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You are here: Home / Archives for Climate Change

April 22, 2023

It’s Time for Transformational Climate Policy

The harmful effects of climate change are happening faster than expected. We need policies and initiatives that do more to keep up with the pace of change. 

The evidence of the human impact on climate change is well-established. The challenge for policymakers now is to understand the true pace and consequences of that impact and how to combat it.

In the AR6 Synthesis Report: Climate Change 2023, published by the Intergovernmental Panel on Climate Change, the panel indicated awareness that its reports understate the magnitude of the problem we face. Climate change is effecting the world at a more rapid pace than ever before, creating “climate surprises” that leave societies with little time to mitigate or adapt to their impact. 

Without a full comprehension of the scale of the impact, key decision-makers are stuck in an incremental, “business-as-usual” way of thinking that deals with climate issues happening today, rather than planning responses based on long term threats.

FREE president Dr. John Byrne, Aalto University’s Dr. Peter Lund, and Dr. Job Taminiau recently explored the need to move past a business-as-usual policy mindset in their recent commentary published in WIREs Energy and Environment. They write:

“Commonly practiced “business-as-usual” (BAU) benchmarking and search processes to find least-cost options can only deliver out-of-date and mostly wrong characterizations of costs and benefits when the underlying process of climate change has advanced several iterations beyond BAU,” the authors write. “Policy research suffers from a deeply misguided understanding of its task as it scours the rear-view mirror of past change in hopes of finding the future.”

This backward-looking, reactive policy mindset is stymieing progress in the fight against climate change. As Byrne, Lund, and Taminiau write, the gravity of the threat of climate change demands a new approach. It is not enough to merely react to problems facing the world today. 

Business-as-usual strategies hinge on the desire to create the least amount of social and economic disruption. This thinking falls into the trap of policy hesitancy, in which those in power become paralyzed by the fear of transformative change. 

“The flaw of incremental climate policy-making and the research that informs it is now obvious: using the cost of mitigation and adaptation as the ranking principle to guide decisions is a formula for doing nothing or very little,” Byrne, Lund, and Taminiau write. 

How decision-makers can create transformative change

So what does transformational policy look like in practice? In their commentary, Byrne, Lund, and Taminiau discuss multiple examples of this approach, including a shift to decentralize decision-making using a community-based model. 

In such a model, local authorities place community stakeholders at the center of policy decision-making. For example, community-based utility agencies in California are offering a competitive alternative to traditional gas and electric companies, such as San Diego Gas & Electric and Pacific Gas & Electric. The community-based agencies now collectively serve more residents in California than major investor-owned utilities, according to the authors. 

“Polycentric climate policy action where decision-making authority is redistributed and governance of energy is transformed has led to change that outpaces in just 5 years what conventional policy and market systems largely failed to achieve,” the authors write. 

Lasting climate policy must reach further and be greater in scale than anything most policymakers currently consider. It must redefine “lowest cost,” instead investing when necessary to avoid billion-dollar disasters associated with threats such as rapid sea-level rise, increasingly intense and frequent high-energy storms, and irreversible biodiversity loss. 

A key example of a transformative policy mentioned by the authors is the push among more than 600 global cities and states to switch to 100% renewable energy systems. This undertaking could have a dramatic impact on how these communities fight and prepare for the growing impacts of climate change. 

“Achievement of 100% renewable energy requires planned policy and regulatory action in coordination with behavioral and social change to prioritize low-carbon options. Policy platforms of this kind incorporate a broad range of strategies to support change throughout society and the economy,” Byrne, Lund, and Taminiau write in their commentary. 

This is just one example of what can happen when we replace traditional ways of thinking about climate policy with proactive, transformative planning. To do so on a large scale, researchers and experts need to help guide the way. 

Organizations like FREE can play a pivotal role in helping to produce up-to-date research that assists national and community leaders in making informed decisions. FREE’s climate experts work across the public and private sectors to engage leaders in the realization of transformational policy. 

Changing the way we approach and execute climate policy is a massive undertaking. It’s one that needs buy-in at all levels of society as community leaders contend with how such policies will change the lives of entire populations at the local, state, and country levels. 

