Testimony on Rhode Island Energy's 2024-2025 Last Resort Service Procurement Plan

Client: Conservation Law Foundation

Authors: Elizabeth A. Stanton, PhD

September 2024

On behalf of the Conservation Law Foundation, Principal Economist Elizabeth A. Stanton, PhD, submitted expert testimony before the State of Rhode Island Public Utilities Commission in response to the Narragansett Electric Company d/b/a Rhode Island Energy’s 2024-2025 Last Resort Service Procurement Plan. In her testimony, Dr. Stanton asserts that the methodology used to create the LRS Procurement Plan and rate design must be updated “to incorporate new policy goals and legislative directives to be considered by the Commission and Division and subsequently applied to Rhode Island Energy (‘RIE’).” To address these concerns, Dr. Stanton recommends the Commission initiate a process to evaluate competing interests and policies and reach a transparent decision to guide future LRS procurement and rate design.

Link to Testimony

Link to Rebuttal Testimony

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Affordable Housing and Energy Resilience in Lynn, Massachusetts: Community Land Trusts and Microgrids

Client: Neighbor to Neighbor

Authors: Deja Garraway, Lila McNamee, Sumera Patel, and Elizabeth A. Stanton, PhD

July 2024

On behalf of Neighbor to Neighbor, Researcher Deja Garraway, Research Assistant Lila McNamee, Assistant Researcher Sumera Patel, and Principal Economist Liz Stanton, PhD prepared a report discussing the potential benefits of community land trusts and community microgrids in the City of Lynn, Massachusetts. In particular, AEC finds that community land trusts and microgrids provide an opportunity to improve affordable housing outcomes for low-to-moderate income communities in the City of Lynn by, for example, supporting more permanent affordable housing, encouraging community empowerment and counteracting gentrification-induced displacement.

AEC offers four recommendations for Lynn communities to take ownership of their electric production, create long-term sustainable housing options, and provide homeownership opportunities for low- and moderate-income communities:

1. Promote awareness and knowledge of the community land trust and microgrid models,

2. Build capacity by providing funding to bring projects to scale,

3. Promote the development of affordable housing options with land acquisition, and

4. Foster long-term sustainability of community land trusts and microgrids.

Link to Report

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Assessing Alternatives to the Proposed Chesterfield Energy Reliability Center (CERC)

Client: Southern Environmental Law Center (SELC)

Authors: Chirag T. Lala, Elisabeth Seliga, Joshua R. Castigliego, Elizabeth A. Stanton, PhD

July 2024

On behalf of the Southern Environmental Law Center (SELC), Researcher Chirag T. Lala, Assistant Researcher Elisabeth Seliga, Senior Researcher Joshua R. Castigliego, and Executive Director and Principal Economist Liz Stanton, PhD prepared a report that critiques the Virginia Electric and Power Company’s (d/b/a Dominion Energy Virginia) proposed Chesterfield Energy Reliability Center (CERC)—a 1,000-megawatt gas-fired combustion turbine facility—in Chesterfield, Virginia. AEC presents an assessment of an Alternative Portfolio—composed of solar, wind, and storage resources—that would provide the same energy and capacity needs as CERC, but at a lower cost. AEC finds that the midpoint of the range of likely levelized costs of the Alternative Portfolio is 52 percent less expensive than that of Dominion Energy Virginia’s proposed CERC: $263 million versus $544 million. The combination of solar, wind and storage meets CERC on peak capacity, beats CERC on annual generation, and would cost ratepayers just half of what Dominion Energy Virginia wants to spend on CERC. Notably, the Alternative Portfolio presented in this report includes neither energy efficiency nor demand response, both of which have the potential to lower costs still further. Investments in energy efficiency alone—made at levels similar to the annual investments common in numerous other states—could obviate the need for CERC by 2030 or sooner.

