The Inflation Reduction Act Makes Climate Change History

The Inflation Reduction Act has passed in the Senate, the House of Representatives, and has been signed into law by President Joe Biden. Alongside desperately needed funding for healthcare, this bill is the first major clean energy investment ever passed in the U.S. The IRA will invest $386 billion dollars into climate related initiatives. Prior to the adoption of the IRA, the U.S. was estimated to be on track to reducing greenhouse gas (GHG) emissions 25% below 2005 levels by 2030. With the IRA, 2030 emissions are estimated to be about 40% below 2005 levels – demonstrating the magnitude of the bill in reducing emissions. The figure below demonstrates how U.S. “business as usual” (BAU) GHG emissions without the IRA compared to the “low,” “moderate,” and “high” emissions scenario trajectories associated with the IRA.  

Graphic provided by Energy Innovation. GHG reduction estimates based on Energy Innovation’s free and open-source U.S. Energy Policy Simulator: https://energyinnovation.org/wp-content/uploads/2022/08/Updated-Inflation-Reduction-Act-Modeling-Using-the-Energy-Policy-Simulator.pdf

According to analysis conducted by Energy Innovation, the IRA also has the potential to deliver significant public health and economic benefits, preventing up to 4,500 premature deaths in 2030 and creating up to 1.3 million jobs in 2030. Let us break down where the $386 billion in the bill is going:

  • $161 billion for clean electricity tax credits
  • $40 billion for air pollution, hazardous materials, transportation, and infrastructure
  • $37 billion for individual clean energy incentives
  • $37 billion for clean manufacturing tax credits
  • $36 billion for clean fuel and vehicle tax credits
  • $35 billion for conservation, rural development, and forestry
  • $27 billion in building efficiency, electrification, transmission, industrial, DOE, grants, and loans
  • $14 billion in other energy and climate spending

The total cost of the bill, including the healthcare components, comes out to $485 billion spent over the next ten years. However, the investment is predicted to bring in roughly $790 billion in that same period, meaning this bill is projected to have a net profit of $305 billion over the next decade. That profit will go towards reducing the deficit and controlling inflation.

The IRA represents the most significant federal action to fight climate change in our nation’s history, taking specific steps to address greenhouse gas emissions from buildings, transportation, and power generation. Here are how the investments align with Acadia Center’s longstanding mission to “Advance the Clean Energy Future” throughout the Northeast.

Buildings
First and foremost, the IRA offers significant federal resources to advance a package of actions Acadia Center calls “Next Generation Energy Efficiency.” Acadia Center has been working throughout the northeast to urge utility companies and regulators to prioritize making our region’s homes and businesses more thermally comfortable and energy efficient through simple actions like better insulation and air sealing of building envelopes as well as replacing inefficient fossil fuel appliances like furnaces, boilers, water heaters, and cooktops with superior all-electric appliances. The combination of these steps significantly reduces the overall amount of fossil fuels used in these buildings, reduces energy bills, and improves overall quality of life by making our living and working spaces healthier, safer, and more versatile.

By focusing these coordinated activities on especially high emitting buildings in our region, we can amplify these multi-faceted benefits even further. For instance, in the residential sector, the leakiest 25% of housing units in New England produce more than half of greenhouse gas emissions attributable to housing. Statistically, these households are far more likely to be low-income and occupied by renters. Nearly all (96%) of high emitting housing units are heated by fossil fuels, which are several times less energy efficient than all-electric heat pumps. Tens of billions for investments in building retrofits and energy efficiency will yield a significant reduction in local air pollution and global greenhouse gas emissions.

What it means for you:

The IRA introduces a slew of new tax credits and upfront discounts for clean building technologies for both homeowners and renters alike. All homeowners, regardless of income, will have access to tax credits to support the purchase and installation technologies including geothermal heat pumps, air source heat pumps, heat pump water heaters, and electrical panel upgrades that are sometimes necessary to support the installation of these technologies. As an example, tax credits for heat pumps will be as high as $2,000.

Low-income (defined as less than 80% of median area income) and moderate-income (80%-150% of median area income) homeowners will have access to several upfront discounts for technologies including heat pumps, heat pump water heaters, electric induction stoves, heat pump clothes dryers, electric panel upgrades, and electric wiring upgrades. As an example, upfront discounts for heat pumps will be as high as $8,000. Upfront discounts for moderate-income households will cover up to 50% of the project cost, while discounts for low-income households will cover up to 100% of the project cost. Low-income and moderate-income renters have access to upfront discounts for clean building technologies that could be relocated in the event of a move, including heat pump window units, electric stoves, and heat pump clothes dryers. A combination of tax credits, upfront discounts and performance rebates will also be available to improve the efficiency of homes – ranging from basic weatherization to more comprehensive retrofits.

