New York RGGI Operating Plan Amendment Update October 2024, by Roger Caiazza
I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good.”
New York RGGI Operating Plan Amendment Update October 2024
The Regional Greenhouse Gas Initiative (RGGI) is a market-based program to reduce emissions from electric generating units. This post describes my comments on the updates to the New York State Energy Research & Development Authority (NYSERDA) Regional Greenhouse Gas Initiative (RGGI) Operating Plan Amendment (“Amendment”) for 2024. The latest RGGI auctions settled at prices higher than expected so the Amendment presents plans to allocate the $146 million windfall.
I have been involved in the RGGI program process since its inception. I blog about the details of the RGGI program because very few seem to want to provide any criticisms of the program. I submitted comments on the Climate Act implementation plan and have written over 450 articles about New York’s net-zero transition because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good. The opinions expressed in this post do not reflect the position of any of my previous employers or any other organization I have been associated with, these comments are mine alone.
Background
RGGI is a market-based program to reduce greenhouse gas emissions (GHG) (Factsheet). It has been a cooperative effort among the states of Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont to cap and reduce CO2 emissions from the power sector since 2008. New Jersey was in at the beginning, dropped out for years, and re-joined in 2020. Virginia joined in 2021 but has since withdrawn and Pennsylvania has joined but is not actively participating in auctions due to on-going litigation. According to a RGGI website:
The RGGI states issue CO2 allowances that are distributed almost entirely through regional auctions, resulting in proceeds for reinvestment in strategic energy and consumer programs.
Proceeds were invested in programs including energy efficiency, clean and renewable energy, beneficial electrification, greenhouse gas abatement and climate change adaptation, and direct bill assistance. Energy efficiency continued to receive the largest share of investments.
Note that although the goal of the program is to reduce GHG emissions, the investment descriptions include beneficial electrification, climate change adaptation, and direct bill assistance that do not reduce electric sector emissions.
NYSERDA Operating Plan Amendment
NYSERDA designed and implemented a process to develop and annually update an Operating Plan which summarizes and describes the initiatives to be supported by RGGI auction proceeds. On an annual basis, the Authority “engages stakeholders representing the environmental community, the electric generation community, consumer benefit organizations and interested members of the general public to assist with the development of an annual amendment to the Operating Plan.”
The Amendment describes the plans to use New York’s RGGI proceeds in the next several years. On September 19, 2024, NYSERDA hosted a webinar meeting to present proposed changes to the Operating Plan initiated because auction revenues were significantly higher than assumed last December. The meeting materials include the following:
The draft Amendment explains that New York State is supposed to invest RGGI proceeds to support comprehensive strategies that best achieve the RGGI greenhouse gas emissions reduction goals pursuant to 21 NYCRR Part 507. The programs in the portfolio of initiatives are designed to support the pursuit of the State’s greenhouse gas emissions reduction goals by:
Deploying commercially available energy efficiency and renewable energy technologies;
Building the State’s capacity for long-term carbon reduction;
Empowering New York communities to reduce carbon pollution, and transition to cleaner energy;
Stimulating entrepreneurship and growth of clean energy and carbon abatement companies in New York; and
Creating innovative financing to increase adoption of clean energy and carbon abatement in the State.
The NYSERDA RGGI operating plan amendment process exemplifies the Hochul Administration approach to Climate Act implementation. For all the talk about welcoming stakeholder comments, the reality is far different. I published my first articleon the NY RGGI operating plan in December 2017 and have submitted comments on the last few operating plan amendments. The stakeholder process reached a low point last December. Per their obligations NYSERDA prepared an amendment update for the operating plan, announced an Advisory Stakeholder meeting, and held the meeting. As I documented in my low point post public access to the meeting was not available because someone forgot to provide it.
Realizing their mistake and recognizing open meetings obligations, NYSERDA did follow up with an “Opportunity for Public Discussion” webinar. The recording of the meeting supports my concern that public engagement is not a real priority. They were clearly just going through the motions. The meeting consisted of agency staff reading scripted spiels that recited information in the operating plan amendment with no additional context or details.
Most disappointing was that the webinar only set aside 30 minutes to respond to questions. I submitted 16 questions before the meeting that they did not bother to try to address until there were only five minutes left. They only addressed four of them. That exemplifies the stakeholder comment approach for the Climate Act. They go through the motions of asking for comments, don’t respond to most comments submitted, and when they do respond they ignore the implications of the question.
Comment Summary
Although supporters of RGGI claim that it is a successful model to emulate, my comments explain the implications of the actual results affect not only the RGGI program but also the Climate Leadership and Community Protection Act (Climate Act). The comments I submitted to respond to this request were similar to the comments I submitted last December. I documented my analyses that show that observed New York State (NYS) emission reductions from the electric sector since 2000 are primarily due to fuel switching and retirements. The reductions directly attributable to RGGI are only on the order of 10% of the total. Coupled with the facts that there are no significant fuel switching opportunities available and that additional retirements threaten reliability, this means that we cannot expect emission reductions to continue as before. The Operating Plan must ensure that adequate funding for emissions reductions are available to ensure that the emission mandates are achieved.
