Latest news with #GreenhouseGasReductionFund
Yahoo
4 days ago
- Business
- Yahoo
California's successful virtual power plant program faces big budget cuts
California's biggest virtual power plant is facing over $100 million in funding cuts due to the state's ongoing budget crisis, threatening the long-term viability of a program that can act as a crucial release valve for the state's overburdened power grid. The Demand Side Grid Support program pays electric customers who reduce their energy use or who provide power to the larger grid during extreme events that stress the system, like heat waves or wildfires. Going into this summer, the program has hundreds of thousands of smart thermostats, batteries, grid-responsive EV chargers, and other distributed energy resources that participating companies can control remotely with software. It can provide hundreds of megawatts of grid relief to help the state avoid rolling blackouts on the hottest days of the year, when air conditioning use pushes the power system to its limit. The companies paying customers to commit to making their devices available for this grid service insist DSGS is a good deal for the money — about $17 million in incentives paid to date, and roughly $82 million remaining for future spending, according to Olivine, the energy services company managing the program. It's certainly a more cost- and climate-friendly approach to mitigating grid emergencies than the billions of dollars the state has spent on fossil-fueled power plants and backup generators over the past few years, they say. But the program's future is now uncertain as legislators search for ways to alleviate California's multi-billion-dollar budget shortfall. The DSGS program already saw much of its state funding cut back last year due to similar budget issues — and now it's back on the chopping block. Late last week, state legislative committees approved cuts to DSGS, proposed in Democratic Gov. Gavin Newsom's 'May Revise' budget plan. The proposal would take away future funding promised in 2024, including $75 million from the state's Greenhouse Gas Reduction Fund and $46.6 million from the climate bond passed late last year. Newsom's plan would also pull $18 million from DSGS's existing budget. The state Legislature must pass a budget bill by June 15. If left in place in that final budget, these cuts and clawbacks would leave DSGS with about $64 million for the fiscal year that starts in July, according to Olivine. That won't kill the program immediately: 'Staff anticipate having sufficient funding for the 2025 program season,' which runs from May through October, Olivine states on its DSGS web page. But Edson Perez, who leads trade group Advanced Energy United's legislative and political engagement in California, says funding cuts will severely cloud the outlook for a virtual power plant program that has been a rare success in the state. For the past decade, California has largely failed to follow through on its stated policy objectives of developing virtual power plant programs, he said. Most of the state's utility-run virtual power plant programs have either stagnated or been canceled. DSGS, by contrast, is 'a very successful program, leading the nation for distributed energy,' Perez said. According to the latest tallies by Advanced Energy United, the program boasts 800 megawatts of capacity ready to participate in reducing peak grid demands this summer, he said, up from more than 500 megawatts enrolled as of last fall. That's an enormous amount of energy flexibility, comparable to the capacity available from a fossil-gas-fired 'peaker' plant. Keeping the program running for the long haul requires having enough money to give participants confidence that it will still exist from one year to the next, Perez said. To be clear, it's very hard to predict exactly how much money is needed to provide that confidence, because DSGS participants are paid for responding to grid emergencies. If weather conditions are mild and power supplies hold up, they could be called on very rarely, if at all, and money could be left over for next year. But if lots of emergencies happen, the funds could be depleted quickly. In that event, participating companies will have to come back in January 2026 to plead for more money to keep it going, with no guarantee the funding will be granted. That's not a sustainable way to do business, Perez said — and it's not a sustainable way to build a resource that the state's grid can truly rely on. California's DSGS program began three years ago not as a virtual power plant but as an experimental response to a grid reliability crisis. The program has grown rapidly since then — largely because the California Energy Commission structured DSGS in a way that avoids the complications of past programs, Perez said. But the growth was also driven by companies that have invested since 2022 to deploy the underlying technologies needed to reliably control thousands of customer-owned devices for up to two hours per day. Those companies have committed to paying customers both up-front incentives and 'performance payments' when they follow through on their promises to allow their devices to reduce power use or push power back to the grid. In some cases, companies have offered discounts on smart thermostats and other devices. All of these commitments are based on the expectation that state funding won't be pulled away, Perez said. 