Hill Heat

10:32 Markey: You’ve estimated that the Southeast can squeeze out no more than 5% from renewables. The DOE estimates you can get at least 15% by 2020, in large part from biomass. How do you respond?

Hobson: I”m not sure there’s an appreciation for the amount of biomass that is required to fuel a powerplant capable of powering the Southeast. We’ve looked at putting in 50 megawatt plants and the number of plants that could be sited is small.

Markey: Can you show us your analysis and show where the Bush administration is wrong?

Hobson: Yes.

Markey: Wind in the Southeast?

Ms. Floyd: We’ve been not talking about offshore wind. The Southeast has the shallow waters needed.

Hobson: I don’t agree. The Southeast has the unique characteristic of standing in the pathway of hurricanes. Wind turbines are not capable of withstanding even a Class 3 hurricane. We’ve done work with Georgia Tech to look at offshore wind.

Markey: Florida is the Sunshine State. You’re saying that it should be renamed the Cloudy State?

Hobson: Gov. Crist reminded us that it is indeed the Sunshine State. There are probably areas in Florida that solar would be a real option. It is a very geographically diverse state. A lot of work would have to be done to make the leap that Florida would actually become the Sunshine State for solar energy.

10:38 Blumenauer: Mr. Hobson, you supplied us with a map of solar intensity. I wonder what the solar intensity map of Germany, with 4-5 times the amount of solar use, would look like.

Floyd Certainly Germany does not have terrific solar insolation. They’ve built a tremendous industry. The Southeast compares well to the Northwest. Large-scale solar for rural areas with high efficiency are being built.

Foster My home state of Minnesota also has a significant paper and pulp industry, like the Southeast, and is using biomass plants. It’s selling biomass pellets to the Great Lakes regions.

Blumenauer Do these observations have any relevance?

Hobson I don’t want to give the impression that a southern company doesn’t think there are any applications. We’re talking about the generation of electricity. I don’t have the luxury for investing in energy that will be available for a small amount of time. If I need solar and it’s not available my customers are going to suffer. Renewable resources can help in niche situations and on the margins. You have to have energy sources you can rely on 24 hours a day 7 days a week.

Blumenauer I’m struck that there other regions with the same issues that are able to make this work.

10:45 Cleaver: Q about the energy transport question.

Sloan A lot of the debate is where is the energy going to be produced instead of where it’s going to be used. A great example is Joplin, Missouri. It’s using wind energy from Kansas. Part of it is that question. Infrastructure is very important. It will be produced in the best areas, then moved.

10:49 Sertheth-Handlin South Dakota and rural America is awesome.

10:50 Recess.

11:37 Floyd We’re going to have to invest in the infrastructure. We’re investing in smart grid technologies.

Markey Texas at 2000 per year is just at the dawn of wind energy. Is 200,000 megawatts of wind for the nation by 2030 realistic?

Sloan In Texas alone we have sites capable of supporting 500,000 megawatts, 150,000 megawatts worth of high-quality sites. But there has to be infrastructure. Texas doesn’t have the NIMBY issues of non-energy producing states.

Hobson Wind won’t be available when I need it.

Sloan We hear these issues all the time. Europe uses very high penetrations of wind. In Denmark 35% of the energy comes from wind. Wind power makes the system more reliable because utility planners don’t count on it. You have enough lights in this room to light the room, but if the lights went out you could open the curtains behind you.

Hobson If I have enough capacity on the ground to meet my load with traditional resources, it makes a lot of sense to use the free fuel of wind when I can. But I have to build the traditional capacity. My customers are paying twice as much. I think it becomes problematic when we’re building 40% capacity factor wind turbines for a 90% reliability system.

Markey How does Denmark do it?

Hobson I’m not an expert on Denmark.

Markey Why don’t you look that up.

Hobson My suspicion is that they have a backbone electrical system or interconnections with other countries.

Markey My suspicion is that where’s there a will, there’s a way.

Floyd I want to put my venture capital hat on and say that $2.4 billion in capital didn’t go into the status quo. There’s investment going into various technologies, including energy storage. There is new technology being developed.

Foster My home state of Minnesota has high wind energy use. Much of our energy comes from Manitoba hydroelectric.

• Imtiaz Ahmad, Vice President, Morgan Stanley
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• Bruce Braine, VP, Strategic Policy Analysis, American Electric Power
• Claude Brown, Partner & Co-Chair Environment and Climatic Trading Group, Clifford Chance LLP
• Mike Burnett, Executive Director, The Climate Trust
• Christopher Carr, Counsel, Vinson & Elkins
• Joelle Chassard, Manager, Carbon Finance Unit, World Bank
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Energy Conservation

Growing certainty that the burning of fossil fuels is warming the Earth’s atmosphere has spawned proposals from governments and industry to conserve energy. The Senate legislation would save 88 billion kilowatt-hours of electricity per year, according to a Bingaman statement, or enough to power more than 11 million homes.