At a time when the impacts of climate change are outpacing collective knowledge, we need to  design effective climate policy and demand more from decision-makers. Only then can we hope to see truly transformative change. 

Filed Under: Climate Change

November 3, 2022

Simply Switching to Electric Vehicles Today is Not Enough to Address Climate Change

By: Deborah Bleviss

There is no doubt that purchasing an electric vehicle (EV) is quite chic right now, and it is indeed true that non-fossil-fuel-based vehicles will play an increasingly important role in achieving net zero greenhouse gas (GHG) emissions by 2050. Moreover, focusing on personal vehicles makes sense; they account for almost 60 percent of the GHG emissions from transportation today in the US, with transportation making up the largest sectoral share of US GHG emissions, 27 percent (EPA, Transportation GHG Emissions).

But simply buying and using EVs today is not enough. Here are the reasons why:

  1. Electricity generation is still overwhelmingly from fossil fuels. Indeed, fossil fuels generated more than 60 percent of utility-produced electricity in 2021 (EIA, Electricity Generation by Source). Hence, EVs are not GHG free when tracing electricity back to how it is generated. But they are better than a fossil-fueled vehicle. A typical gasoline vehicle produces over 11,000 pounds of carbon dioxide (CO2) equivalent emissions per year. In comparison, a fully electric vehicle produces less than 4,000 pounds, while a plug-in hybrid (runs on gasoline and electricity) produces less than 6,000 pounds. A typical fossil fuel hybrid produces not much more than a plug-in hybrid, just over 6,000 pounds of CO2 equivalent emissions (DOE Alternative Fuels Data Center, Vehicle Emissions).
  • Electric vehicles remain outside the affordability scale for most Americans. Their prices continue to be higher than fossil-fueled vehicles. As of June 2022, the average cost of an electric vehicle was $54,000 compared with the average price of a fossil-fueled vehicle of $44,400; both have risen sharply since the beginning of the year, 22 percent for EVs and 14 percent for fossil-fueled vehicles (Inside EVs, EV Prices). Moreover, the dominant electric vehicle brand on the market today is Tesla, whose models all exceed the average price of a fossil-fueled vehicle, ranging from $47,000 to over $200,000 (Motortrend, Price of a Tesla). Hence, while demand for EVs has increased, they remain a small fraction of overall personal vehicle sales, estimated at just over 5 percent (Car and Driver, EV Sales ).
  • Price aside, electric vehicles have other issues that make their potential purchase a problem for would-be buyers. First, their ranges are generally less than for fossil-fueled vehicles, especially high-efficiency vehicles. Lower-priced EVs, in particular, tend to have lower ranges. Ranges for EVs today typically are 200 to 300 miles, with some still getting less than that and a few, generally with price tags over $100,000, getting ranges in the 400-to-500-mile range (Inside EVs, EV range). In contrast, the 2022 hybrid Toyota Camry LE, with a combined fuel economy of 52 miles per gallon, a base price just below $28,000, and a CO2 equivalent emissions of 5,600 pounds per year, has a range of 686 miles (fueleconomy.gov). Added to this problem is the limited infrastructure enabling electric vehicle owners to fuel up when their fuel supply is low. There are 46,000 public EV charging stations in the US today, of which 41,000 are slow-charging level 2 chargers that can take 4 to 10 hours to charge a fully electric vehicle (US News, Charging Stations). In contrast, there are 145,000 fossil fuel service stations in the US, and refueling takes minutes (American Petroleum Institute, No. of Service Stations ).
  • Using electric vehicles instead of fossil-fueled vehicles in congested urban conditions does nothing to relieve the traffic congestion that exacerbates fossil fuel use and thereby increases greenhouse gas emissions. While EVs do not directly consume more fossil fuel in traffic congestion and do not add to local emissions, their usage in urban congested areas only adds to the number of vehicles in those areas. As a result, everybody slows down and is subjected to stop-and-go conditions that cause fossil-fueled vehicles to consume more fuel and emit more greenhouse gas emissions. Not using personal vehicles at all—electric or fossil fuel—in congested urban conditions and instead using public transportation is the best strategy for reducing GHG emissions in these areas. The National Academy of Sciences has recently estimated that a person taking public transportation results in a 55 percent reduction in their CO2 equivalent emissions compared with driving or ride-hailing (NAS, Update on Public Transportation’s Impact on GHG Emissions ).
credit: Pexels

So what should consumers, businesses and governments do to reduce greenhouse gases in personal travel?

