Electric Power Industry Transition and Regulatory Landscape
EM – August 2023: This month, EM examines the transition in the way electricity is generated and used from different perspectives.by Justin Walters and John Kinsman
The focus of this topic addresses the electric power industry and its transition to cleaner types of electric generation technologies and fuels, accompanied by substantial reductions in air emissions to date and more to come. Articles are contributed by the U.S. Environmental Protection Agency, the Edison Electric Institute, the Clean Air Task Force, and the Electric Power Research Institute. EM thanks the authors for their contributions.
The first article, “Electric Companies: Leading the Ongoing Clean Energy Transition,” by Emily Fisher of the Edison Electric Institute (EEI), discusses the clean energy transformation of the U.S. electric power industry and its companies. In 2022, for the first time, renewable energy sources surpassed coal as a generating source (23% of total generation), with coal-based generation falling to 19%. Electric power sector carbon dioxide (CO2) emissions were 36% below 2005 levels, and 50 EEI members have announced voluntary, forward-looking carbon reductions goals. EEI's member companies see a clear path to continued emissions reductions over the next decade using current technologies, including nuclear power, natural gas-based generation, energy storage, and deployment of renewable energy, but the path toward a clean energy future must go further. EEI continues its work to accelerate the pace of innovation by partnering with industry leaders and leading environmental groups to launch the CarbonFree Technology Initiative. With the right policies and with new technologies, an affordable, resilient 100% clean energy future is possible.
The second article, by the U.S. Environmental Protection Agency's (EPA) Janet McCabe—“EPA's Efforts to Protect Our Communities, Our Health, Our Planet, and Our Future”—discusses U.S. efforts to address the climate crisis, EPA regulations, and disadvantaged communities. More than US$100 billion of funding for EPA programs from the U.S. Congress (through the Inflation Reduction Act [IRA] and the Bipartisan Infrastructure Law) will help the United States reduce 2030 national greenhouse gas emissions (GHGs) by approximately 40%, alongside EPA regulatory actions to address methane from the oil and natural gas sector; CO2 from cars, trucks, and heavy-duty vehicles; and CO2 by fossil fuel- fired power plants. In addition, EPA is addressing other power plant air, water and waste issues through regulatory actions. EPA notes the importance of providing regulatory certainty and a long-term planning horizon that enables continued reliable and affordable electricity. IRA can help accelerate the transition to a clean energy future, with EPA working closely with the U.S. Departments of Transportation and Energy to guide new clean energy and transportation opportunities.
In “The Third Wave of Electricity Policy: Managing Carbon Under Risk and Uncertainty,” Armond Cohen and Kasparas Spokas of the Clean Air Task Force (CATF) discuss how regulators in the United States and Europe have played a pivotal and changing role in resource decisions affecting electricity systems. This context lays out a baseline for challenges ahead for electricity policy-making by multiple entities that will need to do a better job of coordination, as they increasingly need to consider uncertainties and various risks related to key topics, such as energy reliability and security, new technologies, facility permitting (social acceptance of new infrastructure), land use, and environmental impacts. The authors discuss uncertainty, risk, and optionality in depth. Current low-carbon energy technologies need to be advanced further and sustained research, development and demonstration is needed so that new technologies are commercially available in the 2030s.
The final article, “Analyzing Air Quality Impacts of Economywide Deep Decarbonization: Challenges and Approaches” by Qianru Zhu, Eladio Knipping, David Young, and John Bistline of the Electric Power Research Institute (EPRI), examines the important implications of deep decarbonization on air quality. While recent studies have shown that electrification and decarbonization policies result in reductions in air pollutant emissions and improvements in air quality, those improvements are sometimes offset by growth in emissions from other activities. Understanding how shifts in the economy and sources of emissions may change over time are critical to informing and shaping policies to protect air quality. EPRI's ongoing work in this area will focus on characterizing how these changes in emissions could impact local air quality and community health as the economy transitions to net-zero GHG emissions.
Continue reading the full August 2023 issue of EM.