'The companies in this space need certainty,' he said. That's the argument being made by Sunrun, Generac, Renew Home, and other companies working in the DSGS program, along with community energy providers and trade groups. In a June 3 letter to state lawmakers, they asked for existing funding to be preserved to allow companies 'to continue investing in market development and customer onboarding,' and to give customers 'certainty in program length to estimate their returns upon participation.' Sunrun, the country's leading residential solar and battery installer, has had its ups and downs with California's ever-changing virtual power plant policies, said Chris Rauscher, the company's head of grid services and electrification. It has had to restructure projects as regulators and utilities altered program rules. One of Sunrun's large-scale pilot projects with utility Pacific Gas & Electric was discontinued last year. Still, Sunrun has continued to enlist customers in what it calls the 'CalReady' virtual power plant, which now has about 56,000 customers capable of providing 250 megawatts of electricity from their batteries to relieve statewide grid stress for up to two hours at a time, Rauscher said. While Sunrun is participating in other virtual power plant opportunities, it has centered its efforts on preparing to serve the DSGS program. Importantly, DSGS is also one of the few programs in California that doesn't bar solar-charged batteries from injecting their power back into the grid — most others allow them only to reduce a household's grid draw to zero. Allowing the equipment to send power back can roughly double their impact on relieving grid stress. 'You can very easily picture that by 2030, we're operating a nuclear power plant-sized [virtual power plant] in California,' Rauscher said. 'It sure would be a shame if the rug got pulled out from under this clean, reliable, and resilient resource that's providing payments to Californians.' DSGS is also good value for the money, argued Kate Unger, senior policy advisor at the California Solar and Storage Association, a trade group pushing for funding to be restored. 'DSGS is providing energy when otherwise it's going to be at emergency pricing, when it's about the most expensive energy you can possibly buy,' she said. Participants get a small up-front payment in exchange for agreeing to allow companies to dispatch their devices or batteries for up to two hours on days when the day-ahead price of power on the state's wholesale energy market exceeds $200 per megawatt-hour. That's a proxy for days when the state's grid operator has forecasted that demand for power, most often due to air conditioning use during heat waves, will exceed available energy supplies. But importantly, DSGS providers are not paid the wholesale energy market price, Unger said. Instead, the program pays companies and customers lower amounts based on energy or capacity actually delivered. That 'pay-for-performance' structure helps ensure that the state is getting value for the money it's spending, she said. In that sense, DSGS is 'one of the most cost-effective forms of insurance for grid emergencies that you can have,' said Ben Brown, CEO of Renew Home. His company, formed by the merger of Google Nest's smart-thermostat energy-shifting service Nest Renew and residential demand-response startup OhmConnect, has set its sights on establishing gigawatts of virtual power plant capacity with existing and new customers across the country. It has an undisclosed number of customers participating in DSGS. It's more difficult to measure the reduction in energy use from thermostats that dial down air conditioning than to measure the amount of power that batteries inject back onto the grid. But Renew Home has 15 years of experience in utility and energy market programs that Nest has run across the country, and has confidence that it can deliver on the grid relief it has pledged to the DSGS program, Brown said. Still, it takes time for demand-side programs like these to become a reliable part of the grid resource mix, he said. They must both entice customers to participate and then use financial incentives to encourage them to stick around. 'You can't just have a program stand up and be able to operate that at scale overnight,' Brown said. 