Additional measures in the IRA will work to address rampant levels of methane leakage occurring throughout the country related to the production of “fossil gas” also known as “natural gas.” This gas is primarily methane, which has a global warming potential of over 80 times that of carbon dioxide in its first 20 years in the atmosphere. Leaking methane is also a significant safety hazard as leaks in the distribution pipes and inside of households are responsible for fires and sudden catastrophic explosions. Specifically, the IRA calls for the implementation of a “methane emissions charge” for oil and natural gas production facilities that are not in compliance with EPA methane emissions regulations.

Acadia Center’s Beyond Gas initiative works to reduce the combustion and leaking of methane by transitioning both power generation and buildings away from today’s overreliance on fossil gas and by prioritizing the strategic repair of leaking pipe sections that are not immediately ready for decommissioning.

Transportation
Acadia Center has long worked on a multi-pronged Clean Transportation strategy to reduce tailpipe emissions through electrification of vehicles, expanding transit access and improving networks, and connecting communities through investments in safe, dedicated pedestrian and bicycle infrastructure. The IRA falls short of taking significant actions to modernize transit and personal mobility infrastructure networks[1], but does prioritize historic measures to accelerate vehicle electrification, ranging from personal vehicles to heavy-duty vehicles like buses and garbage trucks.

What it means for you:

The IRA includes a first-ever $4,000 consumer tax credit for lower/middle income individuals to buy used electric vehicles and up to $7,500 in tax credits to buy new electric vehicles—these programs will effectively extend and expand the current federal electric vehicle incentives that have started to expire under existing law. The tax credits for new vehicles are available to those with an adjusted gross income (AGI) below $150,000 (filing taxes as single) or $300,000 (filing taxes jointly), while the tax credits for used vehicles are available to those with an AGI below $75,000 (filing taxes as single) or $150,000 (filing taxes jointly). Plug-in hybrid electric vehicles (PHEVs), which use both electricity and gas, will still qualify for the tax credit if they have a battery of at least 7 kWh in size, a threshold that nearly all models meet.

However, the EV tax credits will not necessarily be easy to navigate for consumers in the short term. To be eligible for the full tax credit, vehicles must both be 1) Assembled in North America and 2) Source the critical minerals need to make the batteries from a U.S. free trade partner. This policy has created some near-term uncertainty for which specific makes and models will qualify. For example, Hyundai and Kia do not currently produce any EVs in North America despite having several EVs available to U.S. consumers. For those seeking more information, electrek is maintaining a detailed list of which vehicles do and do not qualify for the tax incentive under these new requirements.

The law also includes tax credits and grants for clean fuels and clean commercial vehicles to reduce emissions and $3 billion for the U.S. Postal Service to purchase zero-emission vehicles to replace its aging fleet of vehicles that travel throughout our communities every day.

Additionally, the IRA provides $3 billion in Neighborhood Access and Equity Grants that can support neighborhood equity, safety, and affordable transportation access via competitive grants to reconnect communities long divided by redlining practices that developed transportation infrastructure in a manner that intentionally split apart neighborhoods, many of which were primarily inhabited by people of color. These grants can also be used to mitigate the negative impacts of transportation facilities on disadvantaged or underserved communities, as well as to support equitable transportation planning and community engagement activities that should be at the heart of all community-led decision-making processes.

The IRA also provides $3 billion in grants to reduce air pollution at ports, including for the purchase and installation of zero-emission equipment and technology. This will reduce the amount of fossil fuels burned by idling ships and local port machinery and trucking operations. These strategic investments to reduce the amount of heavy-duty vehicle and machinery emissions directly aligns with work Acadia Center has led in the past to address particulate matter emissions generated by diesel engines in overburdened and underserved communities, particularly school buses which expose communities and school children directly to health impacts from poor air quality.

Power Generation
To sustainably power today’s economy and support the transition from fossil fuel burning appliances and vehicles, the IRA makes critical investments to accelerate the expansion of responsibly sited renewable energy resources, including in rural communities. About two thirds of the estimated greenhouse gas emission reductions resulting from the IRA in 2030 are expected to come from the electricity sector. Two of the key provisions driving this reduction are the 10-year extension of the Production Tax Credit (PTC) and Investment Tax Credit (ITC) which have been critical financial carrots driving the rapid deployment of wind and solar. Solar projects will be able to access the PTC for the first time and battery storage, which is critical for accessing the full benefits of renewable electricity, will have access to the ITC for the first time. Combined, the extension and expansion of these tax credits, along with other clean energy provisions in the IRA, will be critical in continuing to drive down the costs of renewable electricity and accelerating the shift away from fossil fuel electricity generation in favor of renewable electricity generation in the northeast.

