Q2 Update 2010

APA Discussion Draft and ENE Summaries Released

The oil disaster in the Gulf reminded us of the many consequences of our dependence on fossil fuels. The West Virginia coal tragedy reminded us that there is a human as well as an environmental cost of relying on dangerous and dirty fuels. And 2010 has experienced some of the hottest temperatures on record, reflecting a continued warming trend. Yet, as this summer continues the U.S Senate has dropped efforts to deal with a problem we cannot avoid - the need to build a clean energy future that makes our nation more competitive in the global market.

In the near term, states, provinces and cities and towns across the U.S. and Canada will continue to take powerful steps to reduce global warming emissions and put their economies on track toward a sustainable future.

The headlines from this quarter provide some hopeful examples. Rhode Island's energy law shows how states are moving forward to commit to energy efficiency as a clean, affordable alternative. The regional RGGI cap and trade program is an example of an effective market-based climate policy at work. And the northeast states are working toward a low carbon fuel standard (LCFS) that will similarly create incentives to develop sustainable transportation alternatives. Business and industry leaders, policy makers, and environmental leaders and stakeholders from throughout the region and beyond are gathering to discuss the challenges ahead and propose solutions.

ENE is pleased to be supporting these crucial developments. Please read more about the latest news from ENE.

-- Dan Sosland

P.S. We've posted our Board of Directors' bios on our Web site. Please take a look and meet this exceptional team. We are also looking forward to introducing the founding members of ENE's new Advisory Council soon.

Advancing State Energy Policy

Rhode Island Bill Adopts Decoupling and Supports Gas and Electric Program Ramp-Ups

The Rhode Island General Assembly passed important legislation in late May that clears the way for National Grid to make deep investments in energy efficiency, saving Rhode Island customers hundreds of millions of dollars in lower energy bills.

The bill includes three important policy reforms that remove barriers to efficiency investments:
•    Utility rate reform (or "decoupling") aligns National Grid's incentives with its customers' interests. Under the old system, the utility made money with increased sales of electricity and the company lost money when customers reduced their use through efficiency. The new law removes this disincentive for the utility to invest in energy efficiency programs and help customers save money by reducing the amount of energy they use.
•    Clear authority provided to the RI Public Utilities Commission to approve funding that allows the utility to provide energy efficiency programs that include energy audits, rebates, and other incentives that will enable residential, low-income, municipal, commercial, and industrial customers to realize $280 million in bill savings.
•    Adding a least cost procurement requirement for natural gas energy efficiency investments requiring the utility to invest in all cost-effective natural gas efficiency that is cheaper than supply and save customers tens of millions of dollars.

ENE worked with the EERMC, National Grid, and other stakeholders to pass these key measures, as part of ongoing efforts to expand and implement efficiency programs in Rhode Island.

ENE Summary of the RI Decoupling and Efficiency Bill

Resources and more about Rhode Island Energy and Climate Issues at our Web site

More about Decoupling and Energy Efficiency

Decoupling utility revenues from volume of sales is a key step toward ensuring that utilities work with customers to capture the full benefits of energy efficiency resources available. Massachusetts is implementing decoupling for each utility in the state to support clean energy policies, while Connecticut is pursuing a pilot. ENE is participating in rate cases in both states to ensure that this key aspect of their clean energy reforms is implemented.

More information on Utility Incentive Reform.

Proposed 3-Year Efficiency Plan Under Review in Maine

The Efficiency Maine Trust (EMT) worked with expert consultants, industry leaders and other stakeholders -including ENE- to develop its first 3-year plan for expanding efficiency programs in Maine. The plan calls for significantly increased investments in cost-effective programs for all fuels and customers, and it is now being reviewed by the Public Utilities Commission. Former ENE Senior Counsel Michael Stoddard recently joined Efficiency Maine Trust as its first executive director.

See the proposed Triennial Energy Efficiency Plan at the EMT Web site.

More about Maine Energy Reform.

RGGI Success and Next Steps

ENE is working with stakeholders to review the progress of RGGI to date and to help recommend important next steps. RGGI was envisioned as a multi-stage effort that was to begin as a program for the electric sector that, over time, could expand to include other sectors, gases, and possibly jurisdictions and/or programs. The RGGI states deserve tremendous applause for their commitment in making this first in the nation program work so well. Many stakeholders expected RGGI would inform a federal cap and trade program but that a nationwide program would allow it to be phased-out over time. While national action remains uncertain, as RGGI faces its next phase, ENE is working with other stakeholders to encourage RGGI states to begin discussing issues that could be addressed in the next stage of the program related to improving and expanding RGGI and encouraging linkage and trading with other programs.

ENE's RGGI Emissions Trends Report provides analysis of trends shaping auctions and emissions levels, and finds that significant emissions reductions have been achieved at low cost. ENE's RGGI Auction Tracker shows how auctions to date have been successful and have raised millions toward energy efficiency and clean energy programs. While the future and timeline of a federal or regional program is unclear, the northeast can continue to lead with program models and strong results.

For more information and updates visit ENE's RGGI page.

