Lewis and Roca Renewable Energy Blog

CBO Issues New Analysis of Carbon Tax

Thu, 23 May 2013 14:24:00 GMT

The nonpartisan Congressional Budget Office (CBO) released a report yesterday about the impact of a carbon tax on the U.S. economy and the environment. According to CBO's analysis, the overall economic effect of a carbon tax would depend largely on how revenue from the tax is allocated. For example, using the revenues to reduce the federal budget deficit would offset at least part of the tax's costs to the economy by increasing output in the long run. On the other hand, directing revenue from a carbon tax to the people most impacted by it -- low-income households -- would not benefit the overall economy, resulting in a higher total costs. In 2011, the CBO estimated that a carbon cap-and-trade program could raise $1.2 trillion in revenues over ten years.

The economic costs of a carbon tax basically amount to an increase in the prices of goods and services, especially things like electricity and transportation that require relatively large amounts of carbon dioxide emissions to produce. The higher prices would decrease people's purchasing power, thereby reducing their real (inflation-adjusted) wages. Low-income households would bear a disproportionate share of the costs because they generally spend a larger portion of their income on emission-intensive goods and services.

With respect to the environmental effects of a carbon tax, the CBO concluded (somewhat obviously) that any reduction in U.S. carbon emissions will result in an incremental reduction in expected damages from climate change. As in any other context, the social cost of carbon is highly uncertain.

The CBO report was requested by Rep. Henry Waxman (D-CA).

Investment in Clean Energy Dips in First Quarter of 2013

Thu, 25 Apr 2013 16:07:00 GMT

According to research from Bloomberg New Energy Finance, worldwide investment in clean energy dropped to its lowest level in four years during the first three months of this year. Total investment, which includes renewables, energy efficiency, and energy-smart technologies, was down 38% from the last quarter of 2012 and 22% from the same period (first quarter) of 2012. The causes identified by BNEF include policy uncertainty in major markets like the U.S. and Germany and the sharp decrease in prices of solar PV panels which translates to lower investment, in dollar terms, for a project of equal capacity.

The year-on-year decline was sharpest in the U.S., with less than half the amount invested in the first quarter of 2013 as was invested in the first quarter of 2012. A large part of this was the potential expiration of the Production Tax Credit ("PTC") at the end of 2012, which motivated many wind project owners to accelerate their development schedules. This essentially shifted investment from 2013 into 2012 and even 2011. Congress ultimately renewed the PTC in January.

Investment also dropped in Europe (25%) and China (15%) but jumped by 47% in the rest of Asia (excluding China and Asia), led by Japan.

By type of investment, the biggest decline was in the asset finance of utility-scale projects, which fell by 34%. Investment in small (< 1MW) installations - primarily rooftop PV - also dropped 8%, due mostly to the lower cost of PV panels.

Read more here.

NV Energy Proposes Legislation to Close Coal Plants, Invest in Renewables and Natural Gas

Wed, 03 Apr 2013 13:37:00 GMT

The Las Vegas Sun reported yesterday on NV Energy's proposal to begin decommissioning its existing coal-fired power plants and to accelerate its investments in renewable energy and natural gas generating capacity. Interestingly, NV Energy is seeking to implement the plan legislatively, as opposed to having it approved by Nevada's Public Utilities Commission (PUC). This is not surprising considering the difficulty the utility had in getting three renewable energy PPAs approved in 2011 (as we blogged about here). According to the Sun article, the PUC would not be able to reject the plan if approved by the legislature.

NV Energy's plan calls for the closure of (or divestiture from) all the utility's coal plants, beginning in 2014 and completed by 2025. The coal generating capacity will be replaced by 600 MW of renewable generation and 1,000 MW of natural gas capacity over the next five years. The bill would require that the utility own or operate at least 25% of the new renewable resources, a new role for NV Energy. According to the Sun article, the construction projects would bring about 4,700 construction jobs to Nevada and would result in about 200 permanent operations and maintenance jobs at the facilities.

NV Energy estimates that the proposed legislation could result in a 4% increase in rates over the next 20 years. At least part of this will be used to pay for the costs of closing existing coal plants; for example, payments for terminating contracts associated with the plants and the cost of unused coal. The plan would also apparently change the way costs are incorporated into rates. Currently, utilities in Nevada must pay their expenses and then ask the PUC to allow them to recover the costs from ratepayers. Under this process, utilities cannot begin recovering their costs or earning a return on their investments until their next general rate case which could be several years later. This is known in the industry as "regulatory lag". Under NV Energy's proposal, it would be able to start recovering its costs at the start of the next fiscal quarter without prior PUC approval. The PUC would be able to review the rate increases retroactively during the next general rate case.

Suntech Closing Goodyear Solar Plant; Blames U.S. Solar Tariff

Mon, 18 Mar 2013 16:32:00 GMT

Suntech announced last week that it will be closing its Goodyear, AZ panel manufacturing facility in April. We blogged here about Suntech's decision to locate in Arizona in Nov. 2009. The company blamed the closure on hefty tariffs imposed on Chinese solar cells by the U.S. International Trade Commission (although the panels were assembled in Arizona, the cells were produced in China). However, the tariffs are not completely to blame for the company's financial problems -- Suntech announced last summer that it was defrauded into investing 530 million euros ($690 million) in non-existent German bonds. It also had a $541 bond payment due on Friday, on which it defaulted today. Suntech's stock is down almost 80% in the last year.

Forty-three jobs in Arizona's struggling solar industry will be lost as a result of the closure.

We previously blogged about the tariff on Chinese solar cells: Commerce Department Proposes Tariffs on Chinese Solar Panels; and Disagreement Over Effectiveness, Wisdom of U.S. Tariffs on Chinese Solar Cells.

GE Takes Over Top Spot in Ranking of World's Largest Wind Turbine Manufacturers

Tue, 26 Feb 2013 14:17:00 GMT

According to a statement released earlier this month by BTM Consult, a division of Navigant, General Electric passed Denmark-based Vestas Wind Systems in 2012 as the world's largest manufacturer of wind turbines. Vestas had held the top spot for twelve years. Another American company, Siemens, came in third with German-based Enercon and India-based Suzlon rounding out the top five. Although none made it into the top five, four Chinese companies were ranked in the top ten. The only other top ten company was Spain's Gamesa. The rankings are preliminary with the final report expected to be released in March.

Read more here and here.

President Obama Includes Climate Change in Inaugural Speech

Tue, 22 Jan 2013 13:12:00 GMT

In his second inaugural speech yesterday, President Obama mentioned climate change and promised a response. He also voiced his support for a transition to "sustainable energy sources" but did not provide any additional details about how he will address climate change in his second term as President. Here is the relevant portion of his speech:

"We, the people, still believe that our obligations as Americans are not just to ourselves, but to all posterity. We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations. (Applause.) Some may still deny the overwhelming judgment of science, but none can avoid the devastating impact of raging fires and crippling drought and more powerful storms.

"The path towards sustainable energy sources will be long and sometimes difficult. But America cannot resist this transition, we must lead it. We cannot cede to other nations the technology that will power new jobs and new industries, we must claim its promise. That's how we will maintain our economic vitality and our national treasure -- our forests and waterways, our crop lands and snow-capped peaks. That is how we will preserve our planet, commanded to our care by God. That's what will lend meaning to the creed our fathers once declared."

Meanwhile, a new poll by CNN indicates that the percentage of Americans who agree that climate change is real and manmade has dropped seven points since 2007 and is now just below 50%. Of the remaining poll respondents, approximately one half (24% of total) believe climate change is real but not manmade and the rest do not believe in climate change at all.

Here is an interesting blog by the progressive Media Matters non-profit, arguing that CNN itself is at least partially to blame for the public's confusion about climate change.

Duke and SOLON Complete 10MW PV Project in Arizona

Wed, 16 Jan 2013 15:38:09 GMT

Duke Energy Renewables and SOLON Corp. announced last week the completion of the 10MW Black Mountain Solar Project near Kingman. Duke purchased the project from SOLON in May 2012. SOLON constructed the project and will be responsible for operation and maintenance of the solar system. Electricity generated by the project will be purchased by UniSource Energy Services, a sister company to Tucson Electric Power (TEP), under a twenty-year power purchase agreement. The Black Mountain Solar Project is Duke's fifth photovoltaic (PV) plant in Arizona, along with the 5MW Ajo Solar Farm in southern Arizona, the 15MW Bagdad Solar Farm near Prescott, the 1.5MW Prescott Valley Solar Project, and the 6MW Gato Montes Solar Project in Tucson.

Duke appears to be one of the few utilities investing in renewable projects outside its service area and has also been one of the few utilities in support of climate change legislation and various EPA rules that impact the electric industry. Duke Energy Renewables owns eight additional solar farms outside of Arizona along with ten wind farms. According to its press release, Duke has invested more than $2.5 billion in wind and solar projects since 2007.

SOLON Corp. is a subsidiary of the SOLON Energy GmbH, based in Berlin, Germany. SOLON closed its Tucson manufacturing facility in the fall of 2011 and has since focused on project development. The Black Mountain Project uses SOLON's single-axis tracking technology and puts SOLON at over 60MW of PV installations in Arizona.

U.N. Climate Change Conference Reaches Mid-Point

Fri, 30 Nov 2012 16:03:00 GMT

The 2012 conference of the United Nations' Framework Convention on Climate Change is currently underway in Doha, Qatar. The conference began on Monday, November 26th, and continues through Friday, December 7th. You can browse the full schedule here or read summaries of each day's proceedings on Columbia Law School's Climate Law Blog. The general consensus (of observers) is that very little is going to be accomplished at the conference due to a lack of consensus by participating nations about how, or even whether, to proceed with reducing anthropogenic emissions of greenhouse gases. This has been the situation for at least the last few conferences, but it is more significant this time since the Kyoto Protocol terminates at the end of the year.

Read more here and here.

Oxford Economist Criticizes Europe's Approach to Climate Change in New Book

Mon, 29 Oct 2012 13:22:00 GMT

A book by Oxford Economics Professor, Dieter Helm, is highly critical of the methods being used by European countries to reduce their carbon emissions in an attempt to mitigate the impacts of global climate change. The Carbon Crunch: How We're Getting Climate Change Wrong—and How to Fix It, argues that current regulatory efforts to cut carbon emissions have focused on expensive and ineffective methods, resulting in limited progress and widespread scepticism of the movement. (This blog is based primarily on a review of Mr. Helm's book by The Economist, and not a full reading of the book which is not yet available in the U.S.)

One of Mr. Helm's most surprising conclusions is that the implementation of the Kyoto Protocol by European countries has actually increased global greenhouse gas (GHG) emissions by shifting manufacturing to China and India, where industry is less regulated and more carbon-intensive than in Europe. He also argues that countries could achieve much higher reductions in GHG emissions for the same amount of money by initially supporting a shift from coal generation to natural gas, rather than focusing their efforts on expensive renewable technologies. Joining many other economists, Mr. Helm also believes that a carbon tax is preferable to a carbon price set by markets.

The Economist's opinion: "This prescription is unrealistic. Europeans are too committed to their regulatory approach to change now. But Americans, Chinese and Indians would learn a lot from Mr. Helm about cutting carbon emissions rationally. And all readers will get a cogent account of how self-defeating current global climate-change policies are turning out to be."

Supreme Court Refuses to Hear Chevron's Appeal re $18 Billion Ecuador Contamination Case

Thu, 11 Oct 2012 16:33:00 GMT

On Tuesday, the U.S. Supreme Court denied Chevron's petition for certiorari from a decision of the Second Circuit Court of Appeals. Chevron was seeking an injunction barring the enforcement of a $18 billion Ecuadorian judgment anywhere in the world. The District Court for the Southern District of New York agreed with Chevron's accusations of fraud and manipulation of evidence by the plaintiffs and their attorneys and granted the injunction in March 2011. The Second Circuit vacated the injunction in January of this year and Chevron appealed to the Supreme Court. This U.S. case stems from a case in Ecuador, in which an Ecuadorian judge awarded over $18 billion to local farmers and indigenous groups in February 2011. (I blogged about the Ecuadorian court's decision here.)

The allegations in the Ecuador case are based on extensive contamination of surface waters in the Lago Agrio area of the Amazon rainforest from Texaco's drilling operations in the 1970's and 80's. (Texaco was acquired by Chevron in 2001.) The judgment handed down in 2011 is being appealed in Ecuador by both sides. Since Chevron has no assets in Ecuador, the plaintiffs are expected to enforce the judgment by convincing courts in countries where Chevron does have assets to seize those assets. The U.S. case was a pro-active attempt by Chevron to prevent these collection efforts.

Interestingly, the plaintiffs originally filed the case in the same federal District Court. From 1993 to 2001, Texaco litigated the contamination claims against 30,000 affectados and eventually convinced the court that the case could and should be tried in Ecuador. Chevron will apparently now be arguing the exact opposite all around the world -- that the judgment of the Ecuadorian court should not be enforced because it is the product of a corrupt and/or incompetent judicial system.

For more on the dramatic background of this case and the lawyers involved, here is an excellent article from The New Yorker (Jan. 2012). And here is a March 2011 Businessweek article, focused on the conflicting narratives about the plaintiffs' lead lawyer, Steven Donziger.

Last Federal Climate Change Case Dismissed by Ninth Circuit

Thu, 27 Sep 2012 17:48:00 GMT

Last Friday, the Ninth Circuit dismissed the last climate change lawsuit still pending in the federal courts to the best of my knowledge. Native Village of Kivalina v. ExxonMobil Corp. was a lawsuit by a small Alaskan village against 22 oil, energy, and utility companies, alleging that their greenhouse gas (GHG) emissions caused global warming which prevented historic levels of sea ice from forming around the village. The lack of sea ice exposed the village to massive erosion from the ocean's waves and the possibility of devastating storms in the future. The villagers sought damage payments from the defendants for the harm they suffered from global warming; presumably, at a minimum, the costs of relocating the village, estimated by the Army Corps of Engineers at $95 million.

The U.S. District Court for the Northern District of California dismissed climate change claims in 2009 on the grounds that the case presented a political question that should not be considered by the courts. This decision was significant because both the Second and Fifth Circuits reached the opposite conclusion at around the same time in Connecticut v. American Electric Power and Comer et al. v. Murphy Oil USA et al., respectively. Connecticut v. AEP was reversed by the Supreme Court last summer and Comer et al. v. Murphy Oil USA et al. was vacated by the Fifth Circuit in 2010. In dismissing Kivalina, the Ninth Circuit essentially just applied the Supreme Court's precedent from Connecticut v. AEP.

The Ninth Circuit ended its opinion with the following paragraph: "Our conclusion obviously does not aid Kivalina, which itself is being displaced by the rising sea. But the solution to Kivalina's dire circumstance must rest in the hands of the legislative and executive branches of our government, not the federal common law."

Significantly, in 2010 EPA issued its "Tailoring Rule" and begin implementing its GHG regulatory scheme. If not for EPA's action, it is likely that these cases -- and perhaps many more -- would still be winding their way through the federal court system.

Read more here and here.

ASU Selected to Lead Algae Research Under $15 Million DOE Grant

Fri, 14 Sep 2012 15:24:00 GMT

On Tuesday, the U.S. Department of Energy announced a $15 million grant to the Algae Testbed Public-Private Partnership (ATP3) led by ASU. $8 million will cover the first two years of the program and, if certain benchmarks are met, the remaining $7 million will be disbursed. The ATP3 partnership is led by the Arizona Center for Algae Technology and Innovation (AzCATI) housed at ASU’s Polytechnic campus with support from national labs and academic and industrial partners, including the National Renewable Energy Laboratory, Sandia National Laboratories, Cellana LLC, Touchstone Research Laboratory, SRS Energy, Cal Poly San Luis Obispo, Georgia Institute of Technology, University of Texas at Austin, and Commercial Algae Management. Gary Dirks, director of ASU’s LightWorks, said that the grant "puts Arizona in the research and early-development stage as a leader in the U.S., if not the world."

Read more here and here.

DOE Announces $5 Million Grant to Arizona Universities for CSP Research

Wed, 29 Aug 2012 15:43:00 GMT

The U.S. Department of Energy (DOE) announced yesterday that it will invest $5 million over the next five years on research to improve the molten salt-based heat transfer fluids used in concentrating solar projects (CSP), such as Abengoa's Solana Project near Gila Bend. The project will be led by the University of Arizona but will also include researchers from Arizona State University and the Georgia Institute of Technology. The grant is part of DOE's Sunshot Initiative, which is attempting to reduce the cost of solar energy through providing funding for research on high risk, high payoff ideas.

Unlike photovoltaic (PV) panels, which convert light directly into electricity, CSP technologies capture the sun's heat in fluids which are then used to boil water and power a conventional steam turbine. Improving the heat transfer characteristics of the fluid used in a CSP plant improves the efficiency of the plant and, therefore, decreases the cost of energy produced by the plant.

The DOE also awarded $5 million to a university team led by UCLA to study liquid metals as potential replacements for molten salt-based fluids in CSP.

Read more here (Phoenix Business Journal).

Two Arizona Renewable Energy Projects to Receive "Fast Track" Treatment from Federal Government

Tue, 14 Aug 2012 11:30:00 GMT

The Obama Administration announced last week "that seven nationally and regionally significant solar and wind energy projects will be expedited" through the applicable federal permitting and review processes. The two Arizona projects are: (1) BP Wind's Mohave County Wind Farm, between Kingman and Las Vegas; and (2) SolarReserve's Quartzsite Solar Energy Project, near Quartzsite. The announcement also includes two solar PV projects in California, two solar projects in Nevada, and one wind project in Wyoming for a total of nearly 5,000 MWs of renewable energy. The administration did not provide any details on how the "fast track" program will differ from standard procedure. Both of the Arizona projects had already been identified by the BLM as "Priority Projects" for 2012.

The Quartzsite Solar Energy Project is a 100 MW concentrating solar project planned to be built on BLM land near the Arizona-California border. The project will use "power tower" technology to concentrate sunlight on a receiver on top of a 650 ft. tower. Liquid salt circulating through the receiver will absorb the sun's energy and then be used to create steam that can power a conventional steam turbine. BLM issued a Draft Environmental Impact Statement (EIS) for the project in November 2011. The recent announcement sets a target date of December 2012 for the federal government to complete its review.

The Mohave County Wind Farm will consist of a few hundred wind turbines on approximately 49,000 acres of public land in the White Hills area of Mohave County, approximately 40 miles northwest of Kingman. It could have a capacity as high as 500 MWs and will connect to the grid through existing high-voltage power lines that run through the project area. The BLM issued a Draft EIS for the project in April of this year and, according to the recent announcement, federal review will be completed in January 2013.

Lewis and Roca represented SolarReserve in obtaining a Certificate of Environmental Compatibility from the Arizona Corporation Commission for its Quartzsite project and is currently assisting BP Wind in the same process for the transmission line for its Mohave County Wind Farm.

Read the Arizona Republic's coverage on this announcement here.

D.C. Circuit Rejects Challenge to EPA's GHG Rules

Tue, 03 Jul 2012 16:53:00 GMT

Last week, the U.S. Court of Appeals for the District of Columbia Circuit dismissed a series of lawsuits challenging EPA's recently promulgated greenhouse gas (GHG) rules. You can read the full opinion here. The lawsuits were brought by a collection of states and industry groups arguing that EPA's Endangerment Finding, Tailpipe Rule, and Timing and Tailoring Rules are not supported by the Clean Air Act (CAA) and are otherwise arbitrary and capricious. In a per curiam opinion, the three judge panel unanimously rejected each of the petitioners' challenges, finding that the Endangerment Finding was appropriate under the CAA and that the subsequent GHG rules triggered by the Endangerment Finding are required by the CAA and the Supreme Court's opinion in Massachusetts v. EPA. The court didn't reach the merits of the petitioners' challenge to the Timing and Tailoring Rules because it found that none of the petitioners had standing to challenge them because they had not been injured in any way. The petitioners are expected to appeal the ruling.

There were approximately 17 states supporting the challenge, led by Virginia and Texas but also including Alaska, Alabama, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana, Michigan, Nebraska, North Dakota, Oklahoma, South Carolina, South Dakota, and Utah. A roughly equal number of states, let by Massachusetts, intervened in support of EPA's rules. Other states supporting EPA included California, Connecticut, Delaware, Illinois, Iowa, Maryland, New Hampshire, Maine, Minnesota, New Mexico, New York, North Carolina, Oregon, Rhode Island, Vermont, and Washington.

Read more here and here.

Disagreement Over Effectiveness, Wisdom of U.S. Tariffs on Chinese Solar Cells

Fri, 22 Jun 2012 15:34:46 GMT

Since the U.S. Commerce Department's decision to impose anti-dumping tariffs against solar cells manufactured in China, there has been considerable disagreement about the effectiveness of the tariffs, in addition to debate about the broader trade implications of the action. Media outlets began reporting almost immediately that Chinese solar companies were likely to simply begin buying cells made in nearby markets such as Taiwan and Korea and to continue their remaining manufacturing and panel assembly operations in China. These reports predicted that the end result would most likely be a minor increase in the price of Chinese solar panels because of the current oversupply in the global market for solar cells. Last week, one of China's largest solar cell makers, JA Solar, confirmed that it plans to do exactly that (read more here). However, the Coalition for American Solar Manufacturing (CASM) -- the group behind the complaint to the Commerce Department -- released an analysis this week arguing that the tariffs will be effective and that "toll production" of solar cells in a third country should not allow Chinese companies to avoid the tariffs.

Another important consideration on this issue is the broader implications on trade between the world's two largest economies. One week after the announcement, China's Commerce Ministry announced that its investigation of six renewable energy projects in the U.S. had found violations of international trade law. And just this week, it was reported that Chinese polysilicon makers are asking the Chinese government to impose duties on U.S. imports of the material, which is an essential component of solar panels. All of this has led some observers to label the situation a "Solar Trade War".

Of course, the American solar industry is divided on the tariffs, with developers and some manufacturers strongly opposed.

Commissioner Hall Elected President of NARUC Western Region

Wed, 20 Jun 2012 13:05:00 GMT

New Mexico PRC Commissioner Ben Hall has been elected President of the Western Conference of Public Service Commissioners, the regional association of the National Association of Regulatory Utility Commissioners (NARUC), for the next year (beginning October 1st). The Western Regional NARUC Conference will be held June 2-5, 2013 at the Eldorado Hotel in Santa Fe. This will be the first time in 13 years that the conference will be held in New Mexico.

Commerce Department Proposes Tariffs on Chinese Solar Panels

Fri, 18 May 2012 15:58:00 GMT

Yesterday, the U.S. Commerce Department proposed tariffs of at least 31% on solar panels imported from China. The preliminary ruling found that Chinese manufacturers have been illegally "dumping" solar panels on the U.S. market, meaning that they have been selling panels at below production costs. The tariffs will be retroactive for 90 days but will not become final unless and until the International Trade Commission finds that the under-priced panels are injuring the U.S. solar industry. A final decision from the Commerce Department is expected in the fall.

Chinese representatives obviously disagree with the ruling and warn that it will hurt the larger American economy by provoking retaliation by China with respect to American imports and by slowing the rapid growth of the U.S.'s solar industry at large. The domestic solar industry is sharply divided over the issue with manufacturers arguing that the country should try to maintain its manufacturing jobs and capabilities while developers and installers argue that the lower prices are helping the industry and benefitting consumers.

Read more here and here.

Legislature Adjourns Without Senate Vote on HB 2789

Wed, 09 May 2012 17:06:00 GMT

The Arizona Legislature adjourned last week without a Senate floor vote on Rep. Lesko's (R-Glendale) controversial House Bill 2789. This bill, as amended in the Senate, would have prohibited the State from increasing its existing renewable energy standard, which was adopted by the Arizona Corporation Commission (ACC) in 2006. HB 2789 was actively opposed by Arizona's renewable energy industry and was unconstitutional in the opinions of both the ACC's legal division and Legislative Council. Although it passed the House (in a different version) and both Senate Committees to which it was assigned, the bill was never placed on an agenda for a vote by the full Senate -- presumably under the direction of Senate Majority Leader, Sen. Steve Pierce (R-Prescott).

Read my prior coverage of HB 2789 in the following blogs:

Arizona Enacts Environmental Audit Privilege Legislation

Wed, 25 Apr 2012 17:11:04 GMT

Arizona businesses have a new tool to assist their environmental compliance efforts. On April 12, with the signing of House Bill 2199, Arizona joined over twenty other states by enacting an evidentiary privilege for environmental audits.

The new law provides an incentive for regulated businesses to investigate and correct any environmental noncompliance issues they may have. House Bill 2199 is intended to remove the fear that by taking the initiative to conduct an audit, the regulated entity is essentially “writing its own ticket” for a violation. Under the new law, an environmental audit report prepared by a regulated entity or its outside auditor or consultant is inadmissible as evidence and is not subject to discovery in an administrative proceeding or civil action. Upon discovery of noncompliance, however, the regulated entity must promptly initiate and pursue with reasonable diligence “appropriate efforts to achieve compliance” in order take advantage of the privilege.

The privilege does not apply to information already required to be collected, developed, maintained, or reported under existing environmental laws. It is also not available in criminal proceedings.

Arizona’s new environmental audit privilege should benefit both the regulated community and the environment by encouraging businesses to take a comprehensive look at their environmental compliance profile and take upfront corrective action as needed.

U.S. Regains Lead in Investment in Renewables; China Takes Long-Term Approach

Tue, 17 Apr 2012 15:47:00 GMT

The Pew Charitable Trusts released a report last week analyzing the worldwide clean energy economy in 2011 with a particular focus on investment levels in G-20 countries. The report is titled Who's Winning the Clean Energy Race? 2011 Edition and is based on data gathered by Bloomberg New Energy Finance, a market research firm focused on renewable energy. The report found that worldwide clean energy investment rose 6.5% in 2011 to a record $263 billion, resulting in the deployment of 83.5 gigawatts (GW) of new renewable energy capacity.

With a 42% increase in its investment in renewable energy, the U.S. regained the top spot with $48.1 billion of investment in 2011. The U.S. ranked third in 2010 behind both China and Germany. China was just behind the U.S. in 2011 with $45.5 billion of investment, only a 1% increase from the $45 billion invested in 2010. However, the authors predict that China will soon retake the lead as a result of its long-term commitment to renewable energy compared to the short-term, variable nature of government incentives in the U.S.:

"The United States reclaimed the top spot in the worldwide clean energy race in 2011. Because of policy uncertainty, however, its leadership is likely to be short-lived after a variety of American clean energy programs expired at the end of 2011. Nothing appears likely to stem the long-term shift in the clean energy sector's center of gravity as investment swings from the West (Europe and the United States) to the East (Asia) and from the Northern Hemisphere to the Southern." (p.14)

HB 2789 Passes Senate Government Reform Committee

Thu, 15 Mar 2012 15:02:00 GMT

Rep. Lesko's (R-Glendale) energy bill -- HB 2789 -- was passed yesterday by the Government Reform Committee of the Arizona Senate. The bill was subject to a "strike everything" amendment that replaced the version of the bill that passed the House with the following single sentence: "A Public Service Corporation shall not be required to meet a renewable energy standard that is greater than the standards required in any rules in effect on January 1, 2012." The change was presumably made to address concerns about the bill's constitutionality after both the ACC's top attorney and the legislature's own legal counsel concluded that the House version was unconstitutional. However, this sentence seems to have the same constitutional problems as the full version.

Arizona's current Renewable Energy Standard was adopted by the Arizona Corporation Commission in 2006. It requires regulated utilities to produce a certain percentage of their electricity from renewable sources. Those percentages escalate over time, beginning at 1.25% in 2006 and peaking at 15% from 2025 and beyond.

Read our prior blogs on this bill from the blog's homepage, here.

Arizona House of Reps. Approves Potentially Unconstitutional Energy Bill

Tue, 06 Mar 2012 17:32:00 GMT

The Arizona House of Representatives voted today to pass Rep. Lesko's HB 2789. This is the bill that would require the Arizona Corporation Commission (ACC) to get legislative approval of "all rules or amendments to existing rules ... concerning public service corporations that are policy decisions, including rules mandating the use of specific sources of energy or imposing or increasing energy efficiency standards or renewable energy standards." Both the ACC's legal counsel and the Legislative Council have concluded that the bill is unconstitutional (see our prior blogs here and here).

The solar industry strongly opposes HB 2789 and I suspect that most regulated public service corporations (i.e., utilities) doing business in the state are skeptical of a bill which essentially creates an entirely new -- not to mention extremely complicated -- level of regulation over their industries. It passed by a smaller than expected margin of 31-27, meaning that a fair number of Republicans voted against it (go here to see how each representative voted). The bill will now go to the Senate where most observers think it will have a difficult time getting passed.