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Illinois Adult Use Cannabis Industry Disparity Study

Client: Illinois Cannabis Regulation Oversight Office

Authors: Elizabeth A. Stanton, PhD, Bryndis Woods, PhD, Tanya Stasio, PhD, Jordan Burt, Deja Garraway, Nayantara Biswas, and Alannah Shute

July 2024

On behalf of the Illinois Cannabis Regulation Oversight Office, AEC assisted the Nerevu Group, LLC in preparing a disparity study to evaluate and assess existing discrimination within the State of Illinois cannabis industry. In particular, AEC staff reviewed public and private data sources to provide utilization, availability, and disparity analyses for the Illinois economy and the Illinois cannabis industry. AEC finds evidence of significant disparities in Illinois business ownership and wages across race/ethnicity and gender. Specifically, AEC finds that, compared to White men, racial and/or ethnic minorities and women are less likely to be business owners and have less access to capital through either hourly wages or bank loans.

To cultivate a more inclusive and equitable industry, Nerevu Group, LLC recommends broadening availability of financing for cannabis businesses, improved data management, consolidating of the Illinois regulatory structure, additional disparity studies, and more industry-state collaboration along with a set of administrative recommendations.

Link to Report

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Comparing Electric Supply Rates in Massachusetts

Client: Green Energy Consumers Alliance (GECA)

Authors: Joshua R. Castigliego and Elisabeth Seliga

June 2024

On behalf of the Green Energy Consumers Alliance (GECA), Senior Researcher Joshua R. Castigliego and Assistant Researcher Elisabeth Seliga prepared a policy brief that presents a cost comparison of electric supply options offered to residential customers served by investor-owned utilities in Massachusetts. AEC’s analysis finds that residential customers are paying a premium for electric supply provided by Third-Party Competitive Suppliers compared to electricity provided by electric distribution companies and Municipal Aggregation programs. AEC also finds that previous estimates of cost premiums associated with Competitive Suppliers have underestimated the extent to which they raised average residential electric rates by not considering the cost savings associated with Municipal Aggregation programs, which often offer rates lower than both Competitive Supply and Utility Basic Service.

Link to Policy Brief

Link to Appendix

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Testimony on Duke's Roxboro Certificate of Public Convenience and Necessity Request

Client: Southern Alliance for Clean Energy, Sierra Club, and Natural Resources Defense Council

Author: Elizabeth A. Stanton, PhD

June 2024

On behalf of the Southern Alliance for Clean Energy, Sierra Club, and Natural Resources Defense Council, Executive Director and Principal Economist, Elizabeth A. Stanton, PhD provided expert testimony before the North Carolina Utilities Commission in response to Duke Energy's petition to construct a 1,360 MW gas-fired combined-cycle electric generating facility in North Carolina. In her testimony, Dr. Stanton identified five concerns with the assumptions uses and information presented to justify the new facility:

Selective treatment of temporary technical challenges as extended barriers
Overestimation of the costs of renewables and storage
Underestimation of risks as costs to ratepayers
Noncompliance with the federal Clean Air Act
Exposure of ratepayers to costs from delayed plant construction

To address these concerns, Dr. Stanton makes several recommendations regarding the Commission’s determination of Duke’s certificate of public convenience and necessity request.

Link to Testimony

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Home Heating in Massachusetts: What Influences Future Costs?

Client: Home Energy Efficiency Team (HEET)

Author: Tanya Stasio, PhD, Joshua R. Castigliego, Sumera Patel, and Elizabeth A. Stanton, PhD

March 2024

On behalf of the Home Energy Efficiency Team (HEET), Researchers Tanya Stasio and Joshua R. Castigliego, Assistant Researcher Sumera Patel, and Senior Economist Elizabeth A. Stanton prepared a white paper that estimates the average home heating costs faced by Massachusetts households using different heating technologies.

