EIA Releases State-Level Data on Residential Energy Sales

As part of its State Energy Data System, the Energy Information Agency (EIA) has released consumption and prices and expenditures data on 2016 electricity retail sales.  Corresponding graphs and maps were also posted on the EIA website.

The average U.S. residential electricity customer in 2016 used approximately 10,800 kilowatthours (kWh), although the amount varied significantly by region.  States in the southeast had the highest levels of consumption, largely because of the higher levels of air-conditioning use and the greater likelihood of homes having electric space heating, water heating, and cooking than the national average.  Hawaii, Maine, California, Vermont, and Rhode Island had the lowest levels of residential electricity sales per customer.  Although these states are geographically diverse, they share generally mild climates or have high adoption levels of residential solar systems, which reduce the amount of electricity sold to households.

The EIA data also show that Hawaii has the highest residential electricity prices in the country, averaging 27.5 cents per kWh in 2016.  This is over 35 percent higher than the next most expensive state, Alaska (20.3 cents per kWh).  Louisiana has the lowest average residential electricity price at 9.3 cents per kWh, and the average U.S. residential electricity price in 2016 was 12.5 cents per kWh.

Although Hawaii’s prices were the highest in 2016, it ranked fifth in terms of expenditures because of its relatively lower consumption levels.  South Carolina had the highest level of residential electricity customer expenditures; the average customer in South Carolina paid $1,753 in 2016.  This is nearly double the amount paid by the average customer in the state with the lowest expenditures, New Mexico, who paid just $911.  The national average expenditure was $1,351.

EIA data on nuclear energy and natural gas at the state level are expected to be available later this month.  EIA plans to release the final data for the 2016 data cycle on June 29, 2018.

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FERC Issues Storage Rule

UPDATED 2.16.2018 with link to Order No. 841 and further information on the upcoming technical conference in Docket Nos. RM19-9-000 and AD18-10-000. 

At today’s Open Meeting, the Federal Energy Regulatory Commission approved unanimously a final rule concerning electric storage resource participation in RTO/ISO capacity, energy, and ancillary service markets. Order No. 841 directs each RTO/ISO to file tariff revisions implementing a “participation model” to facilitate and govern the participation of storage resources in the markets, and requires that the tariff revisions be filed with FERC within 270 days of the rule’s publication in the Federal Register. The RTOs/ISOs will have 365 days thereafter to implement their proposed tariff provisions.

According to the staff presentation, the new Rule requires that each RTO/ISO’s participation model:

  1. ensure that an electric storage resource using the model is eligible to provide all capacity, energy, and ancillary services that it is technically capable of providing;
  2. ensure that an electric storage resource using the model can be dispatched and can set the wholesale market clearing price as both a wholesale seller and wholesale buyer, consistent with rules that govern the conditions under which a resource can set the wholesale price;
  3. account for the physical and operational characteristics of electric storage resources through bidding parameters or other means; and
  4. establish a minimum size requirement for participation in the markets that does not exceed 100 kW.

The Rule further requires that the resale of energy from an electric storage resource back to the RTO/ISO markets be at the wholesale locational marginal price.

Order No. 841 takes no action on earlier proposed reforms related to distributed energy resource aggregations. As to those reforms, the Commission and Commission staff will be convening a technical conference on April 10 and 11, 2018 in Docket Nos. RM18-9-000 and AD18-10-000. The technical conference notice states that the conference will cover seven different panels. Parties wishing to participate in this conference should submit a nomination form by 5:00 p.m. on March 15, 2018. Though not required, those planning to attend in person are encouraged to register by April 3, 2018.

Commissioners LaFleur, Chatterjee, Powelson, and Glick each issued a separate statement on Order No. 841.

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White House Releases Proposed Budget and Infrastructure Framework

Both the President’s proposed budget and the Trump Administration’s long-awaited infrastructure plan recommend significant changes to the role the federal government plays in the energy sector.  The President’s proposed budget for Fiscal Year 2019, which includes substantial cuts to both EPA funding and certain Department of Energy programs, was released earlier this week and is accompanied by:

  • An Analytical Perspectives document that, among other things, provides additional information and context on assumptions, concepts, technical analysis, and other special topics included in the budget;
  • An Appendix that provides more detailed financial information on budget estimates for individual agencies and programs; and
  • A Major Savings and Reforms document that describes proposed major discretionary and mandatory savings programs.

The President’s proposed budget includes the following energy-related items:

Department of Energy:

  • Reduce funding for DOE’s applied energy research and development programs by approximately $2 billion, including the elimination of the Weatherization Assistance Program and State Energy Program;
  • Eliminate the Advanced Research Project Agency-Energy (which supports early-stage research into high-potential energy technologies);
  • Fund multiple programs relating to cybersecurity and resilience, including more than $95 million to the reorganized Office of Cybersecurity, Energy Security, and Emergency Response; and
  • Divest the transmission assets owned and operated by Power Marketing Administrations, such as the Southwestern Power Administration, Western Area Power Administration, and Bonneville Power Administration.

Department of Health and Human Services:

  • Continue the President’s previous budget proposal to eliminate the Low Income Home Energy Assistance Program.

Department of the Interior:

  • Increase funding to programs that support the Department of the Interior’s proposed “aggressive strategy for leasing offshore oil and gas”;
  • Provide $18 million to help initiate the Department’s internal reform plan; and
  • Reduce funding for land acquisition from $154 million to $8 million.