  1. Buying energy-efficient fossil-fueled cars is a good short- to medium-term strategy. As already noted, a fossil fuel hybrid produces half of the emissions of a typical fossil fuel car. Purchase and use of these vehicles will buy us time to address the price, range, infrastructure, and fossil fuel electricity generation problems facing today’s electric vehicles.
  • To the maximum extent possible, leave your personal vehicle behind—fossil fuel or electric–and use public transportation if you are traveling in an urban area. It is indeed true that public transportation does not function well in some parts of the country. This makes advocacy for investing in functional public transportation systems critical. It is essential to ensure that public transportation systems are inter-connected in an urban area (for example, buses and rail transit systems) and that public transportation users can access this type of transportation from the first mile of their commute to the last.
  • With public transportation so crucial in reducing GHG emissions, prioritize converting public transportation vehicles totally off fossil fuels. Already the percentage of electric buses worldwide, estimated at 13 percent in 2018 (Bloomberg, Electric Buses ), substantially exceeds the percentage of personal vehicles globally that are electrified, estimated at 1.6 percent at the beginning of 2022 (IEA, Electric Vehicles). Being able to plug electric buses into renewably generated electricity goes one step further. Montgomery County, Maryland, is leading the way here, having just started a program that enables county electric buses to recharge through electricity generated by a solar microgrid (Montgomery County, Solar Microgrid for Electric Buses ).
  • Be strategic in driving electric vehicle prices down, including a focus on fleets. Increasing the volume of electric vehicles sold is critical to driving down costs. Focusing on fleets to do this, owned by governments, private companies and car sharing companies such as ZipCar, makes sense. They can purchase en masse rather than buying one at a time. The US federal fleet is under a mandate to green its vehicles and hence can be an important source for increasing the size of the EV market. And among private car-sharing companies, we are already seeing many engaged in demonstrations in cities globally where EVs are among consumers’ choices.
  • Similarly, think creatively about how to increase the range of electric vehicles, not only through better batteries but also by using renewable technologies in the vehicles to capture energy for usage by the vehicle. These may include solar panels on vehicle roofs and wind turbines that capture the energy of air blowing through vehicle grilles. Indeed, Toyota has been testing a rooftop solar system on its Prius Prime since 2019.
  • Invest in solar photovoltaic arrays and potentially other renewable technologies that can directly charge personal EVs. This avoids the usage of the fossil-fuel-intensive electricity grid. These types of investments can start with demonstration programs, potentially in cities with extensive roof infrastructure upon which solar panels can be placed. While these panels should first be used to provide needed energy services for the buildings on which they are placed, by improving the energy efficiency of these buildings, there is the potential for these solar panels to generate more power than is needed for the buildings, power that can then be used to charge EVs.
  • Set clear goals and timelines for converting the electric grid away from fossil fuels across the country. Ultimately, the electric grid will probably remain the major source of electricity for charging electric vehicles. Hence, it is essential that the grid move as quickly as possible to generate electricity from non-fossil sources. This also benefits decarbonization efforts in other sectors that use electricity. But for electric vehicles truly to be fossil fuel-free, the electricity they use must not be generated from fossil fuels.
  • Keep the door open to using other fossil fuel-free fuels for personal vehicles. The most likely alternative fuel is hydrogen-based fuel cells, which both Toyota and Hyundai are seriously exploring. But biofuels may have a role as well, for example, in a country like Brazil, which already has substituted a substantial biofuels/fossil fuels mix into fuels for its personal vehicles.

Transportation will be one of the hardest sectors to move off fossil fuels, if for no other reason than this sector is almost exclusively dependent on these fuels. If we are to be successful in decarbonizing the transportation sector, it is important to recognize how challenging this will be and not leap to simplistic solutions. Electric vehicles have an important role to play, especially in the future, but they are far from the predominant solution today.