Read more here and here.

HB 2789 Moves Forward Despite Legislative Council's Finding of Unconstitutionality

Wed, 29 Feb 2012 15:48:00 GMT

Earlier today, the Rules Committee of the Arizona House of Representatives passed Rep. Lesko's (R-Glendale) HB 2789 despite an opinion issued by the Arizona Legislative Council on Monday concluding that the bill is unconstitutional. The Council's reasoning mirrored a similar analysis issued last week by the Corporation Commission's counsel, as we blogged about here. In short, the Council concluded that the bill would violate the separation of powers clause of the state constitution and infringe on the Corporation Commission's constitutionally granted powers.

Read more here and here.

ACC's Top Attorney Concludes HB 2789 is Unconstitutional

Fri, 24 Feb 2012 11:40:00 GMT

In a letter to the Commissioners last week, Janice Alward, Chief Counsel for the Arizona Corporation Commission (ACC), analyzed a bill currently pending in the Arizona Legislature and concluded that it is unconstitutional. HB 2789 would require the ACC to get legislative approval of "all rules or amendments to existing rules ... concerning public service corporations that are policy decisions, including rules mandating the use of specific sources of energy or imposing or increasing energy efficiency standards or renewable energy standards." Alward concludes that the bill "is unconstitutional insofar as it requires the Commission to submit rules related to ratemaking to the Legislature and the Governor for approval." The primary basis for her conclusion is that the Arizona Constitution gives the ACC exclusive authority over ratemaking and the courts have already determined that the Commission's Renewable Energy Standard & Tariff (REST Rules) -- a clear target of the bill -- falls within that exclusive authority. Alward goes on to conclude that the bill would violate the separation of powers doctrine, is unconstitutionally vague and overbroad, and does not consider the practical consequences of the bill on the ACC's rulemaking process.

HB 2789 was introduced by Representative Debbie Lesko (R-Glendale) and is co-sponsored by an additional 29 legislators -- all Republican -- from both the House and Senate. In addition to its legislative support, ACC Chairman Gary Pierce also supports the bill according to this article by the Arizona Republic ("Long term, it probably is a good thing," Pierce said. "I want to have a lively debate by policy makers on energy issues. I don't think making legislation or policy should be easy."). In response to a Feb. 15th editorial about HB 2789, Chairman Pierce sent a letter to the Yuma Sun "reject[ing] the notion that it is constitutionally problematic for the Legislature and the corporation commission to exercise concurrent jurisdiction over utilities in this state." This statement is not controversial since, as pointed out in the Chairman's letter, utilities are regulated by various agencies on matters such as environmental quality, labor and employment, etc. However, the letter does not address the specific question raised in Alward's memo: whether the legislation would infringe on the the ACC's ratemaking authority, which is exclusive and based in the constitution.

Read more here.

3 Proposed Changes to New Mexico PRC Approved by Legislature; Go to Voters in November

Fri, 17 Feb 2012 09:59:00 GMT

Yesterday, the New Mexico legislature completed its 30 day session and approved three changes to the New Mexico Public Regulation Commission (PRC). The changes were the result of attempts to reform the Agency following several years of scandal, including a felony conviction and prison time for one recent Commissioner. One change moves the State Corporation Commission to the Secretary of State's Office. It has been under the jurisdiction of the PRC following the 1999/2000 change in New Mexico's Constitution which had merged the Public Utility Commission with the State Corporation Commission to form the PRC. The second change establishes minimum qualifications for PRC Commissioners. Presently the requirement is to be at least 18 years of age, a resident of NM for at least one year, and not to have been convicted of a felony. HJR 11 provides that "the legislature shall provide, by law, increased educational and professional qualifications for commissioners and continuing education requirements for commissioners." The third change would remove the insurance division from the PRC oversight and would establish a separate insurance agency. Because the PRC is a constitutionally created entity, the changes will go before the voters in November 2012. If approved, further guidance -- and qualifications -- would be the subject of the 60 day legislative session that would begin in January 2013.

Public Regulation Commission Reorganization Measure Goes to New Mexico Voters

Thu, 16 Feb 2012 09:41:00 GMT

Protestants Seek Dismissal of Water Application Due to Vagueness

Wed, 08 Feb 2012 17:02:00 GMT

Crowds gathered in Socorro, New Mexico at the County Courthouse yesterday to hear oral argument on motions filed by various parties seeking to dismiss an application filed by Augustin Plains Ranch, LLC (APR) to appropriate 54,000 acre-feet of water to be used to off-set the effects of existing uses. If granted, the application would give APR the right to use and perfect the water rights contained in the resulting permit at no cost to itself. Speculation appears to be an inherent trait in applications seeking to transfer or appropriate large quantities of water and move it from rural areas to urban areas for economic gain. The application filed by APR states a very broad place of use that includes seven New Mexico counties and seeks every possible purpose of use for the water, since the end users and uses have not yet been identified.

Last year, then-State Engineer, John D'Antonio granted a similar motion to dismiss an application seeking to pipe water from Ft. Sumner to Santa Fe to sell for a profit. D'Antonio granted protestants' motion to dismiss that application on the grounds that it did not supply enough information to allow the Office of the State Engineer to accurately evaluate whether the transfer would impair other water users' water rights, be contrary to the conservation of water and/or detrimental to the public welfare, as required by statute. Although the issues presented at the hearing in Socorro were identical to the issues raised in the proceeding last year, there is no telling what the outcome will be, since new State Engineer, Scott Verhines, will decide the fate of this application.

Read the Albuquerque Journal's article here (subscription required).

Promoting Solar Energy in Arizona - the Solar Energy Task Force

Fri, 27 Jan 2012 14:36:00 GMT

Last week I attended the January meeting of the Governor's Solar Energy Task Force (Task Force). Arizona Governor Jan Brewer created the Task Force by executive order in March of last year. The executive order notes the existence of "various impediments" that have "hampered several promising, proposed solar projects" and the need for "greater effectiveness and efficiency in public processes and competitive taxation structures to advance development and meet the promise of solar energy in Arizona."

The Task Force is charged with identifying impediments to solar energy development, evaluating current incentive structures, and proposing appropriate reforms to public agency processes and tax structures. The governor's energy policy advisor, Leisa B. Brug, co-chairs the Task Force, together with James Strock, of Serve to Lead, Inc., a leadership and sustainability consulting organization. The Task Force is comprised of representatives of solar companies, utilities, and industry, including Abengoa Solar, SOLON, Suntech, APS, and the Arizona Chamber of Commerce and Industry. Additionally, the group's meetings are open to the public, and the audience for the January meeting included representatives of other governmental entities, including the City of Tucson and the Arizona Corporation Commission.

At the end of last year, the Task Force released its written report of findings and recommendations for 2011. In this white paper, the Task Force identifies the streamlining of permitting processes as "the first step to enhance solar activity in Arizona." The report released last month focuses on residential solar permitting; the Task Force plans two more white papers to address permitting for the commercial and utility-scale market segments.

The Task Force advises the standardization of permitting process across three metrics: costs, approval time frames, and submittal requirements. The white paper provides specific recommendations as to each of these metrics for both photovoltaic installations and solar water heaters. The Task Force also plans the development of a "best practices" permitting guidance document. Authorities having jurisdiction will be able to adopt these best practices to move toward uniformity. Additionally, the Task Force recommends the creation of a "Renewable Energy Rapid Response" or "R3" team. The R3 team would be comprised of representatives of federal, state, and local government entities having authority over various aspects of solar energy development and would work to facilitate intergovernmental coordination and elimination of permitting redundancies. The Task Force's report included a draft executive order creating the R3 team, but it has not yet been signed.

At its January meeting, the Task Force also discussed the $708,992 grant recently awarded by the U.S. Department of Energy to the Governor's Office of Energy Policy. The grant is part of the federal "SunShot Initiative – Rooftop Solar Challenge." The Rooftop Solar Challenge is an initiative by the Energy Department to drive reduction in costs for rooftop photovoltaic systems. Co-grantees of the award include the City of Flagstaff, City of Phoenix, City of Tucson, ASU’s Global Institute of Sustainability, and SmartPower. These entities will work toward identifying best practices in finance, permitting, and zoning to achieve voluntary statewide uniformity. The initiative will also drive adoption of an online system allowing for over-the-counter/same-day permit review. The participants in the Rooftop Solar Challenge will be able to build off of the Task Force's work to help make Arizona the premier location for solar energy investment.

dasHaus Coming to Tempe this Saturday

Wed, 18 Jan 2012 10:06:00 GMT

The dasHaus Tour, an exhibit of advanced technologies for building construction and solar energy use, will be in Tempe from Jan. 21-30 as the third stop on its North American tour. "Das haus" means "the house" in German and the main attraction of the exhibit is the dasHaus pavilion -- a fully-functioning structure that demonstrates advanced German solutions for reducing buildings' energy demand and maximizing the efficiency of energy generated on-site. In addition to the dasHaus pavilion, the exhibit will include presentations by respected experts, new technologies displays, and networking opportunities for students and organizations. The display will be at the Tempe Arts Park, at 700 West Rio Salado Parkway.

The dasHaus pavilion was built with inspiration from the Technical University of Darmstadt’s 2007 and 2009 first-place entries in the Solar Decathlon, an international solar house competition presented by the U.S. Department of Energy. The pavilion has been constructed with open walls to cater to crowds, is completely run on renewable and sustainable energies and features guided tours so you can learn more about the technology that keeps it running.

dasHaus arrived in Tempe the morning of the 17th and they’ll be working for the next few days to have everything ready by the weekend. Doors open at 10:00 a.m. on Saturday the 21st of January for the Early Bird Preview and close Monday, January 30th. Click here for a run down of what activities are taking place on what days, register for industry events, or just take a moment to read a little more.

Read Tempe's press release here.

State Senator Tim Keller Introduces Legislation to Appoint NM PRC Commissioners

Fri, 30 Dec 2011 17:10:00 GMT

State Senator Tim Keller has introduced proposed legislation to revamp the way Commissioners at the New Mexico Public Regulation Commission are selected. Following a series of scandals, including felony convictions of two of its recent Commissioners, Senate Joint Resolution 2 (SJR 2) would have the Governor appoint the members for 5-year staggered terms. The legislature would have a nominating committee evaluate applications of qualified individuals to serve on the Commission. That committee would make recommendations to the Governor. The proposed resolution would also set minimum education requirements -- requiring either a baccalaureate or more advanced degree from a regionally accredited post-secondary educational institution or at least five years of relevant professional experience as determined by law. If passed and signed by the Governor, SJR 2 would still require a change to the state Constitution, since the present election process was approved by the legislature and passed as a Constitutional Amendment in 2001. As proposed, the legislation would not affect Commissioners elected in 2010 or 2012.

For more information, go here.

Duke Energy Buys 20 MW of Arizona Solar Capacity

Mon, 19 Dec 2011 13:31:00 GMT

Last week, North Carolina-based Duke Energy announced the purchase of two photovoltaic (PV) solar projects in Arizona with a combined generating capacity of 20 megawatts (MWs). The two projects are the 5 MW Ajo Solar Project in southern Arizona and the 15 MW Bagdad Solar Project near Prescott, Arizona. Both projects were developed by Recurrent Energy, which has been owned by Sharp Corporation for just over one year now. The Ajo facility began commercial operation in September of this year and the larger Bagdad facility is scheduled to achieve commercial operation within the next few weeks. The electricity generated by the projects will be purchased by APS under 25-year power purchase agreements.

The projects are interesting for how they are integrated with nearby mining operations. The land for both the projects is leased from Freeport McMoRan and is considered to have minimal environmental value because it is located adjacent to large tailings piles. At least in the case of the Bagdad project, Freeport will buy the energy back from APS for use in its mining operations.

Both projects were designed and built by AMEC, and will be operated by AMEC for at least for the next five years under contracts with Duke.

Financial terms of the deal were not disclosed.

Read more here (Phoenix Business Journal) and here (Recurrent blogger).

Additional Information on Views of New PRC Commissioner Doug Howe

Thu, 10 Nov 2011 09:41:00 GMT

In an interview with Las Cruces Sun News, newly appointed Public Regulation Commissioner Doug Howe stated he supports a number of the recommendations made by "Think New Mexico" for restructuring the New Mexico regulatory agency. Howe stated he felt the PRC should focus on its core responsibilities of utility and telecommunications regulation. He also supports establishing some additional criteria for persons elected to the position, a key recommendation from the bi-partisan Think New Mexico group. Democrat Jason Marks and Republican Patrick Lyons favor some reductions in the agency's responsibilities while Democrat Theresa Becenti Aguilar and Republican Ben Hall believe reforms can come from within. Any changes to the responsibilities or qualifications for the Commissioners would have to come from the legislature and from the NM voters, since the PRC's responsibilities are derived from the NM Constitution and not merely from statutes. Howe, an Independent, was recently appointed by Governor Susana Martinez to fill the position vacated by Jerome Block Junior. Howe's term lasts through December 31, 2012. In the interview, Howe indicated he had not decided whether he would run for re-election in November 2012 for a full four-year term.

Read the full article here.

5th Spot on New Mexico PRC filled by Independent Douglas Howe

Tue, 08 Nov 2011 10:27:00 GMT

On Monday, November 7, 2011, NM Governor Susana Martinez appointed Independent Dr. Douglas Howe to the open seat on the New Mexico Public Regulation Commission ("PRC"). Dr. Howe, a consultant with IHS Cambridge Energy Research Associates and a Santa Fe resident, will fill out the remaining term of Jerome Block, Jr. who resigned from the PRC following Block's plea agreement and admission to several felony charges. Dr. Howe has been involved with global power industry for over 28 years and has extensive experience in the areas of long-range corporate, strategic, and regulatory planning, particularly in the areas of executive management, corporate strategy, marketing, regulatory affairs,power contracting, retail energy and energy efficiency.

Dr. Howe has consulted with utilities and regulators in Singapore, China, Libya, UAE, Tanzania, Czech Republic,South Africa and Nigeria. In North America, he has worked with utilities and non-governmental organizations to develop long-range planning. Previously, Dr. Howe was a senior director at IHA Cambridge Energy Research Associates and Vice President of Regulatory Policy at GPU, Inc. -- a multinational utility company. Dr. Howe holds an MS and a PhD in mathematics from the University of Pennsylvania where he was a Franklin Scholar. He holds an Executive Education degree from the Fuqua School of Business at Duke University. Dr. Howe's term on the PRC will be through December 31, 2012. He would be eligible to run for a four year term in the November 2012 election.

Read more here and here.

Nevada Power Makes Second Attempt at PUC Approval of Three Renewable Energy PPAs

Fri, 04 Nov 2011 15:31:00 GMT

On October 21, 2011, Nevada Power Company ("NPC") re-filed its application requesting approval of the Public Utilities Commission of Nevada ("PUC" or "Commission") for power purchase agreements ("PPAs") for three renewable energy projects. This re-filing is a result of the PUC's denial of NPC's initial request for approval of these PPAs in July 2011. The Commission denied NPC's initial request because the utility did not meet its burden in justifying the need for the additional renewable energy. The PUC stated in its order that based upon the evidence and testimony, Nevada Power did not adequately satisfy the legal requirements to allow the PUC to approve the three renewable energy PPAs. It was the first time since Nevada adopted its Renewable Portfolio Standard ("RPS") in 2001 that the PUC did not approve a renewable energy PPA. In late September 2011, the Commission, however, granted NPC's request for rehearing on these PPAs and issued an order requiring NPC to re-file its application for approval, along with additional justification by October 21, 2011.

In the re-filed application Nevada Power is requesting approval of the same three renewable PPAs , which are FRV Spectrum Solar (30 MW solar PV located in Clark County, Nevada), Mountain View Solar (20 MW solar PV project in Clark County, Nevada), and Dixie Meadows Geothermal Project (51 MW geothermal project in Churchill County, Nevada). The new application is similar to the original application in its explanation for requesting approval of these projects. However, NPC provides additional justification as to why the PUC should approve the PPAs, including quantifying the environmental benefits associated with each project, providing specific economic benefits for each project, and describing the minimal rate impacts associated with each project.

One of the interesting things to note in the new filing is that both FRV Spectrum and Mountain View amended their respective PPAs to lower their product rates. FRV Spectrum's product rate is now $111 per MWh, down from the original price of $121.75 per MWh, and Mountain View's product rate is now $116.05 per MWh, down from the original price of $117.50 per MWh. NPC stated that the solar companies were able to lower their product rates due to a decrease in solar panel costs. The Dixie Meadows product rate remains the same at $92 per MWh.

In addition, Nevada Power has submitted a revised load forecast in this filing as requested by the Commission. Nevada Power states that based off a revised load forecast, it estimates it may not need any additional portfolio energy credits ("PCs") to satisfy the RPS until 2020, and collectively with Sierra Pacific Power, until 2025. It does state that this is based off a moderately conservative load forecast and that under a more aggressive load forecast NPC may need additional PCs to comply with the RPS by 2015.

Overall, Nevada Power has provided the Commission more justification, including the need and associated benefits of each renewable energy project in this filing. However, we will have to wait until after the Commission holds its hearing on the re-filed application on January 9, 2012 and issues an order for the conclusion.

New Mexico Gets New Water Czar

Thu, 03 Nov 2011 16:38:00 GMT

Earlier today, Governor Susana Martinez selected professional engineer, Scott Verhines, to serve as New Mexico's new State Engineer. Scott is the president of Occam Consulting Engineers, Inc., a private consulting firm specializing in water resources, program management, transportation and public works. Scott will replace John D'Antonio who was appointed by former Governor Bill Richardson in 2003 and who is leaving to work for the Army Corps. of Engineers. The Governor confirmed that Estevan Lopez, another candidate for the position, will continue to serve as the director of the Interstate Stream Commission.

Read more here.

New Mexico Supreme Court Hears Oral Argument on Domestic Wells

Fri, 14 Oct 2011 20:08:00 GMT

On Thursday, October 13, 2011, the New Mexico Supreme Court heard oral arguments in two cases challenging the state statutes on domestic wells. The cases essentially challenge the Constitutionality of several state statutes that mandate that the Office of the State Engineer approve applications for domestic wells. The second related case argues that under the prior appropriation doctrine, domestic wells should be assigned a priority date. Currently, they are not assigned a priority date. The debate affects farmers, tribes, and other owners of old and senior water rights as domestic wells have proliferated. The impact of domestic wells on the overall supply of water has also increased as drought conditions have become more prevalent.

The case arose when Horace and Jo Bounds in the Mimbres Valley sued the Office of the State Engineer (OSE). The Bounds owned senior water rights on an acequia and claimed their rights were being adversely impacted by numerous unregulated domestic wells that were drying up the river flow. The OSE had also declared the water in the Mimbres to be "fully appropriated." The Bounds argue that if that were the case, any wells, including domestic ones, would further draw from a fully appropriated system. A state district court had found the domestic well law to be unconstitutional, but the Court of Appeals overturned that decision. The New Mexico Farm and Livestock Bureau filed briefs in support of the Bounds, stating that the Bureau is never notified when new domestic wells are drilled. It is not known when the New Mexico Supreme Court will render its decision, but a decision in favor of the Bounds would affect tens of thousands of domestic wells within the state.

Read more here.

Commissioner Block Resigns; Eighty-Seven Apply for Appointment

Fri, 07 Oct 2011 10:50:00 GMT

On Thursday, October 6, 2011, Jerome Block Jr. submitted his resignation of his seat on the New Mexico Public Regulation Commission. The resignation becomes effective at 3:00 p.m. on Friday, October 7. The resignation was the result of a plea agreement that was reached between Block and state prosecutors over the misuse of campaign funds, and other felony charges. Governor Susana Martinez will appoint a replacement to finish Block's term, which runs through December 31, 2012. Eighty-seven applicants filed an application for the $90,000 per year position by Wednesday, October 5, 2011, the deadline established by the Governor. There is no deadline by which Governor Martinez is required to make the appointment. The conviction of Block and numerous legal and ethical problems by several commissioners over the past several years have led law makers and others to look at establishing minimum qualifications to hold the position. Currently one has to be 18 years of age, a NM resident for one year, and no felony convictions to be eligible to run for the position. Adding additional qualifications would require a change to the State Constitution, which would have to go to the voters for approval.

Read more here and here.

New Mexico's Top Water Official Resigns

Wed, 05 Oct 2011 14:38:00 GMT

New Mexico's State Engineer, John D'Antonio, announced on Tuesday, October 4, that he would be resigning from his job as the state's top water official and would be taking a job with his former employer, the Army Corps of Engineers. D'Antonio has served as the State Engineer since being appointed by Governor Bill Richardson in 2003. D'Antonio has been the center of numerous long running water-rights settlements, several of which have involved Navajo water-rights settlements along the San Juan River and those involving water rights on the Lower Rio Grande. D'Antonio will remain in the position for 30 days while Governor Susana Martinez appoints a replacement. Any appointment must be approved by the State Senate.

Read more here.

Commissioner Block to Resign as Part of Plea Deal With New Mexico AG

Thu, 29 Sep 2011 09:39:00 GMT

On Wednesday, September 28, 2011, New Mexico Public Regulation Commissioner Jerome Block, Jr. pled guilty to felony charges concerning misuse of campaign funds, misuse of his PRC gas credit charge and other offenses. The plea agreement included a voluntary resignation from the New Mexico Public Regulation Commission and a commitment not to run for any public office in the future. He will be required to repay $8000 for the misuse of funds and will also enter a drug rehabilitation program. Block will have ten days in which to resign from the PRC office. Following his resignation from the PRC, Governor Susana Martinez will appoint a replacement to serve out his term at the PRC. The plea agreement was reached to as the legislature continued to move forward with impeachment proceedings, which will now be dropped. In addition, charges against his father, former Commissioner Jerome Block, Sr., are dropped.

Read more here and here.

EPA Announces Second Delay for Greenhouse Gas Rules

Fri, 23 Sep 2011 15:53:00 GMT

Last Thursday, September 15, EPA confirmed a rising suspicion that it would fail to meet a planned September 30 deadline for issuing rules limiting greenhouse gas emissions from power plants and other major sources. The EPA is under a court order to issue the rules and originally planned to do so by July 26. However, that date was extended to September 30 by agreement of the parties. EPA has not yet announced a new schedule for issuance of the rules, but stated that such would be forthcoming "soon."

The White House had been under strong pressure from business lobbyists to delay or modify the rules, and congressional Republicans welcomed news of the postponement. Outspoken climate-change critic Sen. James Inhofe (R-OK) called the rules "economically damaging." An EPA official stated, however, that the delay was not driven by political pressure but internal agency considerations, likely just an inability to respond to all comments received and prepare an adequate draft on time.

The New York Times blogs about the delay here.

Arizona Supreme Court Denies Goldwater Institute's Appeal in Lawsuit Over REST Rules

Wed, 21 Sep 2011 20:27:00 GMT

Without comment, the Arizona Supreme Court yesterday declined to hear an appeal of the Court of Appeals' decision in the legal battle over the state's Renewable Energy Standard and Tariff (REST) rules. The appeal was sought by the Goldwater Institute after the both the Superior Court and the Court of Appeals ruled in favor of the Arizona Corporation Commission (ACC). The primary issue in the case was whether the ACC's adoption of the REST rules was within the agency's constitutional authority to regulate the rates charged by private utility companies. Because it declined to hear the appeal without any comment, it can fairly be implied that the Supreme Court agrees with the lower court's decision.

The REST rules, among other things, require regulated utilities to obtain a certain percentage of their retail electricity sales from renewable resources. The required percentage increases from 1.25% in 2006 (the year the rules were adopted) to 15% in 2025. The rules also require that a certain percentage of the required amount of renewable energy -- 30% from 2011 on -- be generated from distributed (i.e., on-site) sources. Of course, the REST rules also authorize electrical utilities to charge their customers higher rates in order to pay for the costs of complying.

We blogged about the Court of Appeals' decision here.

See the Goldwater Institute's summary of the case here.

Read news coverage of the Supreme Court's ruling here and here.

Despite Recent Debacle, DOE Continues to Offer New Loan Guarantees

Fri, 09 Sep 2011 16:29:00 GMT

The news of Solyndra's bankruptcy filing and the FBI's raids of the company must be an embarrassment to the Obama administration, as a little more than a year ago the President praised the solar manufacturer, touting its job creation potential and promise for America's clean energy future. The Department of Energy (DOE) remains undaunted, however, and this week announced three new loan guarantees for solar energy companies.

One will go to SolarCity, a Silicon Valley-based installer, owner, and operator of photovoltaic solar panels. As part of what it dubs the SolarStrong Project, SolarCity plans to install rooftop solar devices on 160,000 housing units on 124 military bases across 33 states, amounting to 371 megawatts of generating capacity. If SolarCity achieves this goal, it will double the number of rooftop solar units in use throughout the country, the first example of distributed generation deployed on so large a scale. The idea for SolarStrong came from SolarCity's 2009 installation project at Arizona's Davis-Monthan Air Force Base. SolarCity executives stressed that the guarantee is a low risk for the government because SolarCity is putting up its own money for the panels and is reimbursed by its lenders only upon completion of an individual project. A conditional commitment for the loan guarantee was offered on September 7. Read SolarCity's press release here.

A second loan guarantee, finalized September 8, went to 1366 Technologies, a Massachusetts-based company that has developed a manufacturing process to cut in half the price of silicon wafers (used in solar cells). The new technology, termed Direct Wafer, avoids wasting up to 50% of the valuable silicon material and is expected to substantially reduce the market price of solar cells, helping to keep U.S. photovoltaic manufacturing competitive against that of countries such as China. The Direct Wafer process forms the wafer directly from molten silicon as opposed to chopping it off a silicon block. 1366 Technologies plans to use the loan funds to complete its Massachusetts facility and to build a second facility at an as yet undetermined location. Read the company's press release here.

Cogentrix of Alamosa, LLC is the recipient of the third DOE loan guarantee, finalized September 9. The loan guarantee will back the Alamosa Solar Generating Project, a 30-megawatt high concentration photovoltaic (HCPV) power plant located in south central Colorado. The HCPV technology incorporates a dual-axis tracking system, allowing the solar panels to tilt and follow the sun across the sky to optimize capture of solar power (achieving 40 percent efficiency, double that of traditional panels). Cogentrix has entered into a long-term power purchase agreement to sell power generated by the Project to the Public Service Company of Colorado.

NNTRC Initiates Rulemaking Requiring CCNs on Navajo Nation; Includes Internet and Satellite Providers

Wed, 31 Aug 2011 15:13:00 GMT

On July 28, 2011, the Navajo Nation Telecommunications Regulatory commission (NNTRC) initiated a rulemaking proceeding for a Proposed Application for Certificate of Convenience and Necessity (CCN) for telecommunications operators who desire to provide telecommunications services on the Navajo Nation. Telecommunications service is defined as "the providing of voice or other communication services by telecommunications including, without limitation, non-voice communications services, or data communication services which may interconnect with other telecommunication networks and/or involve operation of transmission/reception devices for binary information representation." The rule specifically states that it includes wireless phone and data services, satellite services, and Internet.

The NNTRC will be accepting written comments for 45 days from the last date of publication in the Navajo Times, and will be hearing public comments at a public hearing, the date and time which has not yet been announced.

Update: Discussions with the Executive Director at the NNTRC on August 31, 2011 indicate that the NNTRC is likely to extend the period for comment by an additional three to four weeks, in order to provide additional time to satellite and internet providers. The updated information will be posted on the NNTRC web site.

EPA Postpones Certain Parts of GHG Reporting Rule Due to Confidentiality Concerns

Fri, 26 Aug 2011 15:29:00 GMT

EPA published notice yesterday in the Federal Register of its decision to postpone certain greenhouse gas (GHG) reporting requirements in response to industry's concerns about the disclosure of confidential business information. The decision applies only to specific input data required by previous rules to be included in the annual reports of direct GHG emitters such as power plants, petroleum refineries, and many types of manufacturing facilities. For some of the data, the requirement to report is being postponed until March 31, 2013. For the rest of the data, EPA is postponing reporting until March 31, 2015 in order to give the agency time to evaluate whether disclosure would cause competitive harm to reporting entities.

