Page 970 – RTO Insider

March 4, 2021November 23, 2023

Rural Virginia School Districts Skeptical of Electric Buses

For decades, rural Scott County, Va., has been transporting thousands of students daily in diesel-powered school buses. Drivers shift the rumbling yellow vehicles into low gear to climb the Blue Ridge Mountains, expelling plumes of carbon dioxide, a cause of climate change, and particulate matter, which can cause respiratory ailments.

On Saturday, the General Assembly approved legislation introduced by Del. Mark L. Keam (D) (HB 2118) offering school districts grants to replace pollution-belching buses with nonpolluting — but more expensive — electric ones. Separately, the legislature rejected a proposal by Dominion Energy to authorize $400 million in spending to purchase 1,500 electric buses.

But some rural school district transportation directors say replacing diesel buses with electric ones is unrealistic, citing a laundry list of potential problems, including battery life, charging station challenges and cost.

“Electric buses simply would not be workable in this area,” said Tim Edwards, director of transportation for Scott County Schools. “Scott County’s terrain is too hilly, mountainous.”

Some rural school districts say electric buses are not practical for them. | Dominion Energy

Ben Truett, head of transportation for Alleghany County Schools, agreed that electric buses “would work in cities, because of their flat terrain, but not in the mountain areas” of Virginia. “The batteries do not have enough range or power.”

A spokesman for Gov. Ralph Northam did not respond Wednesday when asked whether he plans to sign Keam’s bill.

Keam says his legislation, which would allow school districts to seek competitive grants from a new state fund, offset by federal and private sector philanthropic contributions, would provide major health benefits. In Virginia, he said, nearly 130,000 children suffer from asthma, which leads to many missed school days. With approximately 17,000 school buses transporting more than 1 million students, electric buses would improve their health, he said. Studies have estimated that average exposure to particulate matter inside diesel buses is three to six times greater than ambient levels.

Battery electric buses’ fuel and maintenance costs are about 60% lower than conventional diesel vehicles, but they cost two to three times as much. | Dominion Energy

However, Keam has acknowledged that electric school buses aren’t ideal for rural districts. “My bill really wouldn’t be helpful” to those areas, he said. “Virginia needs a plan on where we put charging stations” before encouraging rural areas to apply for the competitive grant, he said.

Erik Bigelow, senior engineering consultant at the Center for Transportation and the Environment, agrees that current batteries are suitable for flat land but don’t have the power or range in rural areas. Improved battery technologies could give buses the range needed to run rural routes, but that could be years away, he said.

Hydrogen fuel cell buses could offer longer range but require expensive fueling infrastructure.

Battery electric buses’ fuel and maintenance costs are about 60% lower than conventional diesel vehicles, but the increased purchase cost — a premium of about $200,000 per vehicle — have limited deployments to date. Alternative procurement strategies could accelerate the transition, however. The school district in Montgomery County, Md., last month approved a contract to lease 326 school buses over the next four years — the largest single procurement of electric school buses in North America — without increasing the district’s costs. (See related story, Schools’ ‘Budget Neutral’ Bus Deal Could Accelerate BEB Growth.)

Infrastructure

But reducing upfront costs does nothing to address range anxiety.

The leading electric bus maker, High Point, N.C.-based Thomas Built Buses, averages 134 miles on a fully charged 220-kWh battery. Some bus routes in Alleghany and Scott counties are more than 100 miles round trip, the directors said. Given the power needed to climb steep hills, they doubt a fully charged battery would last an entire trip. Both counties run buses that get about 360 miles to a 100-gallon tank, with most requiring a top off several times a week.

The lack of charging stations also concerns the transportation directors, especially Edwards. Scott County has only five buses returning to a central depot each school day; the remaining 41 stay at the drivers’ homes.

While HB 2118 provides funding for charging stations, Edwards asked for clarification: “Does that mean each driver would have a charging station at their home?” If buses were rerouted to a central location, it would double the amount of time and miles drivers are on the road, costing the cash-strapped district money it can ill afford.

Additionally, Edwards questions whether the county has the infrastructure to operate charging stations. The district still has schools using coal furnaces for heat, because some parts of the county’s electric infrastructure is 60 to 70 years old, said Edwards, the district’s former maintenance director. “Homes running air conditioning in the summer and electric heat in the winter couldn’t power buses without problems,” Edwards said.

Proponents of vehicle-to-grid technology say school districts could charge their buses when prices are low at night and profit from selling power during the day when prices are higher. But Truett worries the school district could fall prey to powerful electric utilities. “I don’t see a mutual benefit here,” he said. “It’s not 50/50.”

Even with grants, the rural districts fear they would struggle to keep electric buses on the road. While the maintenance is cheaper, nobody in their garages has the know-how to repair one, the directors said.

Truett, a self-described environmentalist, wants the district to carry students in environmentally friendly electric buses, but even if they were practical, the $400,000 price tag per bus is beyond the district’s budget.

Alleghany County, where one in five people live in poverty, has a fleet of 56 buses. “We are talking tens of millions of dollars to replace our fleet,” Truett said. “This district doesn’t have that kind of money. And I sure hope the state doesn’t make electric buses an unfunded mandate.”

Edwards echoed that sentiment. “It’s Cadillac versus Ford,” he said. “Even if we won a Cadillac, it requires upkeep, costly upkeep. It requires special tools and knowledge, things we don’t have here.”

If the state requires school districts to purchase electric school buses, Scott County, with an 18% poverty rate, would also be “in a world of hurt,” Edwards said.

Dominion Bus Plan Rejected

Rayhan Daudani, a spokesperson for Dominion, Virginia’s largest electric provider, says battery-powered buses are a “win-win” for schools and the power grid. “The buses use less fluids [and] require no oil changes,” he said.