'Having certainty over the next five years is pretty important when you're talking about subsidizing technology.' Financial certainty is particularly key to getting a new form of carbon-free grid resource up and running, DSGS backers say. But to date, fossil-fueled alternatives have gotten most of the money from the multi-billion-dollar emergency backup programs created after the state's rolling blackouts in 2020 and close brush with similar blackouts in 2022. As of last spring, California had spent about $426 million on 'emergency and temporary' power generators that burn fossil gas or diesel fuel, according to the state Department of Water Resources, which administers that program. It has also promised about $1.2 billion to keep fossil-gas-fired 'peaker' plants in Southern California open until 2026, well past their scheduled 2020 closure date — a decision that runs counter to the state's environmental and climate policies. DSGS, by contrast, relies on resources that don't emit carbon or toxic air pollution. What's more, the smart thermostats, solar-charged batteries, smart EV chargers, and other devices involved are being installed and paid for by California residents for their own purposes. Customer-owned resources could significantly lower energy bills for Californians. A 2024 report from The Brattle Group, a consultancy, found that virtual power plants could provide more than 15% of the state's peak grid demand by 2035 and save California consumers about $550 million per year by then. Most of that money would go to the owners of the devices being tapped. But utility customers at large would save about $50 million, compared to what they'd otherwise have to pay for utility-scale resources to fill in where virtual power plant capacity had failed to emerge, the report found. That's an important consideration in a state where utility electricity rates have risen to roughly double the U.S. average and are set to keep climbing in coming years. Not everyone is confident that virtual power plants are a truly reliable alternative to more traditional options. California utility regulators and grid operators have critiqued the performance of demand-side programs during past grid emergencies, saying they haven't delivered what was promised. Nor is California's grid as vulnerable to summer heat waves as it was in 2020 and 2022 when these emergency grid relief programs were created. In the intervening years, the state has added gigawatts of energy storage to absorb its still-growing share of solar power for use after the sun goes down, relieving the evening 'net-peak' challenges of previous years. In a May assessment, the California Energy Commission noted that 'rapid clean energy deployment, expansion of battery storage, and strategic efforts to build up emergency reserves' have put the state on solid footing for this summer. But the commission is also striving to dramatically expand the state's capacity for getting customers to help the grid, with a goal of 7 gigawatts of demand flexibility resources by 2030. 'Innovative programs like DSGS provide a critical buffer for ensuring the reliability of California's electrical grid while reducing emissions,' California Energy Commission Vice Chair Siva Gunda said in an October press release issued after the program surpassed 500 megawatts of enrolled capacity. Anne Hoskins, senior vice president of policy and market development at Generac Power Systems, highlighted the risks that programs like DSGS insure against. Generac, one of the country's biggest manufacturers of backup generators, has expanded into grid services, solar-charged battery backup systems, and smart thermostats via its 2021 acquisition of startup ecobee. Back in 2022, when Gov. Newsom's office sent out emergency text alerts to Californians to turn down power in the face of a potential grid overload, Generac tapped into ecobee's automated grid-response capabilities to help meet the call, Hoskins said. 'With this DSGS funding, we can provide that in a more efficient way,' she said. The costs to the state of keeping DSGS healthy in future years pale compared to the economic risks of leaving California open to future grid emergencies, Hoskins added. She cited a 2023 study from Gridwell Consulting, a Sacramento, California-based energy market analysis firm, that found that the state's four days of emergency grid conditions in September 2022 added more than $1 billion in energy costs to utility customers that 'would have been avoided if there were additional capacity online to meet the increased demand.' 'You're looking at potentially multi-billion-dollar impacts that could be avoided by calling on these distributed resources,' Hoskins said. 'We recognize that California is in a challenging situation' with its budget. But before state lawmakers take away DSGS money, she'd like to see an analysis of 'the alternative costs for this program going away if the money isn't there for customers.'
