The Donald has been in office long enough for an assessment of performance, if I may use that term, on energy policy.
Most, but not all, of us are employed under a patchwork of state policies. State houses and executives set the policies, and utility commissions see to it that the policies are carried out. States tend to zig when the federal government zags. It doesn’t happen overnight but over the course of several years. For instance, the Obama administration was anti-coal, anti-carbon, and as a result, purplish-red (raspberry, I guess) states, including Ohio, Indiana, and Wisconsin, pulled back on efficiency spending and savings targets. For this reason, if Trump swings hard the other way, the opposite is likely to occur. He has already signaled as much, and I will get to that below.
Story Within the Story
In my opinion, it is best to either have the utilities administer the programs or establish an independent non-profit organization, like Energy Trust of Oregon, to administer programs. As discussed way back in Old School EE in 2012, outsourcing the administration of portfolios for an entire state is a bad idea because it is too close to political games. I was beaten up for that opinion back then, but my tormenter just experienced my argument in an unpleasant way.
Again in my opinion, for purely political purposes, funds from Wisconsin’s Focus on Energy program were diverted away from efficiency toward paying for broadband in the sticks of outstate Wisconsin – like where I live, but not where I live. The premise: these citizens need broadband so they can participate in, and get their money’s worth from, Focus on Energy. This is quite ridiculous. What goes around comes around, tormenter.
As you may know, one of the federal-level efficiency departments/programs on Trump’s chopping block is ENERGY STAR. First, let me provide some comfort to those of us who think ENERGY STAR is a good thing. The federal government has a batting record of about 0.004 at cutting spending. That could change under Trump, but federal congresspersons are invertebrates as we just experienced with the healthcare bill.
I came across this post in Conservative Review, which is just that, very conservative. It is full of misleading and inaccurate statements and trigger words.
“It’s not surprising that energy companies would be in favor of a program that gives them free money to make their products better. Who wouldn’t want that deal?” Wrong. To my knowledge, ENERGY STAR subsidizes nothing. It merely provides standards of efficiency.
The article goes on to say that the government shouldn’t force product changes on people. Ironically, that is not what ENERGY STAR does. ENERGY STAR is an unbiased (I think) setter of efficiency standards for consumer choice. It is inherently not a mandate.
I think product mandates are bad policy if, for no other reason, it riles up politics against efficiency. However, the Conservative Review article uses the switch from incandescent to compact fluorescent as an awful policy for consumers because of light color, flicker, buzzing, and so forth. I would add that by the time EISA was incorporated under GW Bush, these maladies were fixed. Compact fluorescent technology evolved to provide a nice spectrum of color temperature. In the process, LED technology development accelerated like a railgun projectile. It has totally transformed the market, and only zealots would choose incandescent over LEDs at this point.
Furthermore, our electric grid is pretty much a privately held socialist business. I’m all for choice, but if large energy users want to opt out of programs because they have “done everything” for efficiency (never the case), it isn’t just their business. This line of thought would scrap axle weight limits for trucks. Instead of a 60,000-pound cargo limit, it’s every man for themselves, and they can haul 100,000 pounds if they damn well please. The rest of us driving 3,000-pound cars would be paying for their freedom. Your freedom ends where it impinges on mine.
Then I cracked open a Forbes article describing three reasons “Trump Doesn’t Matter to Energy Policy” as follows:
- States, as described above.
- “It’s possible to build a brand new wind farm in Colorado, including all of its capital costs and installation costs, for less than the operating cost of an existing coal ”
- Technology costs, in the form of renewable energy, only go down while commodity costs of fuel go up and down.
An article by Energy Innovation Policy and Technology, linked in the Forbes site features an interesting chart for the cost of power generation. To spare you the pain of acronyms, MCOE = marginal cost of energy (fuel, O&M). It is interesting that the cost of combined cycle natural gas, which is quite efficient, is still higher than that of coal.
The price of renewable technologies, like televisions and laptop computers, have to be near their resting place. The wind industry is heavily reliant on the tax credit, which is one place Trump may pose a threat to further expansion, but he needs Congress. As noted above, they will likely buckle to any spending cuts, as they always do.
Coal’s shrinking slice of energy supply is due to the wind subsidies and wind’s natural companion, cheap natural gas. Wind generation is built, and the marginal cost is very low. Trump cannot do anything about that.