Researchers from MIT  shared their vision for the Utility of the Future, where a decentralized, “self healing” grid would replace the heap of old wires we have today. New business models would materialize if only regulators would accept total market transformation. These pronouncements fill the pages of Wired Magazine and give us something to chat about at cocktail parties, while the real future is quietly unfolding right under our noses in Colorado.

MIT’s Utility of the Future study, published in December 2016.

Tucked away in unexceptional office buildings and dated municipalities, Xcel Energy, a legacy utility with a boring dress code and a century old business model, is working alongside policy makers, public utility commissioners, and engaged stakeholders, to transform the State’s power grid. In an effort similar to Germany’s Energiewende, Colorado is on track to meet 55% of its electricity supply with renewable energy by 2026, and reduce CO₂ emissions by 60% below 2005 levels over the same period.  They are pulling this off without significant rate hikes to consumers or disruptions to reliability. This energy transition is challenging long standing assumptions on the economics and technical feasibility of a carbon free grid. Where it is headed offers a far more tangible carbon free energy future than any proclamation has yet offered.

Background on Colorado’s Energy Transition

Xcel Energy’s commitment to energy transition was not a unilateral proclamation. It came about as a response to customer demand. In 2011, residents of the City of Boulder voted in favor of a ballot to divorce itself from Xcel Energy and establish its own municipal utility. As one ballot supporter stated, “They [Xcel] don’t have our interests at heart,” referring to the portfolio of coal assets that Xcel continued to operate, and that comprised 57% of it’s portfolio at the time. This initiated a 6-year process of joint working-groups and often adversarial negotiations. Among the issues that needed to be resolved was the transfer of assets from Xcel to Boulder.

Throughout the rounds of negotiations, public hearings, PUC filings and even a lawsuit that proceed, the City of Boulder offered Xcel several opportunities to “partner” with the city, including asking that Xcel reduce the price of wind power for Boulder customers and remove a cap on wind generated south of Boulder.

Part of Xcel’s Cherokee Generating Station is a 928 MW Coal Plant outside of Denver.

Under the specter of more customers following Boulder’s lead, Xcel Energy submitted a new Electricity Resource Plan (EPC) in 2016, changing its posture, and adopting a commitment to “better serve our customers across the state…” by “keeping your energy costs low” and to “deliver increasingly cleaner energy…” In August 2016, CPUC approved a series of filings whereby Xcel would move forward with programs that offered customers greater resource diversity and access to renewables, while removing the transmission premiums that it had levied on renewable power. This met more customer demand for renewables, and it established conditions that would make municipalization an even less feasible option for customers seeking affordable, clean energy.

In 2017 Xcel unveiled its proposed Colorado Energy Plan (CEP), laying out a more defined roadmap to meet rising energy demand with more renewable energy and lower carbon emissions, at rates that still undercut the national average. Xcel laid identified three clear goals: 1) increase total production to meet growing demand; 2) meet 55% of its total supply with renewable energy by 2026; 3) reduce emissions to 60% below 2005 levels, also by 2026. To get there, Xcel plans on cutting its coal power supply by 30% and reducing 50% of it’s natural gas generation. As a first step, the CEP requested approval to retire place 700 MW of coal powered generation in early retirement, and replace that capacity with wind and solar power. As additional coal plant move to retirement beyond 2026, Xcel believes that it will be on the road to achieve a zero carbon portfolio.

Source: Western Resource Advocates

In early 2018, Xcel received 350 proposals for solar and wind projects, many of which included energy storage. The median prices offered for wind, solar, and combined storage projects all fell sharply below the lowest documented prices previously offered anywhere else in the US, and they significantly undercut coal and natural gas.