Filed Under: Climate Change, Energy and Climate Investment, Renewable Energy

July 27, 2022

How can U.S. climate action equalize the wealth gap between white and black American families?

Income disparity (Getty Images/Hyejin Kang)

By Robert Ddamulira, Ph.D.

INTRODUCTION

“The racial wealth gap in the United States is shocking, the average wealth of a white American family is $170,000, nearly 10 times that of the average wealth African-American family,” observes Kedra Newsom Reeves, consultant at Boston Consulting Group. Climate change impacts are posed to tilt that imbalance even further. More than 1 in 2 black families live in areas that are worst hit by the observed and expected impacts climate change in America. Oftentimes, black families also have little access to risk mitigation mechanisms such as insurance for property or personal health to mitigate against climate risks. Consequently, climate disasters are likely to further erode the limited black family wealth even further.

According to official U.S. Census records, the Black American population currently stands at over 15% of the total population but is growing rapidly. It has increased by over 80% since 2010. Over 55% of this population however lives in the America’s Southern states – these are the same regions that have also been worst hit by billion-dollar climate disasters as illustrated below;

Source: Pew, 2022

Source: NOAA, 2021

Overall, the historical coincidence of high concentrations of black American families within the areas that are hit hardest by climate change disasters presents enormous challenges. However, hidden within those same climate challenges could be important opportunities for the U.S to equalize the elusive wealth gap between its white and black families. But where could these opportunities for equality be at the state and federal levels?

Opportunities to Equalize Wealth through Climate Action:

Abundant opportunities exist at the state and federal levels to equalize wealth, particularly through supporting better education and career outcomes for black families; this is a fail-safe solution. A report by Genesis (2014) estimated that 50% of the jobs we will need in the next 10 years do not exist today; whatever those jobs will be, America will be stronger and more resilient if those jobs incorporate the best and latest climate scientific knowledge and innovation. Therefore, education on climate solutions and career support on the same can be a powerful means of developing an African American workforce that is best suited for a future where climate change will be a decisive factor in successful employment and job outcomes. Support in education and career opportunities at federal and state levels can take many forms. Still, it could include, among others, proactive internships, scholarships/fellowships, and career pathways that seek to equalize the training of a well-qualified black workforce, which will be effective in deploying the innovative climate solutions that Americans need today and in the foreseeable future. Several climate resilience sectors could be helpful in this regard, including, among others, renewable energy services, energy efficiency, circular economy reforestation programs, and other nature-based solutions at home and abroad. These new jobs will also require the creative application of artificial intelligence and social and emotional intelligence.

Federal and state affirmative action policies can go a long way toward expanding opportunities for young black Americans to choose and stay in well-paying careers that at the same time address climate change. Black families and the black community at large have a role to play, too. Black parents must take a more proactive role in encouraging their children and young members to select careers directly linked to the climate solutions sector. At the very least black families should encourage their young members to incorporate a climate lens to whatever career they choose.

It is evident that how the U.S. responds to the climate challenge could strongly affect how the world addresses climate change globally. The same climate solutions sector that has over time concentrated wealth within its white citizens and deprived black families of similar opportunities can serve as a lever to correct historical and structural inequality. Through education coupled with proactive action among black families at the individual and community level – the U.S. can transform climate change into an engine of opportunity and advance social equity.

Robert Ddamulira, Ph.D., is the CEO & Founder of GreenPesa LLC.

Filed Under: Climate Change, Energy Economics

January 27, 2020

Seoul 1 GWp ‘Solar City’ Highlighted at Mayors Forum

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Dr. Byrne and Mayor Park Won-soon interview in Seoul, Korea

The 2019 Mayors Forum (part of IREC held in Seoul in October) featured Seoul’s 1 GWp Solar City Initiative. FREE helped the City to design this ambitious program as part of the FREE-Seoul Metropolitan Government (SMG) Memorandum of Understanding (MOU). Dr. Byrne delivered the keynote at the Forum, which drew 37 mayors from 25 countries. Mayor Park Won Soon chaired the Forum.

