Spitzer Promotes Clean Energy, Minus Ethanol

Early last year, then NY Governor Pataki (R) who had presidential ambitions at the time, touted ethanol as part of his sustainable energy plan for NY State. Since then much of the world has seen as corn ethanol has major sustainability problems of its own. That's not to say that biofuels or even some types of ethanol might not play a role, but it just shouldn't be the centerpiece of a sustainable energy plan.

And it seems that NY's new Governor Spitzer (D), an openly peak oil aware governor has figured this out too. See a PDF of Spitzer's full speech here.

From this NY Sun in the build-up before Thursday's speech:

When Governor Spitzer today unveils the details of his clean-energy initiative, he will announce multimillion-dollar state investments in wind and solar power, plans for a new fleet of power plants that emit less carbon dioxide, and a variety of conservation goals.

Absent from the first major energy speech of his administration will be any discussion of ethanol, a notable policy departure from his predecessor, Governor Pataki, who touted the alternative fuel as the wave of a greener future and aggressively tried to encourage its production and use.

"He's not talking about ethanol at all tomorrow," Mr. Spitzer's top environmental adviser, Judith Enck, said in an interview yesterday. "So that should speak volumes."

New York's shift in energy policy is the latest in a series of setbacks for ethanol, which some have hailed as a cleaner alternative to gasoline that could help free America from its dependence on foreign oil.

The Spitzer administration is turning away from corn ethanol at a time when evidence is building that calls into question the wisdom of state policies and subsidies in support of ethanol.

"The governor is not closing the door on corn ethanol," Ms. Enck said. "We're just not enthusiastically boosting it as the previous administration has. We have concerns that corn ethanol is not as energy efficient as other sources, and there are also air quality concerns."

Glad to see that reason is driving policy instead of crass politics. So what's his alternative plan? More Conservation and Renewables. Here's the Coverage from NY1

Just in time for Earth Day, Governor Eliot Spitzer shared a new plan for conserving energy today.

Dubbing the plan "15 by 15," the governor proposed reducing the state's demand for power by 15 percent by the year 2015. The governor's plan focuses on efficiency, conservation, and investment in renewable energy sources.

"The result will be lower energy bills, a cleaner environment that addresses climate change and thousands of new jobs fueled by a new industry born from clean energy," said Spitzer.

Part of the plan includes building cleaner, more efficient power plants, which the governor says could eventually lead to the closure of the controversial nuclear power plant at Indian Point.

IN one of my favorite parts of his speech, Spitzer rejects skepticism from the highest levels of the current Federal Administration on the power of conservation efforts:

I will admit that the Vice President’s skepticism about the benefits of efficiency may have made sense in 1970, when most people believed energy efficiency meant nothing more than wearing more sweaters in the winter.

But technology has marched on and, in the intervening years, the marginal cost of energy efficiency has plummeted while the marginal cost of energy generation has shot up.

In terms of dollars and cents, it now costs one-third as much to save a given amount of energy through efficiency programs as it does to produce the same amount of energy by building a new power plant. The fact is that energy efficiency now makes economic sense.

This is the logic that the Vice President misses – the simple idea that the cheapest and cleanest power plant in the world is the one you never have to build.

Take that Cheney!

Moving on, another part of the plan is providing greater incentives for utilities to encourage or at least not oppose conservation efforts:

Revenue Decoupling
First, we must eliminate a perverse incentive in the marketplace that discourages utilities from conserving energy. The problem is that we want utilities to encourage their customers to conserve – but right now, when their customers conserve energy, the utility loses money. Obviously, this incentive structure is upside down if our goal is to increase energy efficiency.

Other states have done this. It works. Now, let’s implement it.

He also is making a relatively large investment in renewable sources of power that will come online in 2008:

NYSERDA and the PSC will announce the approval of 21 contract awards for clean, renewable power plants in New York. These contract awards total approximately $295 million and will attract private investment of approximately $1.4 billion – all of it Upstate. Best of all, in terms of immediate returns on economic development and energy bills, construction of all these facilities is expected to be completed as soon as 2008.

And in the end, he ties all of this to not just rising prices for power or environmental concerns, but that the real output of all these efforts will be more JOBS, especially in the economically depressed Upstate regions:

Think of all the high-paying jobs that will be needed to retrofit power plants, homes and office buildings so they can be more efficient; the jobs that will be needed to develop innovative efficiency and clean energy technologies; or the jobs that will be needed to manufacture the products at the scale that will be necessary to reach our goals.

Not to mention that lower energy bills will allow New York’s businesses to spend less on energy and more on innovation – helping us both to retain the jobs we’ve got and attract new ones.

Experience confirms this. NYSERDA has determined that current efficiency programs create or retain an average of 1.5 jobs per year per gigawatt-hour saved. These figures correlate with findings in other states. Given that our 15 by 15 initiative will save 27,300 gigawatt-hours by 2015, NYSERDA estimates that our strategy could create or retain 41,000 jobs in New York State. To give you a sense of the potential impact, that’s about the same number of unemployed people in Buffalo and Rochester combined.

