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Massachusetts Makes Progress on Climate Change

Posted by Robert Rio on Dec 12, 2019 9:14:21 AM

The climate protesters who took to the streets of Boston last week targeted the wrong people.

bostonatnightIf these people really want to impact the climate debate, they should turn their attention outside of a state that is already well on its way to achieving the goals outlined during demonstrations at the State House.

Massachusetts has had a law on the books for more than a decade that mandates an 80 percent reduction in carbon emissions from all sectors (electric generation, transportation and buildings) by 2050. Admittedly that isn’t 100 percent but worrying about whether Massachusetts meets 80 percent or 100 percent misses the larger picture.

There are separate regulations aimed at carbon reduction as well. State policy requires that 80 percent of electricity be generated using carbon free sources by 2050. And new proposed regulations by the Massachusetts Department of Environmental Protection will move that requirement to nearly 100 percent during the same time frame. AIM supports the proposed regulations.

The Baker administration has already finalized contracts for one offshore wind farm and other one is going through the approval process. These developments will leave the region humming with new turbines.

Additionally, a large hydro power project is being routed through Maine to supply about 18 percent of the Massachusetts’ total power. Without hydro power, our transition to carbon-free energy will be delayed for decades because it would take an enormous amount of additional solar or offshore wind to make up for the loss of carbon-free hydro power.

That leaves transportation – which accounts for the largest portion of greenhouse gas emissions - 45 percent and growing.

Governor Baker has been a leader in addressing transportation-based greenhouse gasses and is a visible backer a 12-state (plus the District of Columbia) regional effort to reduce greenhouse gases in the transportation sector known as the Transportation and Climate Initiative (TCI). AIM has joined with the administration and several environmental groups to support this effort and the governor is always looking for more support.

TCI will establish a regional cap on carbon emissions while auctioning emissions allowances. Proceeds from the TCI fee will be sent back to each participating state improve statewide public transportation and to encourage fuel users to purchase alternative vehicles.

A MassINC poll published yesterday found that a majority of registered voters in Massachusetts, Connecticut, Maryland, New York, New Jersey, Pennsylvania and Virginia strongly or somewhat support their home state's participation in TCI.

Some states are balking at joining TCI. Perhaps the Boston climate activists could take their message to other state capitals to ensure that this critical multi-state effort gets off the ground.

Declaring victory and moving on is tough, but it is necessary to move on from Massachusetts and concentrate efforts in those areas where the greatest changes should be made. There is lots of commonality. The 3,500 member employers of AIM support national efforts to mitigate climate change.

The best thing for all of us to do is acknowledge our work favorably and let the rest of the nation know it can be done with the right leadership.

Topics: Environment, Energy, Transportation

What Is TCI and How Will It Help Improve Transportation?

Posted by Bob Rio on Dec 2, 2019 8:00:00 AM

Massachusetts lawmakers continue to debate the best method of paying to repair and upgrade the state’s overburdened transportation system.

trafficsmallAssociated Industries of Massachusetts and its 3,500 member employers oppose widespread calls to raise the gasoline tax. AIM instead favors a gasoline-fee increase through a nascent multi-state regional cap-and-invest program called the Transportation and Climate Initiative (TCI).

What is TCI and why is it better than a gas tax?

TCI establishes a regional (currently 12 states plus the District of Columbia) cap on carbon emissions while auctioning emissions allowances. Proceeds from the TCI fee would be sent back to each participating state to incent fuel users not to pay the TCI fee. A gas tax, by contrast, often generates revenue for transportation projects that may not reduce greenhouse gas emissions.

Think of TCI as an energy efficiency program for transportation.

Massachusetts has maintained a successful energy efficiency initiative during the past decade for the electric generation and building sectors. Many AIM members have been able to utilize generous incentives to install solar panels or perform energy efficiency upgrades. The electric generation sector is on track to be virtually carbon free by 2050.

Energy efficiency has been a key result of the Global Warming Solutions Act (GWSA) signed by Governor Deval Patrick in 2008. GWSA requires an 80 percent reduction in carbon emissions from all sectors of the Massachusetts economy – electric generation, buildings (businesses and residential), and transportation.

Transportation is now the largest generator of carbon emissions, producing nearly 45 percent of the total and increasing as other sectors decrease. The only option for reducing greenhouse gases in the transportation sector is either to ban cars or switch to low-carbon transportation alternatives, including electric vehicles and better and more accessible public transit.