This March 2024 AEC white paper updates the home heating cost analysis conducted in AEC’s January 2021 white paper; both analyses present operating costs only, excluding the costs of purchasing or maintaining heating equipment. Updated analysis, based on the most recent data and cost projections, finds that heating with networked geothermal and ground-source heat pumps is less expensive than heating with gas-fired furnaces today and can be expected to remain so through 2050. Our findings regarding air-source heat pumps, however, point to more questions than answers: Changes in gas and electric prices over the past few years reversed our earlier findings, suggesting that notoriously uncertain forecasts of future fuel prices are of paramount importance in understanding the likely impacts of ASHP adoption on household finances.

Link to White Paper

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Testimony on National Grid’s 2023 Rate Case in Massachusetts

Client: Environmental Defense Fund (EDF) and Conservation Law Foundation (CLF)

Author: Joshua R. Castigliego

March 2024

On behalf of the Environmental Defense Fund (EDF) and Conservation Law Foundation (CLF), Researcher Joshua R. Castigliego provided expert testimony before the Massachusetts’ Department of Public Utilities (DPU) in response to National Grid’s petition to increase its base distribution rates and approve its proposed performance-based ratemaking (PBR) plan, referred to as its Comprehensive Performance and Investment Plan (CPIP). In his testimony, Mr. Castigliego specifically focused on the Company’s Infrastructure, Safety, Reliability, and Electrification (ISRE) Mechanism and performance incentive mechanisms (PIMs, including investment-based “IPIMs” and operating-based PIMs) included in its proposed CPIP. He also addressed National Grid’s proposed electrification pricing option and low-income discount rate proposal.

Based on these assessments, Mr. Castigliego found that the Company’s proposals on these topics were insufficient and should either be rejected or strengthened by DPU to better protect ratepayers and address the affordability challenges facing the National Grid’s customers. Mr. Castigliego also offered recommendations on these topics to better align National Grid’s proposals with the Commonwealth’s climate and clean energy goals and support a more equitable distribution of benefits resulting from the Company’s investments and programs

Link to Testimony

Link to Surrebuttal Testimony

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TVA’s Kingston Fossil Plant: An Economic Assessment of Replacement Alternatives

Client: Southern Environmental Law Center (SELC)

Author: Chirag T. Lala, Joshua R. Castigliego, Tyler Comings, Elisabeth Seliga

March 2024

On behalf of the Southern Environmental Law Center, Researchers Chirag T. Lala and Joshua R. Castigliego, Senior Economist Tyler Comings, and Assistant Researcher Elisabeth Seliga prepared a report that models the costs to consumers of alternatives for the soon-to-be retired Kingston Fossil Plant—a coal-fired power plant in Harriman, Tennessee that is owned and operated by the Tennessee Valley Authority (TVA). TVA’s Alternative A plan replaces Kingston with a gas-heavy portfolio that constructs gas combined cycle (CC) and combustion turbine (CT) plants, while Alternative B focuses on replacing Kingston with a clean energy portfolio that relies on solar and battery storage resources.

Among its four modeled alternatives, AEC finds the net present value costs of Alternative B—renewable and storage replacements that are self-built or procured through power purchase agreements—to be the lower cost option. This contradicts TVA’s claim that Alternative A is the lower cost option. In addition, it is not clear why TVA selected the amounts of solar and storage capacity in Alternative B. The storage capacity is exorbitant compared to the size of the Kingston plant and the solar capacity is made additional to a large amount of capacity TVA is already scheduled to build.

These irregularities are partly attributable to TVA’s failure to synchronize site specific resources assessments with an integrated planning process that provides a full range of plausible alternatives. AEC provides the following recommendations for TVA’s 2024 IRP:

Conduct an all-resource RFP that assesses the range of resources that could reasonably be constructed.
Consider the full set of resources that could facilitate decarbonization of TVA’s grid, including transmission and distribution, distributed energy resources, energy efficiency, demand response, and others.
Conduct optimization modelling on all potential resources instead of on pre-selected portfolios.
Ensure site-specific planning does not contradict TVA’s most recent IRP.
Ensure the IRP provides plausible schedules for the installation and decommissioning of capacity.
Use transparent assumptions and modeling inputs

