Decarbonizing Building Heat in Massachusetts

Client: HEET

Authors: Tanya Stasio, Joshua Castigliego, Sagal Alisalad, and Liz Stanton, PhD.

March 2022

On behalf of the HEET, Researchers Tanya Stasio and Joshua Castigliego, Assistant Researcher Sagal Alisalad, and Director and Senior Economist Liz Stanton, PhD explored the feasibility of injecting green hydrogen and/or upgraded biogas (also known as “renewable” natural gas) into Massachusetts’ existing gas supply as a building decarbonization strategy. AEC compared these alternatives to gas heating and modern electric heat pumps in terms of price, feasibility, supply, and safety, and found that upgraded biogas and green hydrogen are infeasible, expensive, and unsafe strategies for decarbonization of building heating. Moreover, a green hydrogen/fossil gas blend is not feasible before 2040; For a green hydrogen/fossil gas blend to be a viable heating fuel, gas utilities would need to replace all of Massachusetts’ leaky-prone pipes.

AEC also estimated annual home heating costs for an average Massachusetts home using different heating options and found that by the mid-2030’s heating with air-source heat pumps, ground-source heat pumps, and/or networked geothermal systems will be more affordable than heating with fossil gas.

Link to White Paper

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Peabody Peaker Plant Risk Assessment

Client: Massachusetts Climate Action Network

Authors: Bryndis Woods, PhD, Chirag Lala, and Joshua Castigliego

March 2022

On behalf of the Massachusetts Climate Action Network (MCAN), AEC staff developed a policy brief that presents risks that Municipal Light Plants (MLPs) should consider as they decide whether to retain their ownership shares in the Peabody peaking power plant or withdraw from the contract: 1) market risks, like capacity and fuel prices, and 2) climate/environmental risks. We find that while ownership in the Peabody peaker protects against some capacity market risks, it leaves MLPs open to a variety of other important risks, including uncertainty in future gas fuel prices. existing Massachusetts emissions regulations and Environmental Justice (EJ) community protection laws, and the potential for stronger EJ laws, new federal legislation, and/or regulatory changes that put fossil fuel-fired assets at a disadvantage.

Link to Policy Brief

Link to MCAN Press Release

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Testimony on Off-Peak Charging Rebates in Massachusetts

Client: Green Energy Consumers Alliance

Authors: Liz Stanton, PhD and Joshua R. Castigliego

January 2022

On behalf of the Green Energy Consumers Alliance, Clinic Director and Senior Economist Liz Stanton, PhD and Researcher Joshua Castigliego provided Applied Economics Clinic expert testimony to Dockets 21-90 and 21-91 before the Massachusetts' Department of Public Utilities. In their testimony to Docket 21-91, Dr. Stanton and Mr. Castigliego reviewed and critiqued National Grid's methods and assumptions in setting a 3 to 5 cent per kilowatt-hour (kWh) rebate for its Off-Peak Charging Program. Dr. Stanton and Mr. Castigliego determined that National Grid is underestimating its rebate by excluding important benefits of off-peak charging such as avoided transmission and distribution costs, avoided emissions and emission costs, avoided reliability costs, avoided costs due to induced price effects, and non-energy benefits. Their analysis shows that including these benefits in a value for off-peak charging could raise National Grid's rebate by 10 cents per kWh from 3 to 5 cents per kWh to 13 to 15 cents per kWh. Similarly in Docket 21-90, Dr. Stanton and Mr. Castigliego examined a possible off-peak charging rebate for Eversource by modeling avoided energy and capacity costs based on National Grid’s methodology, and offering an illustrative methodology for inclusion of other off-peak charging benefits. In the absence of a rebate, EV owners are currently being overcharged for the energy used to charge their vehicles; implementing a rebate value that includes a complete set of benefits would eliminate a cross-subsidy from EV owners to non-EV owners while at the same time providing an incentive to adopt critical emission reductions in the transportation sector.

