Energy Policy:

Advanced Energy Economy's Woolf discusses role of advanced energy in improving grid performance

How can states incorporate advanced energy technologies in their plans to comply with U.S. EPA's pending regulations for existing sources? During today's OnPoint, Malcolm Woolf, senior vice president for policy and government affairs at Advanced Energy Economy, discusses an upcoming report on the role of advanced energy technologies in modernizing the grid. He also talks about the challenges currently facing the nuclear energy industry.

Transcript

Monica Trauzzi: Hello and welcome to OnPoint. I'm Monica Trauzzi. With me today is Malcolm Woolf, senior vice president for policy and government affairs at Advanced Energy Economy, and as a side note, AEE was co-founded by Tom Steyer, who is also behind the NextGen Climate Action PAC. Malcolm, thank you for joining me.

Malcolm Woolf: My pleasure.

Monica Trauzzi: Malcolm, give us some background on Advanced Energy Economy and how it seeks to influence the policy debate on federal and state levels.

Malcolm Woolf: Advanced Energy Economy is a national business association focused on promoting all forms of advanced-energy technology, whether it's smart grid technology, battery storage, nuclear, natural gas, renewables, efficiency, all the forms of technologies that we can deploy to promote a more secure, clean, affordable energy future with our state partners. We've got over 1,000 businesses, and we're very active in 23 state capitals and growing.

Monica Trauzzi: And you've released a new report focused on the advanced-energy technologies that states could incorporate into their plans as EPA's existing power plant standards are introduced. And you believe that this rule could actually help modernize the grid. From a policy standpoint, what does the rule need to look like in order to get to that end goal?

Malcolm Woolf: We do view this rule as a real opportunity to modernize our grid. Virtually every sector of American technological life has been revolutionized over the last 40 years, and when you look at the electricity sector, we're literally getting our power from some of the same power plants on some of the same transmission wires using essentially the same business model. And so, grid modernization is long overdue, and we think that the EPA mandate to deal with carbon is a way to kind of prompt this grid-modernization effort.

Monica Trauzzi: Don't we see a lot of states going down this track already, though, with their renewable portfolio standards?

Malcolm Woolf: Some states are. I think 29 states now have renewable portfolio standards, which is wonderful, but it's still largely an untapped resource, advanced energy generally. Some states are doing a lot on energy efficiency. Other states aren't. States are all over the board on smart grid technologies, so there's a lot more that we could be doing. Essentially the utilities' regulatory model really doesn't lend itself towards innovation, so new technologies have a very difficult time getting into the market, and this could help break through that logjam.

Monica Trauzzi: So much of this is about economics. Won't states need to go with the technologies that are most economically viable on a state-to-state basis?

Malcolm Woolf: Absolutely. That's exactly what we hope EPA's rule will allow them to do. If EPA gives states the flexibility to design a cost-effective approach that works for their state, then this could be a win-win for everybody, and the report that comes out in about two weeks will actually highlight just as an illustration the breadth of technologies that're out there. So there's energy efficiency and demand-response technologies. There's low-carbon or zero-carbon technologies like renewables, nuclear, wind, low-carbon technologies, natural gas, combined heat and power. And then there's a whole potential of smart grid. So the report's going to focus on 40 different technologies as an illustration of the flexibility that states have. If wind isn't a resource that your state has, you can focus on combined heat and power or energy efficiency or other ways to modernize your grid and achieve these goal in a cost-effective way.

Monica Trauzzi: And you consider nuclear energy a piece of the puzzle. Nuclear is in a hugely transitional phase right now. There's little certainty on what's next for this technology. What needs to be done to ensure that nuclear's part of the U.S.'s energy future?

Malcolm Woolf: As a low-carbon, zero-emitting technology, we're optimistic about nuclear energy playing a role as part of this overall piece. It's hard to see new centralized generation of nuclear. Not a lot of them are being built right now. There've been huge advances, however, in new modular nuclear reactors. I think they're probably going to get tested overseas before they come back to the United States, but I see that as a real potential technology that states might be able to use as a compliance strategy for rules like this and for grid modernization.

Monica Trauzzi: Renewables are being challenged on multiple fronts right now. We have state-to-state challenges of renewable portfolio standards. We have net metering challenges. We also see the nuclear industry pushing back against wind energy tax credits. Could all of this amount to an unreliable grid when paired with EPA's existing source standards?

Malcolm Woolf: I think it's actually going to be the opposite. I think history's going to prove that renewables play a great role in making the system more reliable, more diverse energy sources. Just to give one example, Xcel Energy in Colorado, they are buying more wind than required under their state renewable portfolio standard, because it's the cheapest next source of generation. They're not doing it because of a government mandate; it's economic for Colorado. Another example, Iowa -- Iowa is 25 percent wind now, yet they have among the lowest electricity rates in the nation, so there's lots of ways that you can incorporate renewables into the grid in a cost-effective way.

Monica Trauzzi: Well, here's some people talking about a 100 percent renewable grid. Do you think that's feasible, and do you think that's something we even should be considering?

Malcolm Woolf: Advanced Energy Economy supports a variety of fuel diversity, so we're not talking about 100 percent renewables. I haven't even thought about what the reliability consequences of that would be, but it certainly can be playing a much more significant role than it is now, and as we try to build a more diverse grid that is more reliable, that is more secure, you want fuel diversity. And so, tapping into renewable resources in a much greater way I think is in the national interest.

Monica Trauzzi: We'll end it right there. Thank you for coming on the show.

Malcolm Woolf: Thank you.

Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.

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