It's a simple equation that's worth repeating:

Conservation + More Renewables = JOBS

That's a great formula for practical politicians that want to tackle global warming, peak oil and economic development together.

Stay tuned for Mayor Bloomberg's sustainability speech planned for Earth Day. I hope to hear a similar formula.

Still a big push from the current admin. ..........

April 12, 2007

Testimony of Alexander Karsner
Assistant Secretary for Energy Efficiency and Renewable Energy, Before the Committee on Energy and Natural Resources, United States Senate


Great post.

Spitzer isn't talking ethanol because a lot of Pataki's policies were implemented and Spitzer can try other things. I followed the link where you talk about Pataki's plans and it says, "Gov. George E. Pataki wants to ... make ethanol and biodiesel, two controversial alternative fuels, available in the 27 service areas on the New York State Thruway and in 100 more stations throughout the state as early as this year, in a first small step toward reducing the state's petroleum consumption. The governor is also proposing incentives to bring refineries that produce ethanol into the state."

How did he do?

There are now 5 corn ethanol plants under construction in New York State and one cellulose-based plant. In total these plants will produce almost 500 million gallons a year. There are also around 100 million gallons of biodiesel production in the state.

He gets an A+ for refinery incentives.

He didn't do as well with the stations but there are 8 e85 gas stations and 8 biodiesel stations in the state.

Some of the other things that happened under his watch include the Port of Albany building capacity to move and store biofuels. Trains, trucking fleets all adjusted to move and use it. The research universities in the state including the Forestry Program at Syracuse developed research programs around cellulose ethanol with state funding. The corn farmers are finally getting paid real money for their crop and the air is cleaner. Lastly, Pataki successfully facilitated the transition from MTBE to ethanol in gasoline; no more MTBE in our water.

Pataki did a good job really. I hope Spitzer can continue the momentum.

Lastly, Pataki successfully facilitated the transition from MTBE to ethanol in gasoline

If I understand the arguments correctly, oxygenates are no longer needed to meet emissions standards with modern vehicles.  There is no need to substitute ethanol for MTBE when the MTBE could simply be removed.

I'm not saying that Pataki didn't do quite a bit on ethanol, but that he perhaps placed too much priority on it to the exclusion of other new renewable and conservation efforts.

Spitzer's environmental adviser clearly indicated that Spitzer is not talking about ethanol because he does not think it makes sense to push forward this particular fuel. To say that he is not talking about it because Pataki's policies were implemented ignores the fact that his failure to mention ethanol speaks volumes. Virtually every politician these days pushes ethanol as a cornerstore of their renewable energy policies. But not Spitzer. Spitzer is not mentioning it because he clearly doesn't feel is should be a significant part of his strategy.

Your spin on this is wishful thinking on your part.

Good round-up K.

I tend to agree with you for the simple reason that individual states are typically limited by the feedstock resource that they possess.

1st gen biofuel production is the low-fruit, the easiest milestone to reach but difficult to expand much further in a state that doesn't produce the required feedstock - Rendell in PA faces a similar dilemma.

That said, the one feedstock that is in abundance in NY is MSW and MSW as you know, can be converted thermo-chemically to liquid fuels like ethanol.

This 3rd gen biofuel process has great potential for both NY and PA but is of course still in the demonstration phase.

Translation: a lengthy and perhaps expensive endeavor that may or may not produce the all important, in term photo-op.

MSW? WTF? Google is your friend: Municipal solid waste!

No plans for mass transit or nuclear? In fact it looks like he wants to close a nuclear plant which doesn't sound like something a peak-aware governor would do.

This speech was focused on electricity production and conservation so transportation would be off topic here. I expect good things from him and Bloomberg coming up on Transportation, including congestion pricing and increased support for mass transit.

And yes, he made a campaign promise on closing Indian Point if they can fill the gap in energy production from renewables and/or conservation so that was expected. I was more surprised that he did not mention Liquified Natural Gas once.

The caveat gives Spitzer a way to say that nuclear power is essential.  It is vanishingly unlikely for conservation or imports to stay ahead of declining domestic gas supplies, so he's at least got a necessity defense prepared ahead of time (good lawyer).

One can be peak-aware and yet still be against nuclear. I certainly am. There are other approaches that can work today that I have tirelessly pointed out on this forum. Efficiency, strengthened grid, offhsore renewables etc. etc. No need to go over them here.

Conservation + More Renewables = JOBS

Well, as a friend who was an economics grad students used to say when I was in college, and the President of the day would spout about JOBS, "Here's my JOBS program: all farm machinery shall be outlawed. It will be very dangerous and miserable to start doing all that back-breaking and hazardous work with animals and by hand again, but it will make lots and lots and lots of JOBS. Any takers?"

Of course not. So when an ambitious, grandstanding politician - and Spitzer is second to no one on Earth in that respect - spouts off about JOBS, it's time for anyone who wants people to be able to live decent lives (which BTW leaves out each and every person who promotes the fatuous notion that going backwards to earlier times would be a great idea) to run hard in the opposite direction.