The power company announced in August 2019 it would pursue what it called the nation’s largest electric school bus deployment, beginning with a $13.5 million pilot to provide 50 electric buses to school districts. The first recipients are some of Virginia’s largest school systems: Alexandria, Arlington, Norfolk and Richmond. The first buses were delivered in October.

Dominion Energy’s proposal to spend $400 million to purchase 1,500 electric school buses was rejected by Virginia lawmakers. | Dominion Energy

Dominion said it hoped to replace all 13,000 diesel buses in its service territory. (See Dominion Sees Green in Electrification.) But legislation that would have allowed the utility to purchase 1,500 buses at a cost of $400 million was rejected by the House of Delegates on Feb. 27, the last day of the legislative session (SB 1830). The bill failed even after the program was reduced to 1,250 and then 1,000 buses, according to a report by the Virginia Mercury. Other amendments would have required that one-quarter of the buses go to districts serving low-income students and given the State Corporation Commission authority to determine whether the program was “in the public interest.”

Dominion would have paid the increased cost of the buses and owned the batteries, while school districts would own the buses. The State Corporation Commission reportedly estimated the cost — excluding charging infrastructure — at $345 million, including $108 million in profit. Dominion would have offset the cost by raising residential customers bills by $12 annually.

Observers said some of the opposition to the bill came from resentment over Dominion’s efforts to block legislation that would have restored state regulators’ power to conduct rate reviews, legislation that the Senate Commerce and Labor Committee killed Feb. 15.

March 4, 2021November 2, 2023

Schools’ ‘Budget Neutral’ Bus Deal Could Accelerate BEB Growth

Maryland’s largest school district last month approved a contract to lease 326 electric school buses over the next four years — the largest single procurement of electric school buses in North America and one that would double the number of battery electric school buses in the U.S.

But the real significance of the deal may be not its size — Montgomery County in suburban D.C. runs the 14th largest district in the U.S. — but its contract structure.

Battery electric buses’ fuel and maintenance costs are about 60% lower than conventional diesel vehicles, and they emit no carbon dioxide or particulate matter, which can contribute to asthma and other respiratory diseases. But sticker shock — BEBs cost two to three times as much as diesels — has limited most districts to one or two buses, based on available grant funding.

The contract Montgomery County Public Schools approved with Highland Electric Transportation is “budget neutral” — meaning the school district will pay no more than it would have to acquire traditional diesel vehicles. Highland will pay for the buses and recoup its investment through decreasing vehicle prices, less expensive fuel and maintenance savings. It also will be able to sell power from idled bus batteries to the grid when prices are high.

“As far as MCPS and the vendor know, this is the first budget-neutral, non-grant-dependent, school bus fleet electrification plan available,” schools Superintendent Jack R. Smith told the county’s Board of Education in seeking approval of the four-year $168.7 million contract. “This is the leading edge of the trend that is expected to sweep through the school bus industry.”

Nat Kreamer, CEO of Advanced Energy Economy, said the innovative contract could help meet President Biden’s pledge to electrify the nation’s 500,000 school buses within a decade.

“This leadership step taken by Montgomery County Public Schools shows that it’s possible today to electrify transportation at scale. Comprehensive solutions like Highland Electric’s can leverage private capital, meet the needs of fleet operators and serve communities now without burdening ratepayers or taxpayers.”

“Like solar, where the upfront technology costs are ‘sticker-shock’ high, but the value created for customers over time is substantial, selling EV as a service makes it affordable for customers to make the switch,” said Kreamer, co-founder of SunRun. “I believe Highland’s business model can accelerate the adoption of electric vehicles in the same way SunRun did for residential solar.”

He added: “These school buses do double duty, providing pollution-free transportation for schoolchildren and grid services that benefit all electric customers, while also being available as mobile backup for communities affected by power outages.”

Creating a Stir

Montgomery County intends to replace all of its more than 1,400 diesel buses by 2035.

The district will receive 25 Daimler Thomas Built buses with Proterra batteries for fall 2021, 61 in fall 2022 and about 120 — representing one-twelfth of its fleet — in each of the two years thereafter.

The district’s contract includes use of the buses, all charging infrastructure, charge management and electricity. Separately, it will be responsible for vehicle liability insurance, tags and any damage to vehicles.

“Budget neutrality depends on achieving all of the savings associated with not using the equivalent number of diesel buses,” Smith said. “As some of the diesel infrastructure is scaled back, there may be some modest cost in the early years, which will be offset in later years as the whole fleet is electrified.”

“It’s created quite a stir,” Todd Watkins, the district’s director of transportation, said of reaction to the contract. “If [the contract model accelerates BEB deployment] we’re certainly happy to play that role.”

The contract calls for Highland Electric to provide charging infrastructure at all five of the district’s bus depots, beginning this summer with one near Bethesda — less than a mile from a Pepco switching yard — which will need no power upgrades.

“In one [depot] we need a new loop, I’m told. In others, we just need some transformers. It varies across the different depot locations,” he said in an interview with NetZero Insider. For the first depot, “there was nothing else that Pepco had to do.”

Highland Electric agreed to allow the district’s staff to perform maintenance on the new buses and reimburse the district for the costs, “so we don’t all of a sudden lay off a bunch of our fleet maintenance employees,” Watkins said.

Watkins said the district’s routes average under 100 miles per day, with the longest about 130 miles. The depots will be equipped with Level 3 DC fast chargers, “so we know if we need to boost them in the middle of the day, we can do that.”

Watkins said he attended meetings where the three major American school bus manufacturers predicted that within 10 years, all orders for new school buses will be for electric versions.

But, even if the cost concerns are addressed, the limited range of the batteries and lack of charging infrastructure will make it a difficult sell in some districts. (See related story, Rural Va. Schools Skeptical on Electric Buses.)

March 4, 2021

Strong Bipartisan Support for Wash. FCEV Bill

With Washington’s first hydrogen production facility slated to be built in his district, a state legislator has introduced a bill to create tax exemptions for hydrogen fuel cell electric vehicles.

