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Electric Power Law and Policy: Impacts on Water Resources

Electric Power Law and Policy: Impacts on Water Resources. John N. Moore Senior Attorney September 8, 2011. Overview - Key Developments and Trends. State : Growth of Renewable Energy and Energy Efficiency standards in last 10 years.

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Electric Power Law and Policy: Impacts on Water Resources

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  1. Electric Power Law and Policy: Impacts on Water Resources John N. Moore Senior Attorney September 8, 2011

  2. Overview - Key Developments and Trends • State: • Growth of Renewable Energy and Energy Efficiency standards in last 10 years. • Some states “restructured” electricity markets to encourage competition. • Federal: • Federal Energy Regulatory Commission (FERC) more assertively promotes regional electric system planning, integration of efficiency and renewables into the grid. • Recent US EPA air and water standards will reduce coal power plant use.

  3. Overview - Key Developments and Trends • Economic: • Sluggish economy leads to excess power generation in region • Increasing efficiency means less direct correlation between economic growth and energy demand. • Natural gas prices are key – low gas prices displaces coal; more coal likely with higher gas prices. • Carbon regulation is a major uncertainty.

  4. New Policies and Low Natural Gas Prices Influence the Resource Mix

  5. Major Federal Drivers • Federal Energy Regulatory Commission • Flexing regulatory muscle to promote more competition, more holistic regional planning, regional cost allocation to pay for expensive lines. • Order 1000 (July 2011): important ruling – requires all utilities and regional transmission organizations to conduct transparent, comprehensive planning processes and to spread costs of high-power lines across broader areas. • Some states fighting cost allocation, don’t want to pay for lines that are perceived to not benefit their states.

  6. Regional Transmission Organizations

  7. U.S. EPA Regulations Chart courtesy PJM Interconnection, LLC

  8. Gaps and Opportunities – Federal • Education – FERC Commissioners and electric policy staff; RTO stakeholders (good opportunities at PJM and MISO). • Data – RTOs should estimate water use and consumption and pollution impacts on water resources. • Lifecycle estimates/factors also desirable to develop (EIPC stakeholder process does not currently include them). • Evaluations – • Incorporate low-water sensitivity analyses into long-term planning. • Include “indirect” water use impacts in transmission line NEPA analyses where they occur.

  9. Major State Drivers • Electric Industry Restructuring (Illinois, Ohio, Michigan, New York, Pennsylvania) • Renewable Energy Standards/Energy Efficiency Standards • Integrated Resource Planning – few states actually do perform IRP

  10. Gaps and Opportunities – State • Education: • Develop state-specific presentations for utility commissioners; present at NARUC/MARC conferences. • Similar for Midwest Governors Association. • Study: • Report on energy-related water impacts (work with state environmental agencies). • Laws: • Require consideration of water and other environmental impacts in generation and transmission siting (e.g., Minnesota’s law). • Annual accounting of energy-related water impacts. • Include water impacts in integrated resource planning (to the extent it exists).

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