulatory tools and policy decisions. In this context, it is interesting to consult the “2015 New York State Energy Plan”, a document which was set out to coordinate the steps taken by public authorities to “advance the REV agenda” (Source: New York State Energy Planning Board, 2015a).

Based on these sources, the present document shall, in a first step, outline the REV targets and then, in a second step, critically assess some aspects of these targets’ implementation progress.


        1)      What are the REV targets?

The three following targets are generally presented as REV’s main targets to be achieved by 2030:

  •  A reduction of greenhouse gas (GHG) emissions by 40% compared to 1990 levels 
  • 50% of New York’s electricity shall be generated by renewable energy sources (RES)
  •  Energy consumption of buildings shall be reduced by 23% compared to 2012 levels. This is said to correspond to energy savings of 600 trillion BTU.

It is noteworthy that these targets can also be seen in a broader regulatory context[i]. However, this broader context cannot be described in detail in the framework of this document at hand.

Nevertheless, REV also includes some additional targets, such as “Make Energy More Affordable for All New Yorkers”, “Support the Growth of Clean Energy Innovation”, “Empower New Yorkers to Make More Informed Energy Choices”, “Improve New York's Energy Infrastructure”, “Create New Jobs and Business Opportunities”, “Protect New York's Natural Resources”, “Build a More Resilient Energy System”, “Support Cleaner Transportation” and “Cut Greenhouse Gas Emissions 80% by 2050” (Source: New York State 2016).

Yet, these targets (except the last one) are inherently less quantifiable, since their outcome is less measurable and since there is no clear deadline by which they shall be achieved. Thus, it could be argued that they are less binding and less ambitious than the above-mentioned three targets for 2030. Still, these quantitative goals should not be underestimated either, given that they might contribute to a certain number of new energy policies.

Furthermore, some of the targets seem to contradict each other. For example, it could be argued that if the state of New York was really to implement its target of “improving New York’s energy infrastructure”, this might then be seen as an increasing contradiction to the promise of “making energy more affordable for all New Yorkers”. This type of contradiction between the goals has not yet been solved by the REV strategy – the solution has merely been postponed.  

           2)      What is the current progress towards the REV goals?
According to the impact assessment that was issued at the same time as the New York State Energy Plan, greenhouse gas (GHG) emissions in New York in 2011 were “slightly lower” than those of 1990, whereas national GHG emissions increased by 8% from 1990 to 2011 (Source: New York State Energy Planning Board, 2015b). Therefore, even though New York is outperforming the national average of GHG reductions, a “slightly lower” level is still nowhere near the 40% cut that is envisaged for 2030.

Among the tools for further GHG reductions, the 2015 New York State Energy Plan quotes several “past and ongoing energy efficiency and renewables programs”, such as “the System Benefits Charge, Renewable Portfolio Standard (RPS), Energy Efficiency Portfolio Standard (EEPS), Regional Greenhouse Gas Initiative (RGGI)” (Source: New York State Energy Planning Board, 2015a). Not all of these tools can be analyzed in detail in the framework of this short blog entry. Instead, as an exemplary field of policies, New York State’s renewable energy support shall be described with more detail.

In contrast to many other US jurisdictions, New York’s renewable energy support does not require utilities to purchase electricity from renewable energy sources (RES-E) or renewable energy certificates for a certain percentage of their electricity sales. Instead, the New York State Energy Research and Development Authority (NYSERDA) acts as a "central procurement administrator" which manages the budget that supports RES-E production for either on-site consumption or for feed-in into the wholesale market of the New York Independent System Operator (NYISO). According to the 2015 New York State Energy Plan, the Renewable Portfolio Standard has enabled the construction of “nearly 1,900 MW of clean power” between 2004 and 2015 (Source: New York State Energy Planning Board, 2015a). According to the same source, further support for renewable energy sources includes the following items:

  • The NY-Sun Initiative, which features a budget of $1 billion for additional support to New York State’s solar industry. In this context, it is considered by the 2015 New York State Energy Plan that 3,000 MW of solar capacity could be added to the State’s electricity mix by 2023.
  • K-SOLAR, a solar energy program for schools.
  • On-going discussions about possible new “Shared Renewables” policies, allowing homes without appropriate rooftop conditions to benefit from solar energy, via “community net metering“. 
  • On-going reflections about possible measures to support Offshore Wind energy. 
  • A continuous development of support measures for heat from renewable energy sources.
  • A commitment to assess opportunities to encourage energy production from organic waste.
  • The development of a state-wide strategy for sustainable fuel production.

On top of this enumeration of programs, further support for renewable energy exist in various forms, such as individual net metering provisions or the State-owned New York Green Bank, which enhances the investment conditions for certain clean energy projects.

But how effective are all these support measures and tools? After all, the intermediate target of the RPS stipulates that New York State’s electricity mix shall reach a RES-E share of 30% by 2015 (Source: NYSERDA 2015). 
Different sources give varying evaluations concerning the achievement of this goal:
  • According to NYISO, the RES-E share in New York State was 23% in 2015; however, no details about individual RES-E technologies are given (Source: NYISO 2016). 
  • According to the Federal Department of Energy, the RES-E share in New York State is 44.79%, though this nationwide comparison unfortunately does not indicate which year it refers to. The major RES-E contribution comes from hydro power (about 30%), followed by biomass (above 10%). The remaining 4.79% are mainly provided by wind energy, while solar and geothermal power remain negligible (Source: US Department of Energy 2016).