The bill (SB 5000) by state Sen. Brad Hawkins (R) to apply a partial sales tax exemption to hydrogen FCEVs appears to be sailing through the Senate with overwhelming bipartisan support. Three committees have recommended passage, and the bill faces a full Senate floor vote any day. If passed, the bill would go to the House of Representatives. Opposition in Olympia has been almost nonexistent.

The production of hydrogen is carbon-free when the fuel is sourced from water and the process is powered by emissions-free resources. Exhaust from a hydrogen FCEV is a trickle of water from the tailpipe and a wisp of steam.

Washington FCEV Bill — Washington’s Senate Bill 5000 would provide a partial sales tax exemption for hydrogen fuel cell electric vehicles sold in the state. | *Toyota*

Hawkins’ bill would set up an eight-year pilot program in which the 6.8% state sales tax on cars would be cut in half for the first 650 hydrogen FCEVs sold in Washington. Prices for the cars range from $34,000 to $58,000, according to manufacturers’ figures. After eight years, the exemption would be reevaluated. The exemptions would apply only to new vehicles.

Hawkins is not aware of any hydrogen FCEVs being sold so far in Washington. However, a Kenworth manufacturing plant in the Seattle suburb of Renton has built a handful of fuel cell semi-trucks earmarked for use in California with hydrogen cells from Toyota Mirai cars. A legislative memo said Washington has almost 64,000 conventional electric vehicles.

Hawkins represents a legislative district in central Washington crossed by the Columbia River, which supports an extensive network of hydroelectric dams. His district includes the Douglas County Public Utility District, owner and operator of the 840-MW Wells Dam.

The PUD plans to use electricity and water from that dam to power a proposed plant to create hydrogen from reservoir water. That project’s origin comes from a 2019 Hawkins bill signed into law that allows Washington PUDs to manufacture and distribute hydrogen.

Construction of that $20 million hydrogen plant is scheduled to begin this spring and be finished by November, Douglas County PUD official Gary Ivory told the House Transportation Committee on Feb. 18. The plant is expected to produce two tons of hydrogen a day. “We hope to expand the plant if there is an adequate demand,” he said.

In an interview, Hawkins said: “It is really a big opportunity.”

Hawkins envisions central Washington with its many dams becoming a center of producing hydrogen fuel cells for cars. He said that electric vehicles are slowly becoming more numerous and noted that a hydrogen fuel cell can be refueled in a few minutes, while using an electric charging station can take hours to fully recharge a standard electric vehicle.

Washington does not have any hydrogen fuel cell stations. Hawkins described the co-dependency of hydrogen FCEVs and fueling stations as a “what-came-first-the-chicken-or-the-egg” situation. He said that one hydrogen fueling station is planned for southwestern Washington. Hawkins hopes the Washington legislature’s biennial transportation-funding package — to be tackled later this session — will include two hydrogen stations for his legislative district.

He argued that his agriculture-heavy district — which is the nation’s leading grower of apples — is well suited to combine hydrogen fuel stations with hydrogen-fueled trucks serving the area’s farms.

“North-central Washington is as well positioned as any region in the United States to lead the use of hydrogen” in vehicles, Hawkins said.

March 3, 2021

DC Circuit Upholds FERC on PJM Stability Method

The D.C. Circuit Court of Appeals on Tuesday upheld FERC’s 2019 ruling that directed PJM to implement a new cost allocation method for transmission projects addressing stability issues (PSEG v. FERC, 19-1091).

Public Service Electric and Gas and PPL Electric Utilities petitioned the court for review of several FERC orders concerning cost sharing for upgrades to the PJM grid after the commission directed the RTO in December 2019 to refile tariff revisions on the allocation method. FERC in 2018 had reversed its 2016 decision that approved cost allocations for the Artificial Island reliability project in New Jersey, shifting costs initially allocated to stakeholders in Maryland and Delaware to utilities in New Jersey. (See FERC Lets Original PJM Stability Method Stand.)

PJM transmission owners and New Jersey agencies argued that the commission’s reversal of the 2016 order was “inadequately explained, lacked substantial evidence and improperly focused on assigning costs to violators rather than beneficiaries.” The petitioners also asserted that the 2018 order was inconsistent with Order 1000 and that FERC “failed to respond meaningfully” to the arguments against rehearing.

FERC, which was supported by stakeholders in Maryland and Delaware, maintained that it “engaged in reasoned decision-making.”

“We conclude the commission reasonably decided to adopt a different cost-allocation method for the type of project at issue here and adequately explained its departure from the cost allocations it had approved in 2016,” the court found in denying the petitions for review.

Because the dispute centers on the commission’s exercise of its rate-setting authority, the court said it was “particularly deferential” to FERC’s determinations.

The petitioners and New Jersey agencies challenged FERC’s decision to grant rehearing of the 2016 order on three grounds, particularly contending that the commission “failed to adequately justify” its finding that the solution-based distribution factor (DFAX) method was unjust and unreasonable when applied to the Artificial Island project. (See FERC: Stability Deviation Method Best for Artificial Island.)

PJM Stability Method — The Hope Creek and Salem nuclear units on Artificial Island in southern New Jersey | *BHI Energy*

PJM assigns 50% of the costs of regional facilities (500-kV lines or higher and double 345-kV lines) and “necessary” lower-voltage facilities required to support regional lines on a load-ratio share basis for reliability projects, while the remaining 50% of costs is allocated using DFAX.

FERC originally determined using the methodology that 93% of the $280 million Artificial Island project cost would have gone to Delmarva Power & Light. But the commission later agreed with Maryland and Delaware utility regulators, determining that while Delmarva customers would use new transmission lines from the Artificial Island project, the utility neither caused the need for the lines nor benefited from the flows.