Link to Joint Testimony (DPU 21-90)

Link to Joint Testimony (DPU 21-91)

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Cambridge Net Zero Action Plan

Client: City of Cambridge

Authors: Bryndis Woods and Liz Stanton, PhD

December 2021

Together with DNV GL and Sorensen Partners, AEC led the City of Cambridge's stakeholder engagement process to provide equity input on the City's 2021 update to its 2015 Net Zero Action Plan.

The Net Zero Task Force held five public, remote meetings between November 2020 and June 2021.
AEC provided equity guidance and input throughout the process as the Task Force worked to propose and evaluate adjustments to the Net Zero Action Plan.

• Meeting 1, November 2020: 
  AEC presented on its Climate and Social Equity Framework and baseline equity considerations for the City of Cambridge.

• Meeting 2, December 2020: 
  AEC provided guidance regarding the potential co-benefits of Net Zero Actions, including equity co-benefits.

• Meeting 3, January 2021: 
  AEC answered stakeholders’ questions regarding equity.

• Meeting 4, April 2021: 
  AEC presented on the equity implications of the proposed Net Zero Action Plan adjustments, including equitable action design and implementation.

• Meeting 5, May 2021: 
  AEC presented on the “equity rating” assigned to each proposed Net Zero Action—equity ratings indicate whether each Action, as it currently stands, is likely to have equity impacts that are positive, neutral, or need to be addressed with additional action (“flagged”).

In January 2022, the City of Cambridge received City Council approval on its final Net Zero Action Plan.

Link to Final Cambridge Net Zero Action Plan

Equity Measurement and Targeting Underserved Communities in Massachusetts’ 2022-2024 Energy Efficiency Plan

Client: Green Justice Coalition

Authors: Bryndis Woods, PhD, Sagal Alisalad, Eliandro Tavares, Myisha Majumder, and Liz Stanton, PhD

December 2021

On behalf of the Green Justice Coalition, AEC staff developed three white papers on equity measurement and how underserved communities will be served in the implementation of Massachusetts’ 2022-2024 Energy Efficiency Plan. The first paper, Equity Measurement for Massachusetts’ 2022-2024 Energy Efficiency Plan, builds on the equity recommendations of the Energy Efficiency Advisory Council’s (EEAC) Equity Working Group (EWG) and the Green Justice Coalition by describing metrics needed to evaluate progress towards equity goals. The second paper, Energy Efficiency and Equity Efforts Nationwide, provides examples from other jurisdictions around the nation on the state of equity programming in energy efficiency policies. The third AEC white paper, Targeting Underserved Communities in Massachusetts’ 2022-2024 Energy Efficiency Plan, is a detailed review of Massachusetts towns identified as underserved by the energy efficiency program administrators and their partners.

Link to White Paper 1: Equity Measurement for Massachusetts’ 2022-2024 Energy Efficiency Plan

Link to White Paper 2: Energy Efficiency and Equity Efforts Nationwide

Link to White Paper 3: Targeting Underserved Communities in Massachusetts’ 2022-2024 Energy Efficiency Plan

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Equity Assessment of Electrification Incentives in the District of Columbia

Client: The Office of the People’s Counsel for the District of Columbia

Authors: Tanya Stasio, Bryndis Woods, PhD. Joshua R. Castigliego, Liz Stanton, PhD

December 2021

On behalf of the Office of the People’s Counsel for the District of Columbia, Researcher Tanya Stasio, Senior Researcher Bryndis Woods, PhD, Researcher Joshua Castigliego, and Senior Economist Liz Stanton, PhD examine a potential pathway for reducing emissions in the District of Columbia: equitable electrification–a transition away from fossil fuels while taking into consideration equity implications, in both existing and future decarbonization efforts.

A baseline equity analysis of the distribution of energy expenditures, median income and other vulnerability indicators reveals significant disparities across the District. To account for the existing disparities of income and access within the District and ensure beneficial electrification efforts are equitable, AEC identified the following priorities: (1)  Ensuring that community engagement influences DC Public Service Commission and District Government decision-making regarding beneficial electrification programs; (2) Prioritizing beneficial electrification investments in neighborhoods impacted by environmental injustice and addressing common decarbonization barriers, and; (3) Ensuring that beneficial electrification programs do not increase the energy burden for EJ and other vulnerable communities.

