It has long been assumed that India, China, and other developing countries of Southeast Asia would power their vigorous economic growth for decades to come with coal. We heard over and over that China is building a new coal-fired power plant every three days, and about plans for multi-gigawatt sized coal-fired power plants in India. As long as coal was the cheapest form of power, addressing our climate emergency seemed like a lost hope.
But that nightmare is now evaporating thanks to the continuously declining costs for solar, wind, and battery storage. Although there are far too few policymakers (not to mention the major energy agencies, like EIA and IEA) who appear to be aware of it, the future of coal is fading by the day, as solar and wind take the lead as the lowest cost forms of power. And nowhere is this new reality more starkly evident than in India, where a remarkable pivot away from coal has been under way for about five years now, radically reshaping the outlook for India’s energy consumption, and stranding billions of dollars in investments in coal plants that will not be used as expected. At the same time, India is busily electrifying 18,000 villages, pushing forward on the electrification of transportation, and developing demand-side technologies that together are more likely to make India one of the world’s great success stories in energy transition than one of the world’s largest upcoming carbon emitters.
Our guest in this episode has been closely watching these markets for three decades, and is one of the sharpest observers of what’s happening in India and Southeast Asia. This episode is Part One of our two-and-a-half hour conversation with him, which mostly covers India and coal. Part Two of this interview will be featured in Episode 93.
Tim Buckley is Director of Energy Finance Studies for the Institute of Energy Economics and Financial Analysis (IEEFA), with a key focus on the Indian electricity sector transformation. Tim has 30 years’ financial markets experience, covering Australia, Asian and global equities. He provides financial analysis in the electricity sector for IEEFA, studying energy efficiency and renewables across China and India, and stranded asset risk in Australia. Tim was co-founder of Arkx Investment Management, a global listed clean energy equities fund, and prior to that, was Managing Director at Citigroup and Head of Australasian Equity Research.
This one is for the grid geeks! With the Green New Deal now a hot topic in the US Congress, while wholesale power markets still struggle to figure out how to accommodate new kinds of resources even as coal plants and nuclear plants continue to retire, the question of how wholesale power markets should work, and how they should value new kinds of assets and services, is becoming increasingly urgent. What would a power market look like if it consisted mainly (or totally) of wind and solar, with their zero-marginal-cost power? And if we continue to use out-of-market payments to keep clean but uneconomic nuclear plants operating, what will be the effect on power markets? Will power markets ultimately crash under the weight of accumulated patches and workarounds, or can their design be adapted to new social priorities—like combating climate change—and new kinds of resources, like large-scale storage systems? Can we replace the market construct of locational marginal pricing with something more suited to the new reality of grid power? What kind of policies can keep us on track to support transition and facilitate the evolution of the fuel and technology mix toward a high renewables future? Will FERC Order 841 succeed in opening the doors to storage on the grid? Are real-time prices the future of rate design? And as we move toward a deeply decarbonized grid, what are the implications for our economic system?
In this episode, we delve into all those questions and more with an expert who has worked on power markets for over 30 years.
Pete Fuller is the founder and Principal of Autumn Lane Energy Consulting, which provides strategic business and regulatory advisory services to the energy industry, primarily in the areas of competitive wholesale market design and participation, renewable energy and energy storage, and the intersection of state energy and environmental policy with wholesale markets. Over his 30-plus years in the energy industry, he has held roles in engineering and power supply planning for Eastern Utilities Associates, and has represented independent power producers Mirant and NRG in the ISO New England, New York ISO and PJM stakeholder processes. He has held leadership positions in the New England Power Pool, the New England Power Generators Association, and the Independent Power Producers of New York. Since retiring from NRG a year ago, he has developed his consulting practice by focusing on the role of FERC’s Order 841 in facilitating energy storage in the organized markets, and on facilitating energy storage and renewable energy developers seeking to enter the markets.
How can solutions like Project Bo—the solar-powered microgrid we discussed in Episode #85—be extended to help people elsewhere in the developing world who have similar health and medical needs? How the funding can be arranged? How should projects like this be scoped and designed to ensure their long-term viability? What kinds of energy supply and energy consuming devices are best suited to address the needs for remote medical clinics? What kinds of partner organizations can be helpful in implementing these kinds of projects? And what can philanthropic and aid organizations learn from recent experiences to ensure that their support has an enduring impact?
Our guest in this episode not only helped make Project Bo a reality, but she also has a uniquely deep understanding of the intersection of health and energy systems in the developing world. She has worked on energy access in many impoverished countries around the world, and she has a unique perspective on the global state of health and energy, including how and where philanthropic funding for health and energy projects works, and doesn’t work. And you may be surprised to learn which energy solutions she thinks can really make a big difference in women’s health in the developing world today…it’s probably not what you think!