EPA's GHG Reporting Program requires most large emitters of GHGs to begin reporting their emissions in either 2010 or 2011, with the deadline for 2010 annual reports postponed (in other rulemakings) to September 30, 2011. But these annual reports are not simply the total quantity of GHGs emitted. In an attempt to provide transparency and allow verification of numbers submitted by reporting entities, EPA developed an extensive list of supporting information that must be submitted by each type of facility subject to the rule. This supporting information includes specific "input data" for each industry sector that will allow EPA or members of the public to check each emitter's calculations. Industry has argued throughout the development of the reporting rules that some of this information should be protected from public disclosure as confidential business information.

Emitters are still required to keep records of the input data and to file annual reports (minus the data subject to this notice). If EPA eventually determines that the data does need to be protected, it will attempt to find different ways to verify emitters GHG emissions calculations.

Detailed information about this action is available on the EPA's website here.

Read more here and here.

New Mexico Sues Federal Government Over Rio Grande Project Water

Thu, 11 Aug 2011 18:43:00 GMT

The State of New Mexico filed a Declaratory Judgment action against the federal government on August 8, 2011, claiming that the federal government has denied New Mexico its rightful allocation of surface water in the Rio Grande Project. The State's complaint argues that the federal government's actions threaten the sustainable riverine environment, related aquifer, and the environment, flora, and fauna that rely on the Rio Grande and its connected groundwater. Through its action, New Mexico seeks a court order to permanently enjoin and declare void the 2008 Operating Agreement to be executed by the federal government on the grounds that it violates the Water Supply Act of 1958 because it seriously affects the purposes for which the Rio Grande Project was authorized, surveyed, planned or constructed and is a major operational change to the Rio Grande Project without approval by Congress.

More information about the Rio Grande Project can be found on the Federal Bureau of Reclamation's website.

EPA Orders Expensive Retrofit for New Mexico Power Plant

Tue, 09 Aug 2011 11:05:00 GMT

On Friday, August 5, the EPA issued a rule requiring installation of expensive air quality emissions controls for the San Juan Generating Station (SJGS), a 30 year-old power plant located west of Farmington, New Mexico. Public Service Company of New Mexico (PNM), which owns approximately half the plant, has estimated the cost of the EPA's order at $750 million to $1 billion, translating into an $85 annual increase to ratepayers, although these figures are disputed by environmental organizations. This comes on top of a nine percent rate increase recently approved by the Public Regulation Commission. PNM plans to appeal the EPA's decision.

The new rule finalizes a proposal issued in December, although it extends the compliance period from three to five years. In Clean Air Act (CAA) lingo, the EPA's order disapproves a portion of New Mexico's State Implementation Plan (SIP) and promulgates in its place a Federal Implementation Plan (FIP). The EPA found the state's SIP insufficient with respect to controlling emissions from the plant under CAA rules addressing regional haze, which include the requirement for best available retrofit technology (BART). In a statement posted on its website, the agency explained its rationale:

Today's federal plan relies on proven, cost-effective, and widely used technologies to protect public health in New Mexico and neighboring states by cutting dangerous nitrogen oxide emissions by over 80 percent from one of the nation’s largest polluting power plants. These efforts will dramatically improve visibility in 16 park and wilderness areas in the southwestern US, decreasing the number of days with impaired scenic views and as a result, promoting local tourism.

The EPA estimates that visibility impacts to national park and wilderness areas due to SJGS emissions will be reduced by over 50 percent. The claim that the technology ordered by the agency, known as selective catalytic reduction (SCR), will significantly improve visibility at scenic areas is controversial. In its own press release, PNM stated that an alternative technology, selective non-catalytic reduction (SNCR), would satisfy CAA visibility requirements at a much lower cost of $77 million. In June, the New Mexico Environmental Improvement Board approved the installation of this less expensive alternative at SJGS and submitted this proposal to the EPA. PNM believes that the EPA did not adequately consider the state's proposal.

Read more here (subscription required).

Court of Appeals Reinstates Criminal Charges Against Commissioner Jerome Block Jr.

Wed, 03 Aug 2011 12:36:00 GMT

On August 2nd, the New Mexico Court of Appeals reinstated criminal charges against PRC Commissioner Jerome Block Jr. and his father, former Commissioner Jerome Block Sr. The charges had previously been dismissed by District Court Judge Michael Vigil. In April 2009, Commissioner Jerome Block Jr. was charged with election violation, tampering with evidence, conspiracy, and embezzlement. His father was charged with same charges, absent the embezzlement charge. The charges arose out of alleged misuse of publicly funded campaign funds during the 2008 election.

Judge Vigil had previously ruled that the secretary of state could either impose a fine for violations or refer a case to the Attorney General, but not both. Jerome Block Jr. had paid a $21,000 fine for the alleged violations. On Tuesday, the Court of Appeals ruled otherwise: "The [law] does not limit the attorney general's authority to prosecute." Judges Rod Kennedy and Jonathan Sutin joined Judge Cynthia Fry in the ruling.

If convicted of a felony charge, Commissioner Block would be removed from the Commission, regardless of any appeal, and Governor Susana Martinez would appoint a replacement for the remainder of the term. Commissioner Block's seat is up for re-election in November 2012. The Court of Appeals ruling can be found under Court of Appeals Case No. 30,285.

Read more here.

New Mexico Supreme Court Makes Important Ruling in Fight Over Greenhouse Gas Regulations

Fri, 29 Jul 2011 14:46:00 GMT

On July 27th the New Mexico Supreme Court was unanimous in its decision to allow environmental groups to intervene in an ongoing legal battle regarding the state's regulation of greenhouse gas (GHG) emissions. Utilities and other petitioners recently filed petitions with the New Mexico Environmental Improvement Board (EIB) seeking to repeal the regulations that were approved in the last few weeks of former Governor Richardson's administration. The regulations include New Mexico's plan to participate in a regional cap-and-trade program, as well as implementing a statewide cap on GHG emissions and a reporting system. Environmental groups claim the EIB excluded them from talks meant to resolve the issues raised by opponents of the GHG regulations.

As a result of Wednesday's ruling, the fight over the GHG regulations will involve both petitions before regulators, as well as appeals to the courts. Even if the utilities are successful in getting the regulations repealed, an environmental group can simply petition the board to reinstate the rules and any of the EIB's decisions can be appealed to the courts. Environmental groups consider Wednesday's ruling a victory.

Read more here.

Australia Moves Forward with Plan for Reducing Carbon Emissions

Tue, 26 Jul 2011 17:11:33 GMT

Earlier this month, Australian Prime Minister Julia Gillard announced a plan estimated to reduce Australia's carbon emissions to 80% of 2000 levels by 2050. The plan involves a carbon tax beginning in July 2012 which will be replaced after three years by an emissions-trading program. The tax begins at A$23 per ton and increases 2.5% per year for the three years it is in effect. A coalition between Ms. Gillard's Labor party and the Australian Greens essentially assures the proposal's passage through parliament.

The plan includes numerous tax cuts and subsidies aimed to lessen the impact of putting a price on carbon and to encourage low-carbon alternatives. Roughly half of the revenue collected from the tax will go to households to help offset costs of higher electricity and other goods. Every household with less than A$80,000 of income is expected to receive a tax cut under this plan and nine out of every ten households will receive some kind of economic benefit. The average cost per household, without these tax breaks and other benefits, is estimated at A$9.90. A$9.2 billion over the first three years will go directly back to certain companies exposed to the tax and approximately A$10 billion over five years will be spent on developing renewable energy technologies and resources. In fact, the benefits of the plan are so generous that it is expected to cost the country over A$4 billion in its first four years.

Reaction to the proposal has been, as expected, very mixed. Although Australians are still decidedly against a carbon tax, the difference shifted 6% in favor of the proposed plan in the two weeks since its announcement. And while the coal industry claims the plan will hurt exports and could wipe out almost A$9 billion of value, a takeover bid one day after the plan was announced offered a 40% premium for Macarthur Coal, a large Australian coal miner and exporter.

New Mexico Court Limits Authority of State Engineer in Determining Water Rights

Thu, 21 Jul 2011 19:34:00 GMT

In a recent decision (not published), the 7th judicial district court in New Mexico placed limitations on the authority of the Office of the State Engineer (OSE). Judge Matthew Reynolds wrote: "The State Engineer paints with too broad a brush to grant himself exclusive authority to determine the validity of pre-1907 water rights." In short, the judge ruled that once an administrative process starts, then the exhaustion of administrative remedies applied. However, in the case before the court, a party had NOT initiated the administrative process and instead had filed for a declaratory action in District Court under the Declaratory Judgment Act, NMSA 1978, Sections 44-6-1 through 44-6-15. Therefore, they were entitled to relief before the court, and the case would NOT be dismissed as requested by the OSE.

The judge went on to re-emphasize a key element of NM water law -- that when a person makes a declaration of water rights, the water rights are "prima facie evidence of the truth of their contents." However, nowhere in the water code is there an administrative process for the State Engineer to determine, in the first instance, the validity of the declaration -- only when the holder of those rights seeks some relief from the OSE. On the other hand, a district court, in a general stream adjudication could determine the validity of a declaration of pre-1907 rights in the first instance. Furthermore, district courts "have original jurisdiction in all matters and causes not excepted" in the New Mexico State Constitution pursuant to NM Const. Art. VI, Section 13. Therefore, in this case, it is appropriate that the case not be dismissed and returned to the OSE for resolution, but instead would proceed before the district court on its merits.

EPA Delays Greenhouse Gas Permitting for Biomass Facilities

Mon, 11 Jul 2011 10:31:00 GMT

The EPA has agreed to defer for three years the requirement that biomass facilities obtain greenhouse gas permits. On July 1, in its final rule implementing the deferral, the agency explained, "the issue of accounting for the net atmospheric impact of biogenic CO2 emissions is complex enough that further consideration of this important issue is warranted."

The EPA's action responded to a petition filed by the National Alliance of Forest Owners (NAFO). The result of this decision, as summarized in the final rule, "is that during this three year period biogenic CO2 emissions are not required to be counted for applicability purposes under the PSD and Title V permitting programs." The EPA will use the three-year deferral period to "conduct a detailed examination of the science associated with biogenic CO2 emissions from stationary sources, including engaging with federal partners, technical experts, and an independent scientific panel to consider technical issues." In April 2011, the EPA's Scientific Advisory Board published a notice soliciting experts to examine this issue.

The EPA's fact sheet defines biogenic CO2 emissions as "emissions of CO2 from a stationary source directly resulting from the combustion or decomposition of biologically-based materials other than fossil fuels and mineral sources of carbon." Industries affected by this rule include electric utilities that use biomass fuel, wood products and paper manufacturing, and landfills and wastewater treatment plants.

Supreme Court Rejects Climate Change Claims in AEP v. Connecticut

Mon, 20 Jun 2011 15:29:53 GMT

The U.S. Supreme Court ruled unanimously (8-0) today, in the case of American Electric Power v. Connecticut, that the Clean Air Act (CAA) and EPA's implementing regulations have displaced federal common law related to the control of greenhouse gas (GHG) emissions. The Court was split 4-4 on the separate question of whether the plaintiffs had standing to bring the case at all (Justice Sotomayor recused herself from consideration of the case since she heard arguments on it while on Second Circuit). The even split among the Justices on the issue of standing resulted in an affirmation of the Second Circuit's holding that climate change lawsuits can be subject to the jurisdiction of federal courts.

Because the Court's ruling was based on the fact that GHG emissions are being addressed by EPA under the CAA, it seems likely that at least some of the Justices would change their vote on this case if EPA were to stop attempting to control GHG emissions. This could happen if Congress passes a bill prohibiting EPA from regulating GHGs (as several legislators have attempted) or if EPA, under a new administration, reverses course. The Obama administration supports EPA's efforts to control GHG emissions and filed a brief in this case urging the Court to rule in favor of the defendants.

Although the Second Circuit's standing decision is not binding on other circuit courts, the Supreme Court would presumably find standing in any similar case it considers. This is because Justice Sotomayor would not recuse herself from a case from another circuit and would almost certainly join the four Justices who supported the plaintiffs' standing in this case.

AEP v. Conn. is a nuisance lawsuit brought by eight states, three non-profit land trusts, and New York City against a handful of the largest power producers in the country. Two of the states, New Jersey and Wisconsin, withdrew from the lawsuit earlier this year after electing Republican governors. The states that remain involved are California, Connecticut, Iowa, New York, Rhode Island, and Vermont. The plaintiffs has asked the courts to impose an injunction on the defendants to restrict their carbon emissions. As previously blogged, the case was initially dismissed by the Southern District of New York on standing grounds (political question doctrine), but reinstated by the Second Circuit in Sept. 2009.

Read more here and here.

BPC Issues Report on Impact of Environmental Regulations on Reliability of U.S. Electric System

Thu, 16 Jun 2011 16:23:00 GMT

The Bipartisan Policy Center (BPC) issued a report this week analyzing the impact of new and pending regulations under the Clean Air Act (CAA) on the reliability of the country's electric system. The report's conclusion is that the reliability impacts will be "manageable" and that tools are available to address localized reliability issues. However, the report also warns that careful planning will be required by utilities and regulators to apply these tools and to minimize increases in electricity prices resulting from the new rules. This report comes on the heels of announcements by several large utilities of their intent to shut down coal plants as a result of EPA's overly ambitious agenda.

The five rules considered in the BPC analysis are: (1) the Transport Rule, (2) Utility Air Toxics Rule, (3) Coal Combustion Waste Disposal Regulations, (4) Clean Water Act Section 316(b) Cooling Water Intake Structures, and (5) Greenhouse Gas Performance Standards.

The BPC is a think tank that was established in 2007 by former Senate Majority Leaders Howard Baker, Tom Daschle, Bob Dole and George Mitchell. Its stated purpose is "to develop and promote solutions that can attract public support and political momentum in order to achieve real progress."

Read the BPC's press release here.

APS Files Rate Increase Request Proposing Decoupling

Fri, 10 Jun 2011 16:19:00 GMT

Last week, Arizona Public Service Co. (APS) filed a new rate case with the Arizona Corporation Commission (ACC). The filing proposes raising electricity rates on all classes of customers to support the utility's efforts to improve its system's sustainability and reliability. The filing also proposes, for the first time in Arizona, the establishment of an "Efficiency and Infrastructure Account" that aims to allow APS to recover costs that it spends on energy efficiency efforts.

An electric utility's revenue was historically based directly on how much electricity it sells. This creates a clear disincentive to pursuing energy efficiency projects because a company would literally be spending money to lose money by decreasing its sales. In July 2010, the ACC adopted rules requiring public utilities to achieve energy efficiency savings of 22% by 2020. At the same time, the ACC recognized that the utilities need to be able to recover the costs of saving electricity. To that end, in December 2010, the ACC issued its ACC Policy Statement Regarding Utility Disincentives to Energy Efficiency and Decoupled Rate Structures, preparing the way for gas and electric utilities to recover costs spent on reducing sales. This concept of disconnecting a utility's revenue from the amount of product it sells is called decoupling.

In addition to the new account for energy efficiency, APS proposes using the rate increase for capital improvements and renewable energy projects.

If approved, the new rates would increase the price of electricity by an average of 6.6% per kilowatt-hour (kWh). For a residential user whose electricity use remains constant, this would amount to approximately $8.36 per month on average. However, some of the programs APS intends to pursue with the increased revenue would allow customers to lower their energy usage, at least partially offsetting the higher per kWh rates.

The Phoenix Business Journal estimates (subscription required) that the increase on commercial business rates will vary from 2% to 6.6% while industrial users could see increases of almost 11%. The ACC will conduct a lengthy review of the request during which customers will be represented by the Residential Utility Consumer Office (RUCO), a state agency created in 1983 for this precise purpose. Any increase approved by the ACC would take effect in July 2012 at the earliest.

Read more here and here.

SRP Increases Sustainable Energy Goal to 20% by 2020

Fri, 27 May 2011 23:42:00 GMT

This week, the Salt River Project's (SRP) Board of Directors voted to increase the utility's goal for sustainable energy resources to 20% of all retail sales by the year 2020. SRP's previous goal, set in 2006, was 15% of retail sales by 2025. SRP defines "sustainable resources" to include hydro power and energy efficiency measures along with more commonly recognized renewable resources such as solar and wind. Read more here.

Regulated utilities in Arizona, such as Arizona Public Service Co. (APS) and Tucson Electric Power (TEP), are required by the Arizona Corporation Commission (ACC) to generate 15% of their retail sales from renewable resources by 2025 and to separately reduce energy consumption by 22% by 2020 through energy efficiency measures. As a quasi-governmental entity, SRP is regulated by the State Legislature, not the ACC.

At a special meeting of SRP's Board of Directors on April 18, management proposed to increase SRP's sustainable energy goal to 18% by 2020, with an "aspiration" of reaching 20% by 2020. At that meeting, many renewable energy advocates encouraged SRP to match the ACC's requirements while several large commercial customers encouraged SRP to maintain its focus on prices by not increasing its goal too quickly. Through the public input process leading up to the Board's decision, SRP found broad public support for pursuing low carbon resource options. Find out all about SRP's process here.

Just a few days after the Board's decision, SRP announced that it had entered into an agreement to buy 100% of the energy produced by the 100MW Yavapai Wind Project, currently under construction near Seligman.

Is Your Business Regulated by ADEQ or a Local Agency in Arizona? Take Note: New Regulatory Reform Measures Passed

Mon, 16 May 2011 12:48:00 GMT

The Arizona Legislature adjourned sine die on April 20, 2011. While in session, the Legislature enacted two key regulatory reform bills that will affect environmental and administrative law practitioners as well as regulated entities in the state.

House Bill 2665, sponsored by Rep. Amanda Reeve (R-Dist. 6), strengthens the protections available to entities regulated by state and county environmental agencies. Here is a breakdown of the bill's highlights:

Documents to be provided upon request. Requires state agency inspectors to provide upon request "copies of any documents to be relied on to determine compliance with licensure or other regulatory requirements." This is in addition to the items already required by statute to be provided (e.g., split of any samples taken during the inspection, copies of any analysis performed on the samples during the inspection) (see A.R.S. § 41-1009).
Written explanation if opportunity to correct not allowed. Requires that if a state environmental agency does not allow an opportunity to correct deficiencies identified during an inspection, the agency provide a "written explanation of the reason that an opportunity to correct was not allowed."
Notices alleging noncompliance. Requires, with limited exceptions, that if a state environmental agency determines that a regulated entity is out of compliance with any applicable regulatory requirement, the agency provide a written notice containing the following specific items of information:
- a citation to the statute, regulation, license or permit condition on which the allegation of noncompliance is based, including the specific provisions in the statute, regulation, license or permit condition that are alleged to be violated;
- identification of any documents relied on as a basis for the allegation of noncompliance;
- an explanation stated with reasonable specificity of the regulatory and factual basis for the allegation of noncompliance; and
- instructions for obtaining a timely opportunity to discuss the alleged violation with the agency.
Exclusion of evidence. Allows evidence gathered in violation of prescribed statutory procedures to be excluded from evidence in a civil or administrative proceeding. Previously, evidence could only be excluded if the penalty sought was a license denial, suspension, or revocation or a civil penalty of more than $1000.
Recovering fees and other expenses against a county air pollution control agency. Provides that a regulated entity may recover fees and other expenses if it "substantially prevails" against a county air pollution control agency on the merits in a court proceeding or an administrative appeal. Prior to HB 2665, recovery was only allowed when a person "prevailed" on the merits in a court proceeding, but not in the administrative context.

Senate Bill 1598, sponsored by a coalition of Republican senators, establishes a regulatory bill of rights applicable to local governments. Key points of this legislation include the following:

Recovering fees and other expenses against a municipality, county, or district. Allows recovery of fees and other expenses by a person who prevails on the merits against a municipality, county, or district.
Inspections. Establishes various protections for regulated entities with respect to inspections by a municipality, county, or district, including presentation of photo identification by the inspector, rights to copies of documents, and the right to correct deficiencies identified during an inspection (with certain exceptions).
Licensing time frames. Requires municipalities, counties, and districts to establish time frames applicable to each type of license they issue. The overall time frames must include both an "administrative completeness review time frame" and a "substantive review time frame."

Big Oil Execs. Defend Tax Breaks at Senate Hearing

Fri, 13 May 2011 13:37:00 GMT

Top executives from the five biggest U.S. oil companies testified yesterday before the Senate Finance Committee regarding a bill that would eliminate certain tax breaks that currently save the companies approximately $2 billion per year. The bill is called the Close Big Oil Tax Loopholes Act and was introduced by Sen. Robert Menendez (D-NJ). Democrats claim that there is no justification for the tax breaks which amount to federal subsidies for established and highly profitable businesses. They propose applying the additional tax revenue to the country's budget deficit. Republicans, on the other hand, accuse the Democrats of political theater -- attacking oil companies to gain political favor with an American public that is already upset with oil companies because of high gas prices.

Despite claims from both sides of the debate, it seems unlikely that the bill would affect gas prices either way. It is difficult to understand how the bill could lower gas prices as initially claimed by some supporters but it is unlikely to increase gas prices either because oil prices are set by the global market.

The five companies that would be affected by the bill are Exxon Mobil, Chevron, ConocoPhillips and the U.S. units of BP and Royal Dutch Shell.

Here is a detailed and excellent analysis of the of the proposal by the Cato Institute and another good discussion of the situation is available here.

New Computer Model Will Promote Better Understanding of Groundwater Supplies in Northern, Central Arizona

Wed, 20 Apr 2011 10:11:00 GMT

On Tuesday, April 12, the U.S. Geological Survey (USGS) released a sophisticated computer model of the interconnected aquifers in central and northern Arizona. The Northern Arizona Regional Groundwater Flow Model simulates how precipitation moves through aquifers and eventually supplies water to rivers, streams, and springs. The model covers the watersheds of the Verde, Salt, Colorado, and Little Colorado Rivers. Years in the making, the model was commissioned by the Arizona Department of Water Resources in 1999. The Yavapai County Water Advisory Committee also provided financial support.

A key benefit of the model is that it will allow policymakers and other users to understand how various changes, natural or social, may affect regional groundwater supplies. For example, as Joanna Dodder Nellans notes in an article in The Daily Courier, local governments could analyze how projected population growth might affect local groundwater systems and related surface water bodies. The model could also be used to evaluate the efficacy of artificial recharge efforts as well as the impacts of climate change. Another valuable aspect of the model is that it facilitates a better understanding of how groundwater movement in one area affects flows in other areas.

The USGS has posted online the full text of the report released in connection with the model. Read the agency's press release here.

Lake Mead Water Level to Rise, Avoiding Lower Basin Shortages in 2012

Fri, 15 Apr 2011 17:40:00 GMT

We blogged here last fall about Lake Mead's record low water levels. The reservoir reached an all-time low of 1,081.85 above sea level on Nov. 27, 2010. Now, following the wettest winter in a decade, the mountain snowpack above the Upper Basin of the Colorado River has built up to a level 20% higher than normal. This will allow the Bureau of Reclamation (BOR), as it announced on April 12, to release an additional 3.33 million acre-feet (maf) of water from Utah's Lake Powell to Nevada's Lake Mead. This brings the total to be released up to 11.56 maf, up from earlier projections of only 8.23 maf. The increased amount of release will avoid shortages in Lake Mead that would have triggered restrictions on water deliveries to Arizona and Nevada users under complex compacts existing between the Colorado River Basin states. Lake Mead will also benefit from higher-than-expected spring runoffs. By September 2011, Lake Mead is expected to be at 1,105 feet above sea level, up 20 feet from its October 2010 level. BOR Commissioner Connor cautioned, however, that this year's above-average rainfall does not necessarily signal that the Colorado River Basin's twelve-year drought is over.

New Mexico Task Force Recommends "Revising" Cap-and-Trade Rule

Fri, 15 Apr 2011 17:02:00 GMT

The Small Business-Friendly Task Force, created by Governor Susana Martinez shortly after taking office in New Mexico, issued a 13 page report late on Wednesday. The Governor plans to work with her administration and legislators to implement the recommendations in order to make New Mexico more "business friendly." In the report, the Task Force recommends that the government "revise" the controversial greenhouse gas cap-and-trade rule adopted by the Environmental Improvement Board (EIB) shortly before former Governor Bill Richardson left office. The report does not suggest any specific revisions to this particular rule but it seems safe to assume that the Governor would like it rescinded in its entirety. She replaced the entire EIB just days after becoming governor and attempted to delay publishing the rule (among others) before being required to do so by the State's Supreme Court.

The report also recommends that New Mexico become an observer in the Western Climate Initiative, rather than an active participant. It references New Mexico's greenhouse gas rule as "New Mexico-only Cap and Tax" and bases its recommendations on "the lack of consensus from the scientific community on climate data."

Federal Budget Bill Slashes EPA Budget, Preserves Climate Change Regulation

Fri, 15 Apr 2011 09:40:00 GMT

Congress today passed the much-debated budget bill, the product of a partisan compromise reached late last Friday to avert a government shutdown. The bill reduces the EPA's budget by 16% as to compared to the 2010 fiscal year, down from $ 10.3 billion to $ 8.7 billion. The majority of the $ 1.6 billion reduction is taken from programs that provide aid to states for implementation of environmental laws. Superfund, the hazardous waste cleanup program, received a cut of $ 23 million, roughly 2%. The bill also chops $ 49 million, or 13%, from climate change programs.

Although it must work with less money, the EPA will be allowed to continue its carbon regulation regime. Democrats managed to fend off Republican-sponsored policy riders that would have barred such regulation. Other GOP-backed provisions that made it into the final bill include:

elimination of the position of the president's special adviser on climate change, a post vacated by Carol Browner earlier this year;
removal of gray wolves in the northern Rockies from the endangered species list; and
defunding of the Department of Interior's controversial new Wild Lands policy, which allowed the agency to designate and protect public lands as having "wilderness characteristics," a move that some Western lawmakers denounced as circumventing congressional authority to designate wilderness lands and potentially closing off lands to oil and gas development and other commercial uses.

The House Appropriations Committee has posted the full text of the budget bill as well as a summary and list of highlighted program cuts here. Articles from the New York Times and Wall Street Journal also discuss the bill's environmental funding implications.

BrightSource Secures Financing for Ivanpah Solar Project

Wed, 13 Apr 2011 17:12:00 GMT

On Monday, April 11, 2011, BrightSource Energy, Inc., announced that it had closed financing for the Ivanpah Solar Electric Generating System, a 392 megawatt solar power plant under construction in California's Mojave Desert. Financing for the plant includes $1.6 billion in loan guarantees from the U.S. Department of Energy and a $168 million equity investment by internet giant Google, both announced on Monday. NRG Solar is the project's other large equity stakeholder, which has committed to invest up to $300 million. BrightSource, which is headquartered in Oakland, California, also has operations in the Negev (Israel) and Australia.

The Ivanpah plant will generate power by means of BrightSource's concentrating solar "power tower" technology, which uses proprietary software to control thousands of mirrors that concentrate sunlight onto a boiler placed atop a tower. The power generated will be sold under long-term power purchase agreements to Pacific Gas & Electric and Southern California Edison, helping the utilities to meet California's renewable energy standard of 33% renewable energy generation by 2020. Located on 3500 acres of desert land managed by the Bureau of Land Management, Ivanpah will conserve water by using a dry cooling system. All three phases of the plant are expected to be completed by mid-2013.

Read the company's press release here and read Google's blog about the deal here.

Arizona Court of Appeals Upholds ACC's Authority to Adopt Renewable Energy Rules

Fri, 08 Apr 2011 16:01:00 GMT

In the ongoing legal battle between the Goldwater Institute and the Arizona Corporation Commission (ACC) over the ACC's adoption of its Renewable Energy Standard and Tariff (REST) rules, the Arizona Court of Appeals has affirmed the Superior Court's ruling in favor of the ACC. In its opinion, the three judge panel concluded that the ACC's "promulgation of the REST rules falls within its plenary power over ratemaking under Article 15, Section 3" of the Arizona Constitution. The Phoenix Business Journal is already reporting that the Goldwater Institute is likely to appeal the ruling to the State's Supreme Court (subscription required).

The REST rules, among other things, require regulated utilities to obtain a certain percentage of their retail electricity sales from renewable resources. The required percentage increases from 1.25% in 2006 (the year the rules were adopted) to 15% in 2025. The Goldwater Institute believes the rules impose unnecessary costs on ratepayers but was largely prevented from making these arguments in court because it failed to participate in the public process used to develop the rules. Because it failed to participate in the rule-making process, the lawsuit was a collateral attack that could challenge only the ACC's authority to adopt the rules -- the court could not consider "whether the REST rules represent prudent public policy or make economic sense."

Read more on the Court of Appeals' ruling here and here.

