Making the Most of Distributed Energy Resources: Subregional Estimates of the Environmental Value of Distributed Energy Resources in the United States
Distributed Energy Resources (DERs), like rooftop solar and battery storage, have the potential to generate significant social benefits by displacing pollution-emitting electricity generators. Accurately compensating DERs for this environmental and public health value, which some regulators and experts call the “E-Value,” is imperative for making the most out of DERs’ potential.
This report provides a new set of hourly E-Values for the whole United States, broken down into 19 subregions, using an open-source reduced-order dispatch model. The patterns uncovered by these estimates can help policymakers design economically efficient DER policies to reduce air pollution from electricity generators.
Policy Integrity Comments to New Jersey on Cost Test Straw Proposal
The New Jersey Board of Public Utilities (BPU) asked for comments on its straw proposal for the benefit-cost test that BPU would employ pursuant to the 2018 Clean Energy Act, which requires energy efficiency and peak demand reduction programs to satisfy a benefit-cost test. Policy Integrity’s comments encourage BPU to include avoided greenhouse gas emissions among the non-energy benefits it credits to energy efficiency and peak demand reduction projects. The comments also suggest that BPU adopt a tool and methodology for assessing the benefit of avoided local air pollutants that is more sensitive than those identified in the proposal.
Wisdom of the Experts: Using Survey Responses to Address Positive and Normative Uncertainties in Climate-Economic Models
The social cost of carbon (SCC) and the climate-economic models underlying this prominent US climate policy instrument are heavily affected by modeler opinion and therefore may not reflect the views of most climate economists. To test whether differences exist, we recalibrate key uncertain model parameters using formal expert elicitation: a multi-question online survey of individuals who have published scholarship on the economics of climate change.
Policy Integrity Comments to Oregon PUC on the Social Cost of Carbon
Oregon Governor Kate Brown signed an executive order directing state agencies, including the Public Utilities Commission (PUC), to reduce greenhouse gas emissions. Policy Integrity submitted comments encouraging the PUC to use Social Cost of Carbon metrics to monetize the benefits of avoided greenhouse gas emissions.
SOCIAL COST OF CARBON: Identifying a Federal Entity to Address the National Academies’ Recommendations Could Strengthen Regulatory Analysis
This report examines, among other objectives: (1) how the federal government’s current estimates of the social cost of carbon compare to its prior estimates and (2) how the federal government plans to address the recommendations of the National Academies. GAO reviewed executive orders, OMB guidance, and regulatory impact analyses and interviewed OMB, EPA, NHTSA, and BLM officials and staff who had conducted such analyses. GAO recommends that OMB identify a federal entity responsible for addressing the National Academies’ recommendations.
Comments to Rhode Island on Carbon Pricing Study
Rhode Island is undertaking a study to understand what a state carbon pricing scheme would look like and how it would interact with the state’s participation in the Regional Greenhouse Gas Initiative and the Transportation and Climate Initiative. Policy Integrity submitted comments that support the exploration of implementing a multisectoral carbon price and recommend that the state study a scenario that uses the federal Interagency Working Group’s Social Cost of Carbon.
Option Value and the Social Cost of Carbon: What Are We Waiting For?
Scientists and economists have long recognized that significant uncertainties and irreversibility characterize climate change. And yet, the social cost of carbon (SCC), the preeminent policy tool to address climate change applied by the U.S. government, does not include the option value (OV) that arises due to these characteristics. We demonstrate a simple methodology for approximating the OV underlying the SCC using the Bachelier formula.
Policy Integrity Comments to the Colorado Public Utilities Commission on Electricity Rule Changes
The Colorado Public Utilities Commission is amending its rules relating to utilities, electric resource planning, and renewable energy standards. Policy Integrity submitted comments explaining why the Commission should use Social Cost of Greenhouse Gases estimates to monetize the externalities of carbon pollution. Our recommendations include rule revisions and new language that will help include monetized estimates of climate impacts in all relevant decisionmaking. Policy Integrity also submitted comments and reply comments on additional rule revisions, building on our original comments to further describe how the Commission can best express and apply the Social Cost of Greenhouse Gases.
Testimony on Retirement of the San Juan Coal-Fired Power Plant
Jason Schwartz and Denise Grab prepared a testimony for the New Mexico Public Regulation Commission regarding a proposal to retire the San Juan Generating Units, a coal-fired power plant in New Mexico. Their testimony details how applying Social Cost of Carbon metrics would allow the Commission to better monetize and contextualize the climate impacts of the proposal. Retiring the San Juan coal units would deliver billions of dollars in benefits to agricultural productivity, property values, and human health.
Expert Report on Colorado’s Zero Emission Vehicle Program
In July 2019, Peter Howard and Jason Schwartz provided an expert report on Colorado’s Zero Emission Vehicle program, which will reduce millions of tons of greenhouse gas emissions annually. They demonstrate how the program’s climate benefits can be monetized and how those estimates can provide useful context for decisionmakers and the public.