This past August, CPUC gave final approval for Xcel’s CEP. In moving forward with its plan, Xcel will move to invest $2.5 billion to add over 1,100 megawatts of wind generation, more than 700 megawatts of solar generation, and 275 megawatts of battery storage onto Colorado’s grid. Xcel will also retire the Comanche 1 and 2 coal plants, comprising 700 MW of existing capacity, a decade early. Despite this lofty investment, Xcel is promising to save money for the rate payers. The CEP outlines $200 Million in anticipated savings for Colorado ratepayers. Decommissioning coal plants and operating lower cost resources offsets the burden of the associated capital investment. Furthermore, Xcel anticipates that it will drive further savings by avoiding compliance costs for anticipated emissions regulations as it moves to downsize its coal fleet.

Xcel Energy’s phased plan to increase resource diversity and lower carbon in its generation portfolio.

As Xcel Energy takes on bold moves for a regulated utility, Colorado’s biggest cities and counties are upping the ante even higher. At least ten of the state’s most populous and prominent regions have set 100% renewable energy goals, most of which are set to be achieved by 2030, and none of them any later than 2035. As one executive from excel put it, “We will eventually have a zero carbon power grid. Xcel would rather lead in that direction, than get dragged there.” With so much customer demand, Colorado provides a unique foothold for Xcel to assume that leadership.

Turning Customers into Allies and Taking Advantage of the Stakeholder Brain Trust

During the rounds of public hearings and back room meetings between Xcel Energy and the City of Boulder, the latter gained volunteer support from a team of experts, including researchers from National Renewable Energy Laboratory (NREL) and University of Colorado. These experts assisted Boulder in assessing the cost and technical feasibility of various generation portfolios. The team, referred to as “RenewablesYES!”, provided Boulder with a roadmap to double its renewable energy supply, halve its carbon intensity and “greatly reduce other forms of fossil fuel-related pollution at rates that would meet or beat Xcel’s.”

Through ongoing rounds of negotiation, public hearings, a lawsuit, and PUC filings, citizen leadership in the technical review process influenced Xcel’s process of evaluating its own portfolio. This helped Xcel fuel its own effort to devise a more ambitious renewable energy roadmap, and likely contributed to the partnerships that it formed with renewable energy and environmental advocacy groups. These many of these groups aided Xcel in formulating the CEP, and that have been strong supporters of Xcel’s efforts in front of CPUC.

Xcel intelligently turned its proceedings with Boulder into an opportunity to draw a new relationship with the stakeholder groups that would be difficult opposition if they were not key allies. In its 2017 CEP filing, Xcel listed numerous renewable energy coalitions, consumer advocacy groupd, and even energy think tanks that participated in the plan formulation. The Western Resources Advocates was one of the major partners.

Cities and counties across Colorado are seeking to go 100% renewable.

Firm Renewable Power Beats Natural Gas

In January 2018, Xcel released the results of the All-Sources-Solicitation that it issued in late 2017. The response was striking. In contrast to the 55 responses that Xcel had received in its 2013 solicitation, this time around 430 bids were submitted, 350 of which were for solar and wind projects comprising 100 GW of total capacity. Over 100 of these proposed renewable projects included battery storage, comprising 27 GW of total capacity. In other words Xcel was looking at 27 GW of firm renewable energy, with the same dispatchability and load control as the traditional fossil fuel resources.

If that is not astounding enough, the game changer was in the costs that were proposed for these projects relative to Colorado’s existing fossil fuel resources. The median price offered for Solar + Storage came out to $36/MWh while Wind + Storage was offered at a median cost of $21.50/MWh. With natural gas selling at $40 – $60/MWh and the state’s coal power supply selling for even higher, Colorado is seeing a new reality unfold where renewable energy, made firm and dispatchable with battery storage, is technically and economically scalable, even in the most competitive power markets.

The Vertically Integrated Utility-of-the-People

Xcel’s guiding principles to working with partners such as municipalities and coops. Xcel has taken a tone that utilities operate best when planning is a multi-lateral activity taking place outside of formal regulatory hearings.