What it means for you:

The IRA provides a 30% tax credit to all homeowners, regardless of income, to support the purchase and installation of residential rooftop solar and/or battery storage. Both tax credits are in effect for the next 10 years. The battery storage tax credit is brand new, and the solar tax credit represents a long-term extension of the existing solar tax credit that was previously set to decrease and fade away over the next couple of years.

However, these projected declines in electricity sector emissions will not be realized without addressing existing policy barriers hampering the deployment of cheap renewable energy. The challenges currently facing the construction of transmission lines and the interconnection of renewable electricity to the grid continue to persist. That is why Acadia Center remains focused on tackling these complex and technical issues that arise in the transition to a clean energy future.

Acadia Center’s Clean Power and Utility Innovation programs have tirelessly worked to push regulators and the incumbent fossil fuel-utility industrial complex to update business models to prioritize investments in clean energy and dynamic energy systems that provide greater economic and societal benefits to end users. The IRA buttresses that work by incentivizing investments to develop and deploy historic levels of clean energy and to provide support for more robust local participation in permitting and regulatory processes that are key to developing those resources responsibly and with community input.

The IRA also includes more than $20 billion to support climate-smart agriculture practices. Acadia Center partnered with the American Farmland Trust and other organizations to develop the Smart Solar Siting Project for New England that seeks to co-locate renewable energy resources on parcels that also host agricultural activities—a winning strategy that keeps the Northeast’s precious farmland in agricultural use and provides farmers a source of clean, renewable energy and diversified revenue stream to maintain their farm operations for generations to come.

Overall, the IRA represents a great step forward in U.S. climate policy but there is still much work to be done – much of which will need to occur at the state and local levels – to actualize the full potential of the IRA. Acadia Center’s work across its core initiatives will be crucial in ensuring that the IRA delivers the maximum amount of emissions, economic, health and equity benefits to northeastern states.

 


[1] While the IRA itself may fall short on transit and personal mobility network investments, other large federal legislation of the past few years, such as the American Rescue Plan Act and Infrastructure Investment and Jobs Act, have provided some direction to those priorities.

 

 

Major Win in Massachusetts with Clean Energy and Climate Bill

On July 21st, the Massachusetts House and Senate announced they had reached an agreement on a compromise climate change bill, released that bill unanimously from the committee of conference, and passed it in both branches. The sprawling 96-page bill touched upon practically every sector, including transportation, energy, and buildings. Governor Baker then sent the bill back to legislature with amendments, most of which were rejected, before ultimately signing the bill today. So now we’re just left with the question: “Uh, what’s actually in it?”

Acadia Center Priorities

As to be expected, the conference committee bill is a compromise bill between the separate climate bills passed by the two branches and contains significant elements from each proposal. Significant portions of Acadia Center priorities, including some listed below, were included in this legislation as well. The bill limits Mass Save from incentivizing fossil fuel equipment starting in 2025, aiming instead to promote electrification. It also requires the creation of a stakeholder Grid Modernization Advisory Council and adds a requirement for utilities to submit grid modernization plans to that Council. This language was based upon legislation which Acadia Center drafted in 2018. The conference committee legislation also allows regional solicitation for long-term contracts for offshore wind and transmission and creates a Clean Energy Transmission Working Group to do a full analysis of the barriers to major transmission upgrades. Acadia Center is specifically named as a member of that working group. The legislation also removes biomass from the Renewable Portfolio Standard, a concept for which Acadia Center has long advocated.

The Senate Proposal

From the Senate side, the compromise legislation increases rebates for ZEVs, adds an additional incentive for low-income customers, and requires new MBTA bus purchases to be ZEVs by 2030. It also aims to boost energy storage, fix some issues hindering the solar industry, and allows ten cities and towns to require fossil-fuel free new construction.

The House Proposal

The House climate bill primarily centered around offshore wind, and this final version reflects major elements of that as well. It aims to develop the offshore wind industry through infrastructure, investment, and job training. These sections also have a strong focus on economic inclusion and labor protections and fix issues with the procurement process, such as the conflict of interest stemming from utilities selecting winning bids.

Governor’s Amendments

In sending the bill back to the legislature, Governor Baker offered several pages of amendments, including $750 million in ARPA spending on clean energy. However, most of these were rejected. The legislature did accept a few, including the elimination of a price cap provision on offshore wind, something for which the Governor has long advocated.

What Isn’t In the Bill?