“As the commission explained in the 2019 order, although the Delmarva zone ‘will use the Artificial Island project as measured by the solution–based DFAX method,’ it would not actually derive any benefit from those flows … because its transmission system already was adequate to serve its load,’” the D.C. Circuit said. “Petitioners’ contentions therefore provide no basis to set aside the commission’s decision to grant rehearing of the 2016 order.”

The petitioners also contended that FERC’s reversal was contrary to Order 1000 and that it “failed to meaningfully respond to their arguments in support of the solution-based DFAX method and in opposition to reopening the record.”

“None of these challenges has merit,” the court said.

March 3, 2021

SPP Launches Review of Storm Response

SPP has launched a comprehensive review of its response to the recent severe winter storm that swept through its footprint, leading to the first rolling blackouts in the grid operator’s 80-year history.

“You will hear me use the term ‘unprecedented’ a lot today,” COO Lanny Nickell told the RTO’s Board of Directors and Members Committee Tuesday as he reviewed the mid-February events leading up to the controlled outages.

True to his word, Nickell referred to the “unprecedented” energy imports from neighbors, the “very cold, unprecedented” temperatures in its footprint and the “unprecedented” event as a whole.

SPP storm response — The middle of the United States saw the coldest weather in mid-February. | *SPP*

With nearly 35 GW of generation capacity unavailable, SPP twice reached Level 3 energy emergency alerts and called for load sheds totaling nearly 3.3 GW Feb. 15-16 over a four-hour time period. The RTO reduced its EEA levels and returned to normal operations on Feb. 20. (See ERCOT, MISO, SPP Slough Load in Wintry Blast.)

While SPP’s experience paled in comparison to ERCOT’s, it recommended to the board that staff and stakeholders work together to review the grid operator’s performance during the event. The Members Committee was unanimous in endorsing the recommendation, which the board also approved.

“Staff will learn from this. There’s no doubt in our minds that our best can be better next time,” CEO Barbara Sugg said, “not only because we identified opportunities for SPP to improve, but we can improve those improvements.”

Sugg complimented SPP member collaboration with the RTO, especially when issuing conservation calls. She also said the grid operator wouldn’t have succeeded in minimizing the controlled outages without energy imports from MISO and PJM.

“Being a part of the Eastern Interconnection absolutely paid off for us,” Sugg said. “[The imports] were absolutely critical to us.”

The review is intended to assess SPP’s performance, transparently engage with stakeholders, find operational and market issues, develop recommendations for future improvements and raise “our joint capabilities.”

Nickell will chair the newly-formed Comprehensive Review Steering Committee overseeing and coordinating a process broken into five focus areas: operational, financial, regulatory, communications and a review of market pricing by the Market Monitoring Unit. The group will provide a final assessment and recommendations to the board in July.

The financial review will likely be of most interest to those concerned about SPP’s market performance, as numerous offers exceeded the RTO’s $1,000/MWh cap and prices peaked at $4,274/MWh during the event. Legal staff received FERC approval for two expedited tariff filings: an up to three-day delay to post settlement statements for the Feb. 13-16 operating days (ER21-1185) and a limited two-week waiver for load-serving entities’ collateral calls, normally required within two days (ER21-1193).

The commission noted SPP’s extreme weather conditions, operating challenges, EEA alerts and the potential for repricing in approving the requests.

“We’re very well aware of the settlement issues,” Sugg said.

CFO Tom Dunn will lead the team that reviews the settlement and credit issues and looks at make-whole payments.

The Monitor held a pair of calls last week to discuss the energy offers above the $1,000/MWh cap, which fall under FERC orders 831 and 831-A. The orders require that energy suppliers receive a reasonable opportunity to recover their actual costs of providing energy. The MMU will verify and calculate actual cost reimbursement for energy offer curves above $1,000/MWh.

Market participants have up to 35 days after the operating day to submit documentation for verification and the Monitor has up to 45 days after the operating day to evaluate the information, resolve questions and approve or reject the offers.

SPP is also the subject of a joint inquiry by FERC and Slow Storm Restoration Sparks Anger in Texas, South.)

Missouri’s Public Service Commission is among the state regulators that have opened an investigation into the event and the resulting rolling blackouts and “extreme” natural gas price spikes. Staff will look into utilities’ preparation for the event, using analysis from RTOs, FERC, NERC, market monitors and other bodies.

Butler-Tioga Order 1000 Project Paused

The board and Members Committee also approved pausing the selection process for a competitive upgrade in southeastern Kansas while SPP staff completes a re-evaluation of the project.

The board in February authorized the 138-kV project over protests from Evergy, the incumbent transmission owner. The Kansas City utility has said the project will collide with regional planning efforts and requested a restudy Feb. 5, shortly after SPP issued a request for proposals. (See SPP Board to Consider Controversial Kansas Project.)

After reviewing Evergy’s request, staff determined a pair of transmission upgrades “germane” to the area were not included in the assessment that initially identified the upgrade.

“In consideration of those projects, do we know the [competitive project] is still an appropriate economic project to move forward?” Antoine Lucas, SPP’s engineering vice president, asked. “Based on the magnitude of the two upgrades, we have determined those are material modifications to the system and specific to the system that would be served by the transmission upgrade. We think there’s more assessment to do.”

Staff will re-evaluate the need for the Butler-Tioga project in fewer than 30 days, applying the same economic models used to identify the upgrade after adding the two omitted upgrades and new costs.

Lucas said staff would bring a final recommendation before the board during its April 27 meeting.

The RFP submission deadline will remain Aug. 2.

March 3, 2021

EV Market Gaining Momentum in North Carolina

2020 was an encouraging year for the electric vehicle industry in North Carolina, with EV sales growing by 5% while nationwide sales dropped 3% during the COVID-19 pandemic, according to a recent report from the Southern Alliance for Clean Energy (SACE) and Atlas Public Policy.

The report provides a deep dive into the stakeholders, policies and trends that it says could position North Carolina as a leader in EV adoption in the Southeast. But in a blog accompanying the study, Stan Cross, electric transportation policy director at SACE, said that the challenge before the state “is figuring out how to accelerate consumer and fleet EV adoption while ensuring all residents have equitable access to electric mobility.”