Energy market deregulation was intended to establish competitive markets that would stabilize, if not lower costs for rate-payers, while creating greater transparency. The data on whether or not deregulation helped achieve these goals is inconclusive. Natural gas has been a major factor in driving down the cost of electricity since 2005. The same market construct that enabled the rapid expansion of natural gas generation led to rapid growth in wind and solar power in these markets. That same mechanism, however, limits their continued scalability. As fossil fuels comprise a smaller portion of the resource mix, renewable energy generators must rely more and more on long term power-purchase-agreements to ensure that they will achieve a viable return. But wholesale markets are not going away any time soon, and a 10-year power purchase agreement does not make sense to most customers. The answer to this challenge falls back to benefits of regulation.

These truths lead to difficult questions about the chances of achieving grid transformation in deregulated markets. Colorado would not be on track to deliver on its 2026 goals were it not for the centralization of accountability and oversight that can only be promised by a vertically integrated utility. But owning the entire energy value stream is not enough. The challenges of energy transition require significant changes to the governance and planning culture of most regulated utilities in the US today. Again, Colorado is charging ahead to create this future.

Xcel took many lessons away from its experience with Boulder, and the utility institutionalized the way it works with cities, municipalities, and other governance organizations as a result. As cities like Denver, Longmont, Pueblo and Fort Collins have approved county-wide RPSs of 100% renewable energy by anywhere from 2020 to 2035, Xcel has opted to partner with them in achieving these goals, maintaining its role as their utility. According to Jaren Luner, a public policy analyst at Xcel Energy, when cities approach Xcel with a plan to meet 100% of their demand with renewables, “’No that’s now how it works’ isn’t an answer that is acceptable to our cities. We need to incorporate their goals into our resource planning.”

Why Look to Colorado?

Colorado is not the only state that set ambitious clean energy goals. California and Hawaii have both committed to achieve 100% renewable energy by 2045. They are seeing rapid growth in their renewable portfolios. In both states, however, rate payers are seeing their energy bills escalate to over 50% above the national average. In contrast, Xcel Energy met 28% of its Colorado energy supply with renewables last year. Its customers’ paid energy bills were an average of 33% below the national benchmark. The Colorado Energy Plan estimates that customers will continue to see savings, and by 2030, Colorado rate payers will save as much as $200 million.

An energy transition similar to Colorado, is necessary if we are going to collectively meet the emergent challenges of climate change, resource scarcity and infrastructure vulnerability. On the face of it, the US power grid is a regulatory jungle of balkanized markets and aging infrastructure, making massive transformation almost impossible. At closer look, Colorado may be the oracle that can providing a roadmap for other states to follow. What might that energy future look like?

The post Utility of the Future: Insights from Colorado’s Energy Transition appeared first on Solar Tribune.

The UN  and the World Bank both estimate that 1.1 billion people lack access to electricity. This points to significant progress over the last 2 decades. In 2000, the estimate was 1.7 billion people. However, it has only been in the last few years that real strides have been made towards addressing some of the endemic challenges that are leaving almost 15% of the world’s population in the dark. The rapid maturity of Solar PV technology, advancements in energy storage, and the adoption of new business models are the primary catalysts for recent progress in energy access.

Reliable, Affordable, and Clean Energy for All

Energy access has long been a major development challenge. In 2015, the UN’s 193 member-states ratified the Sustainable Development Goals (SDGs), defining 17 measurable objectives to eradicate poverty by 2030. Goal 7 aims to provide universal access to affordable, reliable, and clean energy. As the International Energy Agency (IEA) stated in its assessment of progress along this goal, “Energy is not only a global goal in its own right but is at the heart of the sustainable development agenda…”

“Goal 7: As Seen Through the Eyes of Children” by Margreet De Heer.

Since 2000, the total number of people living without access to affordable, reliable energy has dropped by 35%. The World Bank reports that since 2012, access to energy has expanded by an average of 118 Million people per year. Over half of that need has been met by off-grid solar (OGS) projects, which have enabled countries to address some of the biggest challenges in supplying reliable energy to remote populations and has been an affordable alternative for impoverished populations. This has fueled massive growth in off-grid solar, with global capacity tripling over the last decade.