TCI will do this by allowing states to develop programs that encourage the purchase of electric and low-carbon emissions vehicles (fleets, buses, and passenger vehicles and rail) and upgrades to the electric-charging infrastructure. It will also stimulate investments in public transportation (including much-ignored areas outside Boston).

How much will TCI add to the price of a gallon of fuel? The best guess is about 10 cents per gallon, but it’s hard to estimate because prices under TCI will be set at a private auction that won’t begin until 2021 or 2022. The TCI region will establish an overall cap on carbon emissions - there is no set amount as a per-gallon fee.

A gas tax is regressive and anti-competitive since it falls most heavily on people outside developed urban areas who have no option other than to drive. Gas-tax increases drive consumers over the border for cheaper fuel. And it raises money that the Baker administration says the commonwealth does not need now.

If your company uses large amounts of gasoline or diesel fuel, a gas tax or TCI fee could harm you. But you are also the perfect customer for rebates using TCI funds because the programs can make it cost effective to purchase a low- or no-carbon vehicle, just like programs that make it cost-effective to install solar energy or install new equipment.

Governor Charlie Baker, Secretary of Transportation Stephanie Pollack and Secretary of Energy and Environment Katie Theoharides plan to lead a briefing for senior business executives on TCI on December 11 in Boston. CEOs interested in attending should contact AIM for more information.

AIM will work throughout the process to make sure that the right incentives and programs are implemented that will save money for drivers and companies that switch to electric vehicles while reducing greenhouse gases in the transportation sector as the law requires. Those are all things a gas tax won’t do.

Topics: Environment, Sustainability, Transportation

Renewable-Energy Mandate Endangers Hydro Deal

Posted by Bob Rio on Jun 8, 2018 8:23:48 AM

Proposed legislation to increase the amount of renewable energy that electricity suppliers must purchase may jeopardize a recently announced project to bring more than 1,000 megawatts of clean electricity to Massachusetts from Hydro-Quebec.

HydroMore significantly, it would remove hydro power as a long-term potential source of clean energy for Massachusetts.

The recently announced hydro project, to be developed by the power company Avangrid, will begin moving hydro power to the commonwealth over a transmission line through western Maine by 2022. The development would curb greenhouse- gas emissions by substituting hydro power for electricity from fossil-fuel plants.

The Avangrid proposal has been championed by the Baker Administration and supported by AIM.

Final contracts are expected to be signed within the next several days. The project will then be filed with the Massachusetts Department of Public Utilities (DPU) to determine whether it is cost-effective for ratepayers.

But An Act to Increase Renewable Energy and Reduce High-cost Peak Hours (H.1747) and similar bills now being debated on Beacon Hill threaten approval of the Avangrid project because they focus only on renewable energy and penalize clean-energy sources like hydro power.

H.1747 was reported favorably by the House Committee on Telecommunication, Utilities and Energy Committee (TUE) last week.

H.1747 increases what is known as the renewable portfolio standard (RPS) – the amount renewable energy (primarily wind and solar) that electricity suppliers need to purchase to serve their electric load. The RPS for 2018 is 13 percent of a suppliers’ total electric load, increasing 1 percent per year.

H.1747 would increase that rate marginally for the next few years, then to 2 percent per year beginning in 2020 until it reaches 100 percent. Other proposals would increase it even faster.

Renewable Portfolio Standard Fact Sheet

Here’s the problem. Hydro power is not eligible for inclusion in the RPS under Massachusetts law. As the RPS mandate increases (along with other energy mandates) hydro power will at some point become ineligible to be sold in Massachusetts. Based upon AIM’s analysis of the small increases proposed in H.1747, hydro power could be out of the energy mix before the end of the proposed 20-year Avangrid contract term and well before the RPS approaches 100 percent.    

The result is that Massachusetts business and residential consumers will end up paying for hydro power they can’t use.  That conundrum could significantly impact the cost-effectiveness determination of the proposed hydro power contract.   

The bottom line is that any bill that raises the RPS will eliminate the possibility of the legislature adding more hydro power to our energy supply. That’s a shame because the amount of power Massachusetts needs to meet its clean-energy goals is immense. Shutting out hydro will add decades to the time frame needed to achieve those goals.

Why does H.1747 and similar legislation put all our energy needs in one basket - essentially offshore wind – when at least part of the solution is already built?

We cannot believe that it is the goal of the Legislature to close the door on any long-term, cost-effective contracts for hydro power beyond the current procurement while disrupting the current procurement from reaching its full potential. That is the net effect of raising the RPS.