Link to Report

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Equity and Environmental Justice Guidance and Recommendations

Client: the Nature Conservancy

Author: Bryndis Woods, PhD

March 2024

On behalf of the Nature Conservancy (TNC), AEC Principal Analyst Bryndis Woods, PhD provided equity and environmental justice guidance and support to TNC Northeast (and New York) Division’s government relations staff. As part of this work, AEC provided an equity and environmental justice organization library and a Diversity, Equity, Inclusion, and Justice (DEIJ) library that includes DEIJ Action Plans, Implementation Guides, Strategy Frameworks, and other related equity, environmental and social justice materials. Informed by the results of AEC’s engagement with TNC staff, Dr. Woods made nine recommendations to guide TNC staff to center and prioritize equity and justice in their work.

Link to Presentation

Link to Guidance

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Comments on Ameren 2023 Integrated Resource Plan

Client: Ameren 2023 Integrated Resource Plan

Author: Tyler Comings, Joshua R. Castigliego

March 2024

Senior Economist Tyler Comings and Researcher Joshua Castigliego co-wrote comments with Sierra Club on Ameren Missouri's 2023 Integrated Resource Plan (IRP) filed at the Missouri Public Service Commission. The comments focused on flaws in the IRP including the lack of a thorough evaluation of the coal units' futures, the understatement of new gas replacement costs and overstatement of clean energy costs.

Link to Comments

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Comments on Avoided Emissions from Energy Recovery in EPA’s Waste Reduction Model (WARM) v16

Author: Joshua R. Castigliego

February 2024

On behalf of the Energy Justice Network, Researcher Joshua R. Castigliego provided expert comments in Docket No. EPA-HQ-OLEM-2023-0451 on the U.S. Environmental Protection Agency’s (EPA) Waste Reduction Model (WARM) Version 16 and its supporting documentation. In his comments, Mr. Castigliego reviewed and critiqued WARM’s methodology and assumptions regarding avoided emissions from the displacement of grid electricity through energy recovery at waste incineration facilities. Mr. Castigliego determined that WARM’s current methodology and assumptions are flawed and include errors that together appear to result in an overestimation of net emission reductions from waste incineration facilities.

His assessment highlights that WARM’s assumptions contain a critical error due to its failure to consider the sales of renewable energy credits (RECs), particularly as they relate to state renewable portfolio standards (RPS), in its estimation of emissions displaced by electric generation from waste incinerators. In addition, Mr. Castigliego identified additional critiques of WARM’s current methodology for estimating electric sector emission factors: (1) WARM’s emission factors for the electric sector are too simplistic and a poor proxy for marginal emissions; (2) avoided electric emissions are best estimated using the displacement of the marginal resource; (3) wind regularly serves as the marginal resource in some regions, meaning that emitting resources are not the only ones displaced; and (4) WARM’s regions do not align with the regions that correspond to electric sector operations and dispatch decisions.

Mr. Castigliego concludes that a majority of the flaws in WARM’s grid displacement assumptions center around the misalignment with how these emissions are addressed within the electric sector. To improve the accuracy of estimating avoided emissions from energy recovery in the waste management sector, EPA must better approximate what resources are most likely to be displaced by waste incinerators based on the characteristics of these facilities compared to other resources on the grid.

Link to Comments

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AEC’s Emissions Measurement Inventory Tool (AEC-EMIT)

Author: Joshua R. Castigliego

December 2023

To support AEC’s emissions accounting work, Researcher Joshua R. Castigliego developed a spreadsheet-based tool—AEC's Emissions Measurement Inventory Tool (AEC-EMIT)—that provides users with an interface to build a greenhouse gas emissions inventory (and 20-year emissions projections) for a specific geographic region. Users can customize the tool by selecting greenhouse gases, sectors, subsectors, scenarios, sensitivities, and other information specific to their inventory. Users are also provided a dashboard to toggle select assumptions and parameters (e.g., global warming potentials, scenarios, and sensitivities, etc.). Summary tabs aggregate results across sectors and can be used to provide disaggregated sub-sector-specific results.