Yahoo
5 days ago
- Business
- Yahoo
CGC Asks Visiting U.S. Cabinet Officials To 'Work Together to Solve the Energy Crisis in Alaska and Beyond'
ANCHORAGE, Alaska, June 4, 2025 /PRNewswire/ -- In a full-page ad in the Anchorage Daily News yesterday, the Coalition for Green Capital (CGC), a national green bank that received $5 billion in funding from the federal government last year, warned that "the nation needs more energy" and asked three Cabinet members visiting Alaska to "work together to solve the energy crisis in Alaska and beyond." The ad was in the form of an open letter to Interior Secretary Doug Burgum, Energy Secretary Chris Wright, and Environmental Protection Agency (EPA) Administrator Lee Zeldin. It cited CGC's network partner Spruce Root, a Community Development Financial Institution in the southeastern Alaska. "Investments in such partners are multiplied many times with private capital," the ad said. CGC, however, has faced obstacles. The EPA earlier this year tried to terminate CGC's contract under the Greenhouse Gas Reduction Fund, awarded under the Inflation Reduction Act of 2022, and has frozen the organization's account at Citibank. CGC has challenged the termination in federal district court and won a preliminary injunction, which is now under appeal. "We shouldn't be at cross purposes. CGC has common ground with Administrator Zeldin's Powering the Great American Comeback initiative, and we want to move as fast as we can," said the ad placed by the CGC, which over more than a decade has developed a network of green banks and community lenders. The ad explained the current energy crisis this way: "The grid is a century old, demand is soaring, capacity can't keep up, and Americans are suffering as their utility bills rise. For Alaskans, it's worse. Many communities will never have a grid connection. They're using expensive and unreliable diesel and paying three to five times the national average for electricity." CGC has a solution to financing projects needed to eliminate the crisis, said the ad: "Distributed, smaller-scale projects are often the cheapest and fastest way to add power. That's why Congress asked us to help finance them." The organization called on the three Cabinet officials to work with CGC and bring public and private capital together work together "to unlock capital and enhance U.S. energy infrastructure." About Coalition for Green Capital The Coalition for Green Capital (CGC) uses public-private investing to unlock clean air, clean water, clean jobs and affordable power for all Americans. Green banks are a proven finance model that uses public capital to mobilize private investment in renewable energy, energy efficiency, and other decarbonization technologies. For over a decade, the Coalition for Green Capital has led the Green Bank movement, working at the federal, state, and local levels in the U.S. and countries around the world. For more information, visit: ContactJames K. Glassman: jim@ (202-344-5777)Or Elizabeth Heaton: elizabeth@ (202-445-9858) View original content: SOURCE Coalition for Green Capital Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Forbes
27-05-2025
- Business
- Forbes
Advocacy By Architecture Firms Fighting Climate Change
BioWall Garden Green Vertical wall of different live plants With federal funding to fight climate change in jeopardy, it may be architecture and landscape architecture firms, along with the associations that represent them, that will be increasingly counted upon to rise to the challenge of advancing the fight. As of this writing, funds for greenhouse gas reduction remain frozen while court proceedings are ongoing. The Greenhouse Gas Reduction Fund (GGRF) funding, encompassing initiatives like the Clean Communities Investment Accelerator and National Clean Investment Fund, cannot currently be accessed by recipients. This means advocacy and innovation, oft initiated by firms in architecture and landscape architecture, is increasingly essential to fostering a resilient and sustainable tomorrow. By incorporating sustainable principles at each stage of the design, the architecture profession has the ability to produce structures that endure and benefit their occupants. To address the ongoing climate crisis, architects can design carbon-positive, clean energy producing materials incorporating current materials and technology. They can advocate for building code and zoning regulations updates. They can design in biophilic elements such as greenery and organic materials to support occupants' physical and mental well-being. And they can link residents and office workers with nature through the use of such elements as rooftop gardens, interior courtyards and green walls. 'Grassroots advocacy is more important than ever before, especially in the realm of architecture and design, where our actions can significantly influence a sustainable future,' says Michael Hayes, managing executive at TPG Architecture, a New York City-based architectural and design firm. 'As designers, we are responsible for promoting the integration of climate-conscious solutions, whether it's advocating for updates to building codes or championing materials that support both the environment and human well-being. Through grassroots efforts, we lead with sustainability in every project and conversation, shaping healthier, more resilient communities.' New stone age As noted, architects are in the forefront of exploring innovative building materials with the potential to substantially cut the carbon footprints of structures incorporating them. London-based architectural firm Hawkins\Brown was commissioned by Albion Stone and Hutton Stone to design Brick From a Stone: Arch Revival, a pavilion featuring a pair of eye-catching vaulted hyperbolic arches displayed at Clerkenwell Design Week in London's Clerkenwell district last week. Each arch is created from a single layer of stone bricks only 102 mm. thick, providing evidence of the product's suitability as a load-bearing material. Clay-fired bricks used for centuries exact an enormous carbon toll, featuring as they do multiple raw materials that must be mixed, dried and heated to 2,912 degrees Fahrenheit. But stone begins life as a zero-carbon material that doesn't need making, and requires energy solely to mine and cut the material. Brick From a Stone: Arch Revival, boasts 66% less embodied carbon than identical structure constructed with clay-fired bricks. Economic benefits Landscape architects also have a role in propelling a greener future. Late last year, the American Society of Landscape Architects (ASLA) released a new brief on the economic benefits of landscape architecture and nature-based solutions. The brief revealed landscape architects boost economic value via their planning and design of nature-based solutions. Landscape architect's work generates economic benefit in five key areas: Improved human health and livability, broadened investment and sustainable jobs, increased biodiversity, results beyond net-zero and more robust resilience. Global policymakers are interested in ratcheting up investment in nature-based solutions, noted ASLA CEO Torey Carter-Conneen. Before doing so, however, they seek to learn the tradeoff between the solutions' costs and their economic benefits. As a result of the new brief released last November, quantitative evidence is available of the economic value landscape architects create through their design of the solutions. For instance, nature-based solutions like rain gardens, bioswales and green roof effectively manage stormwater and can be built for 5 to 30% less and maintained for 25% less than conventional infrastructure. What's more, every dollar invested in parks and green space can yield from $4 to $11 in tourism growth, enhanced property values and better community health.