Seoul Metropolitan Government (SMG) plans to invest $1.5 billion in their strategy to deploy 1 gigawatt (GWp) of solar energy by 2022. As part of the MOU, FREE has provided the modeling and technical assessment of the city’s rooftop potential as hosts of a distributed solar power plant. FREE also calculated the economics of the project and used a financing structure it has developed for city-scale investment in such a project. (FREE has published results of it modeling and financing approach for 5 cities in addition to Seoul: New York City, London, Munich, Amsterdam, and Tokyo.)

In November 2017, Seoul Metropolitan Government (SMG) declared its intention to deploy 1 gigawatt of rooftop solar as part of its “Solar City Seoul” master plan. Over the next five years, Seoul city government plans to invest $1.5 billion to make the project a reality. This is a significant step forward in the future of Seoul’s sustainability contribution and follows in the wake of the very successful first stages of the city’s One Less Nuclear Power Plant (OLNPP) initiative. 1 Under initiatives like the OLNPP, Seoul focused heavily on promoting energy conservation and efficiency improvement. With this new Solar City Seoul plan, the city is ramping up investment in energy production as well. FREE applauds this direction chartered by the Mayor of Seoul, Mr. Park Won-soon.

FREE has been actively advising the city for five years on the prospects of becoming a “solar city.” As part of the Seoul International Energy Advisory Council (SIEAC), Dr. John Byrne has described to city officials the potential of rooftop solar across the 10-million people strong city. FREE has also published several refereed articles analyzing the emergent role of the solar city concept coupled with new priorities, such as policy effectiveness, solar financing support, and market mechanisms available to Seoul to explore this potential in detail. 2 For example, research we have conducted shows Seoul has a full deployment potential of about 10 gigawatts. 3

FREE attended the launch of the initiative. Mayor Park Won-soon and Dr. Byrne were interviewed by leading Korean newspapers on the strategy. During an interview with Kyunghyang Shinmun, Mayor Park underscored FREE’s role, noting that he “had an opportunity to take a view of the downtown area in Seoul from Namsan Mountain with Prof. Byrne. As I talked with him, I realized that Seoul has a significant PV technical potential.” 4

A striking feature of the Solar City Seoul plan is the commitment to increase household-level PV deployment through miniature solar generators installed on rooftops and verandas or so-called “mini-PV” technology. This prong of the plan will engage more than 100,000 households in helping to supply solar energy to the city! This is exactly in tune with the Mayor’s original pursuit of the idea that “citizens are energy.” The initiative will make solar energy a part of the everyday life of Seoul’s citizens and businesses.

FREE has worked extensively on the concept of the “solar city” – the citywide deployment of rooftop solar energy. Our work shows not only that Seoul has significant potential to develop itself as a solar city but that cities like New York, Tokyo, London, Amsterdam, and Munich possess similar resources. 5 Indeed, a paper published in the International Journal of Urban Sciences by the FREE research team highlights the fact that this opportunity is common to most cities around the world. 6 An investigation of the market, finance, and policy considerations associated with solar city deployment found that the concept is not only technically feasible but it also creates practical economic benefits, including job creation and expansion of local green industries, and results in significant environmental benefits by shrinking the city’s carbon footprint by more than 10 percent. 7

“I will make Seoul a place where PV can be found everywhere”, the Mayor said. The FREE team will be there to continue to help make this ambition become unavoidable reality.


