Global Warming Warmup

I have nearly listened to all the MN House hearings on the Global Warming Mitigation Act of 2007 (H.F. 375). By the end of the week, I hope to have a post that offers more detailed discussion of the hearings around that bill. As of now, the fate of the Mitigation Act looks uncertain but is leaning toward death from what I can tell.

I have had some thoughts and concerns over the course of the 12-15 hours of testimony and debate over this bill that I have been dying to express. They follow.

Much of the testimony on the bill is on section 5 (I'll explain the bill in greater detail in a future post) which requires any new large generation source to offset its GHG emissions. This has a major impact on the proposed Big Stone II plant in South Dakota (to supply electricity to Minnesota) and has therefore drawn a lot of ire from the utilities who have invested in Big Stone II and plan on it to supply future baseload power.

After listening to the same people offer the same testimony in front of two MN House committees (Energy Cmte and the Enviro and Natural Resources Cmte) as well as the Senate, I get testy. The utility testimony from Otter Tail Power offered the same flawed analogy 3 times in exactly the same wording without comment from anyone.

Big Stone II will be the most efficient plant for its time (a super critical pulverized coal), creating just less than 1 ton of carbon dioxide per megawatt hour produced. Otter Tail Power notes that it will be considerably more efficient than existing coal plants and should therefore be considered similiar to a hybrid vehicle. In this analogy their existing plants are essentially less efficient vehicles with greater pollution. They argue that not building Big Stone II, Otter Tail Power will be giving up a hybrid vehicle while it is forced to wait for some future zero emission vehicle. The lesson of the analogy is that such a wait is nonsensical.

This analogy is flawed in several ways. For one thing, Otter Tail gives the impression that they are replacing the old vehicle with the new hybrid, but they are in fact, continuing to run the old vehicles constantly while adding a new hybrid which pollutes a little bit less than the old vehicles, but still greatly adds to emissions. They have suggested that they might be able to retire one of the older plants five years after Big Stone II goes online, but have no obligation to do so.

The Mitigation Act legislation emphatically allows Otter Tail to do what their analogy suggests. They can offset their emissions from Big Stone II by reducing emissions from their older, dirtier, less efficient plants. This would be a tremendous benefit for the environment although such a trade certainly would not help Otter Tail add more baseload to their portfolio.

Otter Tail was not the only to note that plants like Big Stone II are good because they allow us to use coal more efficiently but they never noted that they are really proposing to continue using coal less inefficiently even after building these new facilities. No legislation is preventing them from making their older units more efficient.

Another concern of mine centers from that cold weekend in February when MISO asked everyone to conserve electricity because the grid had very little reserve capacity. This was brought on both due to extremely low wind speeds during high demand and the unplanned outage of a large coal generator (at the Sherco plant). Some Representatives (shockingly, only those who deny climate change science) have hammered on this issue by saying we need more coal generation to back up wind generation.

This is indeed one lesson that can be learned from that weekend. However, distributed generation advocates could also claim that by building massive centralized coal plants, we are setting ourselves up for a fall when one too many of the generators have an unplanned outage. This would also be a flawed lesson but seems just as valid as ignoring that component of the low reserve capacity in order to make a point.

What it comes down to is that a strong grid must have different technologies that compliment each other. As Chairman Hilty brilliantly reminded everyone, no utility is required to build that much wind to satisfy the renewable energy standard (although Xcel is - for reasons that I don't think were every justified). Utilities are required to build generation from a selection of eligible technologies. They have overwhelmingly chosen wind, despite its shortcomings, because it is cheaper. A stronger grid may not come cheap, but can be done by increased reliance on other eligible technologies like solar (though intermittent, tends to peak when needed) and biomass.

My last concern is about the rules of the Chicago Climate Exchange (CCX - wikipedia has the basics). While I like the idea of the climate exchange, I am concerned about what would happen if Minnesota joined it.

The way I understand it, CCX creates a baseline of greenhouse gas (GHG) emissions based on the client's emissions over base years 1998-2003 (or something close to that). It then requires (through force of binding contract) reductions from that baseline by certain percentages each year. Any upward deviation from those reductions requires credits from the exchange (currently selling around $4 per ton of carbon dioxide).

My main concern is with the accounting. If the Metropolitan Council joins CCX, its baseline will include the years before the Hiawatha light rail line began operation. LRT requires massive amounts of electricity, which is especially carbon intensive in this region. How is the Met Council expected to reduce its baseline with a spike on that magnitude?

LRT is a net reducer of GHGs but the Met Council does not get credit for the thousands of cars not driving when people take the train instead. This seems a fundamental flaw in CCX (unless I have misunderstood how it works) because it effectively penalizes the Met Council for reducing emissions via the LRT because the Met Council's baseline does not include emissions from all the private vehicles which are taken off the road.