Recent Projects

We recently submitted comments to California’s Public Utilities Commission, focused on the economic analysis used in its longer-term energy planning process across utilities. We ask the Commission to exercise caution in coordinating or consolidating this planning with other energy-related proceedings, as different proceedings have different goals and statutory requirements.

California’s state government is moving forward on electricity and climate policy, likely setting a blueprint for future state and federal action. We submitted comments to the California Public Utilities Commission (CPUC) on factual disputes flagged by stakeholders, related to how utilities will use cost-benefit analysis in decisionmaking. We encouraged staff at CPUC to use the Social Cost of Carbon for its interim greenhouse gas adder, use a 3% discount rate for future damages, include other environmental externalities like air pollution in its analysis, and continue considering societal costs to ensure that the benefits justify the costs of a proposed policy.

We recently submitted comments to the California Public Utilities Commission on their proposal for an interim greenhouse gas adder. The proposal was for an adder that starts at $0 in 2017 and increases linearly to $250 in 2030. We support the use of a greenhouse gas adder. However, our comments suggest that the Commission instead use an adder based on the Interagency Working Group’s Social Cost of Carbon (“SCC”).

We recently submitted a second set of comments to the California Air Resources Board on its 2017 Climate Change Scoping Plan Update. These comments build on those we submitted in December to ARB on the discussion draft of the scoping plan.

The California Public Utilities Commission proposed using a Societal Cost Test to help select the combination of distributed energy resource projects that will result in the greatest net benefits to society. We counter the feedback that some stakeholders gave on implementing this approach in our reply comments. We argue that the Commission should: (1) expand its discussion of the legal basis for applying a societal cost test that includes a full range of externalities; (2) use the damage cost approach to determine the value of greenhouse gas abatement, rather than the proposed abatement cost approach; and (3) apply a societal discount rate to the analysis.

We recently submitted comments to the California Public Utilities Commission (CPUC) on their proposal to develop a more robust societal cost test to evaluate the cost-effectiveness of distributed energy resources (DERs). California has been a national leader in addressing the challenges associated with DER integration, and this proceeding will help the state to reform their cost-effectiveness framework.

The Massachusetts Department of Environmental Protection (“MassDEP”) has proposed a set of regulations to limit the greenhouse gas emissions from electric power plants, natural gas pipelines, government-owned transportation equipment, and utility-owned switchgear equipment. MassDEP has also proposed a new requirement that retail sellers of electricity purchase gradually increasing amounts of clean energy, along with non-binding targets for greenhouse gas emissions from the transportation sector.

In our comments to MassDEP, we offer three suggestions to ensure these regulations cut global greenhouse gas emissions in a cost-effective way. First, we encourage MassDEP to prevent potential emissions leakage to other states in the Northeast’s Regional Greenhouse Gas Initiative (“RGGI”) program. Second, we recommend the regulations should be technology-neutral and use a flexible compliance system. Third, we recommend enforceable emissions limits on the transportation sector rather than non-binding targets, especially considering that the state’s emissions from transportation sector are almost twice those of the electric sector.

In November 2016, the Federal Energy Regulatory Commission (FERC) announced its intent to ease the process for energy storage and distributed energy resources to participate in wholesale electricity markets. The proposed rule would require regional transmission organizations (RTOs) and independent system operators (ISOs) to revise their tariffs to energy providers in order to promote technology neutrality. In comments on the rule, we recommend that in addition to adjusting these tariffs, FERC should take more steps to fully realize the benefits that these technologies could provide for wholesale markets. We recommend that the Commission explicitly clarify the benefits for which it compensates these technologies; allow states to compensate for distribution-side benefits; eliminate location-based constraints on resource participation while recognizing the importance of location in optimally dispatching these services; encourage coordination between RTOs/ISOs and state regulators; and promote advanced metering technology to increase efficiency in how energy is dispatched.

The EPA’s Carbon Pollution Standards for New Power Plants limit carbon dioxide emissions from new, modified, and reconstructed plants. A group of state attorneys general and energy companies have filed suit challenging the standards on several grounds. Policy Integrity submitted an amicus brief in support of EPA.

This summer, California extended its greenhouse gas emissions reduction program to 2030 with two companion bills. The legislation modifies how the Air Resources Board (ARB), the state agency responsible for regulating air pollution, should assess proposed policy measures and prioritize goals in designing regulations. ARB staff released a preliminary draft of the scoping plan for how to meet the new 2030 targets in early December and is expected to release a second draft for comment in mid-January. We submitted comments on the December draft, making recommendations on how to structure the scoping plan’s economic analysis to best achieve the goals laid out in ARB’s new mandate.