These are promising indicators, but the progress is not evenly distributed. Over half of the 1 billion people who lack access to energy live in Sub-Saharan Africa, while the remainder live predominantly in Asia. However, less than 30% of new OGS capacity since 2008 has benefited Africa. Asia, on the other hand claims 67% of new OGS capacity over the same period.

Project Require Strong Fundamentals and Rule of Law

The disparity in new capacity reflects broader regional issues beyond technical project feasibility. In a report on the African energy problem, The Independent pointed to a range of factors from poor management of utilities, to misappropriation of funds and political corruption.

“But it’s also because utilities are vehicles for political patronage and, in some cases, institutionalised theft. US $120m went missing from the Tanzanian state power utility last year though a complex web of off-shore companies.”

The majority of OGS projects over the last decade have resulted from public-private-partnerships (PPP), or multilateral collaborations where, ultimately, a commercial provider takes on the long-term management of decentralized assets. Many of these projects are funded through matching agency funds from international development agencies or NGOs. Under the Power Africa Program, for example, USAID is providing technical assistance to expand energy access in Sub-Saharan Africa, but it will only support initiatives when there is active cooperation and participation from the host country government. Third party implementation partners typically face numerous challenges that USAID is unable to address. Lack of steady Government involvement, weak institutions, and corruption have been major barriers to projects moving beyond exploratory stages.

This 500-watt PV system, installed by SolarNow and financed by Power Africa partner SunFunder, provides clean power for a home, a public broadcasting system, a barbershop and a video hall in a rural village in Uganda. / Sameer Halai, SunFunder

Other OGS projects obtain more traditional development financing from institutions such as the World Bank, regional development banks and the International Finance Corporation (IFC). IFC upholds commercial feasibility standards, like those of a conventional commercial bank, but tailored to the conditions of development projects. In these projects too, host government cooperation is key, and without sufficient regulatory clarity, they lack the assurances that implementation partners need to take on the long-term risks associated with operating distributed generation assets.  As the World Bank stated in an issue brief:

“…the biggest challenges are poor policies, inadequate regulations, lack of planning and institutional support…successful countries have also balanced the objective of the financial viability of electricity suppliers with the need to keep consumer prices affordable…”

Achieving this balance requires the type regulatory clarity and market market reciprocity that can only be achieved through stable institutions of governance.

OGS and the Path Forward to 2030

A range of factors are contributing to the continued rise of decentralize solar PV, and OGS is projected to make up an even larger proportion of new generation projects over the next decade. IEA points to cost as a primary advantage of OGS in closing the energy-poverty gap. The price of solar today is lower than natural gas and coal, making it more affordable than any other generation resource on the market. According to IEA, “To deliver universal energy access by 2030, decentralized options are the least-cost option for 60 per cent of people currently lacking access.”

There is evidence that prices could continue to drop. London based Crown Agents released a report that found that the installed cost of solar plus storage in developing countries may be as much as 80% lower than most project developers are currently estimating on their early stage proformas. One area, where the report noted cost discrepancies, was in the way proformas typically estimate energy storage costs. The cost assumption for energy storage are often still based on outdated lead-acid technology verses the lithium ion batteries that are now the prevalent form of storage. When accounting for lower installation and encasement costs for these batteries, the total cost of storage comes down considerably. Project estimates often use other outdated cost assumptions on panels and balance-of-system components as well, leading to inaccurate phase 1 proformas that render potentially viable projects unfeasible on paper.

Better technology also enables these projects to perform better financially when they are operational. The move towards microinverters enables commercial suppliers to obtain better real time analytics on system performance, minimizing downtime, and maximizing productive return from these projects.