  1. FREE published a blog article on the OLNPP initiative which can be accessed at: https://freefutures.org/one-less-nuclear-power-plant-seouls-commitment-to-a-low-carbon-and-non-nuclear-city/
  2. For more information on our publications, please see freefutures.org/publications
  3. Byrne, J., Taminiau, J., Kurdgelashvili, L., & Kim, K. N. (2015). A review of the solar city concept and methods to assess rooftop solar electric potential, with an illustrative application to the city of Seoul. Renewable and Sustainable Energy Reviews, 41, 830-844. doi://dx.doi.org/10.1016/j.rser.2014.08.023
  4. Translated from the Korean newspaper Kyunghyang (article, in Korean, can be found at: https://news.khan.co.kr/kh_news/khan_art_view.html?artid=201712072105005&code=100100
  5. Byrne, J., Taminiau, J., Kim, K. N., Seo, J., & Lee, J. (2016). A solar city strategy applied to six municipalities: Integrating market, finance, and policy factors for infrastructure-scale photovoltaic development in Amsterdam, London, Munich, New York, Seoul, and Tokyo. Wiley Interdisciplinary Reviews: Energy and Environment, 5(1), 68-88. doi:10.1002/wene.182
  6. Byrne, J., Taminiau, J., Seo, J., Lee, J., & Shin, S. (2017). Are solar cities feasible? A review of current research. International Journal of Urban Sciences, 1-18. doi:10.1080/12265934.2017.1331750
  7. Byrne, J., Taminiau, J., Kim, K. N., Lee, J., & Seo, J. (2017). Multivariate analysis of solar city economics: Impact of energy prices, policy, finance, and cost on urban photovoltaic power plant implementation. Wiley Interdisciplinary Reviews: Energy and Environment, , n/a. doi:10.1002/wene.241

Filed Under: Climate Change, Energy and Climate Investment, Energy Economics, Global Environments

June 11, 2018

California’s Bold Solar Energy Vision

By Joseph Nyangon
How California’s New Rooftop Solar Mandate Will Build Additional Value for Its Customers

Luminalt solar installers Pam Quan (L) and Walter Morales (R) install solar panels on the roof of a home on May 9, 2018, in San Francisco. (Credit: Justin Sullivan / Getty Images).

The boldest new plan yet to increase electricity generation from noncarbon-producing sources has been announced by California. Highly regarded as a trendsetter and vanguard of progressive energy policies, California became the first state to require solar power installed on all new homes. The requirement makes rooftop solar a mainstream energy source in the state’s residential market. Adopted by the California Energy Commission (CEC) as an update to the state’s 2019 Title 24, Part 6, Building Energy Efficiency Standards [1], the solar mandate obligates new homes built after Jan. 1, 2020 to include photovoltaic (PV) systems.

These standards represent a groundbreaking development for clean energy. Single-family homes and multifamily units that are under three stories will be required to install solar panels. The biggest impact may prove to be the incentive for energy storage and the expected uptake in energy efficiency upgrades which could significantly cut energy consumption in new homes.

But not everyone is celebrating. Critics warn that the requirement could drive up home prices overall, further exacerbating already high housing costs in the state. For instance, in a letter to CEC, Professor Severin Borenstein of the Haas School of Business at UC Berkeley warned that such a plan would be an “expensive way to expand renewables” to achieve clean energy goals [2]. But in its order, CEC argued that the new rooftop solar mandate would save homebuilders and residents money in the long-term and cut energy-related greenhouse-gas emissions in residential buildings.

Few solar firms, homebuilders, efficiency experts and local governments fully understand the significance of the mandate. Buildings-to-grid integration experts speak of “turning residential solar into an appliance,”—the merging of rooftop solar, home energy management, energy storage, and data analytics into the next generation of high-performance buildings that is expected to usher in a new era of sustainable development.

How could this new solar mandate help improve grid management so that these ‘new power plants’—clusters of buildings integrated into the grid—can respond quickly to load signals like water heating or home entertainment and thereby contribute to better system reliability? Of course, there are a lot for stakeholders to grapple with between now and 2020 as they come up with compliance solutions to address these opportunities. But this gap, especially, poses a significant challenge in how the new California’s Title 24 codes will affect the clean energy industry.

On the delivery side, First Solar Inc.—a U.S. panel manufacturer—and Sunrun—the largest U.S. residential-solar installer—could be major beneficiaries of the new building codes considering their established market positions in the state. The U.S. Energy Information Administration’s Annual Energy Outlook 2018 puts the mid-point estimate of installed solar capacity required to meet the state’s ambitious ‘50% by 2030’ renewable portfolio standard (RPS) target at around 32 GW (Figure 1). California currently has an installed solar capacity of 18.6 GW, indicating that it has only until the beginning of the next decade to find technical, business, and policy solutions to realize a 50% increase in installed PV capacity. Considering that the core elements of the requirements are now technically locked in, greater cooperation with solar industry players is needed for the success of this bold energy vision.

