- G8 and Major Economy Leaders Agree to Slash Greenhouse Emissions
- DOE, Treasury Provide Guidance on Direct Payments for Renewable Projects
- DOE: $300M for State Rebates on Energy Star Appliances
- DOE: $448M for Weatherization Programs in 13 States
- DOE: $141M for Clean Energy in Five States, One Territory
- Renewable Energy Standards Advance in Four States
- Economic Downturn Cuts U.S. Oil and Natural Gas Drilling by Half
G8 and Major Economy Leaders Agree to Slash Greenhouse Emissions
The leaders of the world’s countries with the largest economies, including the US and the European Union, have agreed to slash global greenhouse gas (GHG) emissions by 2050, with the intent to hold global warming at less than 2 degrees Celsius above pre-industrial levels.
At last week’s meeting of the Group of Eight (G8) industrialized nations, which includes Canada, France, Germany, Italy, Japan, Russia, the UK, and the US, the nations’ leaders agreed that developed countries should reduce their aggregate GHG emissions to at least 80% below 1990 levels by 2050, while the world as a whole should cut its GHG emissions in half.
The G8 leaders acknowledged the 2°C limit and recognized that global GHG emissions "need to peak as soon as possible and decline thereafter" to hold global warming below that limit. The G8 leaders also pledged to take the lead in accelerating the transition toward a low-carbon economy, including various measures to promote renewable energy and energy efficiency. See the climate commitments on page 16 of the G8 declaration, "Responsible Leadership for a Sustainable Future" (PDF 307 KB). The clean energy declarations are on pages 9, 15, 17, 18, 24, and 26.
The G8 meeting was also expanded to include other major economies for the Major Economies Forum on Energy and Climate, which included the G8 plus Australia, Brazil, China, the European Union, India, Indonesia, the Republic of Korea, Mexico, and South Africa. That larger group also recognized the 2°C limit for global warming and acknowledged that global and national GHG emissions should peak "as soon as possible," but also declared that the peak in GHG emissions should occur later for developing countries. The members of the major economies established a global partnership to drive the development of low-carbon, climate-friendly technologies. See the declaration from the Major Economies Forum (PDF 99 KB).
"I believe we’ve made some important strides forward as we move towards Copenhagen," said President Obama, referring to the UN Climate Change Conference to be held in December. "I don’t think I have to emphasize that climate change is one of the defining challenges of our time. The science is clear and conclusive, and the impacts can no longer be ignored. Ice sheets are melting. Sea levels are rising. Our oceans are becoming more acidic. And we’ve already seen its effects on weather patterns, our food and water sources, our health and our habitats. Every nation on this planet is at risk, and just as no one nation is responsible for climate change, no one nation can address it alone." President Obama also highlighted recent U.S. actions to address climate change, declaring that "one of my highest priorities as president is to drive a clean energy transformation of our economy." See the president’s comments and the White House fact sheet on the Major Economies Forum.
DOE, Treasury Provide Guidance on Direct Payments for Renewable Projects
DOE and the U.S. Department of Treasury issued guidance last week on the process for renewable energy project owners to receive direct federal payments in lieu of tax credits.
Most large renewable energy projects are eligible to receive federal tax credits, and prior to the economic downturn, it was common for such projects to receive financing from third parties that would benefit from the tax credits. But with most companies now earning lower profits and expecting to pay lower taxes, that tax-credit financing has dried up, making it more difficult to take advantage of them. To address that issue, the Recovery Act authorized the Treasury Dept. to make direct payments to companies that create renewable energy facilities and place the facilities in service on or after January 1, 2009. See the February 18 article from this newsletter on this aspect of the Recovery Act.
The Treasury has set aside $3 billion in Recovery Act funds for direct payments, sufficient to support an estimated 5,000 facilities using biomass energy, solar energy, wind power, and other types of renewable energy. The agency is not yet accepting applications for direct payments, but by releasing the guidance documents now, it aims to give businesses ample time to prepare applications. The agency intends to launch a Web-based application process in the coming weeks. See the DOE press release and the terms and conditions, guidance, and a sample application for the direct payments on the Treasury Department Web site.
DOE Offers $300 Million for State Rebates on Energy Star Appliances
DOE offered $300 million in Recovery Act funds on Tuesday for state-run Energy Star rebate programs. The funds will support rebates for citizens who buy new Energy Star-qualified home appliances. The funds will flow to state and territorial energy offices according to a formula established by the Energy Policy Act of 2005, with the smallest territories eligible for $100,000 and California, the largest state, eligible for more than $35 million. States can use the rebates in combination with other energy efficiency programs offered in their areas to maximize energy efficiency benefits for their residents.
States have the flexibility to select which residential Energy Star appliances to include in their programs and to determine the individual rebate amount for each appliance. However, DOE recommends they focus on heating and cooling equipment, appliances, and water heaters, as these products offer the greatest energy savings potential. Specific targets include: central air conditioners, heat pumps, boilers, furnaces, room air conditioners, clothes washers, dishwashers, freezers, refrigerators, and water heaters.
The Energy Star program, a joint endeavor of the U.S. EPA and DOE, covers over 60 product categories from 2,645 manufacturers, sold by more than 2,000 retail partners. To earn the rebate funds, states and territories must file an initial application by August 15, followed by a full application on October 15. DOE anticipates that a vast majority of funding will be awarded by November 30. See the DOE press release and the Energy Star Web site, and to see the full Funding Opportunity Announcement, search the public opportunities on FedConnect for reference number DE-FOA-0000119.