Senate Rejects Attempt to Block EPA Regulation of Greenhouse Gases

Fri, 08 Apr 2011 13:14:00 GMT

On Wednesday, the Senate rejected an amendment proposed by Sen. Mitch McConnell (R-KY) that would have blocked EPA's plans to regulate greenhouse gases (GHGs) under the Clean Air Act. The legislation was offered as an amendment to a small business bill that the Senate has been working on for several weeks. The amendment received the support of all but one Senate Republican, Sen. Susan Collins (ME), and was also supported by four Democrats, Sens. Joe Manchin (WV), Ben Nelson (NE), Mary Landrieu (LA), and Mark Pryor (AR). On the same day, the Senate rejected three more moderate attempts to limit or postpone EPA's regulations, primarily because they were opposed by Republicans as not going far enough to curb EPA's plans. The sponsor of one of those amendments, Sen. Jay Rockefeller (D-WV), a long-time critic of EPA's GHG regulations, strongly criticized Senate Republicans for supporting an amendment that had no chance of passing, rather than his proposal to postpone EPA's regulations for two years.

On Thursday, the House passed Rep. Upton's (R-MI) bill that is almost identical to Sen. McConnell's amendment by a wide margin, 255-172. The Administration has already promised a veto of this bill, if it were to somehow get through the Senate.

Read more about this topic here and here.

Court Enjoins California's Cap-and-Trade Program

Wed, 30 Mar 2011 13:21:11 GMT

California's ground breaking CO2 cap-and-trade program may be in jeopardy, after a Superior Court in San Francisco County issued an injunction against the California Air Resources Board (CARB) prohibiting the agency from any further rule making under its "Climate Change Scoping Plan". The challenge to CARB's cap-and-trade proposal was brought by environmental justice advocates, who believe that cap-and-trade would impose disproportionate air quality impacts on low income and minority communities. These advocates believe that a carbon tax is preferable to cap and trade since it would incentivize emission reductions at all facilities equally. The court ruled that CARB did not sufficiently evaluate alternatives to cap and trade as required under the California Environmental Quality Act (a state version of NEPA).

It is not clear whether CARB's related rules, most significantly its renewable portfolio standard, will also be delayed by the ruling.

Here is a great commentary on the situation by Felicity Barringer of the New York Times. You can read the plaintiff's press release here. And here is an in-depth look at the ruling from a legal perspective.

Lewis and Roca Partner Recognized by Donor Network of Arizona

Fri, 25 Mar 2011 16:21:38 GMT

In its March 2011 newsletter (p.18), The Connection, the Donor Network of Arizona (DNA) recognized Greg Harris as a "Donation Champion". Mr. Harris is a partner in Lewis and Roca's government relations practice and has lobbied at the Arizona Legislature on behalf of DNA. Mr. Harris has extensive experience appearing before state and federal agencies and in state and federal court, and appears regularly before the Arizona Legislature. DNA is the federally designated, not-for-profit, organ procurement organization for the state of Arizona and a tissue and eye recovery organization.

Bill to Block GHG Regulation Moves Forward in House

Mon, 21 Mar 2011 13:15:00 GMT

We blogged here about Representative Fred Upton's (R-MI) bill that would repeal the EPA's finding that greenhouse gases endanger the environment. The Energy Tax Prevention Act of 2011, as the measure is known, has now passed the House Energy and Commerce Committee on a 34-19 vote. The committee rejected last-minute amendments that would have put Republican supporters on record denying that human activity contributes to climate change.

On March 15, the same day as the passage of Rep. Upton's bill, Senate Majority Leader Mitch McConnell (R-KY) introduced an amendment to a small business bill that would also block EPA's regulation of greenhouse gas emissions. Senator McConnell's amendment was originally introduced as a stand-alone bill by Sen. James Inohofe (R-OK). In his press release accompanying the amendment, Senator McConnell tied EPA greenhouse gas regulation to higher gas prices. That assertion has proved contentious, with Senator Jeff Bingaman (D-NM) taking to Senate floor on March 17 to dispute the existence of such a link.

House Subcommittee Passes Bill to Block EPA Regulation of Greenhouse Gases

Fri, 11 Mar 2011 15:01:00 GMT

Yesterday, a subcommittee of the House Energy and Commerce Committee voted in favor of a bill that would prevent EPA from regulating greenhouse gas (GHG) emissions under the Clean Air Act. The Energy Tax Prevention Act of 2011, sponsored by Representative Fred Upton (R-MI), will now go to the full Energy and Commerce Committee for consideration. A similar bill has been introduced in the Senate by Senator James Inhofe (R-OK), a vocal and long-standing climate skeptic.

Representative Upton's bill has approximately 40 cosponsors and will likely have broad support from Republicans in the GOP-controlled House, as well the support of some Democrats from oil and coal producing states. However, it could have a more difficult time in the Senate and would almost certainly be vetoed by President Obama. It seems unlikely that the bill could secure the two-thirds support required to overcome a presidential veto, especially in the Senate.

EPA began regulating GHGs in January of this year by requiring large emitters, including power plants, refineries, and cement producers; to address GHGs in obtaining or renewing their permits.

Read more about Representative Upton's bill here and here.

Texas v. EPA, Round Two

Tue, 08 Mar 2011 14:17:00 GMT

We blogged here about Texas' defiance of EPA's mandate that states adopt laws and regulations allowing them to permit new and modified stationary sources with respect to greenhouse gas emissions. In December 2010, the EPA issued its so-called "SIP Call" rule, which ordered 13 states, including Arizona and Texas, to revise their laws to allow greenhouse gas permitting. Failure to do so means becoming subject to a federal implementation plan.

The latest move in the Lone Star State's battle with the feds is the filing of a lawsuit in the D.C. Circuit Court of Appeals challenging the EPA's SIP Call. Texas had previously filed a similar lawsuit in the Fifth Circuit Court of Appeals, which has appellate jurisdiction over the state. Texas decided also to file in the D.C. Circuit as a "protective measure," since the EPA has filed a motion to dismiss in the Fifth Circuit case, contending that the D.C. Circuit is the proper forum. Wyoming, likewise subject to the SIP Call, has filed a similar suit in the Tenth Circuit Court of Appeals.

Read more here.

Arizona Senate Passes Bill Claiming Exclusive Jurisdiction Over Regulation of Greenhouse Gases

Mon, 07 Mar 2011 18:40:03 GMT

Last week, Arizona's Senate passed S.B. 1393 which declares that the Arizona State Legislature has exclusive authority to regulate anthropogenic sources of greenhouse gases ("GHGs") and substances, including PM10 and PM2.5. The bill also makes it "a violation of civil rights" and "unlawful under Arizona state law" for any governmental official to attempt to enforce federal laws or regulations that aim to "restrict intrastate emissions of … greenhouse substances." The bill aligns with three popular conservative positions: states' rights, limited government, and scepticism over global warming. Unfortunately, the most likely effects of the bill, if it is ever enacted, are to (1) cost the state money to defend it in court, and (2) potentially lead to an EPA takeover of all ADEQ's air programs.

The bill contains a large portion of what are essentially legal arguments based on the U.S. and Arizona constitutions for the bill's conclusion that a state has the authority to do what it attempts to do. However, it is highly unlikely that a federal court would agree with these arguments. The U.S. Supreme Court has consistently held that the federal government has very broad powers to regulate interstate commerce, and S.B. 1393's repeated references to "intrastate" GHG emissions is a clear fiction.

ADEQ's new director, Henry Darwin, has already expressed his opposition (subscription required).

The primary sponsor of S.B. 1393 was Senator Sylvia Allen of District 5, a consistent critic of environmental regulations. Eleven other Republican lawmakers signed on as co-sponsors. The bill now goes to the House of Representatives for its consideration and will also need to be signed by Governor Brewer before becoming law.

A companion bill passed by the Senate on the same day, S.B. 1394, instructs Arizona's governor to enter into compacts with states that have statutes similar to S.B. 1393 to assist each other in enforcing the laws. It also creates taxpayer standing to sue the chief law enforcement officer of any party state for failure to enforce the laws. In fact, these suits can be brought in the courts of any party state. So, if Arizona ever enters a compact under S.B. 1394, its Attorney General could be sued by a taxpayer from any party state in the courts of that state.

These bills have been sharply criticized by the Arizona Republic and the Arizona Daily Star

ABA Hosts 29th Annual Water Law Conference

Mon, 28 Feb 2011 16:58:00 GMT

On February 24th-25th, water law attorneys, water experts, and economists from across the nation gathered in San Diego to attend the Annual Super Water Law Conference sponsored by the American Bar Association's section of Environment, Energy and Resources. The conference began with a basic overview of riparian and prior appropriation law and went on to discuss issues currently facing both riparian and prior appropriation states. Aside from water rights, the conference touched on cost-benefit analysis, water quality, watershed governance, floodplain safety, the Endangered Species Act, and Tribal water rights, among other other topics. This annual conference provides a unique opportunity for lawyers and experts to engage in a broad discussion on water issues faced by local governments around the nation.

For more information about the conference or the American Bar Association's section of Environment, Energy and Resources, click here.

Obama Administration's FY 2012 Proposed Budget Shows Less "Love" for the EPA

Fri, 25 Feb 2011 16:40:00 GMT

Earlier this month, on Valentine's Day to be exact, the Obama Administration unveiled its proposed FY 2012 budget, which reflects an approximate thirteen percent (13%) decrease in funding for the Environmental Protection Agency (EPA). As everyone keeping even moderately abreast of current events is painfully aware, President Obama is faced with the herculean task of producing a proposed budget that is not only fiscally sound in response to the financial devastation caused by the Great Recession, but also practically prudent in its ultimate application. In the case of the EPA, the specific task at hand is to reasonably reduce operating overhead while still enabling the agency to effectively carry out its primary purpose of protecting human health and the environment.

One person who feels that the FY 2012 EPA proposed budget has successfully achieved this delicate balance is EPA Administrator, Lisa P. Jackson, who was quoted as saying:

"As millions of families are cutting back and spending less, they expect the same good fiscal sense out of their government. That is why this budget reflects the tough choices needed for our nation's short- and long-term fiscal health – and allows EPA to maintain its fundamental mission of protecting human health and the environment. This budget focuses our resources on the most urgent health and environmental challenges we face. Though it includes significant cuts, it provides EPA with what we need to fundamentally protect the health of the American people."

While a thirteen percent (13%) reduction sounds like a fairly significant decrease in the EPA's current operating budget, the specific line item reductions reflect the fact that President Obama is certainly not intending to remove the EPA's teeth as a powerful force in effectuating the United State's policy for reduction of greenhouse gas emissions. Nevertheless, those on the forefront of the clean water movement here in this country can't help but feel a bit "unloved" as a result of this proposed EPA budget, with the lion's share of cuts coming from reductions in state funding for water infrastructure projects.

Click here for a succinct break down of the specific EPA programs and initiatives to be cut along with an astute analysis of the potential political fallout that may arise in response to the ones that survived the chopping block; and here to see how the battle over the EPA's ability to regulate is playing out on Capital Hill, with the Republican-controlled House voting last week (249 - 177) to block the EPA from having the ability to regulate greenhouse gas emissions that many scientists say contribute to global warming.

Arizona and Arizona-Based Companies Continue to Attract Solar-Related Business

Fri, 25 Feb 2011 13:09:00 GMT

SOLON Corporation, a Tucson-based subsidiary of the German company SOLON SE, announced Feb. 24 that it has been awarded a contract to design and construct a 15 MW power plant in California for Pacific Gas & Electric (PG&E), one of the largest utilities in the U.S. SOLON is a manufacturer of turnkey power plants and crystalline silicon solar modules. Construction on the PG&E project is slated to begin in April 2011 and end in October 2011.

On Feb. 22, Governor Brewer announced that Spanish solar component manufacturer Gestamp Solar Steel will locate its U.S. headquarters in Surprise. The first phase of the facility is expected to be operational by the summer, covering 75,000 square feet and employing 50 people.

Read more here and here.

Ecuadorian Court Finds Chevron Liable for $8.6 Billion

Wed, 16 Feb 2011 19:10:00 GMT

On Monday, a trial court in Ecuador handed down what may be the largest environmental damages award in history: $8.6 billion against California-based Chevron Corp. The lawsuit was filed in 1993 by local farmers and indigenous groups, alleging extensive contamination of surface waters in the Lago Agrio area of the Amazon rainforest. Despite the award, it is uncertain whether Chevron will ever legally be required to pay anything to the plaintiffs in this case.

The plaintiffs are far from realizing any damages for several reasons. First, Chevron has vowed to fight the award through the Ecuadorian court system. Considering that the trial stage took almost 18 years, the appeals process could presumably also take decades. Second, even if the plaintiffs eventually obtain a final judgment from the Ecuadorian courts, Chevron does not have any assets in Ecuador that could be enforced against. Therefore, the plaintiffs will need to convince courts in other countries that the judgment is valid and that Chevron's assets within that country should be seized to satisfy the award. Finally (but related to the last issue), Chevron has already had some success in convincing American courts that the case is fraudulent.

Read more about this case here and here. And here's an interesting article from the San Francisco Chronicle about why the suit did not settle prior to the award.

SRP Begins Review of Sustainable Portfolio Principles

Fri, 21 Jan 2011 15:25:00 GMT

Arizona's Salt River Project (SRP) announced plans this week to review its Sustainable Portfolio Principles, adopted by its Board of Directors in 2004. These principles include goals such as "evaluat[ing] and implement[ing] supply- and demand-side measures that reduce the use of traditional fossil fuels" and "encourag[ing] … the development and use of sustainable energy technologies." The Principles were last reviewed by SRP's Board in 2006.

As a quasi-governmental entity, SRP is not subject to regulation by the Arizona Corporation Commission (ACC), and therefore does not have to follow the ACC's requirement that regulated utilities meet 15% of their retail demand through renewable resources by 2025 (see the ACC's Renewable Energy Standard & Tariff). Instead, SRP's renewable energy goals are determined by its Board of Directors. Although SRP has set a goal to meet 15% of its retail electricity demand through "sustainable resources" by 2025, it counts energy conservation and efficiency measures towards this goal.

As part of its review of its Sustainable Portfolio Principles, SRP will be holding public workshops at its Tempe PERA Club on March 3, March 21, and April 1.

New Mexico Kicks off 2011 Legislative Session with New Governor

Wed, 19 Jan 2011 20:23:00 GMT

Tuesday was the opening day of New Mexico's 51st legislative session. In her speech, New Mexico's 27th Governor, Susana Martinez, mentioned some of her initiatives which include cutting certain taxes while also cutting spending and creating more incentives for businesses to come to New Mexico. Although it is a 60 day session, meaning that all topics are technically germane, the budget remains the top priority in 2011. New Mexico will be facing a budget shortfall that has been estimated to be anywhere between $200 million and just under $500 million. There are various ideas regarding how to cut the budget and/or increase the amount of funds going into the state's general fund. Some legislators propose tapping into the state's severance tax bond fund, considered the state's endowment and referred to as the "permanent fund," for a loan or withdrawal to makeup for the budget shortfall. Legislators are also looking to decrease the size of government which has grown in recent years under Governor Richardson's administration. The cost adds up with the overall number of government appointees increasing from 127 under Governor Johnson to around 400 under Governor Richardson and cabinet positions similarly increased from 15 under Governor Johnson to 23 under Governor Richardson.

Legislators are considering reductions in tax rebates, claiming that New Mexico gave away $65 million in tax rebates last year to companies. Another consideration includes a Corporate Income Tax Bill, Senate Bill 6, which would amend the Corporate Income and Franchise Tax Act to require combined reporting for certain corporations. SB 6 would require that all corporations who pay taxes under the Corporate Income and Franchise Tax Act pay taxes on the income for the entire corporation, regardless of where its store or facility is located. The bill does not apply to corporations whose principal business activity is manufacturing who have not previously been required to file under the Act. The bill would apply to taxable years beginning on or after January 1, 2012.

In addition to the budget issues, there are various other bills seeking to de-regulate. The initiative is consistent with Governor Susanna Martinez' legislative speech on Tuesday, January 19, 2011 at the capitol in Santa Fe, in which she stated that she will work with corporations and attempt to make New Mexico a more attractive environment for corporations, because with corporations come jobs.

Other bills relating to regulation include a uniform Administrative Procedures Act, making the regulatory process run much smoother, particularly for out-of-state corporations. Most states have already enacted a uniform act and many believe that the legislation would help provide predictability and uniformity across agencies. Currently, each agency has its own administrative rules relating to procedure which makes the regulatory process in New Mexico harder to navigate.

The issues of de-regulation and budget are not wholly un-related. Many, including the new Governor, argue that lack of efficiency in the regulatory process in New Mexico, inhibits growth and job creation by making it overly burdensome and costly for corporations. In her speech on Tuesday, Governor Martinez stated that she will seek to eliminate taxes like the Locomotive Fuel Tax which she believes creates a disincentive for certain corporations to come to New Mexico, when Texas has no such tax. The Governor stated that she will not support raising any taxes and will only support scaling back on spending in order to make up for New Mexico's budget shortfall. Although many recognize a need for tax and regulation, others believe that New Mexico will achieve a better balance between taxes/regulation and the need for job creation/economic growth under the new administration.

AZPDES Multi-Sector General Permits 2010 Now Available

Wed, 05 Jan 2011 14:32:00 GMT

On Dec. 20, the ADEQ issued two new multi-sector general permits (MSGPs) for stormwater discharges regulated under the Arizona Pollutant Discharge Elimination System (AZPDES). The new MSGP 2010 for non-mining industrial activity applies to twenty-five specific industrial sectors as well as a sector reserved for any additional discharges designated by the ADEQ as appropriate for coverage in the future. The MSGP 2010 for mining activity covers four specific sectors within the mineral industry. The new permits become effective Feb. 1, 2011 and are valid for a term of five years from that date.

To obtain coverage under either the mining or non-mining MSGP 2010, a facility owner or operator must file the applicable Notice of Intent (NOI). Facilities subject to the permits have 120 days from the effective date (i.e., until May 31, 2011) to submit an NOI and prepare the required Stormwater Pollution Prevention Plan (SWPPP).

The newly issued permits replace the EPA's MSGP 2000, which expired in 2005. Since 2002, the ADEQ has been authorized by the EPA to regulate stormwater discharges under the Clean Water Act. Note, however, that facilities in Indian Country continue to be covered under the EPA's MSGP 2008.

Copies of the new permits and related forms may be downloaded from the ADEQ's website here. The ADEQ has also made available (here and here) detailed fact sheets explaining the scope and terms of each permit and significant changes from the MSGP 2000.

FIJI Water Sued Over Claim That Product is Carbon Negative

Wed, 05 Jan 2011 13:40:00 GMT

A class action lawsuit against FIJI Water was recently filed in federal court in California alleging that FIJI Water has engaged in false and misleading advertising by claiming that its product is carbon negative. The suit alleges that FIJI Water uses "forward offset credits" -- carbon reductions that are to take place some time in the future -- to back its claims that it is carbon negative, which the suit contends is misleading to consumers.

Read more about this case here and here.

EPA Proposes Additional Greenhouse Gas Regulations for Utilities, Refineries

Wed, 29 Dec 2010 11:20:47 GMT

More greenhouse gas regulations are on the way. The EPA announced Dec. 23 that it will revise the new source performance standards for electric utilities and petroleum refineries to add limitations on greenhouse gas emissions. The EPA is taking this step in settlement of lawsuits filed by several states and environmental groups after the agency revised the standards for utilities in 2006 and refineries in 2008 without limiting greenhouse gases.

The settlement agreements require the EPA to propose revised electric utility standards by July 26, 2011 and issue final standards by May 26, 2012. Revised petroleum refinery standards must be proposed by Dec. 15, 2011 and finalized by November 15, 2012. According to the EPA's press release, these two industries together account for nearly 40 percent of U.S. greenhouse gas emissions. Gina McCarthy, top EPA air official, noted that the agency's focus on these sectors would allow it to address a large amount of emissions by regulating relatively few sources.

The revised new source performance standards represent a third wave of EPA greenhouse gas regulation. Reporting requirements became effective January 2010, and the agency is set to begin implementing greenhouse gas permitting requirements under the prevention of significant deterioration program (PSD) on January 2 of next year. Under the PSD program, regulated facilities must deploy best available control technology to limit emissions, which is determined based on a permit-by-permit analysis. The revised new source performance standards will establish a sector-wide threshold level of emissions control requirements, a minimum or floor beyond which PSD permits may impose additional requirements.

Industry was critical of the EPA's decision to adopt greenhouse gas performance standards for utilities and refineries. Representatives of various associations, including the American Petroleum Institute and the National Petrochemical & Refiners Association, stated that the proposed new regulations will jeopardize the nation's economic recovery. Despite its timing right before Christmas, the EPA's announcement also caused a stir among some Republican lawmakers on Capitol Hill, including Rep. Fred Upton (R-Mich.) and Rep. Darrell Issa (R-Calif.), who likewise stated that the regulations threaten to destroy jobs and raise consumer energy prices. While legislation to block or delay the regulations will certainly attract momentum in Congress, it will likely have difficulty passing the Senate and a presidential veto is all but certain.

Read more here and here.

Upcoming Legislation Could Impact Corporate Taxes in New Mexico

Tue, 28 Dec 2010 13:04:00 GMT

Yesterday's Albuquerque Journal contained a legislative update describing upcoming legislation in the 2011 session. The NM Legislative Finance Committee calculates that NM is facing a $215 million budget deficit, while the governor's office has said it will be double that number. The NM Legislature will be looking for ways to make up the deficit, making corporations vulnerable in the upcoming session.

Among other things, almost all tax incentives will be up for discussion and will have to be justified. The biggest tax break in New Mexico is a $217 million tax break on the sale of food. Furthermore, the state currently compensates municipalities and counties for the share of the food tax they would have otherwise received, which is also expensive for the state.

The state will likely be doing an unemployment insurance assessment increase, since its unemployment insurance fund is currently operating at a deficit. Furthermore, a bill that was introduced last session will be re-introduced this year, which would require businesses that operate in more than one state to report income from out-of-state activities for the purposes of calculating NM corporate income taxes. The Legislative Finance Committee has said that doing the combined reporting would increase tax collections by $4.8 million in 2011 and $27 million in 2012.

Despite concerns about additional tax burdens on corporations in New Mexico, there are still reasons to be optimistic about the incoming administration in the hopes that Suzanna Martinez can find ways to cut spending within the budget; rather, than raising taxes on corporations to make up the deficit faced by the state.

Feds Identify Key Areas for Solar Development in the Southwest

Tue, 21 Dec 2010 10:01:00 GMT

The U.S. Department of Energy and the Bureau of Land Management (BLM) have announced a proposal to designate large swaths of land in six southwestern states as "solar energy zones." On Dec. 17, the two agencies issued a Draft Programmatic Environmental Impact Statement (DPEIS) that outlines a program to standardize and expedite the review and approval process for utility-scale solar installations on public lands.

Under the proposed solar energy development program, approximately 22 million acres of BLM-administered lands would be considered to be available for rights-of-way for solar energy projects. A subset of these available lands would be identified as solar energy zones, areas where the BLM would prioritize solar energy and associated transmission infrastructure development. Twenty-four solar energy zones were identified, covering approximately 677,400 acres across Arizona, California, Nevada, New Mexico, Utah, and Colorado.

In the agencies' Notice of Availability of the DPEIS, published in the Federal Register, the BLM states that it "has identified a need to respond in a more efficient and effective manner to the high interest in siting utility-scale solar energy development on public lands and ensure consistent application of measures to avoid, minimize, or mitigate the adverse impacts of such development." The 11,000-page DPEIS analyzes the environmental, social, and economic impacts associated with the development of utility-scale solar. Solar energy zones were selected based on their insolation (measure of solar radiation) and their relatively low level of resource conflicts. In developing the DPEIS, the BLM considered solar technologies likely to be viable for deployment over the next 20 years, including both concentrating solar power (e.g., parabolic trough, power tower, and dish engine systems) and photovoltaic technologies.

The solar industry lauded the DPEIS as a way to ensure a more predictable authorization process for solar projects on public lands. The DPEIS is open for public comment for 90 days, ending March 17, 2011. The agencies also plan to hold public meetings in the affected states.

Read the agencies' press release. For more detailed information, visit the website devoted to the DPEIS, where you can download the entire document and view maps of the proposed solar energy zones.

California Adopts Cap-and-Trade Plan

Fri, 17 Dec 2010 16:45:00 GMT

On the heels of New Mexico's approval of cap-and-trade earlier this month, regulators in the Golden State decided late yesterday to adopt a cap-and-trade plan, creating the world's second-largest carbon market after Europe's. The California Air Resources Board (CARB) voted 9-1 to limit greenhouse gas emissions from large emitters, the keystone of the state's goal to reduce emissions to 1990 levels by 2020, as outlined in the 2006 Global Warming Solutions Act. Voters last month rejected a measure that would have postponed these emissions reduction efforts until a recovery in the jobs market.

Under the new rules, power plants, oil and gas refineries, and other industries that annually emit more than 25,000 tons of CO2 will be required to obtain allowances. At the beginning of the program, free allowances will be doled out, with quarterly auctions beginning in February 2012. Companies will also be able to cover a portion of their emissions through the purchase of carbon offsets.

Industry reaction to CARB's decision has been mixed, with some companies and associations expressing qualified support and others calling the program detrimental to the state's competitiveness. During Thursday's 10-hour proceedings, Gov. Schwarzenegger argued that despite the state's economic and budget woes, green jobs are growing as a result of the state's environmental efforts. CARB Chair Mary Nichols stated that more work on the program remains to be accomplished, including development of safeguards to prevent market manipulation and establishment of a fund to help low-income families pay for potential energy price increases.

Read more here and here.

PNM Files Appeal of New Mexico Cap-and-Trade Decision

Thu, 16 Dec 2010 12:40:00 GMT

We blogged here about the New Mexico Environmental Improvement Board's (EIB's) December 6 decision to adopt a cap-and-trade program and the City of Farmington's immediate appeal of that decision. Now, the Public Service Company of New Mexico (PNM) is joining the fight, filing a separate legal challenge with the New Mexico Court of Appeals on December 14. PNM believes that the EIB overstepped its authority in mandating cap-and-trade and has stated that the program would competitively disadvantage New Mexico. Other parties who have appealed the decision include the New Mexico Oil and Gas Association, Southwestern Public Service Company, and the Tri-State Generation and Transmission Association.

New Mexico's Governor-Elect Susana Martinez has said that she opposes the cap-and-trade program, referring to it as a "cap and tax" that would harm the state's businesses and families. When her term of office begins on January 1, 2011, she could attempt to roll back the EIB's decision by spearheading a legislative effort to undo the rules or appointing regulators that oppose cap and trade. Don Brown, spokesman for PNM, noted, "We know the governor-elect and legislators have options before them . . . but as a party to the case, we have decided to appeal."

Read more here and here (subscription required).

PNM Energy Efficiency Program Surcharges To Increase in January

Thu, 09 Dec 2010 10:56:42 GMT

New Mexico Residential customers can expect a 35 cent increase in their monthly electricity bills beginning in January, 2011. The charge would be added to Public Service Company of New Mexico's energy efficiency rider that, according to PNM, helps pay for the program's actual costs. The program includes many components, from refrigerator recycling to discounts for the purchase of fluorescent bulbs. The rider would allow PNM to recover the revenue to cover fixed costs that continue, even though energy use is decreased. The add-on also is intended to serve as an incentive for investing in low-cost energy programs in lieu of new plants. The increase will be in addition to the average charge of $1.15 that most residents pay now to support those programs. Currently, the recovery is done as a separate charge. In the future, the fixed costs will be part of rate proceedings, with the incentive based on a half-cent per kilowatt hour saved.

Read more here (subscription required).

New Mexico Adopts Cap-and-Trade; Immediately Challenged by Farmington

Thu, 09 Dec 2010 09:41:00 GMT

It did not take long. On Monday, December 6, the New Mexico Environmental Improvement Board New Mexico Environmental Improvement Board adopted a plan to require businesses and industries in the electric and gas and oil sectors that emit 25,000 metric tons or more of carbon dioxide to start reducing emissions by 3% a year from 2010 levels, beginning on January 1, 2013. The rule would sunset if a regional or federal emissions reduction program is put in place. Regulated companies that cannot reach the reduction requirements could buy offsets from unregulated state companies that are able to reduce green-house gas emissions.

On Tuesday, December 7, the Farmington City Council voted unanimously to appeal that decision. The City is interested not just from the effects the regulations will have on its own utilities, but the city owns an interest in the coal-fired power plant San Juan Generating Station, according to Mayor Tommy Roberts.

