American Clean Energy and Security Act | Emission Allowances

Here are the emission allowances proposed in the Waxman-Markey bill, issued this morning.

Emission allowances will be allocated to accomplish three primary goals: (1) to protect consumers from energy price increases; (2) to assist industry in the transition to a clean energy economy; and (3) to spur energy efficiency and the development and deployment of clean energy technology. A small amount of allowances will be allocated to prevent deforestation and support national and international adaptation efforts and for other purposes.

Consumer Protection

Protection from Electricity Price Increases: The electricity sector will receive 35% of the allowances, representing 90% of current utility emissions. Local electric distribution companies, whose rates are regulated by the states, will receive 30% of the allowances, which they must use to protect consumers from electricity price increases. Merchant coal and long-term power purchase agreements will receive 5% of the allowances. These allowances will be distributed according to a formula recommended by the utility industry and will phase out over a five-year period from 2026 through 2030.

Protection from Natural Gas Price Increases: Local natural gas distribution companies, whose rates are regulated by the states, will receive 9% of allowances, which they must use to protect consumers from natural gas price increases. These allowances will phase out over a five-year period from 2026 through 2030.

Protection from Home Heating Oil Price Increases: States will receive 1.5% of allowances for programs to benefit users of home heating oil and propane. These allowances will phase out over a five-year period from 2026 through 2030.

Protection of Low- and Moderate-Income Households: 15% of allowances will be auctioned each year and the proceeds of these allowances will be distributed to low- and moderate-income families to protect them from other energy cost increases. These allowances will be distributed through tax credits, direct payments, and electronic benefit payments and will not phase out.

Transition Assistance for Industry

Protection for Energy-Intensive, Trade-Exposed Industries: Pursuant to the Inslee-Doyle program, energy-intensive, trade-exposed industries will receive allowances to cover their increased costs from the global warming protection program. The number of allowances set aside for this program will equal 15% of the allowances in 2014 and then decrease based on the percent reductions in the emissions targets. These allowances will phase out after 2025 unless the President decides the program is still needed.

Protection for Domestic Energy Production: Oil refiners will receive 2% of allowances starting in 2014 and ending in 2026.

Energy Efficiency and Clean Energy Technology

Investments in Carbon Capture and Sequestration: 2% of allowances from 2014 through 2017 and 5% of allowances in 2018 and subsequent years will be allocated to help electric utilities cover the costs of installing and operating carbon capture and sequestration technologies.

Investments in Renewable Energy and Energy Efficiency: States will receive 10% of allowances from 2012 through 2015; 7.5% of allowances in 2016 and 2017; 6.5% of allowances from 2018 through 2021; and 5% of allowances thereafter for investments in renewable energy and energy efficiency. (The 5% of allowances from 2022 through 2025 will include some future year allowances.)

Investments in Advanced Automobile Technology: 3% of allowances through 2017 and 1% from 2018 through 2025 will be allocated for investments in electric vehicles and other advanced automobile technology and deployment.

Investments in Research and Development: 1% of allowances will be allocated to “Clean Energy Innovation Centers” at research universities and institutions for applied research and development on clean energy technologies.

Other Public Purposes

Supplemental Reductions from Preventing Tropical Deforestation: 5% of allowances will be allocated from 2012 through 2025 to prevent tropical deforestation and build capacity to generate international deforestation offsets. By 2020, this program will achieve additional emission reductions equivalent to 10% of U.S. emissions in 2005. From 2026 through 2030, 3% of allowances will be allocated to this program. In 2031 and thereafter, 2% will be allocated to this program.

Domestic Adaptation: From 2012 through 2021, 2% of allowances will be allocated for domestic adaptation purposes. The amount of allowances allocated for domestic adaptation will increase to 4% from 2022 through 2026 and to 8% in 2027 and thereafter. Half of these allowances will be used for wildlife and natural resource protection and half for other domestic adaptation purposes, including public health.

International Adaptation and Clean Technology Transfer: From 2012 through 2021, 2% of allowances will be allocated for international adaptation and clean technology transfer. The amount of allowances allocated for these purposes will increase to 4% from 2022 through 2026 and to 8% in 2027 and thereafter. Half of these allowances will be used for adaptation and half for clean technology transfer.

Worker Assistance and Job Training: 0.5% of allowances will be allocated for worker assistance and job training from 2012 through 2021. This amount will increase to 1% thereafter.