DOE Delivers $448 Million for Weatherization Programs in 13 States
DOE delivered more than $448 million from the Recovery Act to 13 states last week, allowing those states to dramatically expand their weatherization assistance programs. The programs improve the energy efficiency of the homes of low-income families. DOE awarded funds to Alabama, Idaho, Maine, Missouri, New Jersey, Oklahoma, Rhode Island, Texas, Vermont, Virginia, Washington, Wisconsin, and Wyoming, and the states may spend up to 20% of the funds to hire and train new workers. The funds will help the states achieve their collective goal of weatherizing 125,000 homes, creating new green jobs while cutting greenhouse gas emissions.
The funds represent 40% of the total weatherization funds available to those states under the Recovery Act and follow the award of 10% of the funds in March to support planning and ramp-up activities. The second half of the weatherization funds will be released when the states meet the reporting, oversight, and accountability milestones required by the Recovery Act. Details on the funds awarded each states, as well as the weatherization goals set by each state, can be found in the DOE press release. See also the Web site for DOE’s Weatherization Assistance Program.
DOE Awards $141 Million for Clean Energy in Five States, One Territory
DOE delivered more than $141 million in Recovery Act funds last week to Hawaii, Maine, Nebraska, New Mexico, Texas, and the Northern Mariana Islands to support energy efficiency and renewable energy projects. Under DOE’s State Energy Program, states and territories have proposed plans that prioritize energy savings, create or retain jobs, increase the use of renewable energy, and reduce greenhouse gas emissions. The funds will support loan and grant programs, education and training efforts, energy audits, building retrofits, building energy code upgrades, industrial energy efficiency initiatives, and incentives for alternative-fueled vehicles.
For example, Texas will introduce a revolving loan program that will enable public facilities to implement building efficiency measures. Recovery Act funds will also be used for competitive grants to state agencies, communities, schools, and hospitals to install and demonstrate solar, wind, biomass, and geothermal energy technologies. And Hawaii’s energy efficiency strategy will directly fund high performance buildings, government and residential building retrofits, and energy efficiency measures in the state’s hospitality industry. The program will also provide technical assistance and training to building owners, developers, design professionals, and county building code officials to ensure that new and renovated buildings are designed and built with high efficiency measures.
The Recovery Act appropriated $3.1 billion to the State Energy Program, giving priority to achieving national goals of energy independence while helping to stimulate local economies. For the five states and the Northern Mariana Islands, the new funds represent 40% of the State Energy Program funds available to them under the Recovery Act, following an initial 10% of the funds that were awarded to support planning activities. The second half of the funds will be released when they meet the reporting, oversight, and accountability milestones required by the Recovery Act. See the state-by-state list of funding and energy plans in the DOE press release.
Renewable Energy Standards Advance in Four States
The states of Kansas and West Virginia recently adopted their first mandatory requirements for renewable energy use through renewable energy standards, while Maine and Nevada boosted the requirements under their renewable energy standards.
The Kansas legislation requires the state’s utilities to draw on renewable energy to meet 10% of peak demand by 2011, 15% by 2019, and 20% by 2020. Renewable energy sources can include wind power, solar energy, existing hydropower, new small hydropower, various forms of biomass energy, and fuel cells that use hydrogen produced from a renewable energy resource. New facilities earn 10% extra credit toward the requirement. Kansas is also allowing easy interconnection and net metering for customer-owned renewable energy systems, and those systems can count toward the requirement. Utilities can also meet a portion of the requirement by buying renewable energy credits. The legislation also requires energy efficiency standards for buildings owned and leased by the state and sets fuel economy standards for state-owned motor vehicles. See the press release from Governor Mark Parkinson and the full legislation (PDF 112 KB). Download Adobe Reader.
West Virginia is a coal state, and its new credit-based system allows for both renewable energy and mostly coal-based "alternative energy resources" to meet its new standard. The state requires electric utilities to hold credits for at least 10% of their retail sales by 2015, increasing to 15% by 2020 and 25% by 2025. Renewable energy facilities normally earn double credits, but they earn triple credits if the facilities are located on reclaimed surface mines. Customer-owned generators also earn credits that can be sold to the utility, while utilities can earn credits through energy efficiency and demand management initiatives, as well as projects that reduce or offset greenhouse gases. Eligible renewable energy resources include solar energy, wind power, geothermal energy, biomass power, run-of-river hydropower, and fuel cells. Alternative energy resources include advanced coal technologies, waste coal, coal bed methane, fuel from coal gasification or liquefaction, synthesis gas, natural gas, tire-derived fuel, pumped storage hydropower, and energy reclaimed from waste heat. See the West Virginia legislation.
The changes in Maine and Nevada are far more straightforward. Maine has passed legislation that provides a 50% extra credit toward its renewable energy standard for community-based renewable energy projects. Nevada simply extended its renewable energy standard, which previously topped out at 20% for 2015 and after. Under the new legislation, the standard increases to 22% by 2020 and to 25% by 2025. See the Maine legislation and page 49 of the Nevada legislation (PDF 169 KB).
Economic Downturn Cuts U.S. Oil and Natural Gas Drilling by Half
Drilling for oil and natural gas wells in the United States was down by nearly half in the second quarter of 2009, relative to the same quarter in 2008, according to the American Petroleum Institute (API). The API’s second-quarter drilling report estimated that only 8,038 oil wells, natural gas wells, and dry holes were completed in the second quarter, down 46% from the second quarter of 2008. That’s the lowest level of drilling seen in the United States since 2004.
Most of the current drilling is targeting natural gas, with an estimated 4,225 natural gas wells completed during the quarter. Hardest hit were exploratory wells, with only 336 drilled during the quarter, a 63% decrease from 2008. Such boom-and-bust cycles are common in the drilling industry, but as the economy recovers and demand increases, drillers may find it difficult to secure new drilling rigs and to ramp up production. See the API press release.
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Kevin Eber is the Editor of EREE Network News, a weekly publication of the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE).
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