Figure 1: AEO 2018 estimate of renewable energy generating capacity and emissions in California (2016-2050)

Here are suggestions of what needs to be done to succeed. The provision of today’s electricity services is fundamentally dependent on its transmission, distribution, and storage (TD&S) systems; these functions include business activities that support construction, operation, maintenance and in this case, overhaul California’s electricity infrastructure [3]. According to the 2018 U.S. Energy and Employment Report (USEER), national employment in TD&S including retail service was approximately 2.35 million in 2017, with nearly 7% growth expected in 2018, mostly in manufacturing, construction, installation/repair, and operation of TD&S facilities [4]. Using these national figures as rough benchmarks for job generation, the new solar building mandate represents a major growth opportunity for the solar industry. However, there are transmission implementation challenges that could occur in the future. Orders 890 and 1000 by the Federal Energy Regulatory Commission (FERC) require transmission providers to treat demand resources comparably with transmission and generation solutions during transmission planning. Which means that a clarification is required of whether onsite generation under Title 24 would count toward compliance with FERC’s orders.

With proper distribution and transmission planning coupled with the fact that new homes will have better efficiency overall, California could reap significant benefits from the solar mandate and pioneer in mainstreaming non-wire alternative business models associated with solar distributed generation systems [5]. Deferring and reducing costs to capacity upgrades for distribution and transmission under a distributed utility regime, is one example. For this reason, California regulators would need to anticipate and address compliance issues that could result during the implementation period, such as concerns regarding flexibility measures, the estimated number of homes that would comply with the codes, and year-on-year market bottlenecks that may occur without a rapid change in business models. Further greater stakeholder engagement and partnerships with the building industry, universities and research organizations will be needed to track progress on single–family and multi-family solar development.

Another key step is to improve the revenue model for all generation technologies to reconcile with long-term contracts. In recent years, as solar power grew in the Western Electricity Coordinating Council region, and particularly in California, future prices of solar electricity became uncertain. Today’s electricity prices are set based on the variable cost of the marginal technology. Because technologies like rooftop solar, once built have near-zero marginal costs, this could put downward pressure on long-term electricity prices. Good news for customers and the economy! But payment for TD&S may be of risk. States have been solving this problem by implementing long-term fixed pricing systems, either through power purchase agreements (PPA) or capacity mechanisms, which carry the full-price risk of the technology. California (and New York) has proposed new revenue models that balance the pace of improvement in technology cost and revenue returns [6]. Still, further adjustments to the revenue model may be required in the future.

The logic behind California’s solar mandate is to reposition the market so that the bulk of generation will increasingly come from customer-sited equipment. This is significant: rooftop solar is one of the most effective customer-sited solutions for accelerating a decentralized grid and greening our electricity supply. Apart from the anticipated long-term cost-reductions to the grid, we can infer that CEC may have been guided by the growing market potential of rooftop solar when crafting the new building code energy-efficiency standards. As to the question of the economic viability of the standards to the grid, a detailed study is needed to take into account direct and indirect impacts.

Recently, there has been mention of the mounting problem widely known as the “duck curve”—that is, the sun shines only during the day which means that the solar energy cannot meet the system’s demands when the sun goes down or cloud cover disrupts solar energy system output. This phenomenon can force utilities to ramp up non-solar generation, thereby undermining some of the benefits of a low-carbon strategy. This concern raises a question: What happens to the value of solar energy produced as new additional capacity grows? Over-generation? Because retail competition is still limited in volume to support the anticipated market growth under the new standards, the value of the additional solar generation could decline. Furthermore, the grid would need to be prepared to anticipate and handle any over-generation. CEC is aware of the duck curve problem and included a compliance credit for energy storage in the Title 24 codes to address the issue. But this may not be enough. Options for maximizing on-site solar use should be sought as capacity grows. In addition, while greater electrification of buildings is noteworthy for the utility business model, without offering incentives to residential solar producers, for instance, in the form of affordable construction materials that socializes costs overall ratepayers and introduces new products and services that guarantee long-term profitability, the latest round of CEC building codes could raise significant grid management issues and market uncertainties thus exacerbating the duck curve problem. In brief, the role of utilities in interconnecting these ‘power plants’ and managing any over-generation issues will become more critical.