Supreme Court Accepts Appeal in Connecticut v. American Electric Power

Tue, 07 Dec 2010 19:07:00 GMT

Yesterday, the U.S. Supreme Court announced that it has accepted certiorari over an appeal by several large power companies from a Second Circuit decision allowing public nuisance claims based on greenhouse gas emissions to proceed. The case was brought by eight states, three non-profit land trusts, and New York City seeking to impose injunctions on the defendants to restrict their carbon emissions. The claims were initially dismissed by the Southern District of New York on political question grounds, but reinstated by the Second Circuit last fall. As we previously blogged, the Obama Administration urged the Supreme Court several months ago to review the circuit court's decision.

Justice Sonia Sotomayor recused herself from the decision to grant certiorari since she heard arguments on the case while on Second Circuit.

Plaintiff's in a similar case from the Fifth Circuit are apparently still waiting to hear whether the Supreme Court will accept their appeal.

Read more here and here.

Albuquerque Plans Aquifer Recharge

Mon, 22 Nov 2010 12:15:00 GMT

The Albuquerque Bernalillo County Water Utility Authority has announced a plan to recharge the aquifer beneath the Albuquerque metropolitan area. The water utility intends to drill two deep wells in the city's northeastern quarter that will be used to pump water into the aquifer, as part of a water conservation technique called "water banking." The utility would store excess water in the aquifer during the winter months when consumption is lowest and pump it back out during the summer as water demand increases. This would reduce the depletion of native water in the aquifer. The depletion of Albuquerque's aquifer has become a large concern in recent years with the discovery that the water table in some parts of the city has dropped 100 feet or more due to groundwater pumping.

The proposed aquifer recharge project is expected to cost between $3 and $5 million dollars. The project is still in its early stages and will require a formal application to the Office of the State Engineer. Additionally, concerns must be resolved about the preservation of aquifer water quality. Because water will undergo a treatment process before being pumped into the aquifer, the utility must ensure that treatment byproducts do not infiltrate and contaminate groundwater. The project proposal includes a test phase that would allow monitoring of water quality and general system performance.

Read more here (subscription required).

PNM Proposes Charge for Energy Efficiency Program

Mon, 22 Nov 2010 11:25:07 GMT

The New Mexico Public Regulation Commission is expected to approve a Public Service Company of New Mexico request to add 50 cents to an existing PNM rider to pay for its energy efficiency program. PNM argued that energy efficiency programs cause customers to use less energy, reducing revenues, thus creating a disincentive to develop such programs. The fixed recovery cost would be based on 1 cent per kilowatt hour saved over the life of the energy efficiency program. The Commission will likely rule on the request in December.

Read more here (subscription required).

EPA Releases Draft Indoor Air Quality Standards

Thu, 18 Nov 2010 19:41:00 GMT

The EPA released for comment on Nov. 9 its proposed Healthy Indoor Environment Protocols for Home Energy Updates. The draft protocols are voluntary and intended for use by the home retrofit industry with respect to single-family and multi-family low-rise dwellings. The protocols are addressed to the concern that initiatives to weatherize or "green" existing homes may have the unintended effect of negatively impacting indoor air quality.

The protocols are organized into three categories:

Assessment protocols – for use to assess existing conditions and the potential for increased health risks as a result of retrofitting
Minimum actions – should be taken to ensure that retrofit activities do not introduce new health concerns or worsen existing conditions
Expanded actions – may be implemented at little or no cost in connection with a home retrofit to improve the indoor environment

Of particular relevance for companies in the real estate industry or involved in real estate transactions are the protocols for radon testing and mitigation. Radon is a colorless, odorless, tasteless gas. Radioactive and highly carcinogenic, it is the second leading cause of lung cancer after cigarette smoking. As asbestos and lead paint concerns fade over time with the development of newer housing stock, radon may become an even bigger issue, due to modern building codes that call for tight construction and thus increase radon buildup. Radon exposure is a significant issue for dwellings in Bernalillo County, which is the most populous county in New Mexico, and large parts of Arizona as well.

You can read EPA’s remarks on the draft protocols here. Comments on the protocols are due by Dec. 9, 2010.

Supreme Court Declines Review of Uranium Mine Permit

Wed, 17 Nov 2010 11:15:21 GMT

On Monday, November 15, 2010, the US Supreme Court denied cert to hear a last minute challenge to Hydro Resources Inc.'s Nuclear Regulatory Commission license to mine uranium in northwestern New Mexico near Church Rock. The permit would allow Hydro Resources to leach-mine uranium. Challengers had challenged the license after the US 10th Circuit denied a request for rehearing in September. Opponents will continue to mount efforts at the state level, since certain permits will still be required from the New Mexico Environmental Department and other state agencies. Major concerns have been raised concerning potential groundwater contamination.

Read more here.

EPA Issues GHG Permitting Guidance

Thu, 11 Nov 2010 13:47:00 GMT

Yesterday, EPA issued a guidance document intended "to assist permit writers and permit applicants in addressing the prevention of significant deterioration (PSD) and title V permitting requirements for greenhouse gases (GHGs) that begin to apply on January 2, 2011." The most significant aspect of the new guidance is that, in many cases, implementing energy efficiency measures will be the best available control technology (BACT) for GHGs. Some industry proponents had been worried that GHG permitting would require fossil fuel-fired power plants to implement unproven carbon capture and storage technologies. EPA hopes that the permitting guidance will allay this concern and "rejected suggestions from Republicans opposed to the new [GHG permitting] rules that they would impose onerous and costly conditions on energy firms that will damage the economy and lead to a de facto ban on new facilities."

Beginning January 1, 2011, new sources and major modifications that are already subject to prevention of significant deterioration (PSD) and Title V permitting will be required to consider GHG emissions in obtaining or renewing their permits. Beginning July 1, 2011, new sources that have the potential to emit at least 100,000 tons per year of CO2 equivalent and major modifications that could increase GHG emissions by that amount will become subject to the PSD and Title V permitting programs on the basis of GHGs alone. EPA estimates that these first two steps of its Tailoring Rule will capture facilities responsible for almost 70% of national GHG emissions. The most important component of these permitting programs, is the PSD program's requirement that facilities implement BACT for permitted pollutants.

You can read more at EPA's GHG permitting page, or comment on the new guidance here.

Lewis and Roca's Client Alert about GHG permitting (for companies subject to the new regulations) is available here.

Court Overturns New Mexico PRC Refund Order

Tue, 02 Nov 2010 18:15:57 GMT

The New Mexico Supreme Court has overturned a Public Regulation Commission (PRC) order that El Paso Electric Company refund more than $5 million to customers in Doña Ana and Otero counties. El Paso Electric had been including in customer rates the franchise fees charged by these counties for the utility's use of public rights of way to deliver electricity. In its refund order, the PRC concluded that the counties lacked authority under state law to impose the franchise fees and that El Paso Electric should not pass them on to customers.

The state supreme court blocked the PRC's order from taking effect during El Paso Electric's appeal. In an opinion issued in late October of this year, the court held that the county franchise fees were not properly considered "rates" and therefore fell outside the PRC's jurisdiction. Accordingly, the court vacated and annulled the PRC's order.

Read more here (subscription required). Read the New Mexico Supreme Court opinion here.

Colorado River Reservoir Sinks to Record Low

Fri, 22 Oct 2010 16:16:00 GMT

The "Law of the River" is a complex collection of interstate compacts, federal laws, court decisions, and other documents that governs the allocation of Colorado River water and operation of the river's dams. But this esoteric body of law is now making the news due to the Southwest's shrinking water supply.

Due to a multi-year drought coupled with rapid development in the Southwest, the water level in Nevada's Lake Mead, an almost 10 trillion-gallon reservoir created by Hoover Dam, has dropped to historic lows: hitting 1083.18 ft. below sea level on Sunday, Oct. 17, then falling further to 1083.09 ft. by Monday morning. Lake Mead water levels are the trigger for incremental rationing under a 2007 agreement between the Upper Basin states of Colorado, Utah, and Wyoming, and the thirstier Lower Basin states of Arizona, California, and Nevada. If Lake Mead drops another eight feet to hit 1075 ft. above sea level, then never-before-imposed water restrictions will kick in for Arizona and Nevada, affecting agricultural users first. Southwest water managers, including the federal Bureau of Reclamation (BOR), may be able to avoid or delay this result, however, by transferring water from Utah’s Lake Powell upriver. In its plans for next year, the BOR calls for a 40 percent increase in water deliveries from Lake Powell to Lake Mead.

Read more here. Time has an informative article here.

Large-Scale Solar Photovoltaic Plant Coming to Arizona

Wed, 13 Oct 2010 17:22:00 GMT

Arizona's solar energy industry is expanding again. On Oct. 12, Sempra Generation announced its plans to build a large-scale solar photovoltaic plant in Arizona. The first phase of the planned Mesquite Solar Complex will generate 150 megawatts of electricity, with the capacity to grow to 600 megawatts at full build-out. The plant will be located in Arlington, 40 miles west of Phoenix, on former agricultural land and will connect to the grid at the Hassayampa switchyard.

Sempra Generation, a San Diego-based subsidiary of Sempra Energy, has entered into a 20-year, 150-megawatt power purchase agreement with Pacific Gas & Electric, which is pending approval by the California Public Utilities Commission. Construction at the Mesquite Solar site is slated to begin next year and conclude in 2013. Don Cardon, president and CEO of the new Arizona Commerce Authority, credited Arizona's securing of this project to the state's new renewable energy tax incentives, including SB 1254 (2009), which provides credits for renewable energy generators on a per-kilowatt-hour basis.

Read more here and here.

White House Taps Solar Energy

Wed, 06 Oct 2010 13:47:00 GMT

An interesting tidbit on the solar energy front: The White House is going green, at least to a limited extent. Energy Secretary Steven Chu and Council of Environmental Quality (CEQ) Chair Nancy Sutley announced Tuesday that a solar panel array and a solar water heater will be installed on the White House roof. These installations will heat water for the presidential mansion's living quarters and provide a small amount of electricity. Secretary Chu says the White House installations will demonstrate the availability and reliability of American solar technology.

President Carter was the first to install solar panels on the White House, but these were dismantled in 1986. Later, President George H.W. Bush installed a solar system to power a maintenance building and heat the White House swimming pool. President Obama, who has publicly championed renewable energy, was under pressure from environmentalists to lead by example. Tuesday's announcement was made during the CEQ's 2010 GreenGov Symposium. The Department of Energy will soon initiate a competitive procurement process to select a company to perform the installations.

Algae Summit Heralds Arizona's Biofuels Future

Fri, 01 Oct 2010 16:47:00 GMT

Phoenix this week hosted the 4th Annual Algae Biomass Summit (Summit), a three-day event organized by the Minneapolis-based Algal Biomass Organization (ABO). Over 600 researchers, developers, and other interested constituents from 27 countries, attended the Summit, which took place Sept. 28-30. The ABO selected Arizona as the location for the Summit due to the state’s emergence as a "hotbed for research on algae."

Algae are a primitive form of plant life that secrete oil in their cells. This oil can be extracted and used as fuel, due to its similarity to crude oil. Arizona's abundant sunshine, warm climate, and available land, which make large-scale solar energy so promising, also define the state as an ideal location for developing algae biofuels. Arizona State University is at the forefront of algal research. Scientists at ASU played a major role in discovering oil-rich algae strains and claim to be three to five years away from large-scale algae production, which would pave the way for algal biofuel to become a viable alternative to fossil fuels. ASU researchers are also working to find new extraction methods. On Wednesday, Sept. 28, Gov. Jan Brewer announced a grant of $2 million for the development of a new Arizona Center for Algae Technologies and Innovations.

The Arizona Republic has an informative article here.

Senate Bill Preventing EPA Regulation of GHGs Denied Vote

Fri, 01 Oct 2010 14:29:00 GMT

Senator Jay Rockefeller's (D-WV) bill to postpone EPA regulation of greenhouse gases for two years will not go up for a vote in the Senate until after the November elections. Republican Senator Kit Bond (R-MO), tried to pass the bill by unanimous consent on Monday, but Majority Whip Dick Durbin (D-IL) objected. The bill has six Democratic co-sponsors and wide Republican support, but Sen. Rockefeller is apparently content to wait for the Senate to consider the measure in the lame-duck session after the elections. Majority Leader Harry Reid (D-NV) has promised to allow a floor vote on the bill sometime this year and Sen. Rockefeller is confident it will receive the 60 votes necessary to prevent a Democratic filibuster. Still, it will almost certainly be vetoed by President Obama.

As we previously blogged, Sen. Rockefeller introduced the bill in an attempt to give Congress time to address greenhouse gas emissions legislatively. A similar measure, Senator Lisa Murkowski's (R-AK) "disapproval resolution," was narrowly defeated earlier this year (blog).

Interestingly, according to this blog by The Hill, Sen. Rockefeller did not know Sen. Bond was going to make the attempt and believes it was "sort of a stupid thing to do."

Read more here and here.

EPA Proposes Disapproval of Arizona's Air Quality Plan

Tue, 28 Sep 2010 09:24:00 GMT

The EPA has proposed to disapprove part of the most recent air quality plan revisions for Maricopa County, Arizona, the so-called "Five Percent Plan." If the disapproval goes into effect, the state will be at risk for sanctions under the Clean Air Act (CAA), including restrictions on federal highway funding, unless deficiencies are corrected to the EPA's satisfaction within two years.

The Maricopa County area, which includes metropolitan Phoenix, has been considered by the EPA to be in "nonattainment" for coarse particulate matter (PM-10) since 1996. In 2007, after falling into "serious nonattainment," the State of Arizona submitted a plan to reduce PM-10 by five percent each year until the applicable National Ambient Air Quality Standard (NAAQS) was attained. The EPA's decision this month to propose disapproval of part of the Five Percent Plan is largely a result of two significant problems with the plan in the EPA's view. First, the EPA says that the state relied on an inadequate inventory of emissions sources, with too heavy a focus on the construction industry to the exclusion of other sources. Second, the EPA disapproved a request by the Arizona Department of Environmental Quality (ADEQ) to treat as "exceptional events" four exceedances of the PM-10 NAAQS at a monitoring station in southwestern Phoenix. ADEQ had concluded that these exceedances, measured at the West 43rd Ave. monitoring station, were caused by dust storms rather than human activity, and as such, should not count against Maricopa County's goal of having no more than three violations of the PM-10 NAAQS during the period from 2008 to 2010. The EPA, in a May 2010 decision that we blogged about here, disagreed with the ADEQ's "exceptional events" determination, thereby dooming the state’s efforts to achieve attainment by 2010.

The CAA's "sanctions clock" will begin to run against the State of Arizona when the EPA's proposed disapproval becomes effective. The proposal was published in the Federal Register Sept. 9, 2010, triggering a thirty-day comment period, and the EPA expects to make a final decision in early January 2011. Under the CAA and its implementing regulations, if a state has not come into attainment or revised its plan to the EPA's satisfaction within 18 months of plan disapproval, the EPA is required to apply the "offset sanction," under which new and modified stationary sources are subject to a 2-to-1 emissions offset, meaning that they must reduce emissions from other sources equal to twice the amount they project to emit. Six months later, at the two-year mark, the state will be at risk for highway funding restrictions if deficiencies remain uncorrected, although the EPA's press release states that transportation projects scheduled from 2011 to 2014 would not be affected.

Renewable Energy Standard Introduced in the Senate

Thu, 23 Sep 2010 18:15:58 GMT

On Tuesday, Sen. Jeff Bingaman (D-NM) proposed a national renewable electricity standard (also called a renewable portfolio standard) as a stand-alone bill with some GOP support. The standard would require electric utilities who sell more 4 million MW-hrs per year to generate at least 15% of their electricity from renewable sources by 2021. Supporters view a national RES as a way to encourage the development of renewable energy in light of Congress' rejection of the broader and more ambitious energy bill proposed earlier this year by Sens. Kerry (D-MA) and Lieberman (I-CT). The proposed RES is expected to have much lower costs than Kerry-Lieberman's cap-and-trade scheme although it will also do much less to reduce greenhouse gas emissions.

According to the U.S. Department of Energy, 28 states and the District of Columbia already have renewable portfolio standards, and most are more demanding than the proposed national RES. For example, California utilities are required to produce 33% of their electricity from renewable sources by 2020. Arizona's current RPS only requires 15% renewable energy by 2025. Five other states have non-binding goals for renewable energy development. The bill will obviously have the largest impact on states without any existing standards/goals for renewable energy, primarily the entire southeastern portion of the country.

Co-sponsors on the bill include Sens. Sam Brownback (R-KA), Susan Collins (R-ME), Byron Dorgan (D-ND), Mark Udall (D-CO), and Tom Udall (D-NM). From all indications, the co-sponsors intend to promote the bill as a way to create jobs and make the country more energy-independent, and to avoid the controversial topic of climate change.

Read more here and here.

International Solar Manufacturer to Come to Phoenix

Fri, 10 Sep 2010 13:28:00 GMT

This Thursday, Sept. 9, Power-One, Inc. announced its decision to open a solar and wind inverter manufacturing facility in Phoenix. Power-One is the sixth renewable energy company to locate in the Valley of the Sun since the state enacted a tax incentive program for such companies last year.

Inverters manufactured by the Southern California-based company are used to convert direct current electricity from renewable sources like photovoltaic panels and wind turbines into alternating current electricity, as required to power electrical devices. Power-One, which trades on Nasdaq (ticker: PWER), is the world's second-largest inverter manufacturer, with operations in Germany, Italy, the United Kingdom, Australia, China, and Hong Kong, among other locales. The new Phoenix facility is expected to create 350 jobs, with production beginning next month in a 120,000 sq. ft. facility at 3201 E. Harbour Drive.

Beside the tax incentives, another factor influential in drawing Power-One to the Valley, beating out competitor sites in Texas, was the company's relationship with Arizona State University. Power-One is interested in collaborating with ASU to design an innovation center for research and development on new means of solar power delivery.

Read more here (subscription required).

New Website Compiles Arizona Solar Energy Information

Wed, 08 Sep 2010 15:35:49 GMT

The Arizona Corporation Commission announced last week the official launch of the Arizona Goes Solar website, a one-stop resource for Arizona consumers and businesses looking for information about solar projects going on around the state and available incentives for adoption of solar energy technology. According to the website, Arizona Goes Solar is a "collaborative effort led by the Arizona Corporation Commission and implemented by the electric utilities in Arizona."

Some interesting features of the Arizona Goes Solar site include:

• A list of available utility incentives for residential and non-residential solar installation projects, organized by utility. Below is the APS page:

• A list of available state and federal solar incentives, both residential and non-residential, with links to sites containing further information:

• A calendar of upcoming educational workshops and events:

• The Arizona solar map. This zip code-searchable map shows the locations of solar energy projects across the state, updated bi-weekly. Searching for zip code 85016 in central Phoenix brings up the following screen:

Clicking on an orange (residential & non-residential) or blue (utility solar) icon pulls up specific information about the number of installations in that area, the total capacity of installations, and average annual energy savings. Zip code 85016 has a total of 57 solar installations, with total capacity of 155.09 kW and average annual energy savings of 333,883.00 kWh:

Chairman Kris Mayes states in a Commission press release that the website "will increase the transparency of solar rebates and incentives, and provide a real-time look at where solar systems are being deployed and how much energy they can produce."

Administration Urges Reconsideration of 2nd Circuit's Climate Change Ruling

Thu, 02 Sep 2010 19:02:00 GMT

Acting Solicitor General, Neal Katyal, filed a brief with the Supreme Court last week, asking the Court to vacate the 2nd Circuit's ruling in American Electric Power v. Connecticut, and to remand the case for reconsideration in light of the EPA's progress in implementing greenhouse gas regulations. The move reportedly surprised the plaintiffs and environmental groups who were hoping for the Obama administration's support in the case, which seeks to impose an injunction on six of the largest carbon emitters in the country.

AEP v. Conn. is a nuisance lawsuit brought by eight states, three non-profit land trusts, and New York City against a handful of the largest power producers in the country. The plaintiffs have asked the courts to impose an injunction on the defendants to restrict their carbon emissions. As previously blogged, the case was initially dismissed by the Southern District of New York on political question grounds, but reinstated by the Second Circuit last fall.

Similar cases have been filed in the 4th, 5th, and 9th Circuits. In July, the 4th Circuit reversed a district court decision requiring the immediate installation of emission control equipment at four power plants in Alabama and Tennessee, and ordered the district court to dismiss the case for essentially the same reasons argued by the Solicitor General in AEP v. Conn. In the 5th Circuit, an initial decision to reinstate a climate change case was vacated on highly unusual procedural grounds as we explained here. The 9th Circuit has not yet ruled on the Northern District of California's dismissal of similar claims in Native Village of Kivalina v. ExxonMobil Corp.

Read more about the Solicitor General’s action here and here.

Money Coming to Arizona for Forest Restoration

Mon, 23 Aug 2010 22:58:00 GMT

Northern Arizona's mountainous forest region is about to get trimmed down and cleaned up. Arizona's Four Forests Restoration Initiative (Initiative) was awarded a $2 million grant from the U.S. Forest Service on Aug. 17, the largest grant made under the newly created federal Collaborative Forest Landscape Restoration Program. The Initiative is the result of a coalition between the timber industry, environmentalists, and local communities to restore healthy ecological values in Northern Arizona's ponderosa pine forests, including 2.4 million acres of the Apache-Sitgreaves, Kaibab, Coconino, and Tonto National Forests, while also boosting rural Arizona’s economic growth and fire safety. Forests in the Western United States have been ecologically degraded by overly aggressive fire suppression practices as well as misguided forest management policies, with unsustainable levels of timber harvesting and cattle grazing in the earlier part of the last century followed by the opposite extreme of unduly restricted logging and grazing. As a result, dense thickets of smaller, younger trees have grown up in place of old-growth trees, and the forest floor is buried in needles and leaves. With this overabundance of natural fuel, forests are all too vulnerable to high-intensity, catastrophic fires that reach the forest canopy and spread at a devastating pace –- witness June's Schultz Fire near Flagstaff. Tightly packed trees are also more susceptible to disease and insect attack. Forest restoration projects, including the Four Forests Restoration Initiative, use mechanical thinning to reduce dense tree stands and introduce low-intensity, ground-level fire, a vital part of a healthy ecosystem.

Gov. Brewer praised the $2 million grant as a "win-win by cleaning up the forests and removing the dangerous kindling and turning it into a useful commodity by creating products for the state and putting people back to work." The governor also noted in her press release that the small-diameter roundwood removed from the forest may be manufactured into guardrail posts for use by the Federal Highway Administration. U.S. Representative Ann Kirkpatrick (D-AZ) believes the Initiative will create over 600 jobs.

Read this article on the Four Forests Restoration Initiative from the Payson Roundup.

Science Provides Free Access to Special Issue on Alternative Energy

Thu, 19 Aug 2010 20:23:00 GMT

The Journal Science is providing free online access to its special issue: Scaling up Alternative Energy, until August 27, 2010. The special issue "explores worldwide efforts to develop clean, renewable alternatives to fossil fuels" and is an excellent opportunity to find out what experts think about many of the issues currently being debated by politicians and the public. The underlying message of the issue, is that developing renewable energy on the scale necessary to replace fossil fuels will most likely require more time and be more difficult than many proponents of renewable energy currently realize.

According to this article, by Richard A. Kerr, prior energy transitions (e.g., from wood to coal or from coal to oil and gas) took approximately 50 years and the transition to carbon-free fuels could take even longer due to several issues.

In this editorial, Donald Kennedy, Editor Emeritus of Science, writes that: "The contemporary challenge is not that there isn't enough oil; there is far too much of it. Oil has produced environmental devastation on Gulf shores, more of the same in Amazonian forests, emissions from transportation systems that endanger public health, and supplies managed by nation-states that threaten global security. The abuses that result from an overdependence on oil amount to a national crisis, and its resolution will depend on cooperative actions taken by government, industry, and the public."

This article argues that nuclear power must play a role in moving away from carbon-based energy sources.

Begin by reviewing the special issue's table of contents, and register for free access here.

Rioglass Solar to Open Manufacturing Facility in Surprise

Fri, 13 Aug 2010 17:13:00 GMT

Gov. Jan Brewer announced Aug. 11 that Rioglass Solar, a solar component manufacturing company based in Madrid, Spain, will open a manufacturing and headquarters facility in the City of Surprise. Rioglass manufactures curved glass mirrors for use in parabolic concentrators and has reached a deal with Abengoa Solar to supply all the mirrors for the planned Solana Generating Station, a concentrating solar power plant to be constructed near Gila Bend. Rioglass will make a $50 million capital investment in a 130,000 sq. ft. manufacturing and headquarters facility and create 100 jobs. The company also has plans for a second-phase investment of $45 million in an additional facility. Welcoming the company, Gov. Brewer praised Arizona's "significant progress" in becoming "a global leader in the renewable energy sector." Michael Bidwell, president of the Greater Phoenix Economic Council, noted Arizona's current position as an "established leader" in the renewable energy industry, which "just a year ago overlooked us."

Rioglass is one of several large-scale solar manufacturers to locate in the Valley of the Sun since the July 2009 enactment of the state's Renewable Energy Tax Incentive Program. Other solar manufacturers to announce plans to move to the Phoenix area include the Chinese giant Suntech Power Holdings Co. as well as Tower Automotive and Linamar Corp. (subscription required), both of which are suppliers for Scottsdale-based Stirling Energy Systems.

Texas Defies EPA Greenhouse Gas Regulation

Fri, 06 Aug 2010 18:35:00 GMT

With the death of the Senate climate bill, the spotlight moves back to the EPA and its impending regulation of greenhouse gases. The agency's controversial "Tailoring Rule" will phase in regulation of these gases, beginning in Jan. 2011. That is, if it can get the states to cooperate. Texas, for one, is taking an "over my dead body" approach. In an Aug. 2 letter to the EPA, the Texas attorney general, together with the head of the Texas Commission on Environmental Quality, minced no words in expressing the Lone Star State’s position: "On behalf of the State of Texas, we write to inform you that Texas has neither the authority nor the intention of interpreting, ignoring, or amending its laws in order to compel the permitting of greenhouse gas emissions."

The letter decries the EPA's asserted attempt to achieve "centralized control of industrial development" through greenhouse gas regulation and to force states to "pledge their fealty" to this regulatory regime. It points out the EPA's acknowledgement of the absurd results of applying the Clean Air Act to greenhouse gases, and goes on: "In order to avoid the absurd results of EPA's own creation, you have developed a 'tailoring rule' in which you have substituted your own judgment for Congress's as to how deep and wide to spread the permitting burden." The letter also proffers additional constitutional and statutory grounds for the state's refusal to comply.

The EPA had asked states to inform the agency by Aug. 2 whether each state's laws and regulations would allow greenhouse gas permitting, and, if not, whether the state would promulgate the needed revisions. Nonetheless, to ensure that permitting moves forward despite defiant or reluctant states, the EPA has proposed rules, currently under Office of Management and Budget review, allowing the agency to impose a federal implementation plan if it deems a state's rules insufficient.

Texas also filed a lawsuit challenging the Tailoring Rule on Aug. 2, joining ranks with a coalition of five states led by Alabama that filed a similar suit July 30.

Read the Texas letter here.

SRP Announces "Community Solar" Program for Schools

Wed, 04 Aug 2010 12:14:45 GMT

The Salt River Project (SRP) has announced a plan to allow schools to receive solar electricity without any upfront costs by purchasing output from a single large PV plant. SRP believes this will be more cost-effective than installing PV systems at individual schools. Under the program, schools will sign 10-year contracts to buy electricity at a fixed rate of 9.9 cents per kilowatt-hour (kWh). Schools in SRP's territory currently pay 8.3 cents per kWh for their daytime electricity so, initially, the schools will pay a 19% premium for the solar power. However, SRP's prices will almost certainly increase over the next 10 years. The fixed-rate contract protects schools against price increases and could eventually allow them to buy electricity at less than the normal rate. This new program is in addition to SRP's Solar for Schools Program, which will install PV systems at 14 Arizona schools this year.

The PV plant, to be built in Pinal County by Iberdrola Renewables, will produce around 20 megawatts (MW) of power. Eighteen MW will be used by schools and the other two MW will be available to residential customers who are not able to access rooftop solar.

As a quasi-governmental entity, SRP is not subject to regulation by the Arizona Corporation Commission. However, its Board of Directors voted to adopt renewable energy "goals" in 2004, including a goal to meet 15% of retail sales through sustainable resources by 2025. This goal is identical to the Corporation Commission's Renewable Energy Standard adopted in 2006.