Link to Report

Media Coverage

Media Coverage

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Energy Storage for Winter Grid Reliability: How Batteries Became the Low-Cost Solution for Power Assurance in Massachusetts

Client: Clean Energy Group

Authors: Joshua R. Castigliego, Liz Stanton, PhD, Sagal Alisalad, and Eliandro Tavares

December 2021

On behalf of the Clean Energy Group, Researcher Joshua Castigliego, Senior Economist Liz Stanton, PhD, and Assistant Researchers Sagal Alisalad and Eliandro Tavares evaluated the value of winter reliability services and the opportunity to provide these services economically in New England using distributed battery storage. AEC finds that the value of winter peaking capacity services from distributed (customer-sited) resources is incorrectly assumed to be $0 in the battery program cost-benefit analyses that determine performance payments to battery storage owners.

The value of winter electric capacity is treated by electric distributors as distinct from that same value in summer, and it has been dubbed “winter reliability” to distinguish it from “summer capacity.” When calculating customer performance payments, summer capacity services are valued, but winter reliability services are not. In this report, AEC introduces a winter reliability metric defined as the assurance of adequate electric capacity during periods of critical need, called—following ISO-New England’s convention—capacity scarcity condition (CSC) events. AEC calculated a “winter reliability value” measured as the net dollar value to supply any given peak supply technology (i.e., gas peaker or large-scale battery storage) on a per kilowatt-hour (kWh) basis during a CSC period.

Link to Report

Link to Presentation

Media Coverage

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PJM's Capacity Market: Clearing Prices, Power Plants, and Environmental Justice

Authors: Joshua R. Castigliego, Liz Stanton, PhD, Sagal Alisalad, Tanya Stasio, Eliandro Tavares

October 2021 (Updated November 2021)

Researcher Joshua Castigliego, Senior Economist Liz Stanton, PhD, Assistant Researcher Sagal Alisalad, Researcher Tanya Stasio, and Assistant Researcher Eliandro Tavares prepared a report reviewing the economics of power plants in the PJM region, focusing on the "capacity payments" given to owners of generating units that promise to be available if needed to generate power at times of peak customer demand. AEC finds that PJM has consistently overestimated its peak demand and as a result spent too much money on capacity payments, and generating units—including many in or near Environmental Justice (EJ) communities—are kept online despite being uneconomic and unnecessary to provide reliable electric service.

AEC adjusted PJM’s forecasts and market design to better represent customer demand and other market conditions, and estimated the prices that individual generating units bid into the 2021/22 capacity auction, which took place in 2018. The actual bids by power plant owners are not made public, so we model them based on available cost and revenue data. PJM’s overestimate of customer demand and costs of new generating units raises market clearing prices and capacity payments to power plant owners, resulting in what we call a “fat market” with payments made to unnecessary power plants and higher costs to customers. In place of PJM’s $140 per megawatt-day (MW-day) fat market clearing price, we estimate a clearing price of $100 to $104 per MW-day to serve customer needs without adding unnecessary costs. Our leaner, adjusted clearing price would lower customer bills without sacrificing reliable electric service and put an end to capacity payments propping up the bottom lines of uneconomic power plants, many of them in or near EJ communities.

Link to Report (Updated 11/30/2021)

Link to Presentation for PJM Cities & Communities Coalition

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An Analysis of NHTSA's Preliminary Regulatory Impact Analysis of 2021 Proposed Rulemaking for Model Years 2024-2026 Light-Duty Vehicle CAFE Standards

Clients: Office of the California Attorney General and the California Air Resource Board

Authors: Liz Stanton, PhD, Gabriel Lewis, and Chirag Lala

October 2021

On behalf of the Office of the California Attorney General and the California Air Resource Board, this Applied Economics Clinic white paper examines the National Highway Traffic Safety Administration’s (NHTSA) Proposed Rulemaking for Model Years 2024-2026 Light-Duty Vehicle Corporate Average Fuel Economy Standards. The proposal would increase the stringency of Corporate Average Fuel Economy (CAFE) standards from their 2020 levels, setting the standards close to the path established in 2012. The NHTSA provides an estimate of the expected benefits in its 2021 Preliminary Regulatory Impact Analysis (PRIA), and it expects benefits in fuel savings, energy security, and drive value.Our analysis finds the estimated benefits to be a conservative estimate. Other benefits not included in the cost-benefit analysis would increase the net benefits and provide additional support for stricter fuel economy standards, if included in NHTSA’s comparison.