For example, the report notes that North Carolina does not currently offer any financial incentives or rebates for EV adoption. California, which leads the nation in EV sales, offers incentives to buyers of new as well as used EVs, to help stimulate the second sales market and improve accessibility.

The North Carolina Department of Transportation is considering establishing financial incentives for vehicles and charging infrastructure, according to the report, but legislation has yet to be introduced. Other high-impact recommendations in the report include creating EV-ready building codes and electrifying the state fleet, public transit and school buses.

Electric Vehicle Market North Carolina — EV sales in North Carolina have grown close to four-fold in the past five years. | *Southern Alliance for Clean Energy*

Transportation electrification is a core element of Democratic Gov. Roy Cooper’s plan to reduce North Carolina’s greenhouse gas emissions 40% below 2005 levels by 2025, as laid out in a 2018 executive order. Transportation currently accounts for 42.5% of the state’s GHG emissions, according to the Energy Information Administration, and to put a dent in those figures, Cooper wants 80,000 zero-emission vehicles (ZEVs) on the road by 2025.

Cooper joined with governors from 14 other states and the District of Columbia last July to sign a memorandum of understanding committing the state to ensuring 100% of all medium- and heavy-duty truck sales be ZEVs by 2050. North Carolina is the only Southeast signatory.

While planning North Carolina’s programs for the MOU is still in the early stages, stakeholder consultations are at its core.

In a Feb. 22 presentation to the North Carolina Department of Environmental Quality (DEQ) Environmental Justice and Equity Advisory Board, Mike Abraczinskas, director of DEQ’s Division of Air Quality, emphasized that “a key element of this action plan is to focus on disadvantaged communities.”

“Strong stakeholder engagement in North Carolina’s efforts will be a central part of this program,” Abraczinskas said. “And we are starting that here today.”

Looking ahead, two key challenges to equitable transportation electrification face the state: funding and active utility engagement. Tapping into outside funding sources will be critical to ensure that underserved communities in heavily polluted areas can benefit from transportation electrification as soon as possible, the report says. In 2020, the first round of awards from the state’s share of the Volkswagen settlement were announced, including $6 million for electric school buses.

The state is slated to receive $92 million in the settlement Volkswagen is paying for its fraudulent emissions reporting. Another $64 million of North Carolina’s allocation remains to be awarded, and the report sees more of it going toward bus and other transportation electrification.

On the utility front, Duke Energy’s $76 million proposal to support transportation electrification was only partially approved by the North Carolina Utility Commission in November. The state’s largest investor-owned utility got the go-ahead for spending $25 million to install both DC fast and 220-V Level 2 chargers at public and multi-unit housing sites. The NCUC sent Duke back to the drawing board on other parts of its plan, requiring it to develop EV-charging rates to ensure community involvement in program design and to show clear net benefits for customers.

Critics of Duke’s plan said that equity was largely overlooked. For example, the NC Sustainable Energy Association argued at the November NCUC hearing that without a stronger focus on equity, the 30 electric buses in the plan ― to be distributed on a first come, first serve basis ― “would benefit wealthier counties and cities that would use up the rebates before poorer areas are able to participate.” NCSEA also questioned whether Duke’s plan to install Level 2 chargers in underserved communities is achievable.

The SACE report shows that at present, EV adoption is concentrated around North Carolina’s largest cities ― the Research Triangle of Raleigh, Durham and Chapel Hill, plus Charlotte and Ashville.

The report also highlights innovative programs being developed by the state’s municipal utilities and electric cooperatives, which could also provide models for the IOUs. North Carolina’s Electric Cooperatives, 26 cooperatives serving 2.5 million people, offers $3,500 rebates for qualified customers purchasing a Nissan Leaf. ElectriCities, a nonprofit organization of municipally owned electric utilities in the state, provides matching grants to help members develop community EV plans and present program options for their cities.

As North Carolina seeks to grow its EV market, the state can look to its neighbors for further policies and initiatives to implement, the report said. The Virginia Senate is currently reviewing House Bill 1979, which would create a rebate program for new and used EVs.

In 2018, Virginia also joined the Transportation and Climate Initiative, a collaborative effort by nine New England and mid-Atlantic states to reduce pollution and advance transportation electrification, as the only Southeast signatory. North Carolina recently started working with TCI, helping develop a new multi-state program investing $300 million per year in clean transportation. While neither North Carolina nor Virginia have officially signed on to this new program, they could do so in the future. Joining such regional initiatives could improve connectivity of EV infrastructure and programs up and down the East Coast, the report says.

By building on the MOU and Cooper’s 2018 executive order, and addressing the challenges of equity, funding and utility engagement, the report says the state has the potential to “spur investment in manufacturing, create clean jobs, and rapidly electrify both public and privately-owned vehicles.”

March 3, 2021November 2, 2023

Nuclear Power Wants Some Net-zero Love

Nuclear accidents made Three Mile Island, Chernobyl and Fukushima household words. But how many people know about Calvert Cliffs, which has been operating quietly on the Chesapeake Bay since the mid-1970s?

Calvert Cliffs generates 1,756 MW of power, equal to 38% of Maryland’s needs and representing more than three-quarters of the state’s carbon-free generation. Yet nuclear power is often ignored in discussions about getting to net-zero carbon emissions, according to a new coalition, Nuclear Powers Maryland.

Led by the Nuclear Energy Institute, the American Nuclear Society and Exelon Generation, the coalition’s goal “is really to educate and advocate for nuclear in the state,” said spokeswoman Anne Larimer Hart, when asked what the group seeks to achieve. There is “no specific [legislation] at present.”

The coalition introduced itself Tuesday with a webinar and the launch of a petition drive supporting nuclear power’s role in addressing climate change while warning that “opponents continue to undermine nuclear power, which could put this valuable carbon-free energy resource at risk and drag us backward in the transition to clean energy.”