Unallocated Allowances

Some of the unallocated allowances will be auctioned to ensure budget neutrality. The remainder will be used for consumer protection.

Riding on a sunbeam (no, not a toaster)

The way I see it, any plan for “going solar” in the Valley of the Sun must include transportation. That’s because The Valley is the penultimate example of urban sprawl in the United States (LA is, of course, the champion in the category).

Valley of the Sprawl

Before the bubble burst, when gas was cheap(er) and Phoenix was flush with real estate funny-money, the highways were jammed with Hummers and Escalades (often with no passengers) driving back and forth across the Valley.

Ah, those were the days!

Things have changed some, post bubble-burst. The main change for me came with last December’s opening of our very own Impossible Dream — a sleak, fast, efficent, and all-electric light rail system. Huzzah!

Woo(t)! Woo(t)!

Our son is thriving at the Arizona School for the Arts which is, unfortunately, a 10.5 mile round trip each day. Since we carpool, I only made that drive 2.5 times a week. (M, F and every other Wednesday). Now he takes the light rail from school to a station that’s just a 3 mile round trip from our house.

The light rail has already allowed me to slash my school-related driving from over 26 miles/week to 7.5 miles/week. (The latest estimate I heard was that 35,000 Phoenicians ride the light rail every day.)

Still, there are many other times I need to use my car to get to places where the light rail doesn’t go. Which all leads up to this: Wouldn’t it be cool if I could generate enough electricity using solar panels to power an electric car?

I can answer that one! Yes!

When we return (Ok, when I got the danged time) I’ll explore the options for making that happen.

Phoenix mayor to band: “Who’s the idiot now?!”

“Green Day?” mocks Mayor Phil Gordon. “We’ve got Green Week!”

Well, it could a’ happened.

Fire it Up got the ball rolling on Sunday, March 8, with the first post to our irreverent blog, which is devoted to going solar in the Valley of the Sun.

On Wednesday, the mayor took advantage of the momentum we generated to unveil “Green Phoenix,” his plan to make our town “America’s Greenest City.” (Peak beneath the hastily Photo-shopped Green Day album cover and you’ll see the real plan, which looks like this and can be downloaded here.)

Then, on Friday and Saturday (again following our lead) the Southwest Build-it-Green Expo & Conference, trumpeted as Arizona’s largest green expo, came to town.

Fire it up was there to cover the event with our crack team of reporter.

Here’s our first glimpse inside the Expo.

Build it Green Expo, 2009

The uniqueness of the Green event is readily apparent. Nothing quite like this has been seen in the Valley before.

It’s closest rival, the annual Home & Building Expo, is a different beast altogether, as you can see in the picture below, taken at last year’s event. Look closely at the top picture. Notice anything? That’s right. No kettle-korn! These are some seriously green folks. The photo below is a bit fuzzy, but trust me: every person in it is either eating kettle-korn or looking for a stand where they can buy some.

I kid.

Home & Building Expo, 2008

Both events use the same template, which isn’t surprising because they’re both creations of the same Arizona big media company. It’s named AZ Big Media.

I’m not kidding.

I see this as a good news, bad news situation. The Build it Green Expo can be just as overwhelming as its Home & Building cousin: row upon row of companies hawking their wares from booths pimped out with colored lights and foam-core signage; a gauntlet of red-eyed salespeople demanding that you “check it out,” as they shove one more pamphlet into your hands, and, oh, the humanity! Waves of sore-footed people, many with children who were probably told they were going to a really fun place and now shuffle sullenly through the cavernous room, dragging their feet in rebuke.

OK, now for the bad news.

I kid. Again.

The good news is that all of the bad news above (which I have exaggerated a little) can be taken as a sign that “green” is going mainstream. Solar panels will soon be just as American as Ginsu knives. (Both were invented in the USA, BTW. You can look it up.)

In two years there will be insomniac ads with Crazy ‘Green’ Eddy screaming about his “cut-rate 1000 kWh panels assembled to form the adorable endangered species of your choice, all for the low, low price of…” whatever the market will bare.

The real difference between the Expos was, of course, the products themselves.

Electric car

There were all sorts of hybrid and full-electric cars. The one shown here is no longer available, but it’s pretty cool seeing what’s possible. The car was from Green Motors, Inc., a local company that specializes in converting “regular” cars to full electric, and hybrids, such as the Prius, to plug-ins. Their website shows a very sweet, red (what else?) 1984 Pontiac Fiero sportscar that now has a trunkfull of batteries and can go 50 miles on a single charge. Alas, it’s been sold on Ebay.