Mobile payment technology, termed Pay-as-you-Go (PAYGO), has enabled a secure and consistent flow of revenue from customers to solar power providers, increasing the the accessibility of these projects for customers. This is particularly relevant in Sub-Saharan Africa where mobile payment has given many customers access to digital currency for the first time. By not having to collect cash payments from customers distributed across large regions, projects cost less to manage and operate. Customers can quickly connect to new systems and access energy, and they have more real time visibility how much they’re consuming through their mobile phone payments. Nearly $800 million has been invested in mobile money systems over the last 6 years. West African markets are seeing significant growth in PAYGO traction, and CGAP estimates that as much as 50% of new accounts in the region (outside of Kenya) are created to pay for electricity. PAYGO may eliminate one of the key challenges to electrifying Sub-Saharan Africa. But without stronger regulatory institutions, it will still be difficult to attract outside partners necessary to build capacity and deliver technology.

President Barak Obama looks at a Pay-as-you-Go solar power exhibit during a 2015 Power Africa Innovation Fair in Kenya. (Credit: AP Images)

The UN’s goal-setting strategy has enabled a multi-lateral suite of players, from Governments and NGOs, to banking institutions to establish a common understanding of the biggest barriers to universal access, and a shared timeline to closing that gap. However, despite current progress, the 2030 goal will not be met if new generation cannot be accelerated further. With many lessons learned under their belts, development agencies and financing arms are getting more rigorous in their vetting standards. For Asia, there is still a tall mountain to climb. Regions such as Myanmar are still in early stages of development and conflict has made it nearly impossible to reach the most remote populations. In Sub-Saharan Africa recent successes in Ethiopia, Zambia, and Ghana may be signs that energy access is accelerating. But the largest populations without access to electricity are those in the areas with the weakest institutions. Off grid solar offers the greatest hope for rapid scalability of access to energy. Technologies such as PAYGO systems enable providers and customers to get around market inefficiencies, and all indications are that these contribute to increased living standards. However, stable institutions are the only mechanism that will convert these short term achievements into long term long term solutions.

Case Studies

The following two case studies provide a glimpse into the factors discussed above. The Paluan project illustrates how lower system costs are leading to rapid acceleration of access in the Philippines. In the case of the Bangladesh Solar-Home-Systems program, this program provides an example of how customer side financing innovations are facilitating major changes.

Paluan, Philippines: Solar-Battery Storage Microgrid

Brownouts are a common occurrence across the Philippines, affecting as much as 70% of the country’s population. Approximately 25% of the population lack access to electricity at all or only have access to sporadic, unreliable supply. To address this issue, and to close key vulnerabilities that the country faces as a result of climate change, President Duterte has been a strong proponent of decentralizing the nation’s energy supply, liberalizing energy markets, and transiting to more sustainable energy sources. His administration has set a goal to end energy-poverty by 2022.

It is against the backdrop of this national agenda, that Solar Philippines, a 4-year old company that has quickly accelerated to become one of the largest solar providers in Southeast Asia, recently completed Southeast Asia’s largest Solar PV – Storage Microgrids.

Last December, Solar Philippines completed construction and began operations on a 2 MW Solar PV facility. Combined with 2 MW of Tesla Power Pack battery storage, and a diesel generator for backup supply, this system has enabled the Paluan to benefit from 24/7 electricity service for this first time. Prior to the launch of this project, Paluan’s 16,000 residents frequently experienced brownouts. Napocor, the national utility, limited supply to 16 hours per day, and prior to 2014, village was served by a regional co-op that delivered 4 hours per day and eventually ceased operations.

Residents from the Town of Paluan hold a banner that reads “No More Brownouts” next to the Solar Philippines 2 MW Solar-Storage facility that serves their town with uninterrupted, affordable power. (Credit: Philstar)

According to the Philippine Star, Solar Philippines has reduced the electricity rate for Paluan residents by 50% and enabled them to eliminate the $550,000/year subsidy that the town previously consumed to afford Napocor’s rates.

This Project’s success has led to follow on projects. In June 2018, Solar Philippines flipped the switch on 3 more solar-storage microgrids serving towns in the province of Masbate. The company’s CEO announced plans to deploy a dozen more microgrids serving 500,000 people, all without taking grant or subsidies.