Low Carbon Fuel Standard

Promoting Clean, Affordable Fuel Alternatives in the Transportation Sector

States in the northeast/mid-Atlantic region agreed in December to develop a framework for a model rule for a low carbon fuel standard (LCFS). ENE is working with stakeholders and policy makers to ensure that the region adopts a program based on the best available science and economic analysis that each state can adopt through its own legislative and regulatory processes

A successful LCFS will provide clear market signals and create economic opportunities for cleaner fuels. Currently, the northeast and mid-Atlantic states spend over $78 billion dollars each year on imported fossil fuels, a situation that is environmentally and economically unsustainable. An LCFS can stem the outflow of money and promote a market for locally produced low carbon fuels. It will offer consumers more choice and protection from volatile petroleum prices. The growing market for clean alternative fuels can also provide a welcome economic boost for the region, starting and attracting companies, creating and retaining jobs, and growing the states' clean energy sectors. Adopting an LCFS will also help states achieve their climate goals. A program that requires a 10% reduction in carbon intensity over 10 years will avoid 33 million tons of GHG emissions in the last year of the program and 130 million tons of GHG emissions over the 10 year period. At their recent Annual Meeting, the New England Governors and Eastern Canadian Premiers formally recognized the value of a regional LCFS and adopted a Resolution Concerning GHG Emissions from the Transportation Sector, in which they commit to continuing work on a regional program.

More on resources and information at ENE's LCFS Web page.

ENE is also involved in research and advocacy around other efforts to promote the development and deployment of low carbon fuels and vehicles, such as electric or natural gas vehicles and biofuels, which should be coordinated and consistent with the low carbon fuel standard framework. For more information, see Vehicle Electrification and Biomass and Biofuels.

APA Discussion Draft and ENE Summaries Released

The American Power Act (APA) discussion draft put forward in May by Senators John Kerry (D-MA) and Joe Lieberman (I-CT) marked an important step toward developing legislation that will put our nation on the path to a clean energy future. While current reports indicate that the U.S. Senate will not take up comprehensive climate legislation, the draft legislative proposals circulated to date will, we believe, remain the starting point for a long-delayed, but inevitably necessary, U.S. action to transform our economy and position it for a more competitive - and cleaner - future.

The APA includes proposals for placing a price on carbon and addressing emissions across several sectors, which is essential to cleaning up our environment and transforming our economy. ENE developed a summary and related recommendation memos to inform the public and to aid the development of a strong climate and energy package.

The comprehensive summary is divided into two parts: 1) a high-level overview of the bill, describing the cap trajectory, allowance allocations, and additional provisions on preemption, conventional energy, and offshore drilling; and, 2) a detailed section-by-section summary of the entire bill.

In addition, ENE developed recommendations for improving the bill, focusing on three key areas: energy efficiency; maintaining the role of states; and provisions to strengthen offsets and protect forestlands.

ENE's analysis and perspective on the bill draw on experience with the design and implementation of the nation's first mandatory GHG cap and trade system, the Regional Greenhouse Gas Initiative (RGGI).

More analysis and information on ENE's Federal Cap and Trade page.

Northeast Regional Outreach

ENE was invited to attend the 34th Annual Conference of New England Governors and Eastern Canadian Premiers, to be held in Lenox, MA in July. The theme of the conference was "Promoting Economic Growth through Clean Energy in New England and Eastern Canada." Among the key topics of discussion were energy efficiency and LCFS, both solutions which ENE advocates (see above). ENE is weighing in at this and other regional forums to introduce and advance recommendations for how the states and provinces can fully take advantage of the environmental and economic benefits of clean energy policies.

NEG-ECP Resolution Concerning GHG Emissions from the Transportation Sector

NEG-ECP Resolution Concerning Energy Efficiency

See our Eastern Canada Climate and Energy Reform Web page for more on ENE's work to facilitate region-wide coordination on climate and energy solutions.

The 17th Annual New England Energy Conference and Exposition, hosted by the Northeast Energy and Commerce Association and the Connecticut Power and Energy Society, brought together New England energy industry leaders and public officials from all sectors to examine key factors likely to shape industry and customer decisions on how to supply this region's energy needs. ENE was an invited presenter and discussed the topic: Energy Efficiency: Economic and Regulatory Drivers.

ENE participated in the Consortium for Energy Efficiency (CEE) Summer 2010 Program Meeting in Boston, MA in June. CEE is a consortium of efficiency program administrators from across the U.S. and Canada who work together on common approaches to advancing efficiency, in partnership with other industries, trade associations, and government agencies. ENE presented Energy Efficiency in Cap and Trade: Lessons from RGGI.

ENE's Annual Report for 2009

At ENE, we are committed to delivering real results, and 2009 was no exception. From influencing federal energy and climate policy, to working with state boards on the details of energy efficiency program implementation, tracking greenhouse gas cap and trade auctions, to helping secure state commitments to low carbon fuels, to developing one of the most refined policies on carbon offset approaches available, this was an active and productive year.

Please read our annual report to learn more about the progress achieved during 2009.