Deregulation and Your CCP Action Plan

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Deregulation and YourCCP Action Plan

• Measures to Reduce GHG Emissions from Electric
  Power Generation
• Ann Elsen
• Energy Planner

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Sources of Greenhouse Gas Emissions
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Overview

• Introduction to deregulation
• Participating in the process
• Environmental Issues
• Electricity Procurement
• Educating and Involving the Community

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Action Plan

• Corporate Measures
• Electricity Procurement
• Renewable Energy Installations
• Efficiency Measures
• Demand Side Management

• Community Measures
• Consumer Education
• Municipal Aggregation
• Participation in the Deregulation Process
• Refocusing the Community on Efficiency
  Renewables

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Deregulation 101, Intro.

• What is deregulation?
• Who benefits and who pays?
• National Energy Security
• The same fixes improve environmental
  performance and security.

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• Samuel Insull developed the vertically integrated
  electric monopoly, which functioned for nearly
  100 years.

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Electricity Deregulation
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Transmission
Distribution (Electric Company)
Generation (Supplier)
You (End User)
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Market Transition

• Shift from Investor Owned regulated utilities
  to competitive market
• Concurrent evolution of industry
• Information Age
• Electricity dependent economy
• Distributed generation vs. Central Power Plants
• New Technologies

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With or Without Deregulation

• Current power market doesnt fit digital age.
• Increased need for reliability.
• Aging infrastructure carries power from large
  centralized generation plants.
• Increased complexity of transmission and
  distribution systems.
• Shift to distributed generation.

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Evolution of Electricity Industry
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You are a Stakeholder

• Local government needs to be involved in the
  deregulation process.
• Often among the first to shop for competitive
  power.
• Represents constituents ratepayers, residents,
  businesses.

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Get a Seat at the Table

• Become educated
• Identify key issues
• Contact your state utility commission
• Work with legislators
• Demand participation equal to that of industry

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Expand Your Influence

• Coordinate with other local governments
• Other CCP members
• Municipal Leagues and Associations of Counties
• Work with community groups
• Sierra Club
• Audubon Naturalist Society
• PIRG (Public Interest Research Group)
• Other environmental and advocacy organizations

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Environmental Issues

• Demand Side Management
• Interconnection requirements
• Environmental Disclosure
• Renewables Portfolio Standard
• Municipal Aggregation

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Supply and Demand
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Electricity Demand
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Demand SideManagement (DSM)

• Cost Effective
• Energy Efficiency
• Peak Shaving, Load Management
• Public Benefits Fund
• Market Information

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Real Time Pricing Reveals the True Demand Curve
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DSM Effect of Reductions in Peak Demand on
Wholesale Prices
Spot Market Clearing Price
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Nuclear Energy

• Long lead time
• Large capital investment with uncertain returns
• Vulnerability
• NRC has retracted statements that containment
  could survive impact with aircraft.
• Limited liability
• Price - Anderson Act up for renewal 8/1/02.
• 560 million coverage vs. 300 billion
• If repealed would add cost of about 3.6 billion
  to nuclear.
• National Security
• Operating safety vs. weapons proliferation

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The Changing Face of Nuclear

• ?

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Renewable Energy Requires

• Connection to the grid
• Transmission capability
• Removal of regulatory restrictions
• Access for small generators
• Net Metering
• Market Development
• Educated Consumers
• Adequate and accurate information
• Incentives and requirements (RPS)

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Renewables Portfolio Standard

• Requirement for a minimum percentage clean or
  renewable energy from every supplier.
• Encourages development of new renewable
  resources.
• Insures a market demand.
• Definition of qualifying resource is important.
• Percentages tend to be very low (0.5 to 5).

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Environmental Disclosure

• Enables customers to compare products.
• Best when information is presented clearly and
  uniformly.
• Similar to ingredients and nutritional
  information on food labels.
• Generation mix fuel mix.
• Air emissions SO2 NOX CO2

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Food Label
Amount/serving DV _____________ Total Fat
5g 8 Sat Fat 1g 5 Cholest. Less than
1mg 0 Sodium 75mg 3 Total Carb 37 g
12 Fiber less than 1g 0 Protein 3g Sugars
21 g
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Fuel Mix

• Fuel Source PJM Average, 1997
• Coal 46.3
• Gas 2.5
• Nuclear 35.0
• Oil 1.8
• Unspecified Fossil 11.6
• Renewable Energy 2.8

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PJM Pepco
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Food Label
Nutritional Facts Serv. Size 1 Pkg. 54 g (1.9
oz) Servings 1 Calories 200 Fat Cal.
45 Vitamin A 4 - Vitamin C 0 - Calcium 2 -
Iron 0
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Air Emissions
Pounds Emitted per Megawatt Hour of Electricity
Generated Sulfur Dioxide (SO2)
10.3 Nitrogen Oxides (NOX)
3.3 Carbon Dioxide (CO2)
1,301.3 CO2 is a "greenhouse gas," which may
contribute to global climate change. SO2 and NOx
released into the atmosphere react to form acid
rain. NOx also reacts to form ground level ozone,
an unhealthy component of "smog."
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Air Emissions

• SO2 and Nox in pounds per Megawatt hour
• CO2 in 10 x pounds per Megawatt hour

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Air Emissions as a of Regional Average
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Disclosure Effectiveness

• For all products vs. environmental claims only
• Contract Path vs. Tradable Credits
• Must match the system used to verify a Renewables
  Portfolio Standard.
• Issue of distance between generation and final
  sale, local environmental impacts.

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Aggregation

• Big dogs eat first.

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Municipal Aggregation

• Market power for residential customers
• Enables them to buy power as a group.
• Group can specify environmental characteristics
  of electricity product.
• Only works if its an opt-out system.

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Ways to Buy Green Power

• Generate your own power using a renewable energy
  source.
• Generate your own negawatts through energy
  efficiency measures.

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Ways to Buy Green Power

• Purchase a certified green energy product
  (several different certification programs).
• Use environmental disclosure information to
  select the product that is the least brown.
• Develop your own Renewables Portfolio Standard as
  part of your contracting specifications.

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Consumer Education

• An Educated Consumer is a
• Green Consumer

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Consumer Education

• Explain deregulation impartial information
• Educate business and industry to improve
  environmental performance
• By buying green power
• By improving energy use practices
• Opportunity to reinforce the energy efficiency
  message and to

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Promote Renewable Energy
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Increase Awareness
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Explain Interconnection Issues
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Encourage Energy Efficiency
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Action Plan

• Corporate Measures
• Electricity Procurement
• Demand Side Management
• Generate Your Own Renewable Energy
• Efficiency Measures

• Community Measures
• Participation in the Deregulation Process
• Municipal Aggregation
• Consumer Education
• Refocusing the Community on Efficiency
  Renewable Energy

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