AEC-EMIT was utilized for AEC’s analysis on Puerto Rico’s 2019 and 2021 Greenhouse Gas Inventories Report.

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Space Heating with Heat Pumps: The Need for Alternative Rate Designs in Massachusetts

Client: Green Energy Consumers Alliance (GECA)

Author: Joshua R. Castigliego, Elisabeth Seliga, Elizabeth A. Stanton, PhD

December 2023

On behalf of the Green Energy Consumers Alliance (GECA), Researcher Joshua R. Castigliego, Assistant Researcher Elisabeth Seliga, and Senior Economist Elizabeth A. Stanton prepared a white paper that presents a preliminary assessment of costs to customers heating with air-source heat pumps, and discusses the need for alternative electric rate designs to make heating electrification cost effective in Massachusetts. An “operating cost gap” is a measure that can be used to determine whether switching from one heating system to another would be a cost-effective choice for a given household. The “cost gap” is the difference between current and expected future operating costs and can be used to compare different heating systems. A household looking to electrify its heating system by switching from a gas-fired furnace to electric heat pumps will include this operating cost gap in its decision-making. AEC’s analysis finds that an average-sized Massachusetts home heating with air-source-heat pumps (ASHPs) versus gas-fired heating results in an operating cost gap, under current gas and electric rate schedules, between $166 and $605 over the 6-month heating season between November and April.

Alternative rate designs have the potential to close the operating cost gap between heating technologies, which would make ASHPs a cost-effective heating option relative to fossil-fuel heating systems like gas-fired furnaces. By exploring and implementing alternative rate designs, Massachusetts would be able to make ASHPs more attractive to consumers, which would stimulate the widespread adoption of electric heat pumps and support its decarbonization efforts in the buildings sector.

AEC's Heating Electrification Assessment Tool (AEC-HEAT) was utilized in this analysis to estimate the heating component of a residential customer's energy usage

Link to White Paper

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AEC's Heating Electrification Assessment Tool (AEC-HEAT)

Client: Green Energy Consumers Alliance (GECA)

Author: Joshua R. Castigliego, Elisabeth Seliga

December 2023

On behalf of the Green Energy Consumers Alliance (GECA), Researcher Joshua R. Castigliego and Assistant Researcher Elisabeth Seliga developed a spreadsheet-based tool—AEC's Heating Electrification Assessment Tool (AEC-HEAT)—that (1) compares heating costs for various resource types and (2) evaluates the impact of new space heating electrification on regional peak electric use during the winter heating season.

AEC-HEAT houses two Dashboard tabs (i.e., Heating Costs Dashboard and Load Profile Dashboard) to provide users with an interface to evaluate impacts associated with space heating electrification. Users can customize the tool by selecting parameters from drop-down menus or inputting their own data values. AEC-HEAT is currently equipped to perform assessments specific to Massachusetts but has the ability to evaluate other jurisdictions pending data availability. AEC-HEAT's User Guide and Methodology document provides an overview of the tool as well as the methodological approach, parameters, and data requirements.

AEC-HEAT was utilized in the analysis for AEC’s December 2023 white paper, Space Heating with Heat Pumps: The Need for Alternative Rate Designs in Massachusetts.