Bangladesh Solar Home Systems (SHS) Program

Bangladesh has seen the sharpest increase in energy access of any country. With a per capita annual income of $1,010, and 60% of its population living in remote areas or areas that need to be accessed via narrow waterways, Bangladesh has not been able to carve a feasible path to supplying electricity to majority of its citizens. Since 2009, Bangladesh has increased access from less than 50% of its population to 76% at the end of 2016. Almost half of this new generation capacity has been met with Solar Home Systems (SHS), stand-alone, turnkey systems that provide direct power to individual homes and businesses.

In 2002, the national government set a goal to achieve full electrification by 2020. In support of this goal, the Infrastructure Development Company Limited (IDCOL), a state-owned financial institution, launched the SHS program to provide cost-effective electricity to the country’s rural population. With subsidies from several international agencies, the SHS program partnered with Participating Organizations (POs) to reach customers in the country’s most remote regions, sell subsidized SHS to those customers, and enter into payment arrangements with those customers. IDCOL arranged the subsidy structure and provides backing for the credit that the POs extend to customers.

POs are responsible for purchasing the systems directly from suppliers. Because of the strong backing of the Government, suppliers have been accommodating and agreed to differed payment from the POs. While the POs are responsible for upfront costs, the majority of the capital was initially funded through international agency grants managed by IDCOL.

Different financing mechanisms have been used by the POs. Grameen Shakti, the largest PO responsible for 50% of the SHS installations, provided customers with a system ownership structure, rather than a pay-for-service arrangement. Customers were offered microfinancing arrangements, paying 15% up front, and the remaining balance over 12, 24 or 36 months. Average payments are around $17/month which is less than the cost to run a generator, and once the system is all paid off, Grameen Shakti continues to provide annual system checks for free.

The SHS program was just the beginning of Bangladesh’s rapid electrification process. But it illustrates the critical importance of devising financing mechanisms tailored to customers in the developing world, and it shows how strong regulatory institutions with active government involvement attract international development agency funding.

The post Off-Grid Solar and the Path to Universal Access appeared first on Solar Tribune.

Alexandria Ocasio-Cortez, a 28-year-old New York Bartender turned Bernie Sanders campaign organizer, achieved a stunning political upset last month when she beat incumbent 10-term Congressman Joe Crowley in the primary elections for New York’s 14^th district. In a predominantly Democratic, working class district, many see the upcoming mid-term elections as a mere formality on her path to public office.

More noteworthy than who she defeated is what Ocasio-Cortez represents. She is one of 42 candidates running in federal, state, and local elections who are being endorsed by the Democratic Socialists of America (DSA), an organization that aims to transform the US to a socialist economy through political change. As the organization’s website states:

“As we are unlikely to see an immediate end to capitalism tomorrow, DSA fights for reforms today that will weaken the power of corporations and increase the power of working people.”

These candidates have embraced a set of uniform policies that disrupt the moderate appeal that mainstream Democratic leaders have sought to maintain. They are promising voters that if elected, they will fight to legislate Medicare for All, a Federal minimum wage of $15 per hour, free higher-education, and aggressive federal action on climate change. These positions, and their refusal to accept corporate donations has put them greatly at odds with the Democratic establishment. If elected into office, they could disrupt some of the fundamental Democratic footholds including clean energy legislation.

Ocasio-Cortez campaigning in the Pride Parade in her home district in Queens ,NY a week before the primary elections. (Jennifer Mason / LA Times)

Clean energy and the path to economic empowerment

Climate change is a pivotal issue for the DSA candidates. According to them, it disproportionately affects disadvantaged populations, while the activities causing it primarily benefit wealthy elites. Coal executives, for example, earn incomes as high as 600 times that of average mine workers, while it is the latter who contract black-lung and incur the high cost of medical treatment. Similarly, industry executives and their families were not among those affected by the contaminated groundwater in Flint, MI. On the other hand, combating climate change by transitioning to a clean energy economy will create millions of jobs and facilitate the economic mobility necessary to support a more equitable society. As Ocasio-Cortez’s website states,

“radically addressing climate change is a potential path towards a more equitable economy with increased employment and widespread financial security for all.”