It also released the results of a survey of 600 “media-attentive and engaged voters” statewide and found that while 91% say it’s important for state officials to reduce carbon emissions, including 74% of Republicans, little more than half said they are familiar with Calvert Cliffs, which is jointly owned by Exelon and Électricité de France (EDF).

Joining NEI CEO Maria Korsnick on the kickoff Zoom meeting were Marilyn Kray, Exelon’s vice president of nuclear strategy and development, and officials of two Maryland-based companies: James Howe, vice president of government relations at uranium enrichment company Centrus Energy, and Clay Sell, CEO of X-energy, a nuclear reactor and fuel design engineering company.

“In order for Maryland to achieve its own stated clean energy aspirations, it cannot get there without continued operation of the Calvert Cliffs plant and without building additional new nuclear plants here in Maryland,” Sell said. Calvert Cliffs is licensed until 2034 (Unit 1) and 2036 (Unit 2).

In October, the Department of Energy selected X-energy and TerraPower, of Bellevue, Wash., to build two advanced nuclear reactors in public-private partnerships under its Advanced Reactor Demonstration Program (ARDP). TerraPower, the creation of Microsoft co-founder Bill Gates, will demonstrate the sodium‐cooled Natrium fast reactor, on which it has partnered with GE Hitachi Nuclear Energy.

X-energy will build a four-unit plant based on its Xe-100 reactor design, a high-temperature gas-cooled reactor that can produce 320 MW of electricity for baseload or load-following and 800 MW of thermal output that could be used for industrial heat applications, such as desalination and hydrogen production.

X-energy announced Monday that it had signed the ARDP Cooperative Agreement, under which DOE will invest about $1.23 billion in the company’s project. It will be built in Washington state with Energy Northwest, a consortium of 27 public utility districts and municipalities that operates the Washington Columbia nuclear plant in Richland. Completion is planned for 2027.

Sell said his company’s four-unit design requires only a 22-acre footprint, making it suitable for repurposing retired oil- and coal-fired generators. It will use tri-structural isotropic (TRISO) particle fuel, which it says can withstand very high temperatures without melting. The company says its “meltdown-proof ‘walk-away’ safety” allows a 400-yard safety perimeter as opposed to the 10-mile emergency planning zone for traditional reactors.

“That gives us a number of unique opportunities that we could seize in Maryland,” he said. The U.S. Nuclear Regulatory Commission says it is involved in “preapplication activities” on X-energy’s reactor. NRC in September approved the final safety evaluation report for NuScale Power’s small modular reactor (SMR), making it the first SMR manufacturer to successfully complete the commission’s design certification application review. (See NRC OKs NuScale’s Small Modular Reactor Design.)

Kray said locating small nuclear reactors at former fossil fuel plants would take advantage of existing transmission lines and substations as well as water sources and plant staff. “You could fit one, or maybe two [small nuclear reactors] in what used to be the host site for a coal plant,” she said.

“The challenge we have is to create incentives and to create a political openness to make that happen,” Korsnick said. An NEI spokeswoman said the trade group is also supporting similar coalitions in Pennsylvania and Illinois.

March 3, 2021November 28, 2023

Maryland Carbon Pricing Bill Rejected for 4th Time

A Maryland House committee on Monday rejected a proposed carbon pricing bill, with eight Democrats siding with seven Republicans in opposition. Only eight Democrats supported the bill in the 15-8 vote by the House Economic Matters Committee.

It was the fourth straight year that carbon pricing has failed to make it out of committee.

Sponsored by Del. David Fraser-Hidalgo (D), the Climate Crisis and Education Act (H.B. 33), would have imposed fees on fossil fuel sales and high-emitting vehicles to help reduce greenhouse gas emissions by up to 90% from 2006 levels by 2050.

Fees

The bill would impose a GHG pollution fee on all fossil fuels imported into the state for combustion.

The fee for non-transportation fuels would start at $15/ton of carbon dioxide equivalent on July 31, 2022, rising to $20 in 2023 and increasing by $5 each year through 2030 and remaining at $60 in 2031 and subsequent years.

The fee on transportation fuels would begin at $10/ton for July 31 through Dec. 31, 2022, increasing to $13 in 2023 and increasing by $3 each year through 2030 before leveling off at $37 in 2031. Public transit agencies would be exempt.

The fees would be collected at the first point of sale in the state and paid by the entity transporting the fossil fuel into the state, meaning wholesalers for fuel oil and gasoline and local distribution companies for natural gas.

“I am trying to change behavior — trying to do it in a pragmatic and realistic fashion,” Fraser-Hidalgo said in an interview with NetZero Insider.

Del. David Fraser-Hidalgo | Del. David Fraser-Hidalgo

At a Feb. 18 committee hearing on the bill, Fraser-Hidalgo faced skepticism over his contention that the bill could prohibit fees from being passed through as a direct cost to end users or customers of electric or gas utilities.

He cited a January 2020 letter from the state attorney general’s office that said it was “not aware of any general impediment to the General Assembly enacting such a prohibition.” But the letter added, “There may be circumstances under which the effects of such a pass-through prohibition could amount to an unlawful taking.”

“I know why this bill doesn’t go far [in the legislature]” said Del. C.T. Wilson, one of the Democrats who later opposed the bill. “The thought that they can’t pass fees down — I find that incredible that we’re supposed to believe that somehow, someway these businesses will not inject these fees and have the consumer pay for them.”

Wilson was also leery of promises that any impact on the poor would be addressed through rebate checks.

Republican Seth Howard was also dubious. “We heard big executives will pay for this. … Who is that? Is that somebody with a monocle and big bag of money running around? … A lot of these are publicly traded companies. … Hundreds of millions of people’s 401ks are diversified into some of these stocks.”