Unfortunately, as with most compromises, the final bill does not contain all that we hoped it would. It excludes a top environmental justice priority, which would increase air quality monitoring and require the state to establish baseline air quality for air pollution hotspots. It also does not include language which would have set up a successor to the state’s solar program or a provision to set electrification targets for the commuter rail system. Disappointingly, the final proposal also excludes significant swaths of dedicated funding that were present in the original versions, including funding for EVs, charging infrastructure, and clean energy.

Still, wide ranging climate improvements in nearly every sector is worth celebrating. The Governor, the legislature, and environmental activists deserve credit for delivering a strong climate bill and should take a well-deserved rest. Now let’s recharge and gear up for the climate bill for next session.

 

For more information:

Kyle Murray
Senior Policy Advocate-Massachusetts
kmurray@acadiacenter.org
617-742-0054, ext. 106

ISO-New England’s Federal Regulator Fails to Require Swift Energy Reform, Clean Energy and Consumers Bear the Burden of More Delay

Boston, MA (May 27, 2022) – Today, the Federal Energy Regulatory Commission (“FERC”) issued an order unwisely approving ISO-New England’s controversial proposal to prolong by three more years the Minimum Offer Price Rule (“MOPR”). The MOPR blocks state-supported clean energy generators from bidding competitively in the ISO-New England capacity market. This market is intended to foster the pipeline of energy generation needed to meet the region’s future electricity needs. Instead of using ratepayer funds to promote the development of clean energy, the market has been locking in dirty fossil generation.

“FERC’s decision today fails to end once and for all the reign of this harmful rule,” said Melissa Birchard, Acadia Center’s Director for Clean Energy and Grid Reform. “The last thing we need is more delays to decarbonization and reliable clean energy. FERC and ISO-New England need to take decisive action now to show they’re behind state clean energy policy. They didn’t do that today.”

For the past decade, the MOPR has functioned as a subsidy for fossil fuel generators. By making it impossible for clean energy to get the same capacity payments that fossil fuel generators receive, it has held the region back from developing more and diverse clean energy resources.

On April 12, 2022, Acadia Center and its partners filed a protest of ISO-New England’s plan to keep the MOPR in place, asking FERC to reject the proposal and direct ISO-New England to remove the rule as quickly as possible. As a result of FERC’s action today, the MOPR will continue to provide a lifeline to the region’s most inefficient fossil fuel generators for at least three more years.

Acadia Center’s April 21 protest can be found here, along with its May 18 answer.

 

About Acadia Center:

Acadia Center is a regional clean energy research and advocacy organization based in the northeast supported by independent foundation grant and individual donors.

 

Media Contacts:

Melissa Birchard, Acadia Center
mbirchard@acadiacenter.org
857-276-6883

 

New England for Offshore Wind Urges Federal Regulator to Reject ISO-New England Proposal

April 20, 2022Yesterday, the New England for Offshore Wind coalition called on federal regulators at the Federal Energy Regulatory Commission (FERC) to reject ISO-New England’s (ISO-NE) proposal to delay the elimination of a market rule that disproportionately impacts offshore wind and would increase costs for ratepayers. In a letter to FERC, the coalition underscored the importance of offshore wind to state climate goals, highlighted the momentum of offshore wind policy across the country, and pushed back on ISO-NE’s claims that offshore wind development is uncertain. ISO-NE’s proposal to delay the elimination of the Minimum Offer Price Rule (MOPR) would prevent the fair participation of clean energy in regional markets and drive up consumer costs by incentivizing the procurement of unnecessary and redundant energy generation capacity in the region.

Offshore wind is our best opportunity for new sources of clean, renewable energy in New England, which boasts the best offshore wind resources in the country. Expanding local, renewable energy is critical to our efforts to prevent the worst impacts of climate change and increase energy security in these times of instability due to the conflict in Ukraine. Developed responsibly, offshore wind has the potential to create tens of thousands of high-quality, family-sustaining jobs; provide health benefits to vulnerable communities through pollution reduction; ensure equity in economic benefits; coexist with existing ocean uses; and protect wildlife and the environment every step of the way.

New England for Offshore Wind is a broad-based coalition of associations, businesses, environmental and justice organizations, institutions, and labor unions committed to combatting climate change by increasing the supply of clean energy to our regional grid through more procurements of responsibly developed offshore wind. We believe that responsibly developed offshore wind is the single biggest lever we can pull to address the climate crisis while also strengthening our regional economy, protecting ratepayers, creating high quality jobs, and improving public health by reducing pollution.

