Energy 101: 2012 Candidate Briefing

Fresh Energy Candidate EducationAugust 2012

Fresh Energy works daily for a future where energy production stimulates local economies, efficiently harnessing clean, homegrown electricity sources like wind and solar power.

One where pollution is a thing of the past, where the energy we need doesn’t harm the people we love.

And one that reflects Midwesterners’ love and respect for our lakes, prairies, and forests—for our sake and beyond.

About Fresh Energy

Fresh Energy provides research, advocacy, and innovative policy models while engaging citizens to take action on energy issues.

Fresh Energy is a 501(c)(3) organization and does not participate or intervene in elections for public office in any way.

Our candidate education activities are completely nonpartisan.

About Fresh Energy

Ross Abbeytransportation, solar

Ethan Fawleytransportation

Kate Ellisclean energy, efficiency

Our policy staff

Erin Stojan Ruccolo clean energy, efficiency

J. Drake Hamiltonglobal warming solutions

Alison Lindburgclean energy, efficiency

Michael Nobleexecutive director

AGENDA

Energy in MinnesotaMinnesota’s energy policy foundation

The future of energy policy in MinnesotaPublic opinion research

Q & A

Agenda

Agenda

Energy in Minnesota

Primary energy consumption across all sectors[trillion BTUs]

OilNatural GasCoalElectricity importsUraniumBiomass Wind Biofuels Hydro Geothermal Solar

Source: Energy Information Administration data 2010

Where does Minnesota’s energy come from?

Sources of MN ElectricityMinnesota electricity generation by fuel type

Source: Energy Information Administration data 1990-2010

Minnesota imports a lot of fuels for electricity

Minnesota has no oil wells, natural gas, uranium, or coal mines.

The cost of coal delivered to Minnesota has increased on average 11.8 percent every year since 2004.

Wyoming’s Powder River Basin coal mine

Source: Sierra Club

Costs of different types of powerEnergy efficiency in the United States

Residential Building Energy Code adoption in the Midwest

As of June 2012:

No Mandatory Statewide Code

Code Level / Equivalence

2006 IECC

2009 IECC

2012 IECC

2009 Adopted by Major Municipality

* Upgrading to 2012

*

Energy codes raise the standards for all buildings

Minnesota’s code is currently roughly equivalent to IECC 2006 and the state is in the process of upgrading to the IECC 2012 with amendments.

These proposed changes will save newly constructed Minnesota residences at least 20 percent in energy consumption and 30 percent for commercial buildings.

CapX2020 is a joint initiative of 11 utilities in Minnesota and the surrounding region to expand the transmission grid to ensure continued reliable and affordable service.

Source: US Energy Information Administration’s State Energy Data System

In recent years, Minnesota has “exported” about $2,000 per person per year for oil.

How much does Minnesota spend on oil?

1970

1972

1974

1976

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1980

1982

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1986

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0

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Billions o

f D

ollars

Alberta landscape before and after

Source: U.S. Energy Information Administration (the agency tasked with forecasting energy trends)

Uncertain future for gas prices; volatility and increases likely

Agenda

Minnesota's energy

policy foundation

• 2007 Next Generation Energy Act

• Requirements that electric and natural gas utilities double to triple energy efficiency savings

• 25 percent by 2025 Renewable Electricity Standard

Minnesota's energy policy foundation

State goal to reduce greenhouse gas emissions economy-wide to at least:

15 percent below 2005 levels by 2015

30 percent below by 202580 percent below by 2050

Next Generation Energy Act

Progress toward state goals

Renewable Electricity Standard (RES)

• Utilities are on track or exceeding RES goals.

• Minnesota has 2,500 megawatts of installed wind

energy—enough to power 700,000 Minnesotan homes.

• According to statewide utility reporting in 2012, there has been almost no rate impact due to compliance with RES. Many utilities stated that they would have added wind in any scenario because it is the least-cost resource.

Progress toward state goals

Energy Efficiency Resource Standard (EERS)

• Utilities are on track or exceeding the efficiency goals.

• Increased energy efficiency reduces rates for consumers.• Xcel alone has saved the equivalent of

constructing nine new coal plants, reducing rates for consumers.

• Energy efficiency is the cheapest form of energy.

• Based on utility reporting, for every $1 utilities spent on conservation, their customers save $4. It’s hard to get that level of return with almost any other investment.

Percent of electricity from wind power, 2011

Minnesota has a great wind resource

In 2010 alone, wind power projects

• contributed $7 million in land lease payments, • contributed over $6 million in property tax payments, • provided diversified income for Minnesota’s farm families, and• supported at least 2,000 direct and indirect jobs.