We urge the House Ways and Means Committee to turn thumbs-down on this bill. It will not help us achieve our carbon goals.

Letter Opposing An Act to Increase Renewable Energy

Connect with Bob Rio on Twitter, @robertrioaim, or at rrio@aimnet.org

Topics: Electricity, Environment, Energy

Offshore Wind Project Underscores Value of Competition

Posted by Bob Rio on May 23, 2018 5:40:55 PM

Associated Industries of Massachusetts today applauded the competitive process that led to the selection of Vineyard Wind to begin developing a wind farm off Martha’s Vineyard that will power the equivalent of 750,000 homes each year.

WindTurbinesOceanSmallThe selection of Vineyard Wind, a joint venture between of Avangrid Renewables and Copenhagen Infrastructure Partners, follows an intensive bidding process conducted under the 2016 Act to Promote Energy Diversity. AIM supported the competitive elements of that bill as a means to get the best deal possible for ratepayers as the commonwealth moves to renewable sources of electricity.

Vineyard Wind, an AIM member, will now begin negotiations to secure the necessary transmission services and power purchase agreements to facilitate the delivery of offshore wind electricity to Massachusetts customers. Once satisfactory contract terms are secured, those documents will be submitted to the Massachusetts Department of Public Utilities for formal review.

AIM expects to represent the interests of employers in that review.

No figures were released yesterday about what the power produced by the Vineyard Wind development will cost. 

“AIM supports competition as the best way to moderate energy costs in Massachusetts and that idea was clearly born out by the spirited race to build the nation’s first large-scale wind farm,” said Richard C. Lord, President and Chief Executive Officer.

The 2016 energy bill required the state’s electric distribution companies to procure 1,600 megawatts offshore wind energy within the next decade, resulting in intense competition among offshore wind lease holders for long-term contracts with utilities in Massachusetts.

Vineyard Wind says its project will “support hundreds of operations and maintenance jobs and create thousands of construction jobs.”

“Vineyard Wind is proud to be selected to lead the new Massachusetts offshore wind industry into the future,” said Lars Thaaning Pedersen, CEO of Vineyard Wind. “Today’s announcement reflects the strong commitment to clean energy by Governor Baker and the Massachusetts Legislature.”

Vineyard Wind expects to begin construction in 2019 and become operational by 2021. When completed, the will reduce Massachusetts’ carbon emissions by over 1.6 million tons per year, the equivalent of removing 325,000 cars from state roads.

The proposal also commits $10 million to a Wind Accelerator Fund to accelerate the development of an offshore wind supply chain, businesses, and infrastructure in the Bay State by attracting investments to upgrade or create necessary facilities and/or infrastructure.

It also creates a $2 million Windward Workforce program to recruit, mentor, and train residents of Massachusetts, particularly southeast Massachusetts, Cape Cod and the Islands, for careers in the commonwealth’s new offshore wind industry.

Separately, a second AIM member, Deepwater Wind, was selected yesterday to develop 400 megawatts of offshore wind to serve Rhode Island.

Topics: Environment, Energy, Offshore Wind

Natural-Gas Constraints Bad for Business, Bad for Environment

Posted by Bob Rio on May 8, 2018 11:41:13 AM

A shortage of natural-gas capacity during the December/January cold snap added $1.7 billion to the electric bills of business and residential customers in New England while erasing all the environmental benefits from solar energy in Massachusetts during 2017.

coal_power_plantNow you know why Massachusetts employers support the idea of expanding natural-gas infrastructure in the region.

New data released yesterday by the Massachusetts Coalition for Sustainable Energy (MCSE) and compiled by Concentric Energy Advisors underscores the economic and environmental damage wrought by our energy status quo. AIM is a member of the Coalition, along with scores of other business associations and labor unions.

Natural gas supplies in the region are tight during the winter. Despite abundant supplies just a few states away, pipeline infrastructure to get it here is inadequate and efforts to address this issue have been stymied by those who believe upgrading our natural gas infrastructure will stall progress on transitioning to clean energy. 

Electricity generators simply don’t have enough natural gas to operate during the bitter cold because most of the available gas is used to serve businesses and homeowners.

To satisfy the increased demand for electricity, power plants burn stored back-up oil and coal. The lights stay on, but greenhouse gas emissions increase exponentially since oil and coal emit more carbon than natural gas. The cold-weather shortage of natural gas has become so common in recent winters that power generators are paid to store oil, whether or not it is needed, as sort of an insurance policy funded by ratepayers through higher electric rates.