A proposal by APS to provide solar power to schools with no upfront costs is currently being reviewed by the Corporation Commission. You can read about APS's Schools and Government Program here.

Read more here and here.

Glendale Company Leads the Way in Solar Daylighting

Sat, 31 Jul 2010 14:56:00 GMT

While many people have never heard of solar daylighting, Glendale-based Natural Lighting Company has been designing and installing their energy saving component "daylighting" systems since 1992. Component daylighting is a technology that uses high efficiency skylights, reflective lightwells, and light diffusers to convey sunlight through a building's roof to light the interior. While perhaps, not as flashy as photovoltaic (PV) panels, solar daylighting is starting to gain attention as a cost effective solar technology. For example, in APS's Schools and Government Program (recently filed with the Arizona Corporation Commission), the utility hopes to install a daylighting project along with every PV or solar thermal project. Component solar daylighting is also now an approved solar device in Arizona with incentive programs administered by the State's utilities.

Arizona's Department of Commerce is getting on board too. This article from the Phoenix Business Journal (subscription required), reports on a daylighting project at St. Vincent de Paul's downtown campus that was funded primarily with ARRA (American Recovery and Reinvestment Act) funds awarded by the Department of Commerce's Energy Office. The remaining cost of the project was covered by a rebate from APS. The project is expected to save the charity $14,000 per year on electricity costs. It also provides more and higher quality light than the fluorescent tube lighting system that was being used before the daylights were installed.

I recently visited the St. Vincent de Paul project with Bruce Bilbrey, VP of Natural Lighting Co., and took the following pictures of the new daylighting system (notice the old fluorescent lights that are now turned off):

According to Mr. Bilbrey, the workers love the improved lighting and St. Vincent de Paul intends to put the money saved to good use.

Natural Lighting Co.'s systems include security bars to prevent entry to the building through the skylight component and automated controls to turn the daylights "off" using a motorized shade. Most of the Company's projects are integrated to some degree with the electric lighting system. Usually this means installing devices that measure when the daylights are producing enough light and automatically turn off the electric lights when appropriate. They can also integrate electric lights into the same fixture as the daylights.

Energy Bill Does Not Include RES, Removes Liability Cap on Petroleum Spills

Fri, 30 Jul 2010 15:01:00 GMT

The Clean Energy Jobs and Oil Company Accountability Act, unveiled by U.S. Senate Majority Leader Harry Reid (D-NV), does not include a national renewable energy standard (RES). Several Democratic senators have expressed their support for a nationwide RES that requires utilities to provide 15% of their power by renewable energy resources. Renewable energy groups have also expressed dismay that the bill does not include an RES.

The bill instead focuses on rebates for energy efficiency in homes, incentives to encourage the use of natural gas trucks, funds to study electric vehicles, and removal of the $75 million liability cap on offshore oil companies for oil spills.

The unlimited liability issue may be the sticking point for Republicans. Petroleum industry groups have also expressed their opposition, stating that unlimited liability would slow economic growth and reduce jobs.

Read more here and here.

U.S. Climate Legislation Postponed Indefinitely

Fri, 23 Jul 2010 20:12:00 GMT

Yesterday, Senate Majority Leader Harry Reid (D-NV) acknowledged what has been suspected for several weeks – that there is not enough support in the Senate for a carbon cap-and-trade scheme. Although the possibility of an economy-wide cap-and-trade system has been unlikely for some time, Democratic leaders and environmental advocates had maintained hope that the Senate would pass a utility-only cap-and-trade program or, at a minimum, a national Renewable Energy Standard. The smaller energy and oil spill-related bill Sen. Reid now intends to pursue will include neither.

Despite a 59-41 majority in the Senate, the Democrats could not procure the 60 votes necessary to overcome an anticipated filibuster by the Republicans. Not a single Republican supported the bill, including Senator Lindsay Graham (R-SC) who helped draft it and was one of its original sponsors. Even some Democrats opposed the bill, presumably lead by Senators Jay Rockefeller and the newly appointed Carte Goodwin from the coal-rich state of West Virginia.

The bill's chances of gaining the necessary votes during the fall session are low considering the Senators' current positions and the upcoming elections. And with the possibility that the Democrats' majority will decrease in the fall elections, meaningful climate legislation may not be considered again for years. In the absence of climate legislation, EPA will undoubtedly proceed with its regulation of greenhouse gases (GHGs) under the Clean Air Act (at least under this administration) and courts will likely continue to entertain lawsuits alleging damages from GHG emissions.

Sen. Reid's less ambitious bill will reportedly (1) attempt to increase or eliminate the cap on liability for oil spills; (2) provide tax incentives for natural gas vehicles in an attempt to decrease oil imports; (3) create an energy efficiency retrofit program for homes; and (4) add funds to the Land and Water Conservation Fund from oil royalties. It is not clear whether this bill has the necessary support to pass either.

Read more here and here.

Kerry, Lieberman Push "Utility-Only" Climate Change Bill

Tue, 20 Jul 2010 17:04:00 GMT

The latest development in the Senate climate bill drama is a shift in focus from economy-wide to utility-only greenhouse gas emission caps. Senators Kerry (D-MA) and Lieberman (I/D-CT), who previously authored a sweeping cap-and-trade bill that failed to attract the needed sixty votes, are now working feverishly to garner support for a pared-down version that limits only power plant emissions. Their efforts are in response to Majority Leader Reid’s (D-NV) July 13 announcement that he wants to address power plant emissions in the larger energy bill that he plans to send to the floor during the last week of July. That bill will also include titles that deal with oil spill response, energy efficiency, and renewable energy production.

Despite this narrowing of scope, the success of a energy bill trained on power plant emissions remains far from certain. Even beside the difficulty of gathering necessary Republican votes, the moderate Midwestern Democrats who declined to support the broader Kerry-Lieberman bill are still not sold on a utility-only bill, as the energy-intensive manufacturing sector remains opposed. The American Iron and Steel Institute argued in a letter to Majority Leader Reid that its increased electricity costs under a utility-only bill would be "just as substantial" as under an economy-wide bill, resulting in a competitive disadvantage as compared with foreign manufacturers. Majority Leader Reid may have a tricky situation on his hands when the energy bill is taken up, as the more liberal members of his caucus could revolt if it becomes necessary to remove utility emissions caps from the bill.

Read more here and here.

Kerry-Lieberman Estimated to Reduce GDP by 0.2%

Sat, 17 Jul 2010 14:11:00 GMT

According to an analysis by the Energy Information Administration (EIA), the American Power Act of 2010 would reduce GDP by 0.2% from 2013 to 2035. The decrease in GDP is a result of higher energy prices, "which reduces real economic output, reduces purchasing power, and lowers aggregate demand for goods and services." EIA estimates the Act would cost an average of $206 per household per year.

The report also estimates the Act would reduce oil imports by 1.9 to 2.4 million barrels per day by 2035. For reference, the Energy Information Administration calculates that, in 2008, the U.S. imported 2.4 million barrels of oil per day from Persian Gulf countries.

The legislation, released on May 12 by Senators Kerry (D-Mass.) and Lieberman (I-Conn.) aims to cut carbon emissions by 17% below 2005 levels by 2020 through implementation of a cap-and-trade program for greenhouse gas emissions.

Read more here and here.

MCAQD Releases 2008 Emissions Inventory

Sat, 10 Jul 2010 14:12:00 GMT

The Maricopa County Air Quality Department (MCAQD) issued the final draft of its PM-10 Periodic Emissions Inventory Report on Thursday. The report, prepared in cooperation with the Maricopa Association of Governments (MAG), estimates emissions of particulate matter of 10 microns or less (PM-10), particulate matter of 2.5 microns or less (PM-2.5), nitrogen oxides (NOx), sulfur oxides (SOx), and ammonia (NH3) (the latter three are precursors to particulate matter) for both Maricopa County and the PM-10 non-attainment area. The emissions estimates are used to determine which sources of air pollution could reduce emissions further through tighter regulation and to evaluate the effectiveness of existing controls on various source categories.

The inventory groups sources into five categories: (1) point sources, including power plants and large manufacturing facilities; (2) area sources, such as residential wood burning, commercial cooking, and wildfires; (3) nonroad mobile sources, including airplanes, trains, tractors, etc.; (4) onroad mobile sources; and (5) biogenic sources (i.e., emissions from vegetation).

Importantly for the local construction industry, the 2008 report estimates PM-10 emissions from all construction at only 16% of total emissions in the non-attainment area (and 7% of total emissions within Maricopa County); down from 39% in the 2005 report (and 17% of total emissions within the County).

Senator Rockefeller Pushes Bill to Delay EPA Regulation of GHGs

Thu, 24 Jun 2010 17:03:46 GMT

Senator Jay Rockefeller (D-WV) is working to gather support for a bill that would prevent EPA's regulation of greenhouse gases (GHGs) for two years. The purpose of the delay is to give Congress time to develop its own GHG reduction plan. According to an article this week in the Wall Street Journal, Sen. Rockefeller already has the support of 52 senators. However, the bill would need 60 votes to overcome a Democratic filibuster and, even if it passed, would most likely be vetoed by President Obama. Still, the growing division between Senate Democrats on climate issues is bad news for those hoping for climate legislation in the near future.

Murskowski Resolution Defeated Despite Some Democratic Support

Mon, 14 Jun 2010 15:23:49 GMT

Last week, Senator Lisa Murkowski's (R-AK) "disapproval resolution" regarding EPA's ongoing regulation of greenhouse gases (GHGs) under the Clean Air Act (CAA) was rejected by a vote of 53-47. Six Democrats joined the Senate's 41 Republicans to make the final vote closer than most observers expected when the resolution was introduced in January. Sen. Murkowski's supporters believe that the legislature should be responsible for creating a comprehensive GHG-reduction plan and that EPA's program for regulating GHGs will increase energy prices and cost jobs. Democratic leaders counter that those supporting the resolution have no intention of addressing GHGs legislatively and that their goal is to simply maintain the status quo -- where GHGs are completely unregulated.

Democrats, including President Obama, have said repeatedly that it would be best to address GHGs legislatively. However, they support EPA's authority under the CAA because it pressures lawmakers to approve a legislative fix and, in the absence of legislative fix, is the only available way to control emissions.

Read more here.

Fifth Circuit Vacates Earlier Reinstatement of Climate Change Claims

Thu, 10 Jun 2010 11:17:00 GMT

In a highly unusual procedural decision, the Fifth Circuit recently handed a victory to the defendants in Comer et al. v. Murphy Oil USA et al. This case, a class action against numerous utilities, oil companies, and chemical companies for damages due to the severity of Hurricane Katrina, was reinstated last October by a panel of three Fifth Circuit judges. After voting to rehear the case en banc, another judge (in addition to seven who recused themselves initially) recused herself, leaving only eight of the court's 16 judges to hear the case. In the court's opinion issued on May 28, five of the remaining eight judges concluded that they lacked a quorum required for an en banc rehearing. However, they also concluded that their prior decision to rehear the case en banc technically vacated the panel's October decision. So, the District Court's opinion from 2006, dismissing the case for lack of standing under the political question doctrine, is now in effect again.

The amazing thing about this decision is that the plaintiffs have essentially been denied their absolute right to an appeal. They will undoubtedly appeal to the Supreme Court, but of course, the Supreme Court has the ability to choose which appeals it will consider.

PNM Files New Rate Increase Request

Fri, 04 Jun 2010 12:35:48 GMT

Senate to Vote on Senator Murkowski's Disapproval Resolution

Thu, 03 Jun 2010 18:28:00 GMT

We blogged here about Sen. Murkowski's (R-AK) resolution of disapproval of the EPA's greenhouse gas endangerment finding, which provides the legal basis for the agency's recently promulgated "tailoring rule" for stationary source emissions and its light-duty vehicle emissions rule. On Thursday, June 10, the Senate will vote on the disapproval resolution. Per a unanimous consent agreement between Sen. Murkowski and Majority Leader Harry Reid (D-NV), the Senate is slated to debate the resolution for ten hours, with no filibusters or amendments allowed. Sen. Murkowski has secured forty-one co-sponsors for the resolution, including Democrats Sen. Mary Landrieu (D-LA), Sen. Blanche Lincoln (D-AR), and Sen. Ben Nelson (D-NE), but it is not clear whether she will be able to garner the additional ten votes needed for passage.

Under the Congressional Review Act, Congress may nullify agency rules by joint resolution. Even if Sen. Murkowski's disapproval resolution passes the Senate, its prospects in the House are dimmer and a veto from President Obama almost certain.

Read more here.

Senator Graham Suggests Power Plant-Only Carbon Legislation

Sat, 29 May 2010 11:19:00 GMT

Senator Lindsey Graham (R-S.C.), who until recently was heavily involved in negotiating the Kerry-Lieberman climate bill released earlier this month, said this week that a climate bill focused only on power plants may be the best way to proceed. Senator Graham apparently thinks that the Kerry-Lieberman bill, which includes provisions intended to reduce transportation emissions that critics have labeled a "gas tax", will not be able to get the support it needs to pass a Republican filibuster in the Senate.

Senator Graham believes that the electric utility industry is the sector most in need of a carbon price in order to make non-carbon technologies, including nuclear and solar, economically viable. The industry itself supports carbon legislation in order to avoid regulation by the EPA under the Clean Air Act.

Senate Majority Leader, Harry Reid (D-Nev.), is expected to proceed with climate legislation sometime later this year.

Read more here.

EPA Rejects ADEQ's Request to Consider Air Quality Violations as "Exceptional Events"

Fri, 28 May 2010 16:19:29 GMT

On Wednesday, EPA Region IX disapproved ADEQ's request to treat four exceedances of the National Ambient Air Quality Standard ("NAAQS") for PM-10 during 2008 as "exceptional events". A large portion of Maricopa County has been classified as a non-attainment area for PM-10 (particles of dust 10 microns or smaller) since 1996. Under the Maricopa Association of Governments ("MAG") 2007 Five Percent Plan for PM-10, the goal for the non-attainment area was to have no more than three violations of the PM-10 NAAQS in the three-year period 2008-2010. After registering these violations at the West 43rd Avenue monitoring station in southwestern Phoenix, ADEQ concluded that the high levels of dust were due to "exceptional events" (i.e., dust storms) rather than human activity and requested EPA to concur in that determination. EPA's finding that the exceedances were not caused by exceptional events, means that the Maricopa County non-attainment area will not be able to demonstrate attainment of the PM-10 NAAQS by 2010.

The failure of MAG's Five Percent Plan to bring the area into attainment means that EPA will also most likely reject the plan itself. In developing and submitting a new plan, MAG will undoubtedly urge local governments (most notably the Air Quality Department of Maricopa County) to impose tighter controls over dust generating activities. If the problem is not corrected to EPA's satisfaction within two years, the State could face sanctions under the Clear Air Act, including the loss of over $1 billion of federal highway funds.

Here is an article on this issue from the Arizona Republic and here is a great presentation by MAG. You can read EPA's technical support document for this decision here.

Phoenix Hosts National Solar Conference

Fri, 21 May 2010 10:42:00 GMT

The Solar 2010 National Conference, an annual event of the American Solar Energy Society (ASES), opened Monday, May 17 at the Phoenix Convention Center. Approximately 2,500 industry professionals have attended the week-long gathering, which features hundreds of vendors from all sectors of the solar industry. Participants have included rooftop installers, manufacturers of solar water heaters, and builders of large-scale solar power plants. A major sponsor of the event is Arizona Public Service Co., which offers rebates to electricity customers who install solar systems for their homes and businesses.

On Saturday, May 22, the conference will be open to the public for a $ 5 admission fee. A career resource center will be available for those interested in finding work in the solar industry. ASES expects a couple of thousand people to turn out.

Learn more about the conference here and here.

Senate Climate Legislation Released

Tue, 18 May 2010 20:22:41 GMT

On May 12, Senators John Kerry (D-MA) and Joe Lieberman (I/D-CT) unveiled their much-anticipated cap-and-trade bill (known to opponents as "cap-and-tax"). Senator Kerry declared his hope that the legislation, titled the American Power Act (APA), will reach the Senate floor by June or July, which may be the last opportunity to pass a climate bill before the mad dash to the November midterm elections. The lone Republican to have a hand in drafting the bill, Senator Lindsey Graham (R-SC), was not present at the unveiling, having withdrawn his support last month over concerns about the interference of immigration politics.

The proposed new law would for the first time set nationwide greenhouse gas emissions reduction targets and, for major sectors of the economy, put a price on such emissions. Large-scale industrial emitters (i.e., those emitting more than 25,000 tons per year), transportation fuel providers, and oil refineries would be required to hold one allowance per ton emitted. Industrial emitters would be able to buy and sell allowances in a market regulated by the Commodity Futures Trading Commission, while fuel providers and refineries would purchase allowances directly from the EPA. In an attempt to attract bipartisan support, the bill also provides some incentives for offshore drilling and nuclear power. Additional specifics on the bill include:

Greenhouse gas reduction targets – 4.75% from 2005 levels by 2013, 17% by 2020, 42% by 2030, and 83% by 2050;
Phase-in of emissions caps – Electric utilities, transportation fuel providers, and oil refineries would become subject to a cap in 2013, while industrial sources, such as cement plants and pulp mills, would not be subject to a cap until 2016;
Distribution of emissions allowances – To mitigate the impact on energy consumers and trade-sensitive industries, the bill provides for a time-limited distribution of free allowances, the specifics of which has been much lobbied;
Preemption of EPA regulation – Largely preempts EPA regulation of greenhouses gases under the Clean Air Act (CAA); if enacted, would nullify EPA's newly minted "tailoring rule," which, beginning in 2011, would apply the CAA’s Prevention of Significant Deterioration (PSD) and Title V operating permit requirements to large greenhouse gas emitters;
Preemption of state regulation – Preempts state regulation of greenhouse gas emissions from stationary sources.

President Obama has expressed his support for the measure, but conventional wisdom says the bill, which lacks bipartisan support, has little chance of passing this year. Senate Minority Leader Mitch McConnell (R-KY), has called it "little more than a job-killing national energy tax." Even so, greenhouse gas regulation of one kind or another appears on the horizon, with the EPA poised to begin applying the CAA next year.

Read more about the bill's release here. Get more information about the bill's provisions here.

EPA Issues Greenhouse Gas "Tailoring Rule"

Fri, 14 May 2010 20:30:30 GMT

On May 13, 2010, EPA issued a final rule (the so-called "Tailoring Rule") that will impose the first greenhouse gas (GHG) emission controls on large stationary sources. Starting January 1, 2011, any new or modified source that is already subject to the federal Prevention of Significant Deterioration (PSD) must identify and adopt Best Available Control Technology (BACT) to control GHGs, if the project increases GHGs by 75,000 tons per year (tpy) or more. On July 1, 2011, any new source with GHG emissions of 100,000 tpy, or any modified source that will increase GHG emissions by 75,000 tpy must go through PSD permitting and implement BACT to control GHG emissions.

The air quality permitting consequences will be significant. EPA estimates that this second phase will require over 500 sources to obtain federal Title V operating permits for the first time, and require an additional 900 sources to go through PSD permitting annually. Although the increase in permitting actions will be substantial, it is far less than what would have occurred had EPA relied on the permitting thresholds established under the Clean Air Act. If EPA had used the statutory permitting thresholds, over 80,000 new PSD permitting actions would occur annually, and six million sources would need federal operating permits. A legal challenge to the new rule seems likely, and in the event EPA's decision to focus only on larger sources is overturned, a legislative fix will be necessary.

More information can be found here.

EPA Proposes to Regulate Coal Ash Waste

Thu, 06 May 2010 19:14:00 GMT

On May 4, 2010, the EPA proposed the first-ever federal rules to regulate "coal combustion residuals" (more commonly known as coal ash waste), which are the byproduct of burning coal to produce power. The large volumes of coal ash generated by power plants may be disposed of either in solid form at landfills or in liquid form at large surface impoundments. Coal ash may also be recycled for beneficial uses, including use in cement, concrete, and wallboard.

In its press release, the EPA stated that coal ash waste contains "contaminants like mercury, cadmium, and arsenic, which are associated with cancer and various other serious health effects" and opined that without proper disposal safeguards, these toxins could leach into groundwater and migrate to drinking water sources. A major impetus for the EPA's recent efforts toward coal ash regulation was the December 2008 rupture of a surface impoundment at the Tennessee Valley Authority in Kingston, Tenn., where 5.4 million cubic yards of ash flooded nearby land and waterways, displacing residents and resulting in an expected $1.2 billion in cleanup costs.

The EPA's proposal takes an unusual approach in that it proffers two different alternatives for coal ash regulation under the Resource Conservation and Recovery Act (RCRA), the nation's primary solid and hazardous waste law. The two options differ significantly both in breadth and means of enforcement. Regulation under Subtitle C, which governs hazardous wastes, would establish a comprehensive regime to regulate coal ash from generation to disposal, with permitting requirements and direct federal enforcement. In response to industry's concern that regulation of coal ash as hazardous would stigmatize and hamper its beneficial reuse, the EPA proposes to list coal ash in a newly created "special waste" category under Subtitle C.

The second alternative is regulation under Subtitle D, which relates to nonhazardous residential and industrial solid wastes. Under this option, the EPA would establish performance standards for waste management facilities but would not have "cradle-to-grave" authority to regulate coal ash. Additionally, the rules would not require permitting and would not be federally enforceable, instead leaving enforcement to citizen suits and state action.

Regulation under either Subtitle C or Subtitle D would require protections such as liners and groundwater monitoring for new landfills, groundwater monitoring for existing landfills, and retrofitting of liners for existing surface impoundments, together with strong incentives for closure and transition to dry storage. Additionally, both options would retain the current exemption from regulation for coal ash destined for beneficial reuse.

The proposed rules are open to public comment for 90 days. Read more here, and see EPA’s chart comparing the two alternatives here.

Cape Wind Project Receives Federal Approval

Fri, 30 Apr 2010 17:06:16 GMT

On Wednesday, Interior Secretary Ken Salazar approved the Cape Wind project in Nantucket Sound, ending a nearly decade-long NEPA review of the proposal. The project could become the first offshore windfarm in the U.S., but opponents have vowed to fight it in court -- seeking a preliminary injunction that could postpone construction for years. However, considering the extensive reviews conducted by both federal and state agencies, it could be difficult for opponents to demonstrate a "substantial likelihood of success on the merits," as required for obtaining a preliminary injunction.

The current proposal consists of 130 turbines with the potential to produce approximately 450 MWs of power. Cape Wind estimates it would reduce greenhouse gas emissions by over 700,000 tons per year. Each tower will be around 260 feet tall (from the water's surface) and each turbine will be approximately 365 feet in diameter. The cost of constructing the wind farm has been estimated to be around $2 billion.

Opponents claim the gigantic wind turbines will harm local wildlife and destroy residents' and visitors' views of the Sound. Others oppose the project because they believe it will increase electric rates or destroy tribal burial grounds.

Read more about the Cape Wind project here and here.

Senator Graham Deals Blow to Climate Legislation

Fri, 30 Apr 2010 16:25:01 GMT

As we blogged here and here, Sens. Kerry (D-MA), Graham (R-SC), and Lieberman (I/D-CT) have been collaborating on a bipartisan climate and energy bill, a compromise measure which addresses some of industry's concerns with the previously introduced Kerry-Boxer bill. That six-month-long effort suffered a major setback April 24 when Sen. Graham unexpectedly pulled his support, stating that he could no longer move forward on the legislation. The surprise announcement came on the eve of the bill's much-anticipated unveiling, which had been slated for April 26, and indefinitely delayed its release.

The South Carolina Republican's move protested his failure to receive adequate reassurance from Senate Majority Leader Harry Reid (D-NV) that the Senate would take up the climate bill before addressing immigration reform, an issue that rose to the top of the charts after Arizona's passage of a tough new law April 23. In a letter to business, military, religious, and environmental groups involved in negotiating the climate bill, Sen. Graham called Democrats' "hurried, panicked" calls to address immigration a "cynical political ploy" aimed at increasing the Hispanic turnout in November. The only Republican to have formally endorsed a comprehensive climate and energy measure, Sen. Graham is seen as crucial to building the bipartisan coalition needed to ensure passage. Nonetheless, lead author Sen. Kerry stated that he and Sen. Lieberman will "press forward," and proceeded to request EPA review of the bill.

Majority Leader Reid stated on April 28 that he expects to tackle climate before immigration, as no bill on the latter issue has yet been introduced. It is still unclear, however, whether this apparent concession will win back Sen. Graham's support.

Read more here and here.

U.S. Finalizes Greenhouse Gas Emissions Standards for Light-Duty Vehicles

Tue, 13 Apr 2010 10:47:03 GMT

On April 1, 2010, the EPA and the National Highway Transportation Safety Administration jointly promulgated final rules establishing greenhouse gas emissions and fuel efficiency standards for light-duty vehicles, applicable for model years 2012-2016. The new rules represent the U.S. government's first nationwide limitation on greenhouse gas emissions, capping such emissions at 250 grams per mile by 2016. Also by 2016, average fuel economy will reach approximately 34.1 miles per gallon.

The Obama administration hailed the light-duty vehicle rules as a way to combat climate change while reducing the nation's dependence on foreign oil. It is estimated that the rules will raise the cost of a new vehicle by approximately $950, offset by savings at the pump of approximately $3000 over the life of the vehicle, based on expected fuel prices of $2.61 per gallon in 2012 and $3.60 in 2030.

The legal basis for the new greenhouse gas emissions limitations is the EPA’s December 2009 "endangerment finding," the agency's conclusion that carbon dioxide and other greenhouse gases are harmful to the public health and welfare. The light-duty vehicle rules represent a truce reached in May 2009 between the Obama administration, California (which was prevented by the Bush administration from imposing its own vehicle emissions standards), the automobile industry, and environmental groups. But controversy swirls around the anticipated legal consequences of the new rules. The EPA has taken the position that under the Clean Air Act, greenhouse gas regulation of new or modified stationary sources (e.g., power plants) will be automatically triggered when the tailpipe rules become effective in January 2011. A federal lawsuit filed April 2 by mining and agriculture groups challenges that position.

Read the agencies' press releases here and here.

Two Former Senate Aides Discuss Prospects for Climate Legislation

Fri, 09 Apr 2010 22:27:06 GMT

In this interview with E&E TV, Dave Hoppe, former Chief of Staff for Trent Lott (R-MS), and Patrick Von Bargen, former Chief of Staff for Jeff Bingaman (D-NM), discuss their expectations for Senate action on climate change legislation this year. Both predict that the Kerry-Graham-Lieberman bill will go to the floor but will not be able to garner the 60 votes necessary to overcome a Republican filibuster. The key will apparently be Senator Graham's ability to bring some of his fellow Republicans on board. Mr. Von Bargen also discussed how President Obama's recent proposal to lift restrictions on off-shore drilling was a message to Republican Senators that "it's ok" to support climate legislation because it is not going to be an extreme measure.

Mr. Hoppe believes that if the Kerry-Graham-Lieberman bill fails, Senator Reid (D-NV) will turn to Cantwell-Collins and, if that fails, may support Senator Bingaman's energy bill. Both interviewees believe that any climate legislation that passes will pre-empt EPA regulation of GHGs under the Clean Air Act and neither thinks Senator Murkowski's bill to restrict EPA's authority will succeed.

Mr. Hoppe and Mr. Von Bargen are currently with Quinn Gillespie & Associates, a public affairs firm in Washington D.C.

ASTM Releases Guide for Financial Disclosures Attributed to Climate Change

Mon, 05 Apr 2010 19:07:26 GMT

ASTM International (formerly known as the American Society for Testing and Materials) recently released its Standard E2718-10: Standard Guide for Financial Disclosures Attributed to Climate Change. The standard has been in development for over two years and was issued approximately two months after the SEC released its Interpretive Guidance for Disclosing Climate Change Impacts (we blogged about that guidance here). ASTM is an organization that develops voluntary standards meant to define good practice within various fields by industry consensus.

According to ASTM, the purpose of the Standard is "to provide a series of options or instructions consistent with good commercial and customary practice for climate change-related disclosures accompanying audited and unaudited financial statements" and to "encourage[] consistent and comprehensive disclosure of financial impacts attributed to climate change." The objective of the guide is to help users "determine the conditions warranting disclosure and the content of appropriate disclosure."

You can read more about the standard or purchase a copy ($33) here.