Yahoo
15-05-2025
- Business
- Yahoo
Republicans advance major rollbacks to Biden's clean energy policies
WASHINGTON — Republicans on the House Energy and Commerce Committee advanced a measure to repeal a number of clean energy tax credits passed under the Biden administration to help pay for President Donald Trump's forthcoming tax package. The committee voted along party lines to advance its portion of the budget framework on Wednesday afternoon, which includes measures seeking to secure Trump's campaign promises to make the country energy dominant. Most of the proposals sought to rescind funds from going toward programs passed under former President Joe Biden's Inflation Reduction Act (IRA) and invest some of that money instead in oil and gas drilling. 'The 2024 election sent a clear signal that Americans are tired of an extreme left-wing agenda that favors wokeness over sensible policy and spurs price increases,' Committee Chairman Brett Guthrie, R-Ky., wrote in an op-ed on Monday. 'This bill would claw back money headed for green boondoggles through 'environmental and climate justice block grants' and other spending mechanisms through the Environmental Protection Agency and Energy Department.' The Energy and Commerce Committee has a wide jurisdiction over domestic policy, particularly relating to energy and public health. The energy and environment section of the budget framework encompassed much of the proposal passed on Wednesday, which will dictate much of how the Energy Department and Environmental Protection Agency operates. The committee was tasked with finding at least $880 billion in spending cuts to help pay for the $4.5 trillion in tax cut extensions that Republicans hope to approve before the end of the year. With the repeal of IRA subsidies, the committee would secure $6.5 billion in savings, according to Guthrie. The framework would claw back funds from key green energy programs such as the Greenhouse Gas Reduction Fund, a $27 billion investment that incentivizes the use of clean energy technologies to reduce greenhouse gas emissions, as well as the Methane Emissions Reduction Program, aimed at reducing methane emissions from the oil and gas industry. The framework seeks to repeal portions of the Clean Air Act, which authorizes the EPA to establish national air quality standards and develop programs for states to maintain those levels. Notably, the bill would aim to phase out several renewable energy tax credits over the next six years — a proposal that could be a sticking point for both clean energy friendly Republicans as well as conservatives who want the IRA to be repealed in full immediately upon passage. A handful of Republicans have warned against repealing those green energy credits in full, warning it could cause a spike in utility costs nationwide. The proposed repeals would specifically target wind, solar, geothermal, hydropower, and biomass energy sources. Included in those clawbacks is a measure to rescind electric vehicle tax credits, particularly credits tucked into the IRA that offered rewards to those who bought electric vehicles. The House Ways and Means Committee is also set to consider tax credit repeals of electric vehicles to accompany that proposal. The clean energy rollbacks are part of Trump's larger reconciliation package that encompasses policies on energy, border and national defense, among other things. After the Energy and Commerce Committee portion advances the committee, it will then be compiled with other House committees to craft the final package. GOP leaders hope to get the package finalized and passed through the House by the end of next week — an ambitious timeline as there are still some remaining disagreements Republicans must iron out. Once the reconciliation package is through the House, it will then move to the Senate for consideration — where some Republicans are already wary about the green energy credits being repealed. Also tucked into the budget portion passed on Wednesday were substantial cuts to Medicaid and other healthcare programs. One of the most significant changes proposed in the framework is to implement new work requirements for Medicaid beneficiaries. The bill would require able-bodied adults without dependents to work at least 80 hours a month or complete some other activity such as community service. The proposal to increase work requirements carves out some exceptions, such as for pregnant women, and would only apply to those who are between 19 and 64 years old. Individual states would be responsible for enforcing work hours. If the proposed cuts are signed into law, preliminary estimates predict at least 8.6 million people would lose Medicaid coverage over the next decade, with savings reaching at least $715 billion by 2034, according to the Congressional Budget Office. The legislation would also include new restrictions on how Medicaid funds can be used, including bans on gender transition procedures for children under 18 as well as prohibitions on coverage 'for individuals whose citizenship, nationality, or immigration status has not been verified.'