Richenda Van Leuuwen is currently Chair, International Institutions at the non-profit Global LPG Partnership and a member of the World Bank’s Energy Program’s (ESMAP) Technical Advisory Group (TAG). From 2010-2016 she led Energy Access at the UN Foundation and its engagement with the UN Sustainable Energy for All Initiative. Richenda previously worked in private equity and as an impact investor in emerging markets renewable energy. She also served as CEO of the international women’s micro-entrepreneurship NGO, Trickle Up for nearly five years. She is a board director of SELCO India and Energy 4 Impact and a founding U.S. Women’s “Clean Energy Ambassador” (C3E initiative).
The global energy trade is enormously complex, and its geopolitical implications are vast, but they are only made more complex by energy transition. If the US exports gas to Europe and Asia, might you expect it to largely displace coal in their power plants? Think again! What will be the geopolitical ramifications on our relationship with Russia, as we send more of our gas to China and India? And as the US weans itself off of coal, and seeks to export more coal abroad, will it be stymied by energy transition in foreign countries, as well as political impediments at home?
And what of US “energy independence?” Does it mean that the US is actually self-sufficient in energy, or even just in fossil fuels, in the sense that we may not need imports anymore? And what is the value of it anyway, especially if it also means increased dependence on export markets abroad?
Tune in as we explore some of the fascinating questions about the implications of energy transition on energy trade in this interview, and be prepared to be surprised by some of our guest’s answers!
Alex Gilbert is cofounder of SparkLibrary, an energy research and data firm based in Washington, D.C. His expertise lies in cross- and inter-disciplinary analysis of energy markets and regulations, with specialties in electricity, natural gas, and nuclear power. Previously, Alex analyzed US energy markets for private sector clients at Haynes and Boone, LLP. Gilbert has a Masters of Energy Regulation and Law from Vermont Law School and actively publishes in energy policy journals.
As variable renewables gain ever-larger shares of the grid power supply mix, integrating them on the grid is raising new questions about the best ways to do it. Storage systems are one obvious answer, but their deployment as utility-scale assets is still in the early days. Right now, if a utility-scale solar plant is producing more power than the grid can use, and there isn’t a storage system available to absorb the excess, the standard procedure is to curtail the plant — just turn it off. It hurts the revenues of plant owners, but at least it won’t damage the grid.
But now there are some new ways to the problem of integrating more variable renewables: Make them flexible! Instead of always running wind and solar plants full bore, or curtailing them, just turn them down a bit. Or make them completely flexible, able to ramp up and down at will, after deliberately providing enough room on their host grids to allow that.
Our guest in this episode is an expert on the subject who has helped the California Independent System Operator, or CAISO, think about new, flexible modes of operation for solar plants. It’s a very geeky and oftentimes technical interview, but we know the grid geeks who listen to this show will love it!
Arne Olson is a Senior Partner with E3, an energy consultancy based in San Francisco. He’s an expert in bulk electric system operations and the investment needs brought about by expanding clean and renewable energy production. He has consulted extensively for utilities, electricity system operators, asset owners, project developers, electricity consumers, and regulators. In 2013 he led the technical analysis and drafting of the landmark report, Investigating a Higher Renewables Portfolio Standard for California, prepared for the five largest utilities in California, documenting the challenges of and solutions for achieving a 50 percent renewable grid in California by 2030. Arne has 25 years of experience in energy analysis, and he is a frequent speaker at energy conferences on the role renewable energy will play in decarbonizing the grid. Prior to joining E3 in 2002, he served for six years in the Energy Policy Division of the Washington State Energy Office and its successor agencies.
Are investments in energy transition, especially for public dollars in the form of incentives or subsidies, worth it? Do investments in energy efficiency truly pay off, or does efficiency just make energy cheaper because we’re using less of it, encouraging customers to use more of it—a phenomenon known as the rebound effect, the backfire hypothesis, and the Jevons Paradox? Is public support for rooftop solar systems worth it, once we add up all its costs and benefits, or would it be better to support utility-scale solar projects, or something else entirely, like efficiency? Do wind and solar farms, and electric vehicles, always deliver climate benefits, or does it depend on the power mix of the grid to which they’ll be connected? And even if we determine answers to these questions, for how long are those answers valid?
These are all difficult questions, but our guest in this episode has investigated all of them, and she shares her insights at length in this wonky but accessible discussion. If you worry that the rebound effect might mean efficiency isn’t worth it, you definitely need to listen to this one.
Dr. Inês M.L. Azevedo is Full Professor in the Department of Engineering and Public Policy at Carnegie Mellon University, where she is the PI and co-Director for the Climate and Energy Decision Making Center. Her research interests focus on how to transition to a sustainable, low carbon, affordable and equitable energy system, combining engineering and technology analysis with economic and decision science, and she has published extensively on those subjects.
If you wanted to build a standalone microgrid in Africa, powered by local renewable resources, and make it reliable enough to run a neonatal intensive care clinic, how would you do it? Work through a development bank like the World Bank to get funding? Work with the government in the host country to manage the funds and the project? Build it around lithium-ion batteries? Use Western contractors to do the installation?