In written testimony, Brian Smith, state government relations and public policy manager for Washington Gas, said the no pass-through provision “could potentially raise Constitutional takings concerns.”

Smith said the utility calculated the $15/ton charge would increase residential gas bills by 7%, rising to 30% at $60/ton. Commercial rates would rise from 9% to 35%, he said. Columbia Gas of Maryland cited similar estimates.

“This would bankrupt companies I represent,” said Ellen Valentino, executive vice president for the Mid-Atlantic Petroleum Distributors Association.

Also opposing it were the Maryland Building Industry Association, the state Chamber of Commerce, Local 24 of the International Brotherhood of Electrical Workers, Maryland Farm Bureau, Maryland Transportation Builders and Materials Association and the Maryland Asphalt Association.

“This bill goes over and above what the Maryland Commission on Climate Change is recommending. The negative economic impacts to Maryland citizens will be substantial,” Colby Ferguson, director of government relations for the Farm Bureau, said. “To make matters worse, [some of] the fees that would be collect through the proposed fuel tax would not be used to cover the cost of transitioning to zero-emission vehicles, but instead to pay for a new Pre-K through 12 education program that has nothing to do with climate change.”

Supporters included the Audubon Naturalist Society, League of Women Voters, Sierra Club, the NAACP and the Maryland State Education Association.

Use of Proceeds

The fuel fees would generate $674 million in fiscal 2022, rising to $1.4 billion in fiscal 2026, according to a fiscal and policy note by the Department of Legislative Services.

The department said it was unable to provide a reliable estimate on the fees on high-emission vehicles.

Of the proceeds, the first $350 million annually would support public education through the Kirwan Commission fund.

The Household and Employer Benefit Fund would receive 50% of total revenues or all the revenues remaining after the distribution to the Kirwan fund, whichever is less, to mitigate the impact of fees on low- and moderate-income households and energy-intensive, trade-exposed employers.

Any revenues remaining after the distributions to the first two funds would go to the Climate Crisis Infrastructure Fund for investing in initiatives to expand the use of clean energy and energy efficiency or increase resiliency against climate change.

The bill would have provided the Benefit and Infrastructure funds a combined $324 million in fiscal 2023, rising to almost $1.1 billion in fiscal 2026.

March 3, 2021

Report: State Climate Policy Outcomes Hazy

The diversity and complexity of state climate policies make it unclear which approaches are driving the most progress on emissions reductions, jobs growth and energy resilience, a report by the Clean Resilient States Initiative said.

The report, “Clean Resilient States: The Role of U.S. States in Addressing Climate Action,” is the first in a series, part of a Center for Strategic and International Studies (CSIS) initiative to understand whether state climate policies are achieving their objectives.

To build an understanding of climate policy progress, the report analyzes how metrics for progress shape the perception of states’ performance. Context, the report said, is key to identifying the scenarios that advance emissions, jobs and resilience goals.

Emissions Reductions

An assessment of emissions patterns by individual states will help legislators and regulators identify which new policies can improve emissions reductions over time, according to the report.

Many states are reducing emissions through broad energy efficiency measures and renewables development. The report said a state’s emissions-reduction progress is best measured by the volume of emissions per unit of gross domestic product, or emissions intensity.

That metric reflects differences in states’ energy consumption and “is a good proxy for the relative cost and complexity of the pathway a state must take to reduce its emissions,” the report said.

A state with a lower emissions intensity, for example, might lean toward a service-based economy with low energy consumption. Conversely, a state with a higher emissions intensity might rely heavily on industries that use more energy to power large equipment.

An economy that depends on energy-heavy industry might need policy measures that go beyond energy efficiency and renewables development, including, the report said, “radical product innovations” to replace fossil fuels.

All states, however, are going to find it harder to reduce emissions over time, and new policies will need to address that challenge, according to the report.

Job Creation

The unique characteristics of a state define how and where new jobs are created by its climate policies, the report said.

Most states have advanced climate policies based on environmental and job benefits, but it isn’t clear whether climate policies always spur job growth, the report said.

Policies to transition to clean energy can be limited or cultivated by a state’s renewable resource characteristics, workforce education, infrastructure limitations and urban sprawl. The report said that two states may have similar energy policies, but one might need additional incentives, such as a workforce development initiative, to achieve similar levels of clean job growth.

An evaluation of policies designed to produce jobs within the context of workforce, infrastructure and resource characteristics will help state leaders understand green economic growth. It will also highlight when the promise of jobs “falls short” and why, the report said.

Resilience

The difference in states’ experiences with natural disasters “creates some ‘conceptual fuzziness’ about what resilience looks like in practice,” the report said.

States have begun to foster energy resilience through planning and energy system design based on assessments of their overall vulnerabilities to devastating climate-related events. Those assessments are driven by the memory of the most recent natural disasters, the report said.

The report cited the case of New York and New Jersey, which suffered widespread outages from Hurricane Sandy in 2012. The experience prompted both states to support development of “cleaner, more resilient energy systems” during recovery efforts, the report noted.

Disasters give momentum to options for hardening systems, such as using smart meters and demand response; deploying renewable resources with energy storage; or fostering islanding capabilities through microgrid development, which has occurred in California in the face of persistent wildfires.

State Climate Policy — The outcomes of state climate policies, such as building micogrids (pictured) for grid resilience, are hard to clarify because of their diversity and complexity, according to a new Center for Strategic and International Studies report. | *SoCalGas*

But the vast differences in states’ experiences with such disasters, along with their proportional responses, make it hard to assess whether resilience policy approaches are adequate or cost-effective, the report said.

The individual histories driving resilience initiatives may explain why there are few data on how states are pursuing energy resilience, according to the report.

Additional uncertainties may come from the broad deployment of renewables within state resilience strategies. Anticipating those uncertainties, the report said, will be “increasingly important as state energy transitions advance.”