Painted roofing

There were also lower-tech solutions for increasing energy efficiency. The Arizona Cool Roof Council had a simple setup, but it really makes their point. The picture on the left show two roofing panels, both made from the same mineral shingle material, and both positioned under identical heat lamps. The only difference is that the one on the far left is painted white. But that makes all the difference: Digital readouts attached to temperature sensors tell the story. The unpainted black shingles are a sizzling 207° F; the ones painted white register at 123°F. That difference translates into reduced need for air conditioning and cuts down on our “heat island” problem — that’s when night temperatures stay higher than normal as dark roofs radiate stored heat back into the sky. This might not sound very serious, but it is, increasing deaths during heat waves, altering wind patterns and increasing smog formation.

Say goodbye to R-22

On a more esoteric note, one booth had a display counting down to the time on January 1, 2010, when manufacturers will have to stop making the particularly nasty compound, R-22. The refrigerant not only gobbles up the ozone layer but is a far more powerful greenhouse gas than the better-known CO2.

The booths where I spent most of my time, though, were the ones devoted to solar panels. You know, the components of . . . The Array.

The first solar PV booth I stopped at was run by Bruce, the energy consultant from EnergyPro who was out at my house measuring the roof last Tuesday.

Bruce of EnergyPro

Bruce was sitting beneath a particularly clever solar project. It was a pergola, a traditional Italian shade structure. I had built one for our house back in Iowa years ago with wild grape vines transplanted to provide the shade.

Pergola at the Iowa place

Instead of grapevines, the EnergyPro pergola had solar panels. Producing electricity while providing shade — an elegant idea.

(The pergola in the Iowa photo was taken out by a tornado a few years ago and tossed into my neighbor’s backyard. And so it goes.)

Bruce is already working out a proposal for us that includes the solar project, a new “green” roof that doesn’t add to the heat island effect and an upgrade to our electrical panel. Since that’s still in the works, I said “Howdy” to Bruce and headed off to talk with other solar contractors. I talked with several, and three contractors will be submitting bids before long. One is David from Dependable Solar Products & ETA Engineering. They installed an array (if it’s not on my roof, ‘array’ reverts to lower case) on a neighbor’s house and she was happy with the process, and is still happy with the panels.

I also talked with some folks who seemed very knowledgeable at PerfectPower, Inc.

It was a company I hadn’t heard of before, SolarCity, that really grabbed my attention (not an easy feat by mid-afternoon). They lease solar panels, reducing the steep upfront costs that discourage many people who would like to go solar.

But that’s not what got my attention. No way. In fact, all a salesperson generally has to do is say the words “no money down” and it’s as if they’ve chanted some magical incantation: I vanish. Or maybe they’re the ones who disappear. All I know is that suddenly I’m far away from the salesperson who had promised me great things for free and I am filled with happiness.

So, it’s to SolarCity’s credit that neither of us vanished and the conversation turned to the specific technology they use: thin-film solar panels. In the picture below, that’s a byte-sized sample of what one of their panels looks like.

First Solar, thin-film solar panel

I had been hearing about advances in thin-film solar PV for some time. SolarCity uses panels made by First Solar, with corporate headquarters in the Valley. I’ve read that First Solar, is one of the leaders, if not the leader, in thin-film technology and manufacturing. Several weeks ago they announced they had broken the $1/watt manufacturing barrier. That’s largely due to volume. Their large arrays are found throughout Germany, Spain, France and Italy.

1.3 MW thin-film array in Dimbach, Germany

What interests me about thin-film is the claim that they produce electricity more efficiently than do other solar panels in extreme heat. Like, say, during summers in the Sonoran desert. The output of all solar panels drops when it’s 115° F, but thin-film panels don’t lose as much as the standard PV panels do. That alone earns thin-film high ratings for eco-conscious desert dwellers. The problem for homeowners like me has been that First Solar panels were only available in large quantities for industrial or government buyers. Just in the last year did they start inching into the consumer market. They may not be the way to go for my particular circumstances. Still, it was a nice surprise finding them at the Expo. I’m just sorry that I couldn’t have both thin-film solar technology and kettle-korn under the same roof.