Wind power improves Minnesota’s economy

The Clean Air Act

1970• became law to protect human health and

welfare

1990• bipartisan update signed by President Bush to tackle new air pollution problems

2011 and 2012• scientific findings call for modernizing standards to include mercury, soot, ozone, and carbon

The Clean Air Act

Nationwide, coal-fired power are responsible for at least 21,000 premature deaths each year. Burning coal emits large amounts of

mercury

ozone pollution

carbon dioxide

soot

Source: National Research Council

.

The Clean Air Act and human health and welfare

There are no nationwide limits on carbon and soot emissions from power plants.

The Clean Air Act of 1990 required the Environmental Protection Agency to limit pollutants that harm human health and welfare.

The Clean Air Act

“The Clean Air Act has prevented more than 1.8 million child respiratory illnesses and more than 300,000 premature deaths.”

Senator Dave Durenberger, April 2011

OMB review of Clean Air Act impacts from 1990-2020

The benefits of Clean Air Act regulations exceed the costs by 30 to 1.

Pollution controls are 0.3 percent of the country’s overall GDP, but save millions of Americans from debilitating and expensive illnesses that result from unlimited pollution.

Minnesota has demonstrated feasibility

2006 Minnesota Mercury Emissions Reduction Act:

• six big units at Minnesota’s largest coal plants required to achieve 90 percent reduction in mercury

• Clean Air Act now applies similar standards nationwide

Minnesota Public Utilities Commission (PUC)

Rate regulators for electric and natural gas utilities.

• least-cost planning and integrated resource planning

• Minnesota Emissions Reductions Projects (MERP)

• baseload diversification studies under way to compare costs for oldest, least-efficient power plants

Agenda

The future of energy policy in Minnesota

Federal wind production tax credit

The federal Production Tax Credit, which promotes wind development in Minnesota, require reauthorization by Congress before it expires at the end of 2012.

Wind development supports at least 2,000 construction and manufacturing jobs, as well as millions of dollars annually in tax payments to local governments and payments to landowners.

Germany, despite its inferior solar resource, recently set a world record for solar photovoltaic (PV) production, producing 22 gigawatts of energy (equivalent to the output of 20 nuclear plants).

Minnesota has a great solar resource

On that day, they were able to produce 50 percent of their electricity from solar PV.

• Minnesota has better solar economics than 31 other states, including the rest of the Midwest (before incentives).

• Solar supports 6,000 Minnesota jobs, including 2,200 jobs at 33 component and panel manufacturers in over 30 towns.

• Yet compared to other states, Minnesota has done relatively little to attract solar investment.

• Minnesota ranks near the bottom in per-capita investment, while states with worse solar economics (like New Jersey and Oregon) are attracting 10 to 30 times the investment.

Capitalizing on Minnesota’s solar resource

Solar PV costs are dropping fast

Source: PV module cost curve 1976-2011. BNEF Bazilian et al (2012), Fig. 1

$/W

MW of panels manufactured

We need to

• improve the efficiency of cars,• transition to next generation of

“fuels,”• support transportation options and

development patterns that reduce the need to drive

Reducing our reliance on oil

Vehicle efficiency

Next generation of fuels?

Minnesota Vehicle Miles Traveled (VMT) Trend and Projections

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Year

VM

T (

in b

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ns)

VMT

20 year linear trendline

10 year logarithmic trendline

Source: Minnesota Department of Transportation TDA and OIM

In the Minnesota, about 29 miles are driven per capita per day.

Peak was 30.4 miles in 2004.

Per driver, that’s about 39 miles per day.

Minnesota driving trends

How we pay for our roads

Source: Fresh Energy, based on MnDOT data

Source: Retired State Demographer Tom Gillaspy

Census Bureau forecast December 2009, assuming constant immigration.

Minnesota’s senior population-growth spurt

Aging population most pronounced in more rural counties

21%

Source: Minnesota State Demographic Center, April 2007

2030 Forecasted Population 65 Years of Age or Older

2030 Pop 65 or older

1,000

5,000

10,000

25,000

50,000

75,000

100,000

2030 Percent 65 or older

11% - 15%

16% - 20%

21% - 25%

26% - 30%

31% - 35%

36% - 40%

Economic Regions

Source: MnDOT 2010 State Rail Plan

Improving rail connections

light rail transit

bus rapid transit

commuter rail

streetcar

The Twin Cities needs new transit momentum

Miles of transitways (existing or under construction)

The connected Twin Cities Minnesota needs

Agenda

Public support for Minnesota’s energy future

Polling data

From a statewide telephone poll of 400 registered Minnesota voters, conducted January 9-15, 2012 by the bipartisan research team of Fairbank, Maslin, Maullin, Metz & Associates and Public Opinion Strategies.

The margin of sampling error for the full statewide samples is +/- 4.9 percent; margins of error for subgroups within the sample will be larger.