According to the Concentric report, the amount of coal and oil burned during just a two-week period generated 1.3 million tons of extra greenhouse gas emissions over what would have been emitted if gas had been available. The ratepayer cost was $1.7 billion higher than the previous winter – most of which will show up in next winter’s energy bills. 

In fact, Eversource yesterday sought a 15 percent increase in electric rates for customers in western Massachusetts for the period July through December.

How much is 1.3 million tons? The extra greenhouse gases negated all the greenhouse gas saving from all the solar energy produced in Massachusetts throughout 2017. It’s a problem that cannot be solved by adding more solar capacity since the highest need for natural gas is in the winter, when solar output is at its lowest.

Had the cold period continued (or if another came later in the year), brownouts would likely had occurred. ISO-NE, the regional power grid operator, reports that the system was about three days away from crashing as some plants were already running out of oil and had to curtail their output.       

This dangerous mix of rising costs, rising emissions and brownouts comes at a time when other states are dangling low energy costs in front of Massachusetts employers to persuade those companies to expand elsewhere. It’s not a tough sell – our energy costs are nearly double those of states in other regions of the country.

AIM, along with other members of the Coalition for Sustainable Energy, support a balanced approach to address the region’s energy problems. That approach embraces renewables - AIM has supported the development of both hydro power and offshore wind – while at the same time acknowledging the stresses on our current system and the economic and environmental damage that is occurring.

Read the Concentric Report

Please contact me at rrio@aimnet.org for more information.

 

Topics: Massachusetts economy, Environment, Energy

Natural Gas Central to Energy Cost Moderation, Greenhouse Reductions

Posted by Bob Rio on Apr 25, 2018 11:00:00 AM

How do you reduce greenhouse-gas emissions by 80 percent and accelerate the development of renewable energy without bankrupting businesses that already pay among the highest electric rates in the nation? One key element as New England relies more heavily on electric power is expanding natural-gas capacity. That's why Associated Industries of Massachusetts is part of the MASS Coalition for Sustainable Energy.

The video below is a must-watch for any employer worried about his or her electric bills.

Employers interested in more information about the cost of energy may contact Bob Rio at rrio@aimnet.org

Topics: Environment, Energy, Sustainability

Updated Generator Rules Lower Costs, Improve Safety

Posted by Bob Rio on Mar 19, 2018 8:30:00 AM

The Baker Administration’s three-year-old regulatory review initiative resolved a major issue for Massachusetts employers on March 9 when the Department of Environmental Protection (DEP) broadened the ability of companies to use emergency electric generators.

Generator.jpgDEP’s amended Air Pollution Control regulations ironed out inconsistencies between federal rules, which allow limited non-emergency use of generators, and state rules, which did not.

Associated Industries of Massachusetts long argued that the prohibition on non-emergency use was forcing member companies to rent generators during shutdowns for non-emergency tasks such as electric panel upgrades. The practice was not only costly but dangerous as equipment had to be brought in when the same equipment was on site.

DEP on March 9 changed the rules on emergency generators to mimic federal regulations, increasing safety, reducing emissions and saving money

  • The previous 300-hour limit for emergencies has been removed; and
  • Up to 50 hours per year may be use for non-emergency use (as part of a larger 100 hour per year exemption).

The regulation update is the latest bit of good news to come out of Governor Baker’s 2015 Executive Order 562, which required state agencies to review their regulations to eliminate or modify outdated or burdensome requirements while aligning Massachusetts regulations with Environmental Protection Agency rules and other federal requirements.

“We believe that it was the governor’s Executive Order 562, requiring that state and federal regulations be consistent when possible, that prompted the recent amendments. Several AIM members have already contacted us to let us know that it will reduce their operating costs while at the same time result in enhanced safety and lower emissions,” AIM President and Chief Executive Officer Richard C. Lord wrote in a letter Friday to Governor Baker’s Chief of Staff, Kristen Lepore, and Secretary of Environmental Affairs Matthew Beaton.

There were several other changes in the March 9 rule-making. Companies should review the regulations for any changes applicable to their own operations.

Questions about the new regulations? Contact Bob Rio at rrio@aimnet.org.