Despite the fact that everyone needs one, JOBS are mainly a COST of living, NOT a benefit. Which is why there were no takers for my friend's JOBS program.

Now there are real issues. One is the distribution of jobs and the existence of plenty of jobs that pay miserably simply because no one would care much if they went undone. Another is a sometimes fierce refusal to get the education or training needed to make it worth anyone else's while to pay oneself anything. People in old de-industrializing regions like the Mohawk Valley or Detroit, whose parents got a marvelous but unsustainable free ride in the transitory frenzy of unskilled manufacturing activity that followed World War II, tend to be especially self-delusional about this matter.

But quantity is not an issue. One of the USA's serious social problems is that there are already far too many unproductive JOBS wasting far too many hours of irreplaceable time. This is well attested to by vast and ever-growing piles of social literature lamenting the overworked American and the social ills that accompany him and her. And it's one more excellent reason to beware of politicians spouting about JOBS.

Spitzer is not just talking about jobs, he is talking about well paying jobs. I don't see how your story about your friend has much relevance to the issue here.

Beyond that, it is essential here to be talking about jobs in the context of conservation, renewables, and, incidentally, tackling the problem of global warming. People like Cheney poo poo conservation as anathema to the American way of life with no value. Those who fear attacking global warming advance the notion that tackling warming cuts jobs and cuts GDP. Spitzer is proposing an antidote to this attitude.

I read Spitzer's speach and it looks like a good start. However he doesnot see the Peak Oil message, merely the Global Warming message - so he is still trying to GROW NY by adding population and increasing total Electricity comsumption 15% with new power plants, even if he is trying to reduce individual consuption. I give him a 'C' for being only half way there.

One day he will realize we have no more fuel,so there is no reason to build more power plants. There is reason to make existing power plants more efficient while reducing emissions simply because there is less fuel and it is higher priced all of the time.

I thought it was relevant because these artificially produced jobs almost always (1) turn out to be ill paid rubbish in the end, once the fine words of the original speech are long-forgotten, or else (2) turn out - like "ethanol" - to be highly subsidized monsters that pay a few people well at the expense of taxing others more and generally dragging the economy for no useful purpose.

IOW, no matter how you slice it, government make-work is government make-work, and the last thing the overworked American needs is more artificially mandated make-work. After all, Spitzer wouldn't be able to advertise the JOBS he's "creating" unless what he's proposing is more labor-intensive than what came before - and that's virtually NEVER progress.

Great article Glenn.

I read Spitzer's speech and it is unclear to me if he has detailed projections to give cost and time clarification on how much investment in renewables is needed to make a significant impact. Does he provide numbrs? (not available on the press release).

It seems to me, as renewables provide less than 5% of energy (ex Hydro) -- then there is a significant time and cost gap to build substantial renewable energy capacity.

As mentioned above Spitzer doesn't address nuclear directly. Over the past year I have become aware that the new generator of nuclear power plants re-enrich uranium (I may be opening a bag of worms here concerning nuclear as it is controversial) so therefore supply of uranium is not an issue -- VERY significant considering there is a high probablity that oil and natural gas supply is peaking/plateauing. Background on nuclear resources and reenrichment here: http://www.energypulse.net/centers/article/article_display.cfm?a_id=374 (from Energy Pulse, one of the most respected websites for the power industry, but other scientific sources will confirm the content of this article).

So overall, detailed projections of energy needed appears to me to mean more nuclear energy -- plus of course renewables, but as they start from a relatively low base, time and cost are huge issues. Nuclear plants can be built in three years and can supply huge power numbers.

Here's another reason to be wary of ethanol: air pollution

A new study by atmospheric scientist Mark Z. Jacobson of Stan ford University in Stan ford, Calif., appears in the April 18 on line edition of the re­search journal Environmental Science & Technology.

“Ethanol is being promoted as a clean and renewable fu el that will reduce global warming and air pollution,” said Jacobson. “But our results show that a high blend of ethanol poses an equal or greater risk to public health than gasoline, which al ready causes significant health dam age.”

Jacobson used a computer model to simulate air quality in the year 2020, when ethanol-fueled vehicles are expected to be widely available in the United States. He simulated atmospheric conditions nationwide, but focused on Los Angeles be cause it “has historically been the most polluted air shed in the U.S., the test bed for nearly all U.S. air pollution regulation and home to about 6 percent of the U.S. population,” he wrote.

He compared the effects of gasoline-fueled vehicles to those fueled by E85, a popular blend of 85 percent ethanol and 15 percent gas o line.

“We found that E85 vehicles reduce atmospheric levels of two carcinogens, benzene and butadiene, but in­crease two others — formaldehyde and acetaldehyde,” Jacobson said. “As a result, cancer rates for E85 are likely to be similar to those for gas o line. However, in some parts of the country, E85 significantly in creased ozone, a prime ingredient of smog.”