In this episode, we learn how Michael Liebreich, the founder of Bloomberg New Energy Finance, helped create a successful project in Sierra Leone by doing none of those things. His experience is full of useful and surprising lessons, and offers a very interesting model for other aspiring renewable microgrid project developers. We’ll also talk with him about his insights on energy transition as one of its veterans, including his experience in trying to transition London to use more electric transportation, as well as his views on career direction and diversity in the energy industry.
Michael Liebreich is Chairman and CEO of Liebreich Associates, but he is perhaps best known as Founder and Senior Contributor to Bloomberg New Energy Finance – the world’s leading provider of information and research on clean energy and transport. He is a Visiting Professor at Imperial College, a member of the UK Department for International Trade’s Capital Investment Advisory Board and most recently joined Sustainable Development Capital LLP (SDCL) as a Senior Adviser. Previously, he was a board member of Transport for London and a member of the high-level group for the UN’s Sustainable Energy for All initiative. Michael currently serves on numerous advisory boards, is speaker, writer, philanthropist, and occasional angel investor. Michael also skied for Great Britain at the 1992 Albertville Olympics.
If you wanted to design a set of policies that would reduce greenhouse gas emissions worldwide, right now, where would you start? How would you figure out which sectors of the economy to target in order to have the maximum impact? Which policies would you choose? How would you go about designing them?
And which sectors of the economy would you target in order to reduce emissions the most? Transportation, maybe? Improving the efficiency of our buildings? Would you believe those two sectors rank at the very bottom of the list?
In this episode, we interview one of the authors of a new book by Energy Innovation titled Designing Climate Solutions, which is like a how-to manual for climate policy, identifying the major sectors of the economy that we should target to eliminate as much greenhouse gas as quickly as possible, and the specific policies that can achieve those reductions. We guarantee you will find some surprises in this one!
Robbie Orvis is the Director of Energy Policy Design at Energy Innovation and a co-author of their new book, Designing Climate Solutions. Robbie works on the Energy Policy Solutions and Power Sector Transformation programs, where he conducts analysis on which policies can best meet climate and energy goals, including co-leading a project for the Chinese government providing policy guidance for its 13th Five Year Plan and climate strategy. Robbie’s power sector work focuses on policy design for wholesale electricity markets and energy efficiency programs. Robbie holds a Master of Environmental Management from Yale University and a B.S. from UC Berkeley.
Germany gets a lot of criticism for its Energiewende (energy transition). For not phasing out coal quickly enough. For paying “too much” for solar early in the worldwide solar boom they helped create. Why are they phasing out nuclear at a time when the rest of the world is trying to maintain their existing nuclear capacity because it’s carbon-free? For having the highest electricity prices in Europe. Surely these are all signs that its energy transition has been a failure, right?
To the contrary: Germany’s energy transition is proceeding along on plan and on schedule; they plan to phase out their coal entirely in just four years; and they plan to run their entire grid on renewables. Germans’ energy bills are about on par with those of Americans, and the transition enjoys widespread popular support. Our guest in this episode directs a think tank in Berlin that aims to make the Energiewende a success, and explains why the critics are wrong.
Dr. Patrick Graichen is the Director of Agora Energiewende, a think tank and policy laboratory based in Berlin that develops scientifically based and politically feasible approaches for ensuring the success of the German energy transition. Previously, Dr. Graichen served at the Federal Ministry for Environment and was the Head of the Unit for Energy and Climate Change Policy, where he was in charge of negotiating the design of the economic instruments of the Kyoto Protocol, the Integrated Energy and Climate Programme of the Federal Government (2007), the EU’s Climate and Energy Package (2008), as well as the legislative procedures in the area of the energy law. He has studied economics and political science, and holds a Ph.D. in municipal energy policy at the Interdisciplinary Institute for Environmental Economics, University of Heidelberg.
For large corporations, especially those in the industrial sector, buying renewable energy, reducing consumption and becoming more sustainable are surprisingly difficult things to do. Industries like manufacturing, mining, construction, and producing raw materials like cement are all extremely energy intensive, and in many cases, there simply are no good alternatives to using conventional processes based on fossil fuels.
But that doesn’t mean that businesses engaged in those industries can’t find ways to start reducing their own carbon footprints, investing in renewables, investing in research and development into ways of doing more with less, and sharing their knowledge with their peers, in order to accelerate the progress of entire industries. In this episode, we talk with a company that might at first glance seem like an unlikely one to be pursuing sustainability efforts, but which is establishing itself as a leader in corporate sustainability strategies: Ingersoll Rand, a mid-sized manufacturer operating in construction, mining, industrial and commercial markets. You may be surprised at how much they are able to do to become more sustainable and integrate more renewable energy into their operations.
Scott Tew is the founder of the Center for Energy Efficiency & Sustainability at Ingersoll Rand (CEES) which supports all of the company’s strategic brands — Club Car, Ingersoll Rand, Trane and Thermo King — and is responsible for forward-looking sustainability initiatives aimed at transitioning to more efficient and climate-friendly solutions, and minimizing resource use within company facilities. Tew serves as a thought leader in linking public policy, economic impacts and a value-stream approach to sustainability. He holds graduate and undergraduate degrees in environmental science and ecology from Livingston University.