Link to White Paper

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Recommendations for Cities and States to Improve Equity Evaluation and Reporting in Energy Efficiency Programming

Client: American Council for an Energy-Efficient Economy (ACEEE)

Authors: Bryndis Woods, PhD, Liz Stanton, PhD, and Sagal Alisalad

October 2021

On behalf of the American Council for an Energy-Efficient Economy (ACEEE), this Applied Economics Clinic white paper recommends measures that cities and states can undertake to facilitate equitable energy efficiency evaluation and reporting of energy efficiency efforts, based on the results of our review of low-income energy efficiency efforts in ACEEE’s top-scoring cities and states in their 2020 City and State energy efficiency scorecards.

We find that the cities and states most highly-rated for energy efficiency offer programs for low-income community members, but fail to take critical actions necessary for equitable evaluation and reporting to facilitate equitable outcomes. Based on our review of these programs, we find that—while these programs have made important progress on addressing equity concerns by offering efficiency programming specifically to low-income households—more robust energy efficiency evaluation and reporting are needed to shine a light on city and state equity-focused energy efficiency programming and ensure that efficiency benefits are equitably distributed. We recommend three main improvements that would drastically enhance the ability to evaluate these programs for their equity-related impacts:

• Mandate disaggregated efficiency program performance reporting;
• Identify, track, and target vulnerable populations; and
• Integrate energy efficiency, climate, and equity planning and reporting.

Link to Report

Link to ACEEE's Leading with Equity Initiative White Paper

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Testimony on Xcel Colorado's Energy Resource Plan

Source: The Denver Post

Clients: Natural Resources Defense Council and Sierra Club

Author: Tyler Comings

October 2021

Senior Researcher Tyler Comings filed testimony on Xcel's Colorado's Energy Resource Plan (ERP), focusing on the utility's decisions for two of its coal units--Comanche unit 3 and Pawnee. Mr. Comings' testimony found that earlier retirement of Comanche unit 3 and earlier conversion of Pawnee were lower cost. He provided inputs to modeling performed by Dr. Maria Roumpani at Strategen Consulting which quantified more than $1 billion in savings (including carbon costs) from their alternative plan compared to Xcel's ERP.

Link to Answer Testimony

Link to Cross Answer Testimony

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ConnectedSolutions: A Program Assessment for Massachusetts

Client: Clean Energy Group

Authors: Bryndis Woods, PhD, Liz Stanton, PhD, Eliandro Tavares and Sagal Alisalad

September 2021

On behalf of the Clean Energy Group, this Applied Economics Clinic report assesses the design and performance of the Massachusetts ConnectedSolutions program. Massachusetts’ ConnectedSolutions program offers incentives to customers in exchange for allowing their electric supplier to draw on the energy stored in their grid-connected batteries and/or to curtail energy use via smart thermostats or electric vehicle charging at times of peak electric demand. Launched as a full program offering in 2019, ConnectedSolutions had about 34,000 customer participants with 310 megawatts (MW) of capacity enrolled by the end of 2020.

This report compares the Massachusetts ConnectedSolutions program, as it has been administered in the first three-year program cycle, with related programs in other states across the country. In several important areas, the Massachusetts program administrators could benefit from best practices implemented elsewhere; chief among these is the treatment of income-eligible customers and those in historically underserved communities.