E&E News
13-05-2025
- Business
- E&E News
Republicans' ‘clearly unprecedented' gambit to kill climate programs
House Republicans want to use their sprawling budget reconciliation bill not only to zero out climate programs — but also to make it harder for subsequent Congresses to restore them. The budget bill the House Energy and Commerce Committee released Sunday night would pull back about $6.5 billion in unspent grant funding for green energy finance, clean manufacturing, community pollution abatement and carbon-cutting projects at ports and schools. It would also repeal the authorizing language for the 17 programs that it targets. Advertisement Bill Hoagland, who served as director of budget and appropriations for former Senate Majority Leader Bill Frist (R-Tenn.), called that move 'clearly unprecedented.' 'I have never seen in my career any reconciliation language that would strike authorization language for a discretionary program,' he said. The gambit is risky, given the strict rules of the budget reconciliation process. But it would have some practical advantages for Republicans if it succeeds. A subsequent Congress and administration would have a harder time restoring funding for programs like EPA's $27 billion Greenhouse Gas Reduction Fund or $7 billion Climate Pollution Reduction Grant program — both of which the Energy and Commerce proposal would terminate. 'It's always better to still have authorizations on the books, because it's always easier to get funding for existing authorizations instead of starting from a complete blank slate,' said Adrian Deveny, a former aide for Democratic Senate Leader Chuck Schumer (D-N.Y.). The repeals would also let Republicans claim credit for killing programs they've decried as wasteful and corrupt, even as they rescind only a fraction of the programs' funding. The Energy and Commerce Committee is not attempting to claw back the lion's share of grants, which are already under contract; committee spokesman Ben Mullany said Monday that the panel would 'continue to honor the obligated funds.' Language to repeal program authorizations may survive the House. But Hoagland said it probably won't square with the Senate's strict rules for the kinds of policy provisions that can move through budget reconciliation. Republicans are using the reconciliation process to move their bill to avoid a filibuster by Senate Democrats. It's the same maneuver Democrats used in 2022 to enact the climate spending law, because it allows legislation to pass the Senate with a simple majority vote. But Senate rules extend this privilege only to provisions that raise or spend revenue. And while the Energy and Commerce language rescinding unspent climate law dollars will pass muster, experts say the deauthorization language probably won't. 'Striking language that simply authorizes appropriations but doesn't do anything to appropriate funds doesn't have any budgetary impact, and that therefore violates the Byrd rule,' said Hoagland, referring to a long-established procedural rule named for the late Sen. Robert Byrd ( a former chair of the Senate Appropriations Committee. The rule prohibits the inclusion of 'extraneous' policy provisions in a bill that moves through reconciliation. But whether or not Republicans succeed in revoking program authorizations, supporters of the climate law say the loss of unobligated funds will have consequences. EPA, for example, has already obligated much of the money the climate law appropriated for grant programs. What's left at the agency is mostly its grant-management and oversight budgets — which were small to begin with. 'Members of Congress expect programs to be implemented and crises addressed even when the budget for staff is cut,' said Zealan Hoover, a former Biden administration official who led Inflation Reduction Act implementation at EPA. 'If I was still at EPA I would be very worried about the volume of angry Hill calls coming if anything close to this budget is enacted.'