Growth from the new solar mandate and steps taken to incentivize storage and energy efficiency upgrades may not produce profits for utilities in the short term. But adoption of the Title 24 codes offers utilities opportunities for greater electrification and enables them to search for cost-effective pathways to reduce carbon emissions. In a study of grid decarbonization strategies in California, Southern California Edison (SCE) found that a clean power and electrification path can provide an affordable and feasible approach to achieving the state’s climate and air quality goals [7]. While the cost of managing the grid is an important consideration for utilities like SCE, approval of the new solar mandate is an important reminder of the changing utility industry. Power companies are developing new ways to extract value from emerging distributed solar technologies and expand customer choices. The success of the Title 24 codes will depend to a significant degree on supportive regulation [8,9]. With billions of investments required for grid modernization to address the aging infrastructure issues, finding a sustainable operating model that enables utilities to recuperate costs through rates is fundamental. This is a long-term proposition and power companies should treat it as such.

Despite the challenges discussed above, California’s new Title 24 mandate represents the boldest and most inspiring building energy efficiency standards by any state to date [10]. No doubt the questions surrounding future electricity rates, grid management issues, retail competition, investments in TD&S, design of long-term contracting via PPA mechanisms, and the impact on housing prices require significant attention. But this solar mandate can be an unprecedented energy-problem solving strategy that turns every home into a power plant as solar becomes more mainstream.

Additional Resources
[1] Rulemaking on 2019 Building Energy Efficiency Standards: https://energy.ca.gov/title24/2019standards/rulemaking/
[2] Email response by Severin Borenstein regarding new building energy efficiency standards rulemaking to mandate rooftop solar on all new residential buildings: https://faculty.haas.berkeley.edu/borenste/cecweisenmiller180509.pdf
[3] Nyangon, J. (2015). Why the U.S. urgently needs to invest in a modern energy system. FREE. https://freefutures.org/why-the-u-s-urgently-needs-to-invest-in-modernizing-its-energy-infrastructure/
[4] The 2018 U.S. Energy and Employment Report was prepared by the Energy Futures Initiative (EFI) and the National Association of State Energy Officials (NASEO): https://static1.squarespace.com/static/5a98cf80ec4eb7c5cd928c61/t/5afb0ce4575d1f3cdf9ebe36/1526402279839/2018+U.S.+Energy+and+Employment+Report.pdf
[5] Nyangon J. (2017). Distributed energy generation systems based on renewable energy and natural gas blending: New business models for economic incentives, electricity market design and regulatory innovation [Ph.D. dissertation]. College of Engineering, University of Delaware. Google Scholar.
[6] Nyangon J, Byrne J. (2018). Diversifying electricity customer choice: REVing up the New York energy vision for polycentric innovation. In: Tsvetkov PV, editor. Energy Systems and Environment. London, UK: IntechOpen. pp. 3-23. Google Scholar
[7] The Clean Power and Electrification Pathway: An exploration of SCE’s proposal to help realize California’s environmental goals: https://www.edison.com/content/dam/eix/documents/our-perspective/g17-pathway-to-2030-white-paper.pdf
[8] Nyangon, J. (2015). Obama’s Budget Proposals for Clean Energy and Climate Investment. FREE. https://freefutures.org/obamas-budget-proposals-for-clean-energy-and-climate-investments
[9] Nyangon, J. (2015). Mobilizing Public and Private Capital for Clean Energy Financing. FREE. https://freefutures.org/mobilizing-public-and-private-capital-for-clean-energy-financing/
[10] Nyangon, J. (2014). International Environmental Governance: Lessons from UNEA and Perspectives on the Post-2015 Era. Journal on Sustainable Development Law and Policy 4: 174–202. Google Scholar

Filed Under: Climate Change, Energy Economics, Energy Markets, Renewable Energy Tagged With: Building Energy Efficiency Standards, California, Duck Curve, Solar City, Solar Electricity, Solar Mandate, Title 24

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