Existing Federal Policies

A brief sheet on the ITC and PTC extension

Posted on July 12, 2016 by brbarker

Published July 2016

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The essentials

  • On December 18, 2015, Congress passed The Consolidated Appropriations Act which extended Investment and Production Tax Credits for select renewable energies, effective through 2020.
  • An Investment Tax Credit (ITC) allows a taxpayer to take a certain percentage of an investment or purchase from his taxes. Similarly, a Production Tax Credit (PTC) is a tax reduction by a given amount per unit of a good produced.
  • The Act extends the current 30 percent ITC for qualifying solar energy facilities to 2019. It then creates a phase out program where the ITC is reduced to increasingly lower values until 2022. This ITC also applies to qualifying hydroelectric, biofuel, and methane recapturing programs.
  • The Act also extends the current PTC for wind and other qualifying facilities for another year. Thereafter, the PTC is incrementally reduced before being completely phased out in 2020.
  • The Act also includes an unrelated provision which lifts a 40 year ban on the exportation of crude oil from the U.S. While this seems to be at odds with the favorable renewable energy provisions of the Act, the wind industry has viewed this as an acceptable tradeoff and a net win for the environment.
  • The Act is expected to create $73 billion in new renewable energy investment, 8 million more households powered by renewable energy, and 37 gigawatts of new wind and solar capacity.

Gliding Toward a Clean Energy Future – a joint report from EPIC and the Sonoran Institute

Posted on December 16, 2015 by brbarker

Screenshot 2015-12-16 09.12.15In the wake of the Clean Power Plan, EPIC and the Sonoran Institute issued this Build-out Study on utility-scale solar developments in the pipeline at the end of 2015. These are projects

1. that are fully permitted

2. with planning or permits likely to be concluded by the end of 2017, or

3. are located in areas already identified as suitable for large-scale solar installations).

In addition to this survey, the report identifies existing policies that supported these installments and recommends future policies to continue the clean energy trajectory.

 

Clean Power Plan Summary for Arizona

Posted on November 5, 2015 by brbarker

Published November 2015

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The essentials

  • The Environmental Protection Agency (EPA) announced the finalized Clean Power Plan rule on August 3, 2015. The Clean Power Plan limits carbon dioxide emissions from existing power plants on a state-by-state basis under Clean Air Act 111(d).
  • The final rule for states includes both a mass-based approach and a rate-based approach for states to ensure emission reductions.
  • States have an interim goal for 2022-2029 and a final goal to meet by 2030.
  • Arizona’s final rate-based goal is a 34% reduction from its 2005 carbon dioxide emissions level.
  • The EPA is also issuing a proposed Federal Plan as both a model design for state plans and as the plan that will be used in cases where states do not submit their own plan. The proposed rule was published on October 23rd, 2015, and the public has until January 21, 2016 to provide substantive comments.

President Obama’s Climate Change Action Plan Brief Sheet

Posted on February 13, 2014 by brbarker

Published February 2014

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The essentials

  • In June, 2013 President Obama released his Climate Action Plan.
  • The Plan has three broad categories.
    • First, reducing U.S. carbon emissions.  The President’s plan sets goals to reduce emissions from existing power plants, modernize the U.S. transportation sector, increase the U.S. clean energy portfolio, and increase energy efficiency in American homes and businesses.
    • Second, preparing the U.S. for the impacts of climate change. This is done by supporting climate-resilient investments, responding to major weather events, creating sustainable and resilient hospitals, maintaining agriculture productivity, and providing the tools for climate resilience.
    • Finally, engaging the world’s major economies to advance key climate priorities and in galvanizing global action through international climate negotiations.
  • What does this mean for Arizona?
    • It is hard to predict the full ramifications of the President’s climate action plan for any given state.  Arizona’s utilities and energy regulators will have to plan based on new federal regulations, such as the EPA’s current proposed caps on carbon emissions for new power plants.  Additionally, Arizona could see more federal funds become available to support sustainable agriculture or solar power.  As of now, the exact cost-benefit may be impossible to gauge.