Polling data

Support for Transit by Region

0%

20%

40%

60%

80%

100%

Northeast Northwest South Twin Cities

Total Support Total Oppose Undecided

(% of Sample) (17%)(9%) (21%) (54%)

Voters in all regions support more public transit.

Q14f. I would like to read you some ideas related to energy that might be proposed by people in Minnesota. Please tell me whether it sounds like something you would support or oppose: Building more public transit, like rail and buses. Split Sample.

Support for Transit by Party Identification

0%

20%

40%

60%

80%

100%

Democrat Independent Republican

Total Support Total Oppose Undecided

(% of Sample) (20%)(33%) (47%)

Democrats, independents, and Republicans back building public

transit.

Q14f.I would like to read you some ideas related to energy that might be proposed by people in Minnesota. Please tell me whether it sounds like something you would support or oppose: Building more public transit, like rail and buses. Split Sample.

Region Support Oppose

Hennepin/Ramsey 69% 26%

Outer Suburbs 59% 34%

Southern Minnesota 57% 37%

Western Minnesota 52% 39%

Northeastern Minnesota 59% 37%

Strong statewide support for Southwest Light Rail funding

Source: Public Opinion Strategies and Fairbank, Maslin, Maullin, Metz & Associates poll conducted January 14-17, 2012; commissioned by the Minneapolis Regional Chamber of Commerce, the St. Paul Area Chamber of Commerce, and the Twin West Chamber of Commerce

Support for Solar Energy by Region

0%

20%

40%

60%

80%

100%

Northeast Northwest South Twin Cities

Total Support Total Oppose Undecided

(% of Sample) (20%)(9%) (21%) (50%)

There are no regional differences in support for increased use of

solar…

5i. Here is a list of specific sources of energy. Please tell me whether you would support or oppose increasing use of that source of energy to meet your state’s future needs: Solar

0%

20%

40%

60%

80%

100%

Democrat Independent Republican

Total Support Total Oppose Undecided

(% of Sample) (24%)(33%) (42%)

…and partisan differences are relatively modest.

5i. Here is a list of specific sources of energy. Please tell me whether you would support or oppose increasing use of that source of energy to meet your state’s future needs: Solar

Support for Solar Energy by Party Identification

Support for Wind Energy by Region

0%

20%

40%

60%

80%

100%

Northeast Northwest South Twin Cities

Total Support Total Oppose Undecided

(% of Sample) (20%)(9%) (21%) (50%)

Similarly, support for increased wind energy use cuts across

regions…

5f. Here is a list of specific sources of energy. Please tell me whether you would support or oppose increasing use of that source of energy to meet your state’s future needs: Wind

0%

20%

40%

60%

80%

100%

Democrat Independent Republican

Total Support Total Oppose Undecided

(% of Sample) (24%)(33%) (42%)

…and also across party lines.Support for Wind Energy by Party Identification

5f. Here is a list of specific sources of energy. Please tell me whether you would support or oppose increasing use of that source of energy to meet your state’s future needs: Wind

Voters would rather reduce the need for fossil fuels by

expanding the use of renewables.

Reducing our need for oil and coal by increasing energy efficiency and

expanding our use of clean, renewable energy that can be generated in the

US

Drilling and digging for more oil and coal wherever we can find it in the US

Both/Neither/DK/NA

67%

26%

10%

0% 20% 40% 60% 80%

7. Which of the following do you think should be the highest priority for meeting America’s energy needs…

Which of the following do you think should be the highest priority for meeting America’s energy needs:

Job Impact of Clean Energy by Party Identification

0%

20%

40%

60%

80%

100%

Democrat Independent Republican

Creat Jobs No Effect Cost Jobs All/None/DK

(% of Sample) (22%)(31%) (47%)

Voters of all parties see jobs benefits from clean energy.

9. Which of the following comes closer to your point of view: Increasing the use of clean, renewable energy sources like wind and solar power…

Candidate Preference by Region

0%

20%

40%

60%

80%

Northeast Northwest South Twin Cities

Clean Energy Fossil Fuels Both/Neither/DK/NA

(% of Sample) (20%)(8%) (22%) (50%)

Voters across the state prefer a clean energy candidate.

12. In thinking about the election for State Legislature in your area later this year, for which of the following candidates would you be most likely to vote?

More than seven in ten voters prefer a candidate who would promote renewable

energy over fossil fuels.

12. In thinking about the election for State Legislature in your area later this year, for which of the following candidates would you be most likely to vote?

A candidate who wants to promote more use of clean, renewable energy – like wind and solar

power

A candidate who wants to continue to rely on traditional domestic sources of energy – like coal,

natural gas or nuclear – to meet energy needs

Both/Neither/DK/NA

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Q & A

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