EPA Proposes to Subject Additional Sources to Greenhouse Gas Reporting Requirements

Tue, 30 Mar 2010 10:28:00 GMT

The EPA is proposing to expand its newly minted greenhouse gas reporting rules to include additional emissions sources. The existing rules, which were finalized in October 2009 and went into effect in January of this year, cover 31 industry sectors, representing 85 percent of U.S. emissions. The EPA’s new proposal, issued Tuesday of last week, would add the oil and natural gas industries, industries that emit fluorinated gases, and industries that inject and store carbon dioxide underground. In its press release, the EPA notes that the oil and gas industry emits the greenhouse gas methane, twenty times more potent than carbon dioxide, while fluorinated gases "are even stronger and can stay in the atmosphere for thousands of years." Additionally, the agency states that reporting from carbon dioxide injection facilities will permit the EPA to track the amount of the gas injected and in some cases require monitoring to detect atmospheric emissions. Under the proposed rules, covered industries must begin collecting emissions data in January 2011, with the first annual report due in March 2012.

Conservation Group Seeks Extensive Southwestern Area Designated for Jaguars

Mon, 22 Mar 2010 14:24:00 GMT

The Center for Biological Diversity (CBD), a Tucson-based conservation advocacy organization, is asking the U.S. Fish and Wildlife Service (Service) to set aside more than 53 million acres of the American Southwest for the endangered jaguar. The group’s proposal comes in response to the Service's January 2010 decision under the Endangered Species Act (ESA) to designate "critical habitat" (a geographic area with physical and biological features essential to species survival) and develop a species recovery plan for the jaguar, the largest wild cat in the western hemisphere. The agency’s decision represents a reversal of previous policy; it had determined in 1997, when the jaguar was listed as endangered, and again in 2006 that designation of critical habitat in the United States would not be prudent. The Service’s recent 180-degree flip stems from an Arizona federal court ruling last year ordering the agency to revisit the bases for its prudency determination, a victory for plaintiff CBD. Under the ESA, a critical habitat designation means that activities authorized, funded, or carried out by federal agencies may not destroy or adversely modify the designated area.

The new jaguar policy is controversial, even within the environmental community. Although centuries ago jaguars occupied an extensive area in the United States stretching from California to Louisiana, they now mainly inhabit regions farther south, in Mexico, Central and South America. In recent years, jaguars have been sighted only rarely in the United States, mainly within 40 miles of the U.S.-Mexico border. A leading biologist recently argued in the New York Times that sparse federal wildlife funds will be wasted in forcing the jaguar to repopulate the western part of our country, despite the fact that it is likely no longer an ideal environment for the animal and at the expense of more productive efforts on behalf of endangered species with true critical habitats in the United States. The Service expects to issue its critical habitat proposal by January 2011.

Senators Kerry, Graham, and Lieberman Work on New Climate Bill

Fri, 19 Mar 2010 14:30:42 GMT

Three prominent Senators are working on a new climate bill that will address some of industry's major concerns with the earlier Kerry-Boxer bill while maintaining the Kerry-Boxer bill's caps on carbon emissions. On Wednesday, Senators John Kerry (D-MA), Lindsey Graham (R-SC), and Joseph Lieberman (I-CT) shared an outline of their proposal with several major industry groups, including the U.S. Chamber of Commerce, the Edison Electric Institute, and the American Petroleum Institute. While the proposal reportedly maintains the GHG reduction goals of the Kerry-Boxer bill (17% below 2005 levels by 2020 and 80% below 2005 levels by 2050), it would also pre-empt EPA regulation of carbon under the Clean Air Act and create a "hard price collar" for GHG allowances of $10 to $30 per ton.

Senator Lugar to Propose a "Practical Energy Plan"

Thu, 11 Mar 2010 12:19:00 GMT

On Tuesday, Senator Richard Lugar (R-IN) announced his intent to draft and present to the Senate an energy bill that will focus on threats other than climate change, including national security, economic, and environmental threats to the United States and her citizens. The Senator’s plan does not include a cap-and-trade component or any direct control on GHG emissions but it does contain a "clean energy standard" mandating the use of cleaner energy sources.

Read more about Senator Lugar’s proposal here.

In Attempt to Create New Arizona Jobs, GPEC Focuses on Solar Industry

Thu, 04 Mar 2010 22:49:00 GMT

The Greater Phoenix Economic Council is a public-private partnership whose goal is to bring new, high quality jobs to the Phoenix metropolitan area. According to this article by the Arizona Republic, GPEC has recently focused a lot of its efforts on solar companies and was the driving force behind the Renewable Energy Tax Incentive bill recently passed by the Arizona legislature. (We blogged about the bill here.) GPEC is currently led by board president Michael Bidwell and its president and CEO, Barry Broome. It receives approximately half of its $4.3 million annual budget from Maricopa County and local municipalities and the rest from private-sector investors.

EPA Releases Letter Outlining Agency's Plans for Regulating Greenhouse Gases

Wed, 24 Feb 2010 21:30:00 GMT

On Monday, in response to a letter from several U.S. Senators, EPA Administrator Lisa Jackson released a letter outlining the agency's plans for regulating greenhouse gases in the absence of climate change legislation from Congress. The Senators' letter, signed by eight coal-state Democrats, warned that "[i]ll-timed or imprudent regulation of GHGs may squander critical opportunities for our nation, impeding the investment necessary to create jobs and position our nation to develop and produce its own clean energy," and asked for an explanation of the agency’s plans with respect to regulating GHGs from stationary sources.

In her response, Administrator Jackson states that she shares the Senators' goal of "addressing greenhouse gas emissions in sensible ways that are consistent with the call for comprehensive energy and climate legislation." The letter then outlines some of EPA’s plans for regulating GHGs from stationary sources including the following:

No source will be required to obtain a permit for GHG emissions until 2011.
During the first half of 2011, the only sources that will be required to address GHG emissions in their permits are those that have to apply for permits as a result of non-GHG emissions.
Until at least 2014, the threshold for GHG permitting will be substantially higher than the 25,000 tons/year that EPA originally proposed.
Small sources will not be subject to GHG permitting until at least 2016.

Her letter also emphasizes that EPA is obligated to treat GHGs as a pollutant under the Supreme Court’s ruling in Massachusetts v. EPA. Finally, Administrator Jackson points out the one result of a congressional resolution disapproving of the EPA's GHG endangerment finding would be to prevent the agency from finalizing its rule on GHG emissions from light-duty vehicles. We blogged about Senator Murkowski's proposed disapproval resolution here. The light-duty vehicle rule is supported by the auto industry as preferable to state-by-state GHG regulations.

Read EPA's press release here.

MCAQD Releases Draft Cumulative Modeling Policy for PM10

Wed, 17 Feb 2010 20:01:00 GMT

The Maricopa County Air Quality Department ("MCAQD") recently released a draft policy that will require cumulative modeling of the impacts of new and modified sources of airborne particulate matter of 10 microns or less ("PM10"). Most of Maricopa County is currently designated as serious nonattainment for PM10 and the Department believes that the new policy will "better protect Maricopa County air quality." The goal of the policy is to prevent increases in PM10 emissions that could cause exceedances of the National Ambient Air Quality Standard ("NAAQS") for PM10.

The draft policy involves two phases. In Phase I, the source applying for a permit or permit revision must perform dispersion modeling at maximum allowable PM10 emissions for its own emissions only. If the maximum 24-hour PM10 concentration from this modeling is less than 5 micrograms per cubic meter -- the Significant Impact Level ("SIL") -- the source will not be required to perform any further modeling. If the result is equal to or greater than the SIL, the source must continue to Phase 2 of the policy. In this phase, PM10 emissions from both the applicant source and nearby off-site sources must be modeled. If this model shows a violation of the PM10 NAAQS, MCAQD will require the source to lower its PM10 emissions.

MCAQD will hold a public workshop on the draft policy on Friday, March 26, 2010 at its office at 1001 N. Central Avenue in Phoenix.

Read MCAQD's press release here.

Hualapai Valley Solar Project Approved by State Agency

Mon, 15 Feb 2010 18:53:00 GMT

Lewis and Roca represented Hualapai Valley Solar LLC in hearings on January 12-13 before the Arizona Power Plant and Transmission Line Siting Committee. At the conclusion of the hearing, the committee voted unanimously to approve a new 340 MW solar power plant to be built about 30 miles north of Kingman, Arizona. This project addressed the issue of water usage by thermal solar plants by working with the City of Kingman to purchase the City's effluent for use by the plant, thereby reducing the amount of groundwater needed. The plant will use proven technology and includes storage of power to better meet the peak loads in the southwest. Peak loads continue in the late afternoon and early evening after the sun begins to set.

Visit the project website here or read the company's press release here.

Governor Releases Executive Order on Climate Change Policy

Thu, 11 Feb 2010 13:32:00 GMT

Last week, Governor Brewer issued Executive Order 2010-06, titled "Governor’s Policy on Climate Change." In the Order, the Governor announces that Arizona will continue to be a member of the Western Climate Initiative ("WCI") but will not implement the group’s cap-and-trade scheme that was announced in September 2008 and set to begin in 2012. The Governor also ordered the creation of a "Climate Change Oversight Group" to "monitor" the proceedings of the WCI and any federal actions to regulate GHG's, and to advise the Governor on Arizona's response to these developments. The Group will include up to 15 members and include representatives of the general public, electric power utilities, NGO's, mining, local government, agriculture, tribes, transportation, and manufacturing. Finally, the Order instructs ADEQ to review Arizona's tailpipe emissions rules set to take effect in 2012 but continues the requirement that State entities purchase only hybrids or other low emission vehicles ("[c]ertain state law enforcement vehicles" are excepted).

Some of the reasons given for the Governor's position include: (1) that a cap-and-trade program under the WCI would harm Arizona's economy by putting the State at a disadvantage to national and international competitors; (2) that Arizona's per capita GHG emissions are already one-third of the national average; and (3) the existence of a renewable energy requirement for utilities (the Corporation Commission’s controversial Renewable Energy Standard).

The Governor believes Arizona should remain a member of the WCI to influence the group's actions and as a platform to influence any GHG laws or regulations at the federal level.

The Order points out that over 75% of GHG emissions in Arizona come from the transportation and electricity sectors. As already mentioned, GHG emissions from each of these sectors are already being addressed in Arizona.

As a practical matter, Arizona was unlikely to participate in the WCI's cap-and-trade program even before the Governor's Order since it would have required the approval of the legislature.

Read the Arizona Republic’s coverage of this announcement here.

White House Budget Eliminates Funding for Yucca Mountain

Tue, 02 Feb 2010 11:23:00 GMT

Plans to bury America's nuclear waste inside Nevada's Yucca Mountain, a project that has long been the subject of environmental and political opposition, appear to be coming to an end. Funding for the nuclear waste site has been eliminated in President Obama's budget proposal released Monday. The Department of Energy also seeks to eliminate Yucca as an option, filing paperwork to suspend licensing for the site.

Congress would need to approve the President's budget and cut the funding in its Energy Appropriations Bill for the funding to cease.

Read the full article here.

SEC Issues Interpretive Guidance for Disclosing Climate Change Impacts

Mon, 01 Feb 2010 16:03:38 GMT

Last week, SEC Commissioners voted to provide public companies with interpretive guidance on the application of existing disclosure rules to climate change issues. These guidance documents are not meant to create any new legal requirements or modify any existing ones but are "intended to provide clarity and enhance consistency for public companies and their investors." The areas mentioned by the Commission as potentially triggering disclosure duties include: (1) Existing and pending legislation and regulation; (2) Impacts of international accords; (3) Actual and potential indirect consequences of regulation or business trends; and (4) Physical impacts of climate change.

The vote was divided along party lines with Chairman Schapiro and the other two Democrats voting in favor and the Commission’s two Republicans voting against. In her speech opposing the move, Commissioner Casey concluded that "the purpose of this release is to place the imprimatur of the Commission on the agenda of the social and environmental policy lobby, an agenda that falls outside of our expertise and beyond our fundamental mission of investor protection." You can read Commissioner Paredes’ statements (in opposition) here and Commissioner Aguilar’s statements (in support) here.

As we blogged about here, a group of institutional investors and asset managers has been pushing the SEC to take action on climate change disclosures for over two years.

Read the SEC’s press release here.

Republican Senator Seeks to Prevent EPA Regulation of Greenhouse Gases

Tue, 26 Jan 2010 16:14:00 GMT

Last week, Senator Lisa Murkowski (R-AK) introduced a "disapproval resolution" regarding EPA's recent endangerment finding that lays the foundation for the regulation of greenhouse gases under the Clean Air Act. The Senator says that while she supports finding a way to address climate change, the solution should come from Congress rather than EPA under a statute that was not intended to apply to greenhouse gases. She believes that EPA regulation will harm the economy more than a comprehensive program designed by Congress. Opponents of the resolution believe it would be inappropriate for Congress to reject a scientific health finding of the EPA and that it is primarily a political move intended to further delay restrictions on greenhouse gas emissions.

Both parties agree on the basic premise of the resolution - that a legislative solution would be preferable to EPA regulation under the Clean Air Act. However, Democrats intend to use the threat of EPA action as leverage in passing comprehensive climate change legislation. Senator Murkowski's resolution would eliminate that leverage.

The resolution is co-sponsored by 35 Republicans and three Democrats, but will face a difficult path in this Democrat-controlled Congress. Even if it passes, the resolution would be subject to veto by President Obama, which seems almost certain.

Read more here and here.

Investors Continue Push for Climate Change Disclosure Rules

Mon, 25 Jan 2010 15:06:00 GMT

A group of institutional investors, asset managers, and environmental advocacy groups has filed a supplemental petition with the SEC asking for rules requiring public companies to assess and disclose their exposure to climate change-related risks and opportunities. The group, led by Ceres and the Environmental Defense Fund and holding more than $1 trillion of assets, argues that the physical, business, and regulatory risks of climate change should be disclosed to the investing public. The original petition was filed in September 2007.

U.S. securities laws already require public companies to disclose "material" information and risks, and several provisions of the applicable rule (SEC Regulation S-K) could arguably include climate change issues. However, the SEC has never officially stated that companies must analyze potential risks from climate change and two analyses of recent 10-K reports concluded that most public companies do not do so.

Among the institutional investors signing the petition are representatives of the pension funds of seven states, including California and New York.

Read more here and here.

Federal Judge Stops Expansion of WV Wind Farm to Protect Endangered Bats

Fri, 22 Jan 2010 14:58:05 GMT

Federal district court Judge Roger Titus of the U.S. District Court for the District of Maryland, issued a comprehensive ruling that an industrial wind energy facility in Greenbrier County, West Virginia will kill and injure endangered Indiana bats, in violation of the Endangered Species Act (ESA). The court concluded that "the development of wind energy can and should be encouraged, but wind turbines must be good neighbors." This is the first federal court ruling in the country finding a wind power project in violation of federal environmental law.

Read more here and here.

Another Solar Energy Manufacturing Operation to Open in Phoenix

Fri, 22 Jan 2010 13:51:00 GMT

Arizona Governor Jan Brewer has stated that she wants to make Arizona the "solar capital of the world." To that end, she has signed into law tax incentives for renewable energy companies and created a solar energy advisory task force. And, during her Jan. 11 State of the State address, she marked further progress toward that goal. Gov. Brewer announced a commitment by Tower Automotive to locate its solar component manufacturing operations in the Valley. Tower Automotive’s decision comes just two months after the news that Chinese giant Suntech Power Holdings Co. will open a large solar-panel manufacturing facility in Phoenix. Gov. Brewer called both decisions "strategic wins" that establish Arizona's "foothold in the solar industry."

Tower Automotive is an international manufacturer of automotive metal structural components and assemblies. It is diversifying its product line to make solar components for Stirling Energy Systems, an Arizona-based solar energy technology company. According to Gov. Brewer, Tower Automotive will invest more than $50 million in its Arizona operations and create nearly 200 jobs.

Read the full text of Gov. Brewer's State of the State speech here.

States Urge EPA to Postpone Greenhouse Gas Regulation of Stationary Sources

Tue, 19 Jan 2010 16:30:00 GMT

With the December 2009 issuance of its endangerment finding, EPA is set to promulgate in March 2010 a proposed rule limiting greenhouse gas emissions from light-duty vehicles. Under EPA’s current interpretation of the Clean Air Act (CAA), promulgation of the light-duty vehicle rule will render greenhouse gases "regulated pollutants" under the statute, thereby triggering a requirement that the agency limit emissions from stationary sources as well. To prevent millions of small-source emitters (e.g., restaurants, apartment complexes) from becoming subject to CAA regulation, EPA has proposed a contentious "tailoring rule" that sets a regulatory threshold of 25,000 tons per year. However, because most states operate under EPA-approved "state implementation plans" that would require revision to conform with the tailoring rule lest they capture smaller sources, several states are urging the EPA to postpone stationary source regulation by one or two years. These states are also concerned that the increased regulatory burden is coming at a time when their budgets are already in the red. Therefore, the National Association of Clean Air Agencies (a group of state and local regulators) has asked the EPA to take the position that stationary source regulation will not be triggered until the light-duty vehicle rule actually takes effect, which will not occur until 2011 or early 2012.

Read more here and here.

Arizona Governor Plans to Keep State Enrolled in Western Climate Initiative (WCI)

Tue, 12 Jan 2010 11:30:00 GMT

The regional consortium, which consists of seven western states and four Canadian provinces, aims to reduce greenhouse gas emissions, partly through implementation of a region-wide cap-and-trade program. But although Arizona, under Governor Janet Napolitano, was a founding member of the WCI, the state’s participation is unpopular with some Republican legislators. A bill to prohibit Arizona Department of Environmental Quality officials from attending WCI meetings was introduced in the Legislature after Republican Jan Brewer replaced the Democratic Napolitano, but the bill did not make it to Gov. Brewer’s desk. (Because the WCI is an agreement among governors, the Legislature cannot compel the state to formally withdraw.) On Tuesday, Jan. 5, however, Gov. Brewer issued an executive order that continues Arizona’s WCI participation, suggesting that she would likely veto any measure disapproving of the state’s membership. In a speech to the Western Business Roundtable that announced the executive order, Gov. Brewer acknowledged that she has been urged to withdraw from the WCI but responded that she wished to remain in the group to advance Arizona’s “unique perspective.”

Read more here (subscription required).

Read the full text of Governor Brewer's speech here.

U.N. Summit Results in Non-Binding and Non-Specific "Copenhagen Accord"

Wed, 23 Dec 2009 15:36:00 GMT

Although the United Nations' Summit on Global Climate Change failed to reach a binding agreement on a plan to combat climate change, a majority of the parties in attendance have indicated their support for a non-binding agreement negotiated between some of the major players at the conference. This agreement, called the Copenhagen Accord, was negotiated between the United States, China, India, and some of the other largest countries over the last few days of the conference. Although it was not formally adopted by the U.N. because it was not supported unanimously, the Conference of the Parties "took note" of the Accord and many countries expressed their support for the plan.

The most detailed element of the Accord is its "recogni[tion of] the scientific view that the increase in global temperature should be below 2 degrees Celsius." Although this is a concrete step forward for global climate discussions, a group of small island nations and least developed nations argued strongly that the goal should be 1.5 degrees to prevent serious damage to their countries.

Another major point of contention was the amount of aid developed countries will provide to developing countries to address the impacts of climate change and to improve their economies without relying on cheap fossil fuels. The Accord commits rich countries to provide $30 billion between 2010-2012 and $100 billion per year by 2020. The recipients claim it is not nearly enough.

Some countries criticized the Accord for essentially abandoning the U.N. framework for addressing climate change -- allowing a few powerful countries to produce their own plan and potentially abandon the requirements for emission cuts by developed countries found in the Kyoto Protocol. Others argue this was a practical necessity due to the U.N.'s requirement for unanimous agreement and that the Accord is a small but important step forward. Predictably, environmental groups roundly denounced the Accord as a failure to adequately address the issue of climate change.

Officials Say Nevada Not to Get Nuclear Waste

Thu, 10 Dec 2009 13:39:00 GMT

Nevada has been ruled out as an alternative disposal site for low-level radioactive waste from South Carolina. The Nevada Test Site, about 65 miles north of Las Vegas, is being excluded from discussions about the nearly 15,000 drums of depleted uranium because the energy department agreed to conduct a statewide environmental impact statement before accepting new waste there and the review could take longer than a year.

The U.S. Department of Energy was considering Nevada as an alternative disposal site of the depleted uranium from South Carolina currently scheduled to go to Utah. Another option would be to keep the material at the Savannah River Site until the Nuclear Regulatory Commission finalizes new rules for disposing of the low-level radioactive waste.

The material is a by-product of the uranium enrichment process used to make nuclear weapons in the Cold War era. The waste is currently being stored at EnergySolutions, a privately owned low-level radioactive waste disposal site in South Carolina. Utah's radiation control board is undergoing a rule-making process that would require EnergySolutions to prove it could safely dispose of the material before it accepts any more of the waste.

The original Department of Energy schedule had the depleted uranium shipments to Utah completed by late spring.

Read the full article here.

Funding Announced for Biofuel Refinery in New Mexico

Tue, 08 Dec 2009 14:27:00 GMT

On December 4, 2009, New Mexico U.S. Representative Harry Teague announced over $100 million would be funded for an algae-based biofuel refinery near Las Cruces, New Mexico. California-based Sapphire Energy, with a present test facility in Las Cruces, is planning to build a facility in which fuel could be refined from algae. Total funding for the facility is $104.5 million with $50 million as a Recovery Act grant and $54.4 million provided in the form of a loan guarantee through the Biorefining Assistance Program. The facility will be located outside of the village of Columbus, in Luna County. Construction is expected to begin in September 2010 on about 2000 acres with 300 acres of open water.

Read more here.

EPA Issues Endangerment Finding for Greenhouse Gases

Mon, 07 Dec 2009 14:57:00 GMT

EPA issued a widely anticipated finding today that greenhouse gas emissions “endanger … the public health and the public welfare of current and future generations.” This finding is a prerequisite to EPA finalizing its proposed light-duty vehicle GHG emissions standards proposed in September and is a step towards regulating emissions from stationary sources such as power plants and refineries.

The issuance has two significant political implications. First, it is intended to signal to the rest of the world that the United States is determined to control its GHG emissions in advance of the U.N.’s climate talks in Copenhagen that began today. Second, it signals to Congress (and to domestic businesses) that the current administration and the EPA intend to move forward with GHG regulation under existing law if Congress does not act by passing some type of carbon-reducing legislation.

Public Interest Group Sues EPA for Alleged Failure to Act on Arizona’s Air Quality Plan

Fri, 04 Dec 2009 17:08:00 GMT

On Wednesday, December 2nd, the Arizona Center for Law in the Public Interest (ACLPI) filed suit in federal district court to challenge EPA’s failure to act on Arizona’s most recent plan to reduce the level of airborne coarse particulate matter in the Phoenix metropolitan are (the "Five Percent Plan"). The lawsuit stems from the Phoenix area’s designation under the Clean Air Act (CAA) as a "serious nonattainment area" for PM10 (particulate matter that is 10 microns or less in diameter), meaning that Phoenix had failed to attain the applicable CAA standard within the requisite timeframe. As a result, Arizona was required to submit to EPA by December 30, 2007, a plan to reduce by 5% annually the level of PM10 in the air, which, in turn, triggered a duty on the part of EPA to review the plan and either approve or disapprove it.

ACLPI alleges that EPA was required to take action on Arizona’s Five Percent Plan by June 30, 2009, and has failed to do so. This lawsuit will motivate EPA to act on the Five Percent Plan. If EPA ultimately disapproves the plan, the CAA’s "sanctions clock" will start to run against the state.

Funding Cuts for ADEQ Raise Specter of Fee Increases, EPA Intervention

Thu, 03 Dec 2009 09:41:00 GMT

The Arizona Department of Environmental Quality (ADEQ) is feeling the pinch. Due to Arizona’s fiscal woes, the agency’s funding has been cut by over 50 percent since 2007, dropping from $32 to $13.2 million. This budget shortfall threatens ADEQ’s ability to fulfill its enforcement responsibilities. To make up the difference, ADEQ Director Benjamin Grumbles has sought legislative approval to increase fees for some permitting programs. Absent such additional funding, Grumbles predicts that ADEQ may be forced to yield some of its enforcement authority to EPA. For example, Grumbles warns that ADEQ may not have the resources to oversee cleanup of groundwater contamination at four Superfund sites, including two in Phoenix, which may lead EPA to take control of cleanup efforts. Similarly, EPA could assert greater authority over the Arizona Pollutant Discharge Elimination System, a federal clean water program that Arizona has administered since 2002.

As explained in this article by the Arizona Capitol Times (subscription required), ADEQ’s proposed fee increases pose a dilemma for the Republican-controlled legislature: It must balance a dislike for raising costs for businesses against the risk of a similarly undesirable increase in federal control over state environmental affairs.

UNR to Receive Renewable Energy Research Funding

Wed, 02 Dec 2009 14:11:00 GMT

The University of Nevada, Reno, as part of the Nevada System of Higher Education (NSHE), has received $3.2 million from the U.S. Department of Energy for renewable energy research in addition to the $5.7 million NSHE has secured over the past two fiscal years from the Department of Energy.

The funding has been secured through Federal Energy and Water Development appropriations bills supported by Senator Harry Reid. The funding will be used for the Nevada Renewable Energy Consortium. The consortium consists of NSHE member institutions, Desert Research Institute and UNLV, along with participating community colleges. The goal of the consortium is to establish and enhance collaborative research in the areas of biofuels, solar and geothermal energy. In addition, the consortium will support the expansion of workforce training programs in renewable energy technologies in participating community colleges.

The effort by NSHE institutions is considered critical in making the state of Nevada the leader in the utilization of renewable energy sources to promote a cleaner environment.

Read the full article here.

Completely Sold Out

Tue, 01 Dec 2009 11:48:00 GMT

How to end reliance on coal? Pay homeowners for feeding electricity into the grid at a rate that is double the rate they pay for electricity. Over three gigawatts (!) of solar electric generation have been installed in Germany this year, leading to the sell out of all available solar panels in that country. Time will tell, but it appears that one half of all of the installed photovoltaic capacity in the world is now in Germany!

How Big Can a Wind Farm Be?

Tue, 24 Nov 2009 12:22:00 GMT

As big as you can afford. While the fabled “London Array”, which contemplates 1 gigawatts of production capacity in the Thames Estuary, is truly enormous, Sweden plans a wind farm array in Lappland (where the reindeers live) that will generate over 3 gigawatts. They will use 7.5 megawatt turbines, that will be far higher than a football field is long: over 35 stories high. See the video, and more details, here.

Senate Delays Action on Climate Bill

Mon, 23 Nov 2009 13:08:13 GMT

It’s official: Climate change legislation will not happen this year. Senate Democratic leaders announced last week that floor debate on the Boxer-Kerry bill (S. 1733) will not begin until next spring, taking a back seat to legislation overhauling the healthcare system and financial industry. According to conventional wisdom, the climate bill will become increasingly difficult to pass after March 2010, with election pressures making lawmakers reluctant to support legislation that many see as likely to slow economic recovery and raise energy costs.

The news of this delayed timetable comes on the heels of a declaration by world leaders that they will not reach an international binding treaty at next month’s global climate summit in Copenhagen. Instead, they will aim for political commitments to reducing emissions and assisting developing countries transition to cleaner energy, deferring until mid to late 2010 hopes for a treaty to succeed the Kyoto Protocol.

Feet-dragging by the U.S. Senate and world leaders does not mean that greenhouse gas regulation is indefinitely postponed. The EPA is moving steadily toward Clean Air Act regulation. Its proposed rule limiting emissions from light-duty vehicles is currently undergoing public comment and is expected to be promulgated in March 2010. The light-duty vehicle rule, in turn, may justify EPA regulation of greenhouse gas emissions from large industry sources, including manufacturing facilities, power plants, and oil refineries.

We blogged here and here about Senate committee action on the Boxer-Kerry bill. Read more about the bill’s prospects here.

Plans for "Solar Tower" Energy Plant in Arizona

Thu, 19 Nov 2009 15:23:00 GMT

EnviroMission (USA) Inc., the Phoenix-based subsidiary of the Australian company EnviroMission Ltd., already has a few parcels under option in La Paz County and recently received an initial approval from the Southern California Public Power Authority ("SCPPA"). The company plans to construct a plant in Arizona that will generate electricity using "solar tower" technology. This new technology, described here, essentially heats air near ground level using a greenhouse effect and then funnels it into a huge tower as it rises, driving wind turbines. Unlike photovoltaic and concentrating solar, the solar tower does not require any water and can operate at night and on cloudy days since it is powered by radiant heat rather than direct sunlight.