Susannah Hatch, Environmental League of Massachusetts Director of Clean Energy Policy and New England for Offshore Wind Regional Lead, said:
“Responsibly developed offshore wind will be the workhorse of our decarbonization efforts in our region, and it holds enormous potential to grow the economy, meet our energy needs, and create equitable economic benefits for decades to come. ISO-NE should allow that transition to take place instead of hindering states’ ability to achieve their climate goals and burdening ratepayers with unnecessary costs.”

Melissa Birchard, Acadia Center Director for Clean Energy and Grid Reform, said:
“Offshore wind is one of the most promising energy opportunities of this decade and, combined with energy storage, can be a key to addressing climate change and grid reliability in New England. We call on FERC to direct ISO-New England to stop dragging its feet on clean energy and eliminate the backward Minimum Offer Price Rule now – not years down the road – so that the region can meet its climate goals in time to protect communities from danger.”

Launa Zimmaro, League of Women Voters Massachusetts Legislative Specialist, Climate Change and Energy, said:
“Maintaining the MOPR would have real and lasting impacts on the health and well-being of residents in the Commonwealth, as well as our opportunities to grow a clean energy economy in the region.”

Charles Rothenberger, Save the Sound Climate and Energy Attorney and New England for Offshore Wind Connecticut State Lead, said:
“Removing the barriers to clean, renewable energy and supporting state efforts to transition to zero-carbon resources should be fundamental to the operation of our regional energy market. Every year that we delay reforming or eliminating the market rules that disadvantage renewable resources makes it more difficult and more expensive to address the pressing climate and air quality issues we face.”

John Carlson, Ceres Manager of State Policy and New England for Offshore Wind Business Lead said:
“New England states are making informed, considered policy decisions to forge a new clean energy economy in the region. Local, renewable energy resources will drive investment in the region, reduce emissions, create jobs, and insulate us from volatile fossil fuels markets. The continued imposition of the Minimum Offer Price Rule will delay and reduce the ability of states to reap these benefits in the long-term and drive up ratepayer costs in the near term. ISO-NE should eliminate this protectionist rule immediately and embrace the just transition to a clean energy future.”

Logan Malik, Massachusetts Climate Action Network Clean Energy Director, said:
“The rapid deployment of offshore wind is critical for the Commonwealth of Massachusetts to meet its 2030, 2040, and 2050 climate goals. ISO-NE’s proposal to delay repealing MOPR by two years will unnecessarily slow our progress towards meeting our emissions reduction targets and extend the life of old and dirty facilities that are polluting our communities. FERC should reject this proposal. In doing so they would be supporting grid reliability, energy security, and the growth of a promising industry that will create thousands of good-paying jobs in New England.”

Jen Benson, The Alliance for Business Leadership President, said:
“In delaying a decision on MOPR, ISO-NE is making it harder for renewables to gain access to the energy market by artificially raising the cost of clean energy to allow more expensive fossil fuels to “compete”. Ultimately this hurts ratepayers, impacts our economy, and potentially reduces New England-based innovation and investment. In order for Massachusetts to reach its own climate goals, we must project a consistent message that renewable energy will be valued fairly in forward capacity markets to ensure that near and long-term investment continues.”

William Sedlack, Maine Conservation Voters Program Manager and New England for Offshore Wind Maine State Lead, said:
“We call on ISO-NE to be a partner with Maine and the rest of New England in the transition to a just clean energy future. Delaying the elimination of the Minimum Offer Price Rule blocks clean energy from being able to fairly compete and participate in the market, burdens taxpayers, and wastes time that we do not have as states in a geographically vulnerable region to climate impacts.”

 

 

 

About Acadia Center 

Acadia Center is a nonprofit research and advocacy organization committed to advancing the clean energy future. Acadia Center advocates for an equitable clean energy future for Connecticut, tackling regulatory and legislative energy policy, transportation, energy efficiency, beneficial electrification, utility innovation, and renewable energy. 

 

Media Contacts:

Ellen Macaulay, Environmental League of Massachusetts
emacaulay@environmentalleague.org
617-742-2553

Melissa Birchard, Acadia Center
mbirchard@acadiacenter.org
857-276-6883

Clean Energy and Consumer Groups Call on FERC to Reject ISO New England’s Proposal to Delay Key Energy Market Reform

BOSTON, MA (April 21, 2022) – Today, 11 New England clean energy and consumer advocacy organizations filed a protest urging the Federal Energy Regulatory Commission (FERC) to reject ISO New England’s proposal to delay reforming the Minimum Offer Price Rule (MOPR) and require an immediate fix to this anti-competitive rule.