Link to Report

Link to Webinar

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Testimony on the Enbridge Energy Limited Partnership Proposed Replacement and Relocation of Line 5

Clients: The Environmental Law & Policy Center, The Michigan Climate Action Network, and the Bay Mills Indian Community

Author: Liz Stanton, PhD

September 2021

On behalf of The Environmental Law & Policy Center, The Michigan Climate Action Network, and the Bay Mills Indian Community, Clinic Director and Senior Economist Liz Stanton, PhD filed testimony on the Enbridge Energy LP (Enbridge) application to replace and relocate a segment of an oil and natural gas pipeline (Line 5)that crosses the Straits of Mackinac into a tunnel underneath the Straits of Mackinac. Dr. Stanton found that Enbridge failed to consider a “no-action” alternative to replace the oil pipeline and that shutting down the existing line is not only feasible but would also likely have a positive impact on Michigan’s economy while accelerating the state’s transition to a zero-carbon economy.

Link to Testimony

Link to Michigan Radio coverage

Link to Bridge Michigan coverage

Link to News-Review coverage

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Comments on Evergy Missouri's Integrated Resource Plan

Source: Missouri Independent

Client: Sierra Club

Authors: Tyler Comings and Joshua Castigliego

September 2021

Senior Researcher Tyler Comings and Researcher Joshua Castigliego co-authored comments with Sierra Club on Evergy Missouri's Integrated Resource Plan (IRP). AEC found several deficiencies in the utility's plan including: 1) the lack of optimization modeling, 2) limited consideration of battery storage, 3) failure to model power purchase agreements (PPAs), and 4) failure to consider other coal retirement portfolios (among others).

Link to Comments

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An Analysis of EPA's Proposed Revised 2023 and Later Model Year Light-Duty Vehicle Greenhouse Gas Emissions Standards

Client: Office of the California Attorney General

Authors: Liz Stanton, PhD, Gabriel Lewis, and Chirag Lala

September 2021

On behalf of the Office of the California Attorney General, this Applied Economics Clinic white paper examines the Environmental Protection Agency’s  (EPA) Proposed Revised 2023 and Later Model Year Light-Duty Vehicle Greenhouse Gas Emissions Standards. The proposal would increase the stringency of the Safer Affordable Fuel-Efficient (SAFE) Vehicles rule from their 2020 levels, setting the emissions standards close to the path established in the 2012 National Program for controlling light-duty vehicle greenhouse gas emissions. The EPA provides an estimate of the expected benefits in its 2021 Draft Regulatory Impact Analysis (DRIA), highlighting the proposal’s energy security benefits. Our analysis finds the estimated benefits to be a conservative estimate. Other benefits not included in the cost-benefit analysis would increase the net benefits and provide additional support for stricter greenhouse gas emissions standards, if included in the EPA’s calculations. AEC also compared the 2021 DRIA with the Final Regulatory Impact Assessment (FRIA) of the implemented 2020 SAFE final rule, finding that the methodology of the 2021 DRIA is more reliable than that of the 2020 FRIA.

Link to White Paper

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Comments on Astoria Gas Turbine Power LLC's Proposed Gas-Fired Combustion Turbines

Client: New York Lawyers for the Public Interest and Earthjustice

Authors: Bryndis Woods, PhD and Liz Stanton, PhD

September 2021

On September 13, 2021, New York Lawyers for the Public Interest and Earthjustice—on behalf of the New York City Environmental Justice Alliance, THE POINT CDC, UPROSE, Chhaya CDC, and Clean Energy Group, together with Sierra Club—submitted comments to the New York State Department of Environmental Conservation (DEC) regarding the Draft Title V Air Permit and the Draft Supplemental Environmental Impact Statement for Astoria Gas Turbine Power LLC's proposed Astoria Replacement Project. The comments urged the DEC to deny the permit for the proposed Project because of its inconsistency with New York State climate and emission reduction goals set forth in the 2019 Climate Leadership and Community Protection Act (CLCPA).

AEC's comments address Astoria Gas Turbine Power LLC's incorrect claims that the proposed Project is CLCPA-consistent and that a hypothetical future conversion to hydrogen fuel is zero emissions or CLCPA-consistent. AEC's comments also outline the negative environmental justice and public health implications of hydrogen fuel use. We conclude that—with or without switching from gas fuel to hydrogen—the proposed Project is not consistent with the CLCPA.