Ocasio-Cortez has made clean energy central to her campaign. She points to low-income communities in her own district that are being affected by erosion and sea level rise, and she is proposing a “Green New Deal” that she says will not only increase employment, but also support national security through global climate action. Like Ocasio-Cortez, DSA backed Kaniela Ing, running for Hawaii’s first congressional district, relates the effects of climate change to the lives of his voters. In a 2017 Facebook post, Ing wrote that:

“Climate change is already impacting our islands. Hawai‘i must act now to keep our shorelines and our economy from ending up underwater.”

He is referring to the shrinking coastline of Waikiki and the impact that it is having on the island’s mainly native, economically struggling population.

Ocasio-Cortez, Ing, and other DSA candidates are proposing bold climate policy that would transition 100% of energy in the US to renewable energy by 2035. They believe that this will close economic and labor gaps. They are promising that a strong, resilient and fair economy can be achieved by directing the ingenuity and skill of the American workforce towards the energy transition. This, they say, will create millions of jobs and lead to a more equitable society in the process.

Breaking the deal with the Devil

Ambitious Climate policy is not new in the Democratic political landscape. Some of the party’s most influential leaders have put their weight behind bold legislation to curb Greenhouse Gas emissions and transform the US energy sector. In 2009, the Democratic House passed H.R. 2454, a bill that outlined a national cap-and-trade market and mandated a renewable portfolio standard of 25% by 2025. The bill never made it through the Senate. It was ambitious, even by today’s standards, and most experts believed that implementing its mandates would spark significant growth in clean technology. More aggressive measures have recently been proposed. Just last year, H.R. 3671, the Off Fossil Fuels for a Better Future Act, was introduced into congress. Thirty-seven cosponsors signed onto the bill including Joe Crowley himself. This bill set the – 100 percent renewable energy by 2035 – goal that Ocasio-Cortez later adopted in her lead-up to the primary race.

Despite these initiatives, progress in transitioning to carbon-free energy has been slow.  As candidates like Ocasio-Cortez, Ing and others see it, establishment democrats lack the political will to turn climate bills into laws, because in large part, their campaign treasuries are filled high with donations from the fossil fuel industry. Ocasio-Cortez and Ing, along with Rashida Tlaib from Michigan, Randy Bryce vying for the Wisconsin seat being vacated by Paul Ryan, and 310 other Congressional candidates signed on to the No Fossil Fuel Money pledge, refusing to accept donations from PACs, executives, or “front-groups” of fossil fuel companies. They say that by avoiding this conflict of interest, they can take the firm action on climate change that current Democratic lawmakers are only able to give lip service to.

Many however, see turning down fossil fuel money as too big a campaign risk in an election process where cash is king. OpenSecrets.org reports that in the 2016 elections the fossil fuel sector contributed over $100 Million in campaign contributions, making it the largest contributor of campaign funds out of every measured sector. The tide, it seems, may be turning on the importance of a campaign treasure chest to winning voters’ hearts and minds. Both Ocasio-Cortez and Ing were outspent by their primary opponents at a rate of 10 to 1 before they both delivered the startling upsets that ushered them into national attention.

It’s not the What, but the How

Another key factor that differentiates the climate policy vision of the insurgent candidates from that of the old guard lies in who would lead the massive investment that energy transformation will require. Since the American Recovery and Reinvestment Act of 2009, renewable energy and climate policy has mainly focused on market driven solutions. Policies relied on tax credits, loan guarantees, and grant funding to incentivize private sector investment in energy technologies. The Production Tax Credit (PTC) and Solar Investment Tax Credit (ITC), for example are recognized for catalyzing the rapid growth in solar and wind power that took them from less than 1% of total US energy production in 2007 to over 10% today.