The MOPR artificially inflates the cost of clean energy, giving an advantage to more expensive fossil fuel power plants in ISO-NE’s forward capacity market. The rule has extended the life of highly-polluting, uneconomical plants and incentivized continued investment in fossil fuel infrastructure while preventing affordable, clean energy from entering the market. As a result, the MOPR imposes higher electricity costs on customers and perpetuates air pollution in historically impacted fenceline communities across New England. The rule also undercuts New England states’ efforts to address the threat of climate change by decarbonizing the electric grid.

“FERC has an obligation to immediately fix ISO New England’s Minimum Offer Price Rule,” said Hannah Birnbaum, Sierra Club Northeast Deputy Director of Energy Campaigns. “The rule has needlessly increased electricity bills and stifled job growth in clean energy for years. Fenceline communities are facing dirty air and long-term health risks because the MOPR protects uneconomic fossil fuel plants that would have otherwise retired long ago. The economic and health costs of keeping the MOPR in place for two more years are unjustifiable. We can’t allow the fossil fuel industry to get in the way of making responsible and cost-effective improvements to our energy system.”

“New England’s residents are demanding clean energy. So why is the region’s grid operator trying to put up roadblocks and delays to this transition?” said Bruce Ho of the Sustainable FERC Project at NRDC (Natural Resources Defense Council). “FERC needs to step in and ensure clean solar and wind power get a chance to compete in New England’s electricity capacity market – and that they get that chance today, not in 2025.”

“ISO New England promised the New England states and the public to eliminate the discriminatory MOPR rule in the next capacity auction and then backed out of that promise at the last moment,” said Melissa Birchard, Director of Clean Energy and Grid Reform at Acadia Center. “FERC should hold ISO New England to its original proposal – vetted by stakeholders over the course of more than 12 meetings – to eliminate the MOPR now, without delay. Every excuse not to reform the markets to let clean energy compete fairly now puts our children and communities at greater risk from pollution and the climate emergency.”

“The climate crisis is threatening our health and safety as we speak. Nearly every New England state has climate laws that require slashing polluting emissions, and clean energy sources like wind and solar are the keys to reaching these goals,” said Conservation Law Foundation Senior Attorney Phelps Turner. “But ISO New England’s attempt to keep the Minimum Offer Price Rule on the books prevents electricity from these sources from being delivered into our homes. ISO’s decision to keep this rule alive for two more years allows polluting fossil fuel plants to keep running, costs electricity customers millions of dollars, and creates a major roadblock to safeguarding a livable world in the face of climate change. The rule cannot be allowed to stand.”

“”The latest IPCC report warns that we are running out of time to prevent the worst of the climate crisis. New England’s grid operator is making it harder for the region to power our homes, businesses, and transportation with clean energy. We’re asking FERC to stand up for what New England residents have already demanded: a clean grid powered by renewable solar and wind and freedom from polluting fossil fuels,” said Danielle Fidler, Earthjustice Senior Attorney.

“ISO’s administratively set pricing floor creates a bias in favor of existing resources and is slowing the transition to a cleaner grid at great expense to consumers. The ISO has simply not justified its proposal to delay the elimination of this artificial barrier,” said Francis Pullaro, Executive Director of RENEW Northeast.

​​“Competitive energy markets are essential to ensuring cost-effective and reliable electricity,” said Jolette Westbrook, Director and Senior Attorney, Energy Markets & Regulation at Environmental Defense Fund. “Unfortunately, ISO New England’s proposal moves the region in the wrong direction, accomplishing little to improve reliability, delaying the deployment of renewable energy and increasing costs for electricity customers. Market barriers must be eliminated for New England to get the reliable, affordable and clean electricity it deserves.”

 

 

About Acadia Center 

Acadia Center is a nonprofit research and advocacy organization committed to advancing the clean energy future. Acadia Center advocates for an equitable clean energy future for Connecticut, tackling regulatory and legislative energy policy, transportation, energy efficiency, beneficial electrification, utility innovation, and renewable energy. 

 

Media Contacts:

Adil Trehan, Sierra Club
adil.trehan@sierraclub.org
202-630-7275

Melissa Birchard, Acadia Center
mbirchard@acadiacenter.org
857-276-6883

Phelps Turner, Conservation Law Foundation
pturner@clf.org
207-210-6439

Mark Drajem, NRDC
mdrajem@nrdc.org
202-297-5444

New report from Acadia Center: New Jersyans Can Achieve 50% Reduction in Energy Bills

A new report by Acadia Center confirms that electrifying the building sector and weatherizing homes is beneficial to all New Jerseyans. It makes buildings healthier and safer while greatly reducing greenhouse gas emissions in the state and saving money on energy bills. Commissioned by New Jersey Conservation Foundation, the report, titled “The Future is Electric,” outlines the fact that while New Jersey is making strides toward clean energy, much more is possible. “The Future is Electric,” authored by Director of Policy, Amy Boyd, and Ben Butterworth, Senior Manager, Climate and Energy Analysis shows that, when combined with weatherization, New Jerseyans will save money and improve local health by electrifying their homes.