Coordination is Key

The report contends that emissions reductions, clean energy growth and resilience are “distinct but interrelated imperatives” and “state success in each of these areas is partly contingent on efforts to strategize around and coordinate across all three.” It points to the increasing practice of states of including environmental justice considerations into energy policy with an eye to deploying clean resources and creating opportunities in communities that have been disproportionately affected by pollution and climate change.

“Since this emerging priority takes on dimensions of emissions reductions, clean growth and resilience, it cannot be fully accounted for without a wider view of how states are coordinating across policy areas,” the report said.

The report also highlights the benefits — and challenges — of states coordinating their activities and policies across borders.

“Willingness to coordinate is often conditional on some degree of priority alignment across states,” the report said. “Conversely, where states lack shared priorities, there is potential for conflict to arise, particularly among states that trade energy or rely on common energy infrastructure.”

Such conflicts can slow or reverse state initiatives, the report noted.

CSIS sees the same potential for coordination and conflict between state and federal policies. While states have benefited from federal research and development efforts around energy technologies and resilience, the federal government has also in recent years attempted to roll back state regulations regarding power plant and vehicle emissions.

But the new administration will likely yield a lessening of those conflicts.

“Apart from a new national agenda, President Biden may support considerable progress in state-level climate initiatives simply by scaling back such challenges to them,” the report said.

March 3, 2021February 2, 2024

Utility Group Wants to Cover Southeast’s Highways with DC Fast Chargers

Six utilities are banding together to make electric vehicle “range anxiety” a thing of the past with a plan to create “a seamless network” of fast-charging stations along highways stretching from the Atlantic and Gulf coasts to the Midwest.

“Throughout the ages, travelers have had to figure out how to get from Point A to B. From feeding and watering horses, to filling gas tanks and now recharging batteries, ensuring there are convenient places to accomplish these tasks is critical,” said Nicholas Akins, CEO of American Electric Power, one of the six utilities now working together as the Electric Highway Coalition, which announced the plan on Tuesday.

Other members of the coalition include Dominion Energy, Duke Energy, Entergy, Southern Co. and the Tennessee Valley Authority. According to a press release, the goal is to make fast-charging sites as convenient as gas stations, located “along major highway routes with easy highway access and amenities for travelers.” DC fast chargers can top up an EV battery in 20 to 30 minutes, the release says.

The initiative reflects utilities’ growing support for transportation electrification, which they see as a major driver of new electricity demand and infrastructure growth at a time when increasing amounts of renewable and distributed energy on the grid are disrupting traditional industry business and regulatory models. A 2018 report from the Edison Electric Institute predicted the U.S. would see 18 million EVs on the road by 2030.

“We have electric customers in Virginia, North Carolina and South Carolina, and in a lot of cases, those customers are side by side with AEP or Duke or Southern Co. customers,” Dominion spokesperson Rayhan Daudani said. “So, it only makes sense for us to make sure we’re looking for places where we can address the gaps in EV charging infrastructure.”

TVA is looking to put charging stations every 50 miles on Tennessee’s major highways, spokesperson Malinda Hunter said. “What happens when you are on that highway and you exit our service area?” Hunter said. “We don’t want to be building on top of each other. We want to make sure that we have a good standard for what’s expected out of the charging station and how the connection works.”

Scott Blake, spokesperson for AEP, said the utilities have been laying the groundwork for the coalition over the past few months. But, he said, the project is still in its early stages, and any plans will need to take into account the expense and regulatory and operational hurdles an interregional fast-charging network will face.

For example, a $76 million electric transportation plan that Duke proposed in 2019 finally earned partial approval from the North Carolina Utilities Commission in November 2020. Duke got the go-ahead for $25 million to be used for charging stations and an electric school bus program but was sent back to the drawing board to ensure more community involvement — and net benefits for customers — in its EV planning.

Daudani also pointed to the range of EV adoption rates, incentives and other mandates that currently exist state to state. “It’s not one size fits all, either by state or by utility,” he said. “We really do have to be responsive to the customer’s needs, to regulatory needs, to the policy needs that are all in play. There are times where there may be a lack of alignment; that’s when more dialogue needs to be had, and hopefully this collaboration can foster that.”

Open Questions: Time and Cost

Coalition efforts and utility programs promoting transportation electrification have been growing across the country. In July 2020, governors of 15 states and D.C. Mayor Muriel Bowser signed a memorandum of understanding to cut emissions from medium- and heavy-duty trucking. Meanwhile, individual press releases from each of the Electric Highway Coalition members highlighted their various programs to expand EV sales and charging infrastructure.

AEP noted its own commitment to replacing its fleet of 2,300 cars and light-duty trucks with EVs by 2030, with an expanded charging network to ensure its employees can drive the electric fleet across the utility’s 11-state service territory. Rebates on chargers and low rates for EV charging during off-peak hours are being offered by various of the company’s subsidiary utilities.
Dominion is also offering special EV charging rates and has a pilot program providing rebates for certain kinds of chargers. It is also helping two public transit systems in its service territory ― one in South Carolina and one in Virginia ― to start converting to electric buses.
TVA announced an initiative aimed at removing barriers to EV adoption across its seven-state service territory, with the goal of having 200,000 EVs on the road by 2028. The agency is also partnering with the Tennessee Department of Environment and Transportation to build a fast-charging network along the state’s highways.

While none of the utilities have set time frames for rolling out highway fast chargers, Blake and Daudani said AEP and Dominion, respectively, would like to begin installations this year. TVA is aiming for 2022, according to Hunter.

“We’re trying to make sure that each of the member companies can take the resources that they have available and put them to the most efficient use,” Blake said. “We’re really trying to identify the locations for the DC fast-charging infrastructure, where the transmission system and the local distribution system support these types of charging stations without a lot of additional make-ready work.”

How the fast chargers will be paid for, and whether the utilities will try to include them in their rate base remain open questions. Hunter said TVA will not own any of the chargers, while Daudani said Dominion will be looking at the issue on a state-by-state basis.