Link to AEC-HEAT [Excel Workbook]

Link to User Guide and Methodology

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Distributed Energy Storage: The Missing Piece in North Carolina's Decarbonization Efforts

Client: Clean Energy Group (CEG)

Author: Tanya Stasio, PhD, Elisabeth Seliga, Deja Garraway, Bryndis Woods, PhD, Elizabeth A. Stanton, PhD

December 2023

On behalf of the Clean Energy Group (CEG), Researcher Tanya Stasio, Assistant Researcher Elisabeth Seliga, Researcher Deja Torrence, Senior Researcher Bryndis Woods, and Senior Economist Elizabeth A. Stanton prepared a report that identifies distributed energy storage as the missing piece in North Carolina's decarbonization efforts. Distributed energy storage can provide load management to help meet peak electric demand and reduce the need for costly and polluting fossil fuel peaker plants. When paired with solar PV, distributed energy storage batteries can provide clean backup power to improve energy resilience while reducing home energy bills.

To support North Carolina’s decarbonization efforts and equity goals, this report makes three key policy recommendations for increasing incentives and lowering barriers to distributed energy storage deployment:

Approve and expand utility deployment of equitable distributed solar and distributed energy storage pilot programs.
Create statewide financial incentives for residential and community-based distributed solar and behind-the-meter battery installations.
Establish equity, climate, and energy performance-based metrics and targets for electric utilities.

Link to the Report

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Testimony on Kentucky Power 2023 Rate Case

Client: Mountain Association, Appalachian Citizens’ Law Center, Kentuckians for the Commonwealth, and Kentucky Solar Energy Society

Author: Tyler Comings

December 2023

AEC Senior Researcher Tyler Comings filed testimony before the Kentucky PSC on behalf of Joint Intervenors (Mountain Association, Appalachian Citizens’ Law Center, Kentuckians for the Commonwealth, and Kentucky Solar Energy Society). Mr. Comings recommended that the utility's return on equity (ROE) should not be increased because of several flaws in its estimate of the ROE; and that the utility had exaggerated its level of financial distress.

Link to Testimony

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Comments on Xcel Colorado's Electric Resource Plan

Client: Sierra Club

Author: Tyler Comings

December 2023

Senior Researcher Tyler Comings (along with Telos Energy and Strategen Consulting) assisted Sierra Club and NRDC in comments on Xcel Colorado's Electric Resource Plan. The comments argued for rejecting a proposed biomass project and instead adding more solar and battery resources than what Xcel included in its preferred plan. The comments also discussed the risks of Xcel's planned new gas procurement: in particular the utility's assumption that new gas units could become carbon-free, but not incorporating all of the costs required to achieve that status.

Link to Comments

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Testimony on DTE Electric Company 2023 Rate Case

Client: Michigan Environmental Council (MEC), Natural Resources Defense Council (NRDC), Sierra Club (SC), and Citizens Utility Board of Michigan

Author: Tyler Comings

December 2023

AEC Senior Researcher Tyler Comings filed testimony before the Michigan PSC on the DTE Electric Company (DTE) 2023 rate case on behalf of Michigan Environmental Council (MEC), Natural Resources Defense Council (NRDC), Sierra Club (SC), and Citizens Utility Board of Michigan. Mr. Comings recommended disallowance of capital investments that could be avoided if DTE followed through on its recent plan to retire Monroe units 3 and 4 in 2028.

Link to Testimony

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Economic Impacts of Offshore Wind in Connecticut

Client: Connecticut Roundtable on Climate and Jobs (CRCJ)

Author: Chirag T. Lala, Joshua R. Castigliego

October 2023

On behalf of the Connecticut Roundtable on Climate and Jobs (CRCJ), Researchers Chirag Lala and Joshua Castigliego prepared a policy brief that assesses the economic impacts associated with installing and operating 2,000 megawatts (MW) of offshore wind resources in Connecticut to meet the State’s 2030 target. The benefits of wind procurement need not flow to Connecticut’s economy if neighboring states undertake industrial development efforts and Connecticut does not. AEC’s analysis finds that a concerted policy effort to develop Connecticut’s offshore wind industry would allow the addition of these offshore wind resources to create a total of 39,880 in-state job-years (i.e., one job-year is the equivalent of one person working full-time for one year) between 2024 and 2049 as well as an estimated $5,529 million in state economic output and $4,190 million in labor income

Link to Policy Brief

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