Read the Report

ISO-NE Decision Will Hold Back Clean Energy Throughout the Region

Boston, MA. — If approved by its regulator, a decision made Thursday by New England’s power grid operator, ISO-NE, along with a majority of its stakeholders, will slow New England’s ability to meet state climate goals, exacerbate the climate pollution impacting our communities and our economy, and cost consumers extra money they can ill afford.

Yesterday afternoon, ISO-NE and a majority of its stakeholders, which are mostly energy companies, decided to push back by two more years the elimination of a major barrier to clean energy in the region. The Minimum Offer Price Rule (MOPR), which pays gas power plant generators extra on the ratepayer’s dime to stay in the market, was on its way out. But now ISO-NE is delaying implementation of an improved approach and keeping clean energy from competing fairly in the regional capacity market for two additional years.

According to Melissa Birchard, Senior Regulatory Attorney and Director for Power Grid Reform at Acadia Center, after originally proposing in May of 2021 to eliminate the harmful MOPR rule in 2023, ISO-NE changed its position at the 11th hour. “ISO-NE has let the region down by choosing to cut clean energy out of the capacity market for two more years. This decision throws an unnecessary lifeline to gas generators that could otherwise be priced out of the market by cost-effective clean energy,” says Birchard. “Despite pushing for quicker market reforms in the recent New England Governors Energy Vision Statement process, the states appeared to back the delay. This is a disappointing failure of leadership,” said Birchard.

The New England States Committee on Electricity (NESCOE), which represents the states, recently announced they did not oppose the two-year delay. This position appeared to sway many previously opposed parties, contributing to majority support for the delay. Acadia Center and its partners, as well as renewable energy companies and a number of other stakeholders, strongly opposed the delay, which would keep in place barriers to clean energy participation in the ISO-NE capacity market until the 2025 auction, which commits resources for the period beginning in 2028.

“This outcome comes at a cost for New England’s climate goals and damages the communities that will suffer higher bills and more pollution in their neighborhoods,” said Acadia Center’s Birchard. “The region has waited too long already for these overdue market reforms.”

Acadia Center calls on the New England states to stand behind important climate and clean energy reforms and demand that ISO-NE increase its accountability to consumers and communities, to avoid these failures in the future.

 

Media Contacts:

Melissa Birchard
Clean Energy Program Director
mbirchard@acadiacenter.org
617-742-0054 x103

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Acadia Center is a nonprofit research and advocacy organization committed to advancing the clean energy future. Acadia Center advocates for an equitable clean energy future for Connecticut, tackling regulatory and legislative energy policy, transportation, energy efficiency, beneficial electrification, utility innovation, and renewable energy.

Holding Public Utilities Accountable

Today Maine’s Governor Janet Mills announced the Utility Accountability Bill, the Governor’s initiative authorizing the Public Utilities Commission (PUC) to set minimum service standards to ensure electricity consumers receive adequate service at just and reasonable rates. 

If the state is going to transform buildings, transportation, and the electricity grid to better serve Maine’s energy consumers and respond to the climate crisis, it needs to start with utility regulatory reforms that give the PUC the tools to regulate utilities with Maine people in mind. Acadia Center commends Governor Mills for taking these necessary steps to best leverage ratepayer dollars to ensure reliability and affordability while simultaneously planning across all state agencies for climate and equity benefits for all Mainers.  

If our electric utilities fail consistently on any of the standards, they will face financial penalties. By establishing a “report card” on utilities’ performance, with repercussions for poor performance, we expect to see demonstrable improvements on reliability, bill accuracy, storm recovery, and renewable interconnection issues, all problems that have plagued Central Maine Power (CMP) and placed them dead last on national utility customer satisfaction lists. In addition to its audit, climate adaptation, and whistleblower provisions, the bill provides more direction on options available if utilities are not fit to serve Maine’s consumers. 

Further, Maine’s investor-owned utilities have a monopoly franchise, and often charge ratepayers at returns that far exceed interest rates while building bigger projects that may not benefit energy consumers accordingly. While Acadia Center thinks utility regulatory reform can go further to relieve energy burdens on underserved and overburdened consumers, the Governor’s bill is a good first step in holding CMP and Versant Power accountable for their performance on affordability and reliability.