Experts see the PTC and ITC as having been vital to the growth of US wind and solar energy over the last decade; Total installed Solar PV and Wind capacity in the US: 2006 – 2016. (GridLion Analytics)

Underlying the Democratic-Socialists’ plan for energy transformation is a firm belief that Government has the capability to invest trillions of dollars directly into industries currently controlled by the private sector, if only legislators had the political will to authorize such expenditure. Ocasio-Cortez, who calls herself an “Environmental Hardliner”, criticizes market-based approaches as half-measures. Instead, she is calling for a centralized approach, empowering Government to lead the way rather than hoping for private sector action. She points to Puerto Rico, which has been slow to regain a stable power grid, as a prime example of why central planning from Government is the only way forward on energy.

On her website, Ocasio-Cortez outlines her vision for a Green New Deal that, like FDR’s program, would entail massive direct investment by the Government. Under this plan, the Government would directly invest trillions of dollars to expand manufacturing and implementation of renewable energy and electric vehicle technologies. This, she says, will create “millions of high-wage jobs”, and provide the resources needed to dismantle America’s reliance on fossil fuels. As she was quoted in a recent Huffington Post interview:

“The Green New Deal we are proposing will be similar in scale to the mobilization efforts seen in World War II or the Marshall Plan.”

Over the last month, however, beyond reiterating the high-level concepts of a Green New Deal or new Marshall Plan, Ocasio-Cortez has not provided any insight into her strategy for achieving these lofty policy goals.  In an email inquiry trying to obtain more information on the candidate’s plan, her staff responded saying that they “hope” to be able to provide more concrete information soon.

Another Democratic Socialist who is positioning climate action at the epicenter of his platform is Hawaii’s Kaniela Ing. Like Ocasio-Cortez, Ing is hitting on two issues with one solution. His website states that:

“he will fight to commit our nation to‍‍‍ a 100% renewable energy goal in order to save our planet from climate change and put millions of rural Americans back to work.”

Ing plans to achieve this by partnering with labor unions and environmental groups to generate groundswell in congress for federal job guarantees, labor agreements, and community owned renewable energy.

Congressional candidate Kaniela Ing has experience legislating on clean energy market transformation through his work in the Hawaii State Legislature.

Ing has direct, first-hand experience passing similar legislation. During his time in the Hawaii legislature, the Ratepayer Protection Act (SB 2939) was signed into State law. This law ties utilities’ reimbursement to their performance on achieving Solar PV and Energy Storage benchmarks to meet the State’s 100% renewable energy goal. Furthermore, he has taken a strong stance against a proposed gas pipeline, and in a verified Reddit post, he claims success for preventing the pipeline altogether “I successfully fought to stop fracked natural gas from reaching Hawaii.”

Randy Bryce is another candidate whose platform ties clean energy to job creation. A former steel worker, Bryce believes that the job insecurity faced by today’s steel workers can be eliminated by retooling the industry and focusing it on domestic wind production. Like Ocasio-Cortez and Ing, Bryce sees Government investment as the key to this.

Can they really live up to their promises on clean energy?

The change that Ocasio-Cortez, Ing, and others are committing to deliver will require immense political capital that freshmen in Congress typically do not have. Furthermore, as Ocasio-Cortez herself points out, it will require deep structural change and trillions of dollars of Federal investment. That could lead to a rapid increase in the nation’s debt. On the other hand, if these candidates do enter the next class of freshman Congress-men-and-women, it will be without being beholden to either fossil fuel interests or their own party’s leadership. That may empower them to disrupt the legislative cadence enough to make real progress in their first terms. There is little insight into how, exactly, these candidates will attempt to turn their respective visions into realities. But any progress on the ground could mean significant steps forward for solar and wind companies. Even if the DSA candidates’ initial progress is limited to tax credit extensions or direct, program specific investments, this would mark a significant turning point for clean energy, thrusting into the limelight as a first-tier issue. That, ultimately, is what may open the pathway towards full decarbonization.

The post Political Climate Change and the Path to Clean Energy appeared first on Solar Tribune.