In my comments I included my concern that the zero-emissions resources being deployed to displace the affected RGGI sources must include a new technology. It is clear that new technology is needed to achieve the goals. As part of the proceeding to implement a large-scale renewable program and the Clean Energy Standard (Proceeding 15-E-0302), the Public Service Commission held a technical conference on December 11 and 12, 2023 entitled “Zero Emissions by 2040” that included a session titled “Gap Characterization.” The session described the gap between the capabilities of existing renewable energy technologies and future system reliability needs. Speakers acknowledged that generation from wind and solar alone could not fill it and recognized the need for some new resource needs to be developed to provide electricity to meet demand when wind and solar production are low. They referred to this new, not-yet-existing, hypothetical technology as the Dispatchable Emissions-Free Resource, or “DEFR.”
The need for emission reductions and need for new technology should be the top priorities for the NYSERRDA RGGI Operating Plan in general and this Amendment in particular. Adequate funding for zero-emission electric generation is a prerequisite for a successful transition. The transition cannot occur unless this new technology necessary for the zero-emissions electric grid is developed. A feasibility analysis is needed as soon as possible to determine how much money will be needed for emission reductions consistent with the goals and to determine what is needed for new technology development and deployment. Such an analysis would also determine a realistic schedule. I acknowledge that there are competing priorities to minimize costs for low- and middle- income customers that should also be prioritized but the key point is that there are proposed programs that do not address any of the priorities.
DEFR Resource Recommendation
As a meteorologist I have a particular concern about the DEFR technology. To determine how much DEFR must be developed, it is necessary to characterize the wind and solar resource “gap”. The characteristics of the resource gaps must be quantified not only for New York but also for adjoining regional systems presuming that they also transition to an electric system with a similar reliance on wind and solar.
Some work in this regard has been completed. For example, as part of the recently completed NYISO 2023-2042 System & Resource Outlook, DNV modeled “long-term hourly simulated weather and generation profiles for representative offshore wind (OSW), land-based wind (LBW), and utility- scale solar (UPV) generators”. The analysis covered the period 2000 to 2021 and was limited to the New York Control Area. At the September 27, 2024 New York State Reliability Council (NYSRC) Extreme Weather Working Group (EWWG) meeting, Thomas Primrose from PSEG Long Island presented his analysis of data from the DNV work. Among other things, his evaluation found that all New York solar, onshore wind, and offshore wind capacity averaged less than 10% for 73 hours starting November 23, 2016 at 1600. I found that if the renewable resources projected in the Integration Analysis, without any fossil-fired resources, were operating at that time that there would have been a cumulative generation deficit of up to 103,465 MWh within the lull. Note that the lull deficiency projection length is dependent upon the location of the solar and wind facilities, so this is an approximation. Nonetheless, it exemplifies the challenge that DEFR must resolve
Recommendation
For anyone who is really interested, my comments describe the proposed programs in the Amendment, so I am not going to describe them here. I ranked the proposed programs by the emission reduction obligation for RGGI-affected sources, energy conservation and efficiency programs for consumers, and feasibility analysis criteria into three categories. The highest priority programs address one or more of these criteria or an issue that must be resolved for the transition to succeed. In my comments recommended that program funding incorporate these priority category rankings.
Highest priority – addresses technological gap for emission reductions, consumer energy savings, or electric sector feasibility
DEFR Gap Feasibility Study
Scoping Plan Implementation Research
Technical Services
Circular Economy Renewable Energy Feasibility Study
Medium priority – directly supports emission reductions, consumer energy savings, or electric sector feasibility
Disadvantaged Communities Schools/Buildings
Comfort Home
Lowest priority – no emission reductions, no consumer energy savings and does not address electric sector feasibility
ChargeNY
Green Jobs – Green New York
Building Retrofit and New Construction Challenges
Conclusion
The State of New York has consistently allocated RGGI auction proceeds inconsistent with the stated goals of the program. As long as emissions were going down then this had no impact on RGGI program goals. The emission reduction low-hanging fruit are gone now, and cost-effective and efficient emission reductions are needed to maintain compliance with the RGGI limits. The failure of the 2024 RGGI operating plan to recognize this need could very well mean that RGGI reduction goals and the Climate Act emission reduction targets will not be achieved. It gets worse because the New York Cap-and-Invest (NYCI) program that is supposed to be developed in 2024 will also include compliance limits. If state investments do not produce emission reductions consistent with the NYCI limits, then the only compliance option would be to stop running. In other words, the stakes have been raised and NYSERDA has not accounted for that in the program review.
The regulatory review stakeholder process does not include a real attempt to address stakeholder input. In my retirement it has become a hobby of mine to continue my involvement with the Climate Act regulatory proceedings. I respond to requests for comments knowing full well that if I am lucky, I will get some indication that someone read the comments, but I expect nothing else. With all due respect to the State agencies, colleagues and I have more experience and background for this particular topic than their staff so it would be appropriate for a real dialogue with the state’s subject matter experts. Even in the absence of the State’s lack of discussion I persevere because I consider my submitted comments a marker. When this inevitably all blows up, the record will show that they had been warned. Unfortunately, the odds are that the ideologues pushing these policies will have moved on to a new grift so they will never be held accountable.