Link to AEC Comments

Link to Joint Comments

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Estimating the Net Change in Carbon Dioxide Emissions for Solar Projects in Massachusetts

Client: Borrego

Authors: Joshua R. Castigliego, Chirag Lala, Eliandro Tavares, and Liz Stanton, PhD

September 2021

On behalf of Borrego, Researchers Joshua Castigliego and Chirag Lala, Assistant Researcher Eliandro Tavares, and Senior Economist Liz Stanton, PhD conducted analysis estimating the net change in carbon dioxide (CO2) emissions of Borrego’s proposed solar projects at three sites in Wareham, Massachusetts. AEC estimated net emission savings of the proposed projects as the sum of “positive” CO2 emissions savings from the electric grid due to renewable energy generation, and “negative” CO2 emissions due to land use conversion from forestland to grassland. AEC found that Borrego’s proposed projects offset four times more CO2 emissions than are emitted in their development.

Link to White Paper

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Assessment of Backup Diesel Generators in Massachusetts and New York City

Client: Bloom Energy

Authors: Joshua R. Castigliego, Tanya Stasio, Sagal Alisalad, Liz Stanton, PhD

August 2021

On behalf of Bloom Energy, Researchers Joshua Castigliego and Tanya Stasio, Assistant Researcher Sagal Alisalad, and Senior Economist Liz Stanton, PhD prepared two reports assessing backup diesel generators in Massachusetts and New York City. AEC compiled inventories of backup diesel generators in each jurisdiction based on publicly available data and reviewed the quantity, combined capacity, proximity to environmental justice (EJ) communities, and emissions impact of backup diesel generators.

AEC found that there is an abundance of backup diesel generators throughout both areas that are commonly sited near EJ communities and represent a considerable—and largely avoidable—source of air pollution and greenhouse gas emissions that threaten public health and the environment.

Link to Massachusetts Report

Link to New York City Report

Link to Download Shapefile for Massachusetts Environmental Justice Communities

Link to Download Shapefile for New York City Environmental Justice Communities

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Background Report: Benefits of Coal Ash Cleanup and Remediation

Client: Earthjustice

Authors: Joshua R. Castigliego, Tyler Comings, Sagal Alisalad, Liz Stanton, PhD

July 2021

On behalf of Earthjustice, Researcher Joshua Castigliego, Senior Researcher Tyler Comings, Assistant Researcher Sagal Alisalad, and Senior Economist Liz Stanton, PhD prepared a report outlining the benefits of coal ash cleanup and remediation at three power plants: Montana’s Colstrip Steam Electricity Station, South Carolina’s Grainger Generating Station, and Indiana’s Michigan City Generating Station.

AEC staff found that the more complete and more effective cleanup scenarios with full excavation of coal ash in contact with groundwater and contaminated soils results in more than double the jobs compared to the less effective cleanup plans. In all three case studies, workers’ income and local economic activity follow this same pattern with more stringent clean up protocols resulting in greater benefits for both workers and the community.

Following release of this report, on August 6, 2021, Michigan City Council passed a unanimous resolution supporting the more stringent coal ash cleanup option. Read the resolution below.

Link to Report

Link to Earthjustice Publication

Link to Press Release

Link to Resolution

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“Measuring Climate Equity" at LIEN Annual Conference 2021

Event:
“Measuring Climate Equity" at the Low-Income Energy Network (LIEN) Annual Conference 2021

Speaker:
Sagal Alisalad

July 2021

AEC Assistant Researcher, Sagal Alisalad presented on “Measuring Climate Equity" at the Low-Income Energy Network (LIEN) Annual Conference 2021. Ms. Alisalad gave a primer on climate equity, described AEC’S climate and social equity framework, and introduced four types of metrics for climate equity: Outcome Metrics, Distributional Dimensions, Process Metrics, and Structural Metrics. This year’s LIEN conference focuses on Energy Equity: Using Energy Efficiency to Fight Energy Poverty in Canada.

Link to Presentation Slides

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