 

Topics: Environment, Energy, Regulatory Reform

Lack of Natural-Gas Infrastructure Puts Massachusetts at Risk

Posted by Christopher Geehern on Mar 5, 2018 11:07:11 AM

Employers in Massachusetts pay some of the highest electricity rates in the country, in part because the commonwealth lacks adequate infrastructure to bring natural gas from other regions of the country. AIM Senior Vice President of Government Affairs Robert Rio last week debated the natural-gas issue on Commonwealth magazine's Codcast with Elizabeth Turnbull Henry, President of the Environmental League of Massachusetts.

Commonwealth.Codcast.jpg

Topics: Environment, Energy, Business Costs

Senate Energy Bill: Christmas for Special Interests

Posted by Bob Rio on Feb 13, 2018 8:58:57 AM

Some members of the Senate don’t want you to spend all those recently announced savings on your electric and gas bills just yet.

solarpanels.small.jpgWeeks after federal tax reform generated rate reductions of $56 million for Eversource electric customers and $36 million dollars for National Grid gas customers, the Senate Committee on Global Warming and Climate Change released an energy bill yesterday that will take all the savings back from the wallets of consumers.

Proponents claim these proposals will reduce the threat of climate change. They will not. Instead, the bill has become Christmas in February for energy related special interests. 

The 71-page bill, still under review by AIM, contains unnecessary and redundant programs just a year after the Legislature passed and Governor Charlie Baker signed another omnibus energy measure that brought competitive bidding to the procurement of clean energy. Massachusetts has already committed to a goal of 80 percent clean energy by 2050.  Legislating more will not make it happen faster – it will just increase prices for something we are already on track to meet.

The bill includes:

  • A requirement for the Secretary of Energy and Environmental Affairs to develop a new “market-based compliance mechanism” on carbon emissions from transportation. The mechanism is better known as a carbon tax.  AIM supports imposition of a tax on carbon only if the money is used exclusively to invest in programs, including public transportation, that reduce fuel use. The current bill passes such discussions off to a regulatory process.  
  • A mandated increase in the amount of renewable power purchased by energy suppliers. Last year’s energy bill required the state’s utilities to purchase large amounts of offshore wind, hydropower and onshore wind as part of the largest competitive procurements for power ever in Massachusetts.  The results of these competitive bids are currently under review by the Department of Energy Resources (DOER) and the Department of Public Utilities (DPU). AIM believes lawmakers should let the current process play out before layering addition regulations on top.
  • An increase in subsidies (net metering) for solar development. The provision sounds good, but is unnecessary. The commonwealth unveiled a new competitive solar program in August that has already  reduced the cost of solar energy by nearly 50 percent. Let the new program work.

Employers urge the new Senate President, Harriet Chandler, and House Speaker Robert Deleo to take no action on the energy bill since many of the proposals are already set in motion. Give the current programs time to be implemented in a manner that creates benefit for the ratepayer, not special energy interests.

Interested in updates on energy issues? Contact Bob Rio at rrio@aimnet.org. 

Topics: Massachusetts senate, Environment, Energy

New Greenhouse Regulations Will Drive Up Costs for Employers

Posted by Bob Rio on Aug 11, 2017 11:29:19 AM

The Baker Administration will today introduce new regulations that set specific limits on sources of greenhouse gases, the emissions linked to climate change. State officials indicate that the regulations could increase costs to electric ratepayers by as much as 2 percent.

Electriclinessmall.jpgThe new rules aim to reduce the state’s carbon emissions 25 percent below 1990 levels by 2020, as required by state law.

Robert Rio, Senior Vice President of Government Affairs at AIM, issued the following statement:

“The 4,000 member employers of Associated Industries of Massachusetts are extremely disappointed with the Baker administration’s new electricity sector regulations. The administration openly admits that these rules will increase Massachusetts electric rates that are already among the highest in the nation.

“The increases produced by the proposed rules, when combined with other pending cost increases, could raise the electric bills of Massachusetts employers some 10 percent in the next year alone.

“These regulations are ultimately unnecessary. The administration could have chosen to work with the legislature to change the Global Warming Solutions Act to allow for alternative ways for the electricity sector to meet these obligations.  Instead, the administration has turned a blind eye to the corrosive impacts that high electric rates are having on struggling Massachusetts companies.

“The cost increases produced will harm consumers as well through higher rents, taxes and other costs of doing business.   

“AIM supports clean energy and is a leader in working with the administration to transition the power sector to cleaner sources.  These regulations are a setback to that effort."

Topics: Massachusetts economy, Environment, Energy

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