Environmental Protection Agency:

  • Eliminate “lower priority programs,” including the Climate Change Research and Partnership Programs, the Indoor Air and Radon Programs, the Marine Pollution and National Estuary Programs, the Environmental Education Program, and the Beaches Program;
  • Reduce funding for EPA’s Office of Research and Development by approximately $230 million compared to 2017 levels; and
  • Eliminate government funding for the ENERGY STAR program and authorize EPA to instead collect fees from product manufacturers to fund this program.

The President’s proposed budget now will go to Congress for its consideration.

This week, the White House also put out its infrastructure plan, entitled Legislative Outline for Rebuilding Infrastructure in America.  This document provides the Trump Administration’s roadmap for Congress to draft a comprehensive infrastructure bill designed to “stimulate at least $1.5 trillion in new investment over the next 10 years, shorten the process for approving projects to 2 years or less, address unmet rural infrastructure needs, empower State and local authorities, and train the American workforce of the future.”

The President’s infrastructure plan includes the following energy-related measures:

  • Create a $100 billion Incentives Program (administered by the Department of Transportation, Army Corps of Engineers, and EPA) that would provide support to wide-ranging classes of assets, including hydropower infrastructure;
  • Establish a Rural Infrastructure Program that would make $50 billion available for capital investments in rural infrastructure, including “governmental generation, transmission and distribution facilities”;
  • Create a $20 billion Transformative Projects Program to “provide Federal funding and technical assistance for bold, innovative, and transformative infrastructure projects,” including those in the energy sector; and
  • Significantly revise and streamline the federal permitting and environmental review process.
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Bipartisan Budget Deal Passed

Early this morning Congress passed and the President signed into law a two-year budget deal. The Bipartisan Budget Act of 2018:

  • Increases the discretionary spending caps for nondefense spending to $579 billion in FY2018 and $597 billion in FY2019, a total increase and for defense spending to $629 billion in FY2018 and $647 billion in FY2019, a total increase from current spending levels of $131 billion and $165 billion, respectively, over the two years. The increase in nondefense spending includes $20 billion towards energy, water, broadband, and transportation infrastructure projects.
  • Includes $89.3 billion in additional disaster relief funding. The funding is primarily directed towards initiatives related to addressing the 2017 hurricanes (e.g. Harvey, Maria, Irma) and wildfires, and includes $13 million to the Department of Energy “for necessary expenses related to the consequences of Hurricanes Harvey, Irma, and Maria, including technical assistance related to electric grids.” The disaster relief funding also includes over $15 billion to the Army Corps of Engineers to construct flood and storm damage reduction and shoreline protection projects, and $23.5 billion for FEMA’s Disaster Relief Fund.
  • Extends certain energy tax credits including credits related to residential energy property (e.g. residential solar electric, solar water heater, fuel cell, and small wind), biodiesel and biofuel production, Indian coal, renewable energy resources qualifying under Sections 45 and 48 of the Internal Revenue Code (IRC);
  • Modifies the credit for the production from advanced nuclear power facilities to authorize the reallocation and transfer of any unutilized national megawatt capacity; and
  • Enhances the tax credit for entities using carbon capture and storage technology.
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EIA’s Annual Energy Outlook 2018 Shows U.S. Could be Net Energy Exporter By 2022

Today, the Energy Information Administration (EIA) released its 2018 Annual Energy Outlook.  The report includes projections of U.S. energy markets through 2050 based on a Reference Case,* which takes into account existing laws and policies and assumes they remain unchanged throughout the projection period, as well as six side cases incorporating different assumptions that reflect market, technology, resource, and policy uncertainties affecting energy markets.**  The Outlook indicates that strong domestic production of shale, tight oil, and natural gas, paired with relatively flat energy demand, allows the U.S. to become a net energy exporter over the projection period of the Reference Case and four of six side cases.  In the Reference Case, the U.S. becomes a net energy exporter in 2022.

The U.S. has been a net energy importer since 1953.  Historically and in EIA’s projections, most U.S. energy trade is in crude oil and petroleum products.  In the Reference Case, U.S. imports of crude oil and petroleum imports will decline (although the U.S. will remain a net importer of crude oil and petroleum) and exports of liquefied natural gas will grow.

Other key findings with respect to the Reference Case include:

  • Increases in energy efficiency temper growth in energy demand throughout the projection period.
  • Almost all new electricity generation capacity is fueled by natural gas and non-hydroelectric renewables after 2022.  Natural gas consumption is projected to grow the most on an absolute basis, while renewables consumption is projected to grow the most on a percentage basis.
  • Production of shale gas resources, as well as crude oil and petroleum products, is projected to increase through most of the Reference Case projection period, but will start to decline toward the end of the projection period as less productive areas are developed.

EIA has published an article on the report’s release, and has also made available a webcast of the release event.

* The Reference Case does not include implementation of the Clean Power Plan, though it does consider how a number of current state and regional policies—including the Illinois Future Energy Jobs Act, the New York Clean Energy Standard, the Maryland Clean Energy Jobs Act, and the Regional Greenhouse Gas Initiative—affect the projected electric generation mix.

** The side cases include a High Oil Price Case and Low Oil Price Case, a High Economic Growth Case and Low Economic Growth Case, as well as a High Oil and Gas Resource and Technology Case (assumes high resource availability and low cost of production) and a Low Oil and Gas Resource and Technology Case (assumes low resource availability and high production costs).

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