<\/p>\n
The opinions expressed here by Trellis’ professional contributors are their own and not those of Trellis.<\/em>.<\/p>\n Never in my life have I struggled with energy so much. The US war with Iran and the surge in domestic electricity demand are disrupting energy politics and markets alike. But the confusion has obscured a remarkable success story in clean energy. An astonishing 90 percent of all new electricity generation capacity in the United States now comes from clean sources. Voluntary corporate procurement has been the main driver of this growth, accounting for more than 40% of this capacity maintaining the grid.<\/p>\n But a highly technical battle erupting over how companies account for their sustainability advances threatens to derail adoption at the worst possible time. Standards governing how companies track, offset and report their carbon emissions are due to be overhauled this summer by the Greenhouse Gas Protocol (GHGP).<\/p>\n The GHGP is considering a proposed standard known as “24\/7” or “hourly matching.” This requires companies to prove that their electricity consumption matches clean energy generation on an hourly basis within the exact same geographic area. In reality, most companies would rather avoid signing new clean energy contracts than bother with complex standards.<\/p>\n Under the existing system, companies can cover their carbon emissions by funding new wind and solar projects that match their annual energy use. While not perfect, this approach has undoubtedly contributed to a surge in clean energy development across the country. When companies agree to buy power from wind and solar farms for the next 10 to 15 years, they secure financing for clean energy developers and provide the guarantees they need to put shovels in the ground. And we can do it in the most cost-effective, effective, and buildable areas of the country.<\/p>\n Improvements need to be made to prevent companies from averaging their usage across a single continent, but most companies will abandon their clean energy goals in this anti-ESG moment rather than following expensive tracking software or short-term certificates from already-built projects to adjust for hourly differences in energy usage. This project-by-project, hour-by-hour approach is similar to the \u201cthree pillar\u201d methodology that will ultimately doom the clean hydrogen industry in 2023 and 2024 due to all the additional costs. The only difference is that the GHGP has removed the \u201cadditionality\u201d pillar that ensures that all additional costs actually build new projects.<\/p>\n The changes would create additional friction on top of the headwinds the federal government faces on clean energy. Given hostile, partisan politics and the strain on supply chains from increasing AI loads, now is precisely the wrong time to overhaul the systems that work. Instead, the focus should be on expanding the coalition of corporate buyers seeking to avoid soaring wholesale power costs.<\/p>\n Proponents of 24\/7 power generation argue that allowing companies to supply electricity on an hourly basis will create the market demand needed to commercialize technologies such as next-generation nuclear, advanced geothermal, and long-term storage that can provide power even when the sun isn’t shining or the wind isn’t blowing. These technologies are often expensive and out of reach for most businesses. And for many companies, including those in fully regulated markets, they will be forced to negotiate complex negotiations with often hostile monopoly utility companies. <\/p>\n It would be a fatal miscalculation to make the procurement strategies of a few high-profit companies the mandatory standard for everyone. Most Fortune 500 companies have tight profit margins and, as a result, need more flexibility in their sustainability goals. This would make it more likely for them to stop participating in the Greenhouse Gas Protocol altogether, instead signing deals for nuclear and geothermal power. <\/p>\n If we restrict corporate buyers from the marketplace, there could be serious consequences for ordinary Americans. Clean energy projects would continue to be built, but they would be slower and more expensive, and the costs would ultimately be passed on to ratepayers, raising household electricity prices by as much as 26%.<\/p>\n 24\/7 also encourages an \u201cisland\u201d approach to electricity, where companies build and purchase energy to fit exactly their loads, rather than optimizing procurement for what they think is best for the grid as a whole. For example, rather than reducing system-wide peak demand to sell more power and reduce everyone’s bills, companies may dispatch battery storage systems to meet their own load requirements. This is estimated to increase grid instability, congestion, and power curtailment by 47%. <\/p>\n Companies’ voluntary climate change measures are truly voluntary. The private sector has proven that when the rules and incentives are reasonable, it can drive clean energy adoption on an unprecedented scale. The 24\/7 model will significantly slow down the deployment of clean energy, just when it should be accelerating the addition of electricity to the grid. <\/p>\n<\/p><\/div>\n #emissions #regulations #impact #clean #energy #industry #Trellis<\/p>\n","protected":false},"excerpt":{"rendered":" The opinions expressed here by Trellis’ professional contributors are their own and not those of Trellis.. Never in my life have I struggled with energy so much. The US war with Iran and the surge in domestic electricity demand are disrupting energy politics and markets alike. But the confusion has obscured a remarkable success story … Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":913,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[846,903,119,518,2220,183,2222,2221,2223],"class_list":["post-912","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","tag-clean","tag-clean-energy","tag-emissions","tag-energy","tag-greenhouse-gas-emissions","tag-impact","tag-industry","tag-regulations","tag-trellis"],"_links":{"self":[{"href":"https:\/\/hyokal.com\/index.php?rest_route=\/wp\/v2\/posts\/912","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hyokal.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hyokal.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hyokal.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/hyokal.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=912"}],"version-history":[{"count":0,"href":"https:\/\/hyokal.com\/index.php?rest_route=\/wp\/v2\/posts\/912\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hyokal.com\/index.php?rest_route=\/wp\/v2\/media\/913"}],"wp:attachment":[{"href":"https:\/\/hyokal.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=912"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hyokal.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=912"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hyokal.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=912"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}create more friction<\/strong><\/h2>\n
Dangers of the \u201cisland\u201d approach<\/strong><\/h2>\n