Greenhouse gas emissions would be cut by 500 million tons annually, or 1.5 percent, by replacing incandescent light bulbs worldwide, Paul Waide, a policy analyst at the International Energy Agency, said at the Senate hearing. He said that would be the equivalent of “installing 100 times current U.S. wind generation capacity in lieu of unsequestered coal-fired power plants.”

Replacing Bulbs

Under the Senate proposal, beginning in 2012 and continuing through 2014, the current 40-watt, 60-watt, 75-watt and 100-watt incandescent bulbs, which now number 4 billion in U.S. homes and businesses, will be replaced by lower wattage bulbs that produce equivalent amounts of light. Bingaman’s bill would allow for a reevaluation of how to raise standards in 2020.

The House bill requires existing wattage lights to be brighter, which industry and environmental groups say will lead to more efficiency, although not necessarily to energy savings. The House measure then requires efficiency gains by 2020 that industry says are untenable.

The House plan would raise lighting efficiency by about 30 percent by 2014 and by 75 percent by 2020.

“If it stays the way it is now, as far as we know now, it is basically a CFL standard,” Earl Jones, senior counsel for the consumer and industrial division of GE, said of the House bill. He said new technology could develop, however Congress should not lock in an approach now to be mandated in 2020.

GE, Siemens’ Osram-Sylvania and Philips are planning different kinds of new products that would not meet the House’s long-range standards.

‘Tough’ Standards

Representative Jane Harman, a chief sponsor of the House bill, said the two bills were not all that far apart and she would compromise on how savings are measured. She would not support a less stringent bill.

“The standards are going to stay tough,” the California Democrat said in an interview after testifying at the hearing. “We are not watering down savings.”

Harman wants states to be able to preempt the federal standard until 2020. Bingaman wants no state preemption. Harman said that issue would not lead to the measure’s downfall.

Steven Nadel, executive director of the American Council for an Energy Efficient Economy, who testified at the hearing, said the Senate bill will save a little more energy than the House bill through 2020, and a little less than the House bill through 2030.

Nadel said the Senate bill should be toughened in ways industry does not support. For example efficiency groups want lawmakers to close loopholes that would allow less efficient lighting products to be exempted from the rules.

“I could think of a dozen ways that I could evade these standards without any trouble,” Nadel said of loopholes in the Bingaman bill.

To contact the reporter on this story: Daniel Whitten in Washington at [email protected]

Congressman Fred Upton (R – St. Joseph) testified this morning before the U.S. Senate Energy & Natural Resources Committee on his bipartisan amendment to transform the country’s lighting industry from obsolete, inefficient incandescent light bulbs toward higher-efficiency standards. Upton, a senior member of the Energy and Commerce Committee, and California Democrat Jane Harman are leading the effort to promote energy efficiency and reduce greenhouse gas emissions.

Both Upton and Harman testified during the hearing to examine “Energy Efficiency Standards for Incandescent Lamps.” Upton’s bipartisan amendment, supported by both environmental and industry groups, was included in a broad energy package that passed the U.S. House in early August.

“We must examine other solutions in addition to conservation as energy consumption across the globe is expected to increase approximately 50 percent by 2030,” said Upton. “Current incandescent bulbs on store shelves are obsolete and highly inefficient – only 10 percent of the energy consumed by each bulb is for light with 90 percent wasted on unnecessary heat. With more efficient bulbs, we will dramatically lower our energy use, reducing greenhouse gases as well as saving American families billions of dollars in their electric bills – and the benefits will be as easy as a flip of the switch. Every home will be on the front lines in the effort to reduce pollution and save energy, and we will be successful one light bulb at a time. I am confident that the Senate will embrace our common sense, bipartisan approach that partners with American industry to substantially reduce pollution.”

Across the nation, the environmental and economic benefits of more efficient bulbs will be substantial.

High efficiency bulbs will result in the:

• Reduction in electricity demand equal to the output of 23 nuclear plants;
• Reduction of airborne mercury emissions from coal burning plants – 4,500 lbs;
• Reduction in annual Carbon Dioxide emissions – 120 million tons; and
• $14 billion in reduced electricity costs for consumers.

The amendment sets technology-neutral performance standards to replace today’s inefficient 100 watt, 75 watt, 60 watt and 40 watt incandescent lights with a mix of products (halogen, compact fluorescent, high-efficiency incandescent, and LED’s) that will result in efficiency gains exceeding 50%. Starting in July 2012 , the 100 watt incandescent will be completely phased out, with the 75, 60 and 40 watt bulbs phased out for more efficient bulbs in 2014, 2015 and 2018 respectively. The transition will result in the annual phasing-out of the production of 2 billion inefficient incandescent bulbs. Upton and Harman worked very closely with industry and environmentalists to craft common sense legislation that seeks to clean up the environment, all the while protecting American jobs.

Upton and Harman are also leading the effort to require that each agency, department, and office within the Federal Government, beginning Oct. 1, 2007, purchase light bulbs that meet the Department of Energy’s “Energy Star” efficiency ratings. Their bipartisan amendment has been included in every spending bill that has passed the House.