Acadia Center supports the Governor’s utility regulation bill and urges the Governor and Legislature to make deeper reforms to ensure utilities serve energy consumers in the transition to a clean energy economy – what we call RESPECT (Reforming Energy System Planning for Equity and Climate Transformation). These two significant reforms in utility planning will overcome the dysfunctions caused by siloed decision-making, unbalanced utility incentives, and the current market indifference to climate and equity: 

  1. Conduct “all-in” energy system planning that considers supply and demand-side resources; customers’ energy, capacity, and thermal needs; and climate requirements and environmental justice impacts for all fuels across the state.
  2. Create a statewide planning entity that can look for solutions beyond utility boundaries and across fuels, leaving traditional utilities free to focus their efforts on business development in alignment with climate and equity mandates.

RESPECT proposes a modernized framework for how utilities make investments and decisions, so that we can build the energy systems necessary at the speed required to address the climate crisis. RESPECT addresses three problems with current planning and regulatory oversight: (1) planning is siloed between electric and gas utilities, which causes overspending, reduced reliability and resilience, and more climate pollution; (2) current planning processes ignore equity and environmental justice; and (3) utilities will not plan against their financial interests, even with performance incentives. 

Until these reforms are in place, we believe the Governor’s bill is a powerful opening shot to create greater accountability of transmission and distribution utilities to Maine ratepayers and resolve performance issues that are not improving under current law and regulation. 

 

For more information:

Jeff Marks
Maine Director & Senior Policy Advocate
jmarks@acadiacenter.org
Mobile: 207-956-1970
 

We Are Grateful to You!

The Acadia Center team is deeply thankful to all who support our efforts and partner with us on tackling the challenges of the climate crisis. Here are just a few highlights of all we were able to achieve in 2021 because of your support. Because of you, we can continue this important work in 2022 and beyond.

Fuel Oil Associations Issue Misleading Claims

Rockport, ME. — Oil and gas dealer associations initiated a media campaign today calling on the region’s governors to cease support for clean, consumer friendly electric heat pump options. In fact, heat pump rebates are already insulating consumers from volatile heating oil price spikes while improving indoor air quality, reducing pollution, and providing efficient, comfortable heat.

“Energy marketers misleadingly claim that concerns ISO-NE [the regional power grid operator] recently flagged about pandemic-related fuel supply constraints require this backward response, but their claim is meritless,” said Melissa Birchard, Senior Regulatory Attorney and Director, Clean Energy Program at Acadia Center. “Pandemic supply chains and fuel demands in other countries are contributing to price volatility and making fossil fuels harder to come by,” noted Birchard.  “The short- and long-term answer is to help residents shift from reliance on volatile fossil fuels to electric alternatives that are cleaner, safer and equally comfortable.”

“Calls to cancel heat pump rebates are a sad example of the fossil fuel industry once again fighting the clean energy solutions that will keep our communities, safe, warm, and healthy,” said Matt Rusteika, Senior Policy Analyst at Acadia Center. “Many fuel oil dealers already recognize this and are providing a full array of heating choices to their customers, including air source heat pump conversions.”

According to press reports, ISO-NE’s Gordon van Welie has raised concerns about supplies of home heating oil, citing pandemic-related shortages of truck drivers that could affect deliveries.  Given that the supply chain for heating oil, gas, and other fossil fuels has been disturbed by the pandemic, increasing reliance on those fuels makes zero sense. As European gas prices soar, U.S. gas companies are exporting gas for greater profits, leaving domestic customers exposed to even more price volatility.

“Heat pump rebates help families and businesses control costs, insulate household budgets from fossil fuel price spikes, and increase the overall efficiency of the region’s energy use,” said Rusteika. “Energy marketer attempts to sow doubt about heat pumps are sadly self-serving. Heat pump rebates are unlikely to influence fuel supply constraints either way. And many heat pumps installed each year displace electric resistance heat—which reduces strain on the grid.”

“Long-term,” says Birchard, “the region needs to expand its electric transmission grid and clean energy supply to help solve constraints and ensure reliability.  Heat pumps are a key part of the solution, as controllable heat pumps can provide a flexible resource for the electric grid.”

Acadia Center calls on the governors to reject the misleading assertions and backward-looking position of the fuel dealers associations.

 

 

Media Contacts:

Melissa Birchard
Clean Energy Program Director
mbirchard@acadiacenter.org

617-742-0054 x103

Matt Rusteika
Senior Policy Analyst & Buildings Lead
mrusteika@acadiacenter.org
617-742-0054 x108

 

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Acadia Center is a nonprofit research and advocacy organization committed to advancing the clean energy future. Acadia Center advocates for an equitable clean energy future for Connecticut, tackling regulatory and legislative energy policy, transportation, energy efficiency, beneficial electrification, utility innovation, and renewable energy.