A 200 MW solar tower plant would involve a tower over 3,000 feet tall (making it the tallest structure in the world), a glass or plastic greenhouse covering around 2,400 acres, and 32 wind turbines around the base of the tower. An industry brief on solar tower technology by Raymond James, estimates that it could be considerably less expensive than concentrating solar: 25% less per MW of capital costs with almost twice the operating life, and at least 80% lower operating costs.

The SCPPA represents 11 cities and one irrigation district in Southern California, including Los Angeles, Anaheim, and Glendale. The Authority issued RFPs for renewable projects and granted preliminary approval to EnviroMission's proposal. SCPPA must still determine how much power it would be willing to purchase from the project and is simultaneously negotiating with other developers. If the company does not reach a deal with the SCPPA, it would presumably try to procure an agreement with an Arizona electrical utility.

You can read more on this project from the Phoenix Business Journal here.

China's Largest Solar Manufacturer to Open U.S. Headquarters in Phoenix

Tue, 17 Nov 2009 23:01:00 GMT

Four months after signing into law new tax incentives for the renewable energy industry, Arizona governor Jan Brewer welcomed China’s largest solar-panel manufacturer to the Valley of the Sun. Suntech Power Holdings Co. announced on Sunday its decision to locate its U.S. headquarters and an 80,000 to 100,000 sq. ft. manufacturing facility in Phoenix. The facility, which will assemble panels that convert sunlight into electricity, is slated to begin operations in the third quarter of 2010. Initially, it will employ 75 Arizonans, and that number could grow to 250 at full capacity.

Suntech’s decision to open U.S. operations was largely in response to the decreasing price of solar panels, which raised relative costs of international shipping, and pressure on companies installing solar power to “buy American.” The company, which had also seriously considered a Texas location, cited Arizona’s renewable energy tax incentives, leadership in solar energy research, and location in the desert Southwest as reasons for its decision. The Greater Phoenix Economic Council, which pushed for passage of the renewable energy tax incentives and lobbied Suntech to locate in the Valley, predicted that Suntech’s facility will draw associated companies, e.g., material suppliers, to Phoenix. Suntech is currently considering East Valley and West Valley sites and is expected to announce the specific location next month.

Read more here and here.

Senators, Arizona Representative Voice Concern about Senate's Climate Bill

Mon, 16 Nov 2009 10:37:25 GMT

Now that climate change legislation has passed the Senate's Environment and Public Works Committee, albeit without any Republican votes, proponents must gather the bipartisan support and 60 votes needed to withstand an expected filibuster. The road to the floor will not be smooth, with senators of both parties expressing reservations and seeking to modify the bill.

Particularly contentious is the question of how to allocate the limited inventory of free emissions allowances (i.e., permits to emit greenhouse gases) among the country's electricity providers. On Thursday, a bipartisan group of 14 senators drawn largely from midwestern states sent a letter to Majority Leader Harry Reid (D-NV) expressing concern that the current allocation formula disfavors utilities that are more coal-dependent relative to those that generate power from a broader mix of sources. Smaller utilities that serve less populated areas tend to rely more on coal. Thus, rural customers could be disproportionately affected by rising electricity bills. This potential inequity worries U.S. Representative Ann Kirkpatrick, who serves a largely rural district in the northern and eastern parts of Arizona, and factored into her vote against the House climate bill passed last June.

Read related blog articles here and here.

Non-Profit Pushes for GHG Emission Limits in New Mexico

Fri, 13 Nov 2009 10:25:24 GMT

A proposal submitted by petition for hearing on January 5, 2009 by New Energy Economy (a Santa Fe based nonprofit) is being considered by the state Environmental Improvement Board (NMEIB) and would place strict limits on greenhouse emissions. The New Energy Economy proposal would apply to oil and gas producers, refineries, manufacturers, power plants, and others that emit 10,000 tons or more a year of carbon dioxide and require that by 2020, they reduce greenhouse gas emissions 25% below 1990 levels. New Energy Economy claims its proposal will spur alternate energy and create jobs related to that industry. A copy of the New Energy Economy petition to NMEIB can be found here; and here is a copy of a press release re same. New Energy Economy is supported by the New Mexico Environmental Law Center.

According to its opponents (including major power providers and other users and producers of coal, oil and gas, such as PNM, El Paso Electric, Tri-State Generation and the NM Oil & Gas Association, as well as Dairy Producers of NM, Grupo Cementos, the NM Farm and Livestock Bureau, BP North America and the New Mexico Mining Association), the proposal will cause energy costs to soar and hamper the state and its ability to attract new business. An attorney for the opponents say the proposal involves stricter restrictions than anything in federal law or any other state law. PNM says it will have a $1 billion impact on PNM alone and that it could cause the shut down of some plants and the need for expensive spot purchases, causing a tremendous impact on electric bills. Some of the opponents say they will reconsider doing business in NM and take their jobs elsewhere.

NMEIB (a 7 member governor-appointed board) is expected to act on the proposal this spring and has said it has authority to issue such restrictions.

Most of the information in this article comes from an article published in the Albuquerque Journal (subscription required) on Nov. 11, 2009: "Businesses Slam Gas-Cap Plan" by Michael Hartrant, on p. D4.

Phoenix Hosts Summit on Green Building

Thu, 12 Nov 2009 15:45:00 GMT

The Greenbuild 2009 International Conference and Expo opened on Wednesday at the Phoenix Convention Center. An annual event organized by the U.S. Green Building Council, Greenbuild is the largest convention of its kind, with over 20,000 attendees and exhibitors expected this year. Greenbuild 2009 runs from November 11 through 13 and offers a wide variety of activities and programming, including over 100 educational sessions and workshops in sustainable construction, a green building job fair, and a large exposition highlighting the latest products and technologies in green building. Additionally, the Wednesday evening opening celebration, held at the Diamondbacks' Chase Field, featured a keynote address by former vice president Al Gore and a concert by singer and environmental activist Sheryl Crow.

Learn more about Greenbuild 2009 here. Reuters reports here.

New Arizona Law Creates Tax Incentives for Renewable Energy Companies

Wed, 11 Nov 2009 18:24:00 GMT

On Tuesday, Arizona governor Jan Brewer participated in a celebratory signing of SB 1403, entitled "Renewable, High-Wage Industry Incentives." The bill, which Gov. Brewer signed into law in July, creates income and property tax incentives for renewable energy companies, including those in the wind, biofuel, and solar industries, to locate or expand their operations in Arizona. The bill ties tax benefits to the creation of high-paying jobs or capital investment for manufacturing or headquarters in Arizona. Supporters of the bill, including sponsor Barbara Leff (R-Paradise Valley), maintain that it will diversify Arizona's economic base and better enable the state to attract investment in the growing renewable energy sector.

Read the Legislature's fact sheet for SB 1403 here.

Spain Produces Over Half its Energy from Wind for 1.5 Hours

Tue, 10 Nov 2009 21:18:00 GMT

In the wee hours of Sunday morning, Spain set quite a record: The country got more than half its electricity from wind farms, a first for a country long invested in renewable energy. Between 4:30 and 6 a.m., Spanish wind turbines took advantage of a particularly windy day to generate 53% of the electricity coursing through the grid. Spain had never gotten more than 43% of its juice from wind power before. It suddenly had so much wind power, it had to export some electricity. The Wall Street Journal blogged about it here.

NV Energy Begins Testing Bio-Mass

Mon, 09 Nov 2009 11:41:00 GMT

NV Energy recently began a bio-mass test in an attempt to increase efficiency, reduce emissions, and reduce energy prices for customers.

The test began two weeks ago and consists of burning wood chips to produce steam. The steam drives a turbine, which turns a generator that converts the power into electricity. In some bio-mass industries, the spent steam from the power plant is also used for manufacturing processes or to heat buildings. Such combined heat and power systems greatly increase overall energy efficiency. By mixing coal with wood chips, NV Energy believes it can lower emissions since the wood has significantly lower emissions than the coal.

NV Energy is one of only 10 power plants in the nation to try this bio-mass test and the utility believes the test will work and make it less costly for customers. If the test works, NV Energy will open a second power plan in Northern Nevada.

You can read the full article here.

Senate Committee Passes Climate Bill Despite Republican Boycott

Fri, 06 Nov 2009 11:18:00 GMT

On Thursday, Democrats on the Senate's Environment and Public Works (EPW) Committee approved the Boxer-Kerry cap-and-trade bill without a single Republican present. The 10-1 vote came after a two-day Republican boycott of the committee's markup of the bill. The boycott protested the lack of a comprehensive analysis of the measure's potential effect on jobs and energy prices, with Republicans calling the bill a hidden tax increase. Democrats labeled the boycott a stall tactic and countered that a new study would largely duplicate EPA's analysis of the House-passed cap-and-trade bill, which pegged costs to the average American household at 22 to 30 cents per day.

Chairwoman Barbara Boxer (D-CA) invoked little-used committee rules—termed the "nuclear option" by Ranking Member James Inhofe (R-OK)—to bring the 900-page-plus bill to a vote despite the Republican boycott. Now that it has cleared the EPW Committee, the Boxer-Kerry bill must be integrated with climate change bills passed by five other Senate committees. A full Senate vote is not expected until next year.

We blogged here about the EPW Committee's hearings on the Boxer-Kerry bill, which sets 2020 as the deadline for a 20% reduction in greenhouse gas emissions from 2005 levels. Read more about Thursday's vote here and here.

Nevada PUC to Open Docket Regarding Feed-in Tariffs

Wed, 04 Nov 2009 19:03:00 GMT

On Tuesday, the Nevada Interim Committee on the Production and Use of Energy heard presentations from the Solar Alliance and the Electric Auto Association of Nevada regarding feed-in tariffs. After the presentations, Chairman Schneider directed the Nevada Public Utilities Commission (PUCN) to open an investigatory docket regarding the plausibility of the feed-in tariffs.

Rebecca Wagner, Commissioner for the PUCN testified that the Commission has been considering conducting a study regarding the use of feed-in tariffs for some time and confirmed that with the direction of Chairman Schneider, an investigatory docket will be opened on November 19th, 2009 to consider the feed-in tariff system.

Feed-in tariffs are an incentive structure to encourage the adoption of renewable energy through government legislation. The process allows homeowners, schools, businesses, local government, co-ops, Native American communities as well as the utility to generate renewable energy and feed into the gird. For each kilowatt-hour of energy produced the generator is paid a price based on the cost of production plus a rate of return on investment. Feed-in tariffs guarantee grid access, establish a fixed contract, and set a price that’s differentiated by technology (i.e., solar, wind, geothermal, biogas, or landfill gas).

The feed-in tariff system has been adopted in over forty countries, including parts of the U.S., and a dozen states in the U.S. are considering feed-in tariffs.

"Carbon Exposure": Who are the Winners and Losers in Cap-and-Trade?

Tue, 03 Nov 2009 18:13:00 GMT

PointCarbon, a market research firm, has just released a study projecting that ExxonMobil would need to spend nearly $6 billion for carbon allowances under the terms of the Kerry-Boxer cap-and-trade bill.

While that seems unsurprising, it is less intuitive to see that electricity giants like Exelon and Pacific Gas and Electric would emerge as financial winners, because they already lean heavily on low-emission technologies that include nuclear reactors and hydro dams.

The analysis examines the impact of a $15-per-ton carbon dioxide trading market on the nation’s largest oil and power companies, which together account for about 40 percent of the emissions in the American market.

Solar's Never been Less Expensive

Mon, 02 Nov 2009 16:54:00 GMT

Government incentives (federal, state and local combined) make installing solar power almost irresistible. Buyers can save up to 90% on a system whether its for a single family home or a 75-unit condo in the city. This article by Chris Kahn describes a $394,514 solar system installation at a Queens, NY co-op in which the 75% of the cost was picked up by government incentives. The remaining 1/4 costs will be recouped in a couple years, and then the co-op can start selling back energy to the public utility. A Lawrence Berkeley National Laboratory study released last month shows solar costs have declined 31% over last 10 years.

The federal government increased incentives last year and over half the states offer their own incentives (which vary and can be found on this list maintained by North Carolina's Solar Center). While state incentives may be disappearing or reduced due to recessionary pressures on government budgets, the Department of Treasury is issuing $2.3 billion in tax credits next year to companies that make energy equipment including solar power.

This an interesting contrast to a recent article (subscription required) in the San Francisco Business Times about the rising costs of wind power.

Attention to Psychological Aspects of Mitigating Climate Change Increases

Fri, 30 Oct 2009 18:06:00 GMT

An article in London's "The Guardian" newspaper tackles the touchy subject of human behavior and the role of psychology in addressing climate change. It describes the increased attention to how psychologically informed public awareness campaigns can be used to transform abstract concerns about climate change into concrete behaviors that reduce net energy consumption. While a few upcoming technological developments may demand no commitment on the part of individuals, at the end of the day, lowering society's carbon footprint cannot be accomplished without some lifestyle changes by each of us—and that's where things really get tricky.

500 Expected at Energy Conference in Nevada Next Week

Thu, 29 Oct 2009 16:23:00 GMT

More than 500 researchers, federal contractors and venture capitalists are expected in the Reno-Sparks area next week to attend a business, energy, and technology conference.

The convention entitled “Re-Energizing America” runs Monday through Thursday at John Ascuaga’s Nugget in Sparks. It will include workshops intended to help businesses access more than $2 billion in federal grants and contracts for energy-efficient technologies.

The sponsors and exhibitors include Boeing, Lockheed Martin, NASA, the Desert Research Institute, Nevada Commission on Economic Development and the U.S. Departments of Defense, Energy and Homeland Security.

You can read more about the conference here.

Senate Begins Hearings on Climate Bill

Wed, 28 Oct 2009 13:59:00 GMT

On Tuesday, the Senate Environment and Public Works Committee began hearings on a climate bill introduced by Senator Barbara Boxer (D-CA), chair of the Committee, and Senator John Kerry (D-MA). Most republicans remain opposed to climate legislation on grounds that it will raise energy prices and cost jobs. Supporters counter that clean energy technology could be the next major growth industry and that the U.S. is falling behind many other countries who are already making heavy investments in research and development. Some climate bill “fence-sitters”, primarily moderate democrats such as Senator Max Baucus (D-MT), are in favor of passing climate legislation but concerned that the current version is too ambitious.

The Boxer-Kerry bill calls for a 20% reduction in greenhouse gas emissions from 2005 levels by 2020. Waxman-Markey, passed by the House in June, requires only a 17% reduction over this same time period. According to an EPA analysis, the costs of the Senate version “are likely to be quite similar” to Waxman-Markey, which EPA estimated would cost the average American household between 22 and 30 cents per day for the 2010-2050 period. This article by The Washington Post discusses the current debate over the economic impact of climate legislation.

As quoted by msnbc, Energy Secretary Steven Chu, believes the U.S. “has fallen behind” China and other countries in the market for renewable energy technology." Secretary Chu claims that “China is spending about $9 billion a month on clean energy” and that “[n]inety-nine percent of the batteries that power America’s hybrid cars are made in Japan.” We blogged here about the European Union’s plan to spend $73 billion on renewable energy technologies over the next ten years.

An interesting aspect of the climate debate on Capitol Hill is its effect on the United Nations’ climate talks to be held in Copenhagen in December, as discussed in this article by Bloomberg.

NV Energy Receives $138 Million Grant for Smart Grid Technology

Wed, 28 Oct 2009 13:32:00 GMT

NV Energy will receive a $138 million grant, as part of the American Recovery and Reinvestment Act (ARRA), to implement smart grid technologies in Nevada. The project is part of an $3.9 billion build out of the smart energy grid announced Tuesday by President Obama.

The largest investments are divided among three categories. One category gives consumers access to information about their electricity use so they can make choices to use less electricity. Another provides the infrastructure needed to move the renewables from the their processing sites to where the energy is needed. The third category funds new technology necessary to to create the smart grid backbone.

Smart grid technology would reverse the informational flow, allowing NV Energy to send detailed consumption numbers to consumers via a small plug-in display inside the home. The technology would allow NV Energy to show consumers how much their bill is so far in the month, what the cost of power per kilowatt was and what it will be in the next hour, and possibly what consumers could save if they unplugged high energy consuming appliances such as plasma-screen TV's. The idea is to show consumers real-time energy costs and empower decisions on reducing electric bills.

NV Energy expects to launch its pilot program by late 2010, with plans to install all 1.45 million smart meters in the state by the end of 2012.

Here is DOE's press release and here is one from NV Energy.

Representative Giffords' "Solar Roadmap" Bill Passes with Bipartisan Support

Mon, 26 Oct 2009 10:32:00 GMT

The Solar Technology Roadmap Bill passed the House of Representatives last Thursday by a 310 to 106 vote. "Democrats and Republicans alike recognize the need to develop American sources of energy," Giffords said. "We know that sending more than $400 billion a year overseas to buy foreign energy weakens our economy, strengthens our enemies and undermines our national security. Tapping our own energy resources like solar represents an opportunity that we cannot afford to pass up." The bill was also supported by numerous business groups including the U.S. Chamber of Commerce and the National Association of Manufacturers.

You can read the Congresswoman's press release here.

New Mexico Withdraws Pending Greenhouse Gas Reporting Regulations

Fri, 23 Oct 2009 17:57:00 GMT

Proposed in July 2009, the regulations would have imposed reporting requirements on sources emitting 10,000 metric tons of carbon dioxide equivalent annually and required third-party verification of emissions reports for sources emitting more than 25,000 metric tons annually. The withdrawn regulations were based on a set of comprehensive reporting requirements developed by the Western Climate Initiative (WCI), a group of seven U.S. states, including New Mexico, and four Canadian provinces that is committed to developing a regional cap-and-trade program.

The withdrawn regulations would have been stricter than the greenhouse gas reporting rule promulgated by the federal Environmental Protection Agency in September of this year. The New Mexico Environmental Department announced that it would undertake an effort to develop state regulations that harmonize with federal law in order to simplify greenhouse gas reporting requirements for businesses.

You can read the notice of withdrawal and press release here and here.

New Mexico Adopts Rules for Negotiating Sales in Languages other than English

Thu, 22 Oct 2009 21:38:00 GMT

The New Mexico Attorney General has issued new rules involving negotiating a sale in a language other than English. Effective September 15, 2009, the new rule states that "it is unfair and deceptive business trade practice for any seller to fail to furnish the buyer with a summary translation of any receipt or contract pertaining to the sale of goods or services at the time of its execution that is in the same language as that principally used in the oral sales presentation or negotiations." The new rule requires that any summary translation must contain the material terms and conditions of the parties' agreement and that the sellers must also furnish the English language receipt or contract. The rule goes further to require that if the negotiations are not a written language, the seller or his representative must provide a summary in English, but must also read the material terms and conditions orally to the consumer in the language used during the presentation or negotiations. The reader must certify that he or she is fluent in that language and that her or she has accurately read the translation summary.

In Absence of Federal Legislation or EPA Rules, Courts may Address Climate Change

Wed, 21 Oct 2009 11:14:00 GMT

Two federal circuit courts recently allowed mass tort cases based on damages from climate change to proceed. In these two cases, the Second and Fifth Circuits agreed that public nuisance claims based on the effects of climate change could be considered by courts in the absence of federal legislation or rules from EPA.

In Connecticut v. American Electric Power (September 21), eight states, three nonprofit organizations, and New York City filed suit against six of the country’s largest electricity producers. Plaintiffs sought an injunction under the common law theory of public nuisance but the district court dismissed their claims on the grounds that they presented political questions that should not be considered by courts. The Second Circuit reversed, holding that courts could consider climate change claims in the absence of comprehensive federal legislation or regulation. The states involved in this case were California, Connecticut, Iowa, New Jersey, New York, Rhode Island, Vermont, and Wisconsin.

In Comer et al. v. Murphy Oil USA et al. (October 19), a class of plaintiffs filed nuisance, trespass, and negligence claims against numerous oil and chemical companies for damages due to the severity of Hurricane Katrina. The Fifth Circuit agreed with the Second Circuit’s earlier ruling, holding that the plaintiffs had standing and the issue did not present a non-judiciable political question.

In another case, the U.S. District Court for the Northern District of California dismissed climate change claims on the same basis rejected by the Second and Fifth Circuits – that the case presented a political question that should not be considered by the courts. Native Village of Kivalina v. ExxonMobil Corp. (September 30).

CBO Chief Addresses Congress on the Costs of Cap-and-Trade

Thu, 15 Oct 2009 18:49:00 GMT

On Wednesday, the head of the Congressional Budget Office, Douglas Elmendorf, answered questions from a Senate energy panel regarding the costs of the cap-and-trade bill passed by the House of Representatives in June (known as Waxman-Markey). CBO estimates the bill would slow US GDP by 0.25 to 0.75 in 2020 but Mr. Elmendorf noted that costs of climate change were not included in the analysis.

This article by the Washington Post quotes Mr. Elmendorf calling the economic costs of the bill "comparatively modest" and warning about the unknown but potentially huge costs of climate change. This article by the Wall Street Journal claims that the CBO's conclusions contradict the Obama administrations claims that the bill would actually boost the economy by creating "new low-carbon industries" and "green jobs".

European Union Adopts Strategic Energy Technology Plan

Tue, 13 Oct 2009 19:43:00 GMT

The European Commission announced plans to spend $73 billion on renewable energy technologies over the next ten years. Europe has clearly decided to go all out in the white-hot competition to lead the world in solar, wind, nuclear, and other non-carbon based energy technologies.

According to one EU official: "We know that low-carbon technology will one day become cost-competitive with fossil fuels, and the question then is whether the EU will be an importer or an exporter of that technology. We have to be in pole position." The EU hopes the plan will help it meet its goal of cutting GHG emissions by 80 percent by 2050 and give it a competitive edge in the green technology race with Japan and the United States.

The targets of the funding include: solar (16 billion euros), carbon capture and storage (13 billion euros), "energy-sipping 'Smart Cities'" (11 billion euros), biomass and other waste sources of energy (9 billion euros), nuclear (7 billion euros), and wind (6 billion euros).

US Chamber Responds to Climate Change Defectors

Sat, 10 Oct 2009 14:01:58 GMT

Chamber President Tom Donohue claims the majority of the Chamber's members support its position on climate change and that businesses leaving the organization over this issue do not understand its position. Apple Inc., the latest business to withdraw from the Chamber over this issue, wrote that it "would prefer the Chamber take a more progressive stance on this critical issue and play a constructive role in addressing the climate crisis." Donohue responded that Apple "didn't take the time to understand the Chamber's position on climate and forfeited the opportunity to advance a 21st century approach to climate change." According to Donohue and the Chamber's official policy on climate change, the Chamber supports greenhouse gas legislation but opposes "ill-conceived" policies that will hurt the economy, including the Waxman-Markey bill that passed the House in June.

New "Solar Shingles" May Make Solar Energy Cheaper, More Accessible

Wed, 07 Oct 2009 17:38:00 GMT

Dow Chemical recently introduced its "Powerhouse" line of solar shingles. The solar shingles use thin-film solar technology but can be installed by roofers without any specialized tools or training. Dow believes the shingles compare favorably to mounted solar panels in terms of aesthetics and will be considerably cheaper than existing solar shingle products. According to Reuters, Powerhouse shingles will cost 10-15% less per watt, despite being less efficient than traditional solar panels. Dow intends to begin distributing its solar shingles through home builders as early as early as mid-2010.

Renewable Energy Projects Running Into Water Problems

Mon, 05 Oct 2009 16:01:00 GMT

Renewable energy developers using technologies that consume large amounts of water are finding it more difficult to obtain the necessary water rights and approvals for their projects. This article in the NY Times discusses this issue and quotes one expert predicting that "water could become the real throttle on renewable energy."

Proposed Rule Would Require BACT for Greenhouse Gases

Fri, 02 Oct 2009 09:54:00 GMT

On Wednesday, EPA proposed a rule that would subject GHG-emitting facilities to its NSR program, including the requirement of best available control technology. The applicability threshold in the new rule is 25,000 tons/year of CO2 equivalent.

Here is EPA's press release and here is a helpful fact sheet.

Representative Giffords Introduces "Solar Roadmap" Bill

Wed, 30 Sep 2009 16:44:00 GMT

U.S. Representative Gabrielle Giffords, of Arizona's 8th District, recently introduced legislation that would require the Department of Energy to develop a long-term plan for the research and implementation of solar energy technology. Today, the Energy and Environment Subcommittee of the House Committee on Science and Technology passed the bill with bipartisan support.

Businesses Leaving U.S. Chamber of Commerce Over its Position on Climate Change

Wed, 30 Sep 2009 10:56:00 GMT

Three energy-sector businesses have recently left the U.S. Chamber of Commerce over its opposition to carbon legislation and its general stance on the issue of global climate change. The three businesses are Exelon Corp., the largest nuclear operator in the United States; PG&E Corp., a California utility; and PNM Resources Inc, an energy holding company in New Mexico.

Here is the article from Reuters and here is a more in-depth article by the New York Times.

Village Green Commerce Center Receives Land Use Approvals

Mon, 28 Sep 2009 11:15:00 GMT

Alfredo Alonso, lobbyist, and Garrett Gordon, land use attorney, in the Lewis and Roca office in Reno, Nevada, recently obtained final land use approvals for an 80-acre environmentally conscious business and industrial park called the "Village Green Commerce Center". The commerce center is designed to be energy efficient and potentially self-sufficient with roof-mounted photovoltaic solar panels. Other low-impact development standards include: drought tolerant native landscaping, use of reclaimed water for irrigation and shared parking standards to reduce impervious surface areas. The project received unanimous approval from the Washoe County Planning Commission, Washoe County Board of County Commissioners and Regional Planning Commission and is the first of its kind in Northern Nevada. Here is a rendering of one proposed building in the development.

China's President Expresses Intent to Address Climate Change

Wed, 23 Sep 2009 12:36:04 GMT

At a U.N. climate summit yesterday, President Hu Jintao discussed China’s willingness to reduce greenhouse gases including some specific proposals. Here is CNN's article and here is one from MSNBC. Although he did not commit to any specific reductions, it seems like most observers are interpreting the President's remarks as helpful to an American-Chinese agreement on reducing GHG emissions.

A central argument against carbon legislation in the U.S. is that it would put American companies at a disadvantage when competing against companies from developing countries such as China and India that do not have carbon caps. The United States rejected the Kyoto Protocol in 2001 primarily because it exempted China and India from compliance. This fact sheet by the Pew Center gives some useful background information about China's GHG emissions.

EPA Finalizes Greenhouse Gas Reporting Rule

Tue, 22 Sep 2009 12:15:00 GMT

The rule identifies certain “source categories” such as power plants, petroleum refineries, and Portland cement manufacturers that must report emissions. In addition, any stationary source that emits 25,000 tons/year of CO2 equivalent must also report its emissions. EPA estimates that the 85% of total GHG emissions in the U.S. will be covered by the new rule. Facilities must begin monitoring on January 1, 2010 and reports for 2010 will be due on March 31, 2011.

In addition to facilities that emit GHGs directly, the rule also applies to some “upstream” sources - suppliers of petroleum products, natural gas, coal-based liquid fuels, and industrial GHGs. Finally, the rule requires manufacturers of certain mobile sources, including heavy-duty trucks and off-road engines, to report to EPA beginning with model year 2011.

You can read EPA's Press Release here. Here is EPA's information page on the rule with links to the full-text rule and preamble as well as other relevant documents.

Goldwater Institute's Position on Development of Renewable Energy

Mon, 21 Sep 2009 14:08:27 GMT

In this "Daily Email", Clint Bolick of Arizona's Goldwater Institute argues against the Corporation Commission's Renewable Energy Standards. The Commission's current rules require regulated utilities to provide 15% of their electricity from renewable sources by 2025. The Goldwater Institute is challenging these rules as unconstitutional in a lawsuit started in 2008. The Commission recently won at the Superior Court level and the Goldwater Institute has announced its intent to appeal.

Proposed Rule Would Improve Vehicle Fuel Economy

Tue, 15 Sep 2009 13:47:00 GMT

A rule proposed by the U.S. Department of Transportation and the EPA would reduce GHG emissions by mandating better fuel economy for cars and light-duty trucks. The proposed rule requires automobile manufacturers to increase fuel economy by approximately 5% per year starting with model year 2012. The agencies estimate that the new program would conserve 1.8 billion barrels of oil and save the average driver more than $3,000 in fuel costs. The proposed rule would also allow automakers to build a singe national fleet that complies with all federal and state requirements for fuel efficiency.

Here is EPA's press release. EPA is holding several public comment sessions on the proposed rule and will accept comments until November 28, 2009.