These impressive statistical variations could be explained by various factors, such as different methodologies or different reference time frames. In addition, it is equally noteworthy that these figures also highlight that New York’s current RES-E generation depends largely on hydropower. Indeed, hydropower is a renewable technology that faces certain deployment limitations in industrialized countries, as it requires specific geographic conditions.

Hence, it could prove to be unrealistic to rely solely on hydropower to achieve the REV target of a RES-E share of 50% in the New York power mix by 2030. Alternatively, wind and solar energy are among the cheapest RES-E technologies that can be deployed on a larger scale without too many geographic restrictions. Concerning the installed wind energy capacity, New York currently occupies the 13th place in the ranking of US States, according to the American Wind Energy Association (AWEA). However, while AWEA acknowledges that New York possesses 1,749 MW of installed wind turbines, the outlook of projects under construction amounts to only 79 MW (Source: AWEA 2016). This growth rate is much too low if wind energy is to contribute significantly to the 50%-goal of 2030. Likewise, according to the Solar Energy Industries Association (SEIA), the installed solar photovoltaic capacity sums up to 803 MW in New York State (the 7th place in the ranking of US States), and could see an increase of additional 3,007 MW in the next five years, which would be the 5th highest growth rate in the US over that time frame (Source: SEIA 2016). Despite this substantial increase, the contribution of solar photovoltaic energy to the overall electricity mix would still be relatively low in the early 2020s, given the low load factor of that technology[ii].



Conclusion


As discussed in this blog entry, the clean energy figures of NYISO and the US Department of Energy are showing significant differences (23% vs. 45% of RES-E in the electricity mix in New York State). Indeed, it may be quite revealing that it does not seem like there are reliable, easy-to-find, unequivocal statistics on renewable energy… At least, it constitutes an obstacle when assessing New York's clean energy progress.

New York State’s energy strategy – known as “Reforming the Energy Vision” or “REV” – sets out ambitious clean energy goals for 2030. Indeed, the State already possesses a variety of clean energy support mechanisms and substantial renewable energy installations. However, this present document has also shown that it is not yet certain if and how these assets and their future evolution will suffice to meet the REV targets for 2030. Further in-depth research (including specific assumptions on future technology costs and revenues) would be necessary to evaluate the deployment potentials of each renewable energy technology in New York State. 
It can be argued that the level of ambition shown by New York State’s energy policy sends out an encouraging message to the clean energy industry. Nevertheless, actual deployment of clean energy will depend on the future evolution of regulatory support, technology costs and revenues.



Sources
AWEA (2016): US Wind Energy State Facts. Retrieved on 10/30/2016, from: http://www.awea.org/resources/statefactsheets.aspx?itemnumber=890

DPS (2015): DPS – Reforming the Energy Vision. Retrieved on 10/30/2016, from: http://www3.dps.ny.gov/W/PSCWeb.nsf/All/CC4F2EFA3A23551585257DEA007DCFE2?OpenDocument

New York State (2016): Reforming the Energy Vision. Retrieved on 10/30/2016, from: http://rev.ny.gov/

New York State Energy Planning Board (2015a): The Energy to Lead – 2015 New York State Energy Plan. Volume 1. Retrieved on 10/30/2016, from:                https://static1.squarespace.com/static/576aad8437c5810820465107/t/5797fc52f5e231d942a2d79b/1469578322990/2015-state-energy-plan-pf.pdf

New York State Energy Planning Board (2015b): The Energy to Lead – 2015 New York State Energy Plan. Volume 2. Impacts and Considerations. Retrieved on 10/30/2016, from:           https://static1.squarespace.com/static/576aad8437c5810820465107/t/5797fc10cd0f68be0b7d2347/1469578263418/2015-nysep-vol2-impacts.pdf

NYISO (2016). Power Trends 2016. The changing energy landscape. Retrieved on 10/30/2016, from: http://www.nyiso.com/public/webdocs/media_room/publications_presentations/Power_Trends/Power_Trends/2016-power-trends-FINAL-070516.pdf

NYSERDA (2015): Renewable Portfolio Standard Frequently Asked Questions. Retrieved on 10/30/2016, from: https://www.nyserda.ny.gov/All-Programs/Programs/Main-Tier/FAQs

NYSERDA (2013). NYSERDA Renewable Portfolio Standard Customer-Sited Tier Impact Evaluation Report: Solar PV and On-Site Wind Programs. Prepared for The New York State Energy Research and Development Authority.
Prepared by The Cadmus Group, Inc. Contract Number: 24890.

SEIA (2016). State Solar Policy – New York Solar. Retrieved on 10/30/2016, from: http://www.seia.org/state-solar-policy/new-york

US Department of Energy (2016): Renewable energy production per State. Retrieved on 10/30/2016, from: http://energy.gov/maps/renewable-energy-production-state





[i] Such as the nationwide “Clean Power Plan” from 2014, which calls for a 30% reduction in the USA’s GHG emissions by 2030, compared to 2005 levels; or the “BuildSmart NY” initiative from 2012, which aims for a 20% energy efficiency improvement by 2020 for all buildings that are owned and managed by New York State.
[ii] For example: a NYSERDA-commissioned report determined photovoltaic capacity factors of 13,4% (NYSERDA 2013). This way, even a photovoltaic capacity of 3,810 MW, as mentioned in the above-mentioned future projection, would be unlikely to produce much more than 4 TWh, which would be only around 3% of New York’s power generation (142 TWh in 2015, according to NYISO 2016).