The era of small hydro? The Federal Hydropower Regulatory Efficiency Act of 2013

Posted on November 7, 2013 by brbarker

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The essentials

  • On August 9, 2013, President Obama signed into law the Hydropower Regulatory Efficiency Act of 2013, which as the name indicates, seeks to reduce the regulatory burden associated with licensing certain small hydroelectric projects by:
    • exempting certain conduit hydropower facilities from the licensing requirements of the Federal Power Act (FPA);
    • amending subsection (d) of Section 405 of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2705) to define “small hydroelectric power projects” as having an installed capacity that does not exceed 10,000 Kilowatts (prior to the amendment, “small hydroelectric power projects” were defined as having an installed capacity that does not exceed 5,000 Kilowatts);
    • authorizing the Federal Energy Regulatory Commission (FERC) to extend the term of preliminary permits once for not more than 2 additional years beyond the 3 years previously allowed under section 5 of the FPA; and
    • directing FERC to investigate the feasibility of a 2-year licensing process for hydro power development at non-powered dams and closed-loop pump storage projects.

The Energy Savings and Industrial Competitiveness Act (Shaheen-Portman Bill)

Posted on September 2, 2013 by brbarker

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The essentials

  • The Energy Savings and Industrial Competitiveness (ESIC) Act (the Shaheen-Portman bill) was intended to promote energy efficiency measures and technologies in residential, commercial and industrial sectors.
  • It was a bipartisan energy efficiency bill, sponsored by Senators Jeanne Shaheen (Democrat-New Hampshire) and Rob Portman (Republican-Ohio), in the 2013 session. Senators Shaheen and Portman revived the bill in 2014 and introduced a more targeted bill in 2015.
  • The bill required states, Indian tribes and local governments to adopt energy efficiency codes for residential and commercial buildings. Training and assessment centers would be set up to promote R&D and application of energy efficient technologies in buildings.
  • It included provisions promoting sustainable practices in industrial processes and increasing industry partnerships with National Laboratories and energy service/technology providers.
  • The 2015 bill, the Energy Efficiency Improvement Act of 2015, included a provision focused on “aligning the interests of commercial building owners and their tenants to reduce energy consumption.” The EEIA became an amendment to a bill approving the Keystone XL pipeline.
  • Both the original 2013-2014 Shaheen-Portman bill and the 2015 amendment failed in their respective sessions.

The Federal Wind Energy Production Tax Credit: How will it affect the wind industry’s development in the coming years?

Posted on June 24, 2013 by brbarker

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The essentials

  • In January of 2013, U.S. Congress approved a one year extension of the Production Tax Credit (PTC) for Wind Power in the American Taxpayer Relief Act, as a part of the “fiscal cliff” budget negotiations. The Wind Power PTC currently expires on January 1, 2014.
  • The PTC provides temporary support for the development of wind power by providing a 2.2cents/kWh subsidy for wind power produced over the wind farm’s first 10 years of operation, starting when construction begins.
  • Wind facility construction must begin before January 1, 2014 in order to qualify. Residential wind power production is exempt from the tax credit.
  • Of all new generating capacity installed from 2007-2011, 35% was wind power.  In 2012, the percentage grew to 44%. (AWEA).

Mexico’s General Law on Climate Change/Ley General de Cambio Climático

Posted on April 24, 2012 by brbarker

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The essentials

  • Mexico recently passed the General Law on Climate Change, which may have impacts on energy policy decisions made in Arizona.  The Law calls for
    • Reducing CO2 emissions by 51 million tons by 2012
    • A 30% reduction in greenhouse gas emissions by 2020
    • A 50% reduction in greenhouse gas emissions by 2050;
    • 35% of electricity from renewable sources before 2024.
    • Mexico’s natural gas consumption has increased over 30% since 2000, and their oil consumption dropped 30% over the same time. Mexico’s energy use from renewable sources remains static at 4%.
    • The 35% national renewable energy standard presents export opportunities for Arizona while Mexico builds its renewable energy infrastructure.

Qualified Energy Conservation Bonds

Posted on March 28, 2012 by brbarker

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The essentials

  • A Qualified Energy Conservation Bond is a qualified tax credit bond allocated by the Treasury Department to all 50 states, Washington, D.C. and tribal governments.
  • Federal funds are available for local energy efficiency programs, renewable energy production, technology research and commercialization projects throughout Arizona.
  • About $67 million has been allocated to Arizona.
  • The funds are not being used due (at least in part) to lack of intergovernmental communication and guidance.