|By Robert Thornton||
|September 13, 2013 05:05 PM EDT||
It seems you can't open a newspaper or magazine today without seeing a story on severe weather, the fragility of the electricity grid and the need to invest in more robust infrastructure. This issue of energy resiliency is gaining traction and visibility among policy makers and elected officials at the federal, state and local levels. Even more importantly, district energy, CHP and microgrids are frequently identified as key strategic solutions. We are clearly building momentum for a new energy paradigm.
Recently, at the IDEA Annual Conference and Trade Show, we heard from three energy and sustainability directors from major U.S. cities who shared the following insights: (1) Energy resiliency is both an economic and environmental imperative; (2) those cities with robust and reliable infrastructure will prosper in the future; and (3) district energy with CHP offers premium value to multiple stakeholders. As an industry, we were urged to collaborate with city departments, to educate more public and private audiences, and to be more forceful advocates for the multiple benefits our systems provide. I invite you to listen to the sage advice that Brian Swett of Boston, Alisa Kane of Portland and Katherine Gajewski of Philadelphia offered on this video clip at http://tinyurl.com/luqgn5n.
Today, action is occurring at the local level. IDEA released the U.S. version of the Community Energy Development Guide in 2012 to help mayors and economic development officials navigate the process of evaluating, planning and implementing clean energy solutions for communities. Our work continues with the U.S. Department of Energy Clean Energy Application Centers in assisting public and private entities with guidance from our screening tool and early-stage consulting to help germinate new opportunities for deployment of district energy systems around the country. We are in the process of revising the guide for the Canadian market to be released at a special Canadian Community Energy Workshop and system tour Nov. 11 in Markham, Ont. in conjunction with the QUEST Canada Annual Conference. From my perspective, industry activity is accelerating and will continue to expand across North America.
Consistent with this trend, IDEA is hosting the Third Global District Energy Climate Awards in conjunction with Euroheat & Power Sept. 23-24 in New York City. As administered by the International Energy Agency, the awards will recognize and celebrate significant environmental and economic progress being achieved via district energy in cities, communities and campuses around the world. Prior award winners from the events in Copenhagen in 2009 and Paris in 2011 will share progress updates, and we will learn more about the innovations and excellent schemes that stood out for awards in 2013. The awards are intended to provide an insightful moment for educating both public officials and the general public on how district energy is working in many locations today, including North America, Europe and the Middle East, and successfully producing valuable economic and environmental benefits in communities large and small. Award winners will share their expertise and insights as a means to replicate their success elsewhere. Timing the event to coincide with Climate Week NYC, we hope to capture media attention and elevate the visibility of district energy with this event. I urge you to join us in Manhattan to participate, listen and learn from our international colleagues.
On an international level, our colleagues at Euroheat & Power and DHC+ (an initiative for research and innovation for district heating, district cooling and related technologies) continue to focus on the importance of heat in government and regional policy. With over 40 percent of all end-use energy in the form of heat, it makes sense to pay attention to the many primary opportunities to harness surplus heat and to use low-carbon options as primary fuels. Too often, policy makers overlook thermal energy, focusing exclusively on electricity. They're missing the forest for the trees. As an industry, we need to enlighten and encourage more relevant and effective solutions to accelerate deployment of proven technologies like combined heat and power and district energy in all its local forms. In the Middle East, where air conditioning can consume up to 70 percent of all electricity produced, district cooling is clearly an important infrastructure investment to support economic growth, reduce energy waste and conserve vital water and fuel resources for higher purposes. In Saudi Arabia, they recognize that every one unit of energy conserved results in 4.2 units of oil saved for export or other purposes. There is clearly an economic argument for investments in energy efficiency like district cooling.
Here in the U.S., with the recent leadership of President Obama on the urgency of addressing climate change, the administration is taking progressive action on many fronts to move forward, despite a recalcitrant and dysfunctional legislative branch. The DOE, now under the enlightened leadership of Ernest Moniz, formerly of MIT, is an engaged proponent of industrial energy efficiency and CHP. Due in large measure to the commitment of informed people like Katrina Pielli, DOE is driving regional dialogue on best practices in deployment while expanding awareness and shaping approaches to facilitate market penetration for CHP and coordinating education across multiple federal agencies on the advantages of community-scale energy efficiency. With the recent approval of Gina McCarthy as Environmental Protection Agency Administrator, we will also have informed leadership at the helm to advance practical, effective regulations and voluntary programs that should enable and not constrain investment in CHP and district energy.
Over the past six months, IDEA has been actively engaged with Sen. Al Franken's office (D-Minn.) on federal legislation in Senate bill S. 1205, the Local Energy Supply and Resiliency Act (LESRA) that will provide financial support for early-stage technical feasibility assessments and access to loan guarantees for more competitive capital for community-scale investment. These days, advancing federal energy legislation is unduly complicated. The most effective mechanism seems to be attaching S. 1205 as an amendment to S. 761, the Energy Savings and Industrial Competitiveness Act of 2013, also known as the Shaheen/Portman bill. LESRA would be an effective complement to the efficiency objectives in S. 761 and, in our view, is an appropriate amendment that is both germane and fiscally prudent. As I write this, IDEA is carefully monitoring conditions on Capitol Hill and hoping that when the moment arrives, our members will rise to endorse this approach and actively seek support from their respective senators to vote for this bill.
At the state level, we witnessed a potentially important precedent when Minnesota Gov. Mark Dayton signed H.F. 729 into law on May 23. By expanding the definition of "waste heat recovery" and adding "waste heat recovered and used as thermal energy," this legislation opened the door for the recovery and reuse of waste heat from existing machinery, buildings or industrial processes, including CHP, for heating or cooling. Approximately 55 percent of Minnesota's energy output is currently lost to the environment and rejected as waste heat to the air or a nearby waterway, according to the DOE. The expanded recovery and reuse of otherwise wasted heat to reduce demand-side energy usage will now be eligible to participate in a utility's conservation improvement programs, and the resulting energy savings will be eligible toward a utility's natural gas or electric energy savings goals.
"This policy makes economic sense by encouraging investment in energy efficiency and reducing waste in the energy system," said Ken Smith, president and chief executive officer of District Energy St. Paul, which championed the bill over many years. "Further, the development of waste heat recovery opportunities creates benefits for customers, utilities, communities and the environment," he said. Moreover, this policy can be replicated in other states and sets the stage for more widespread adoption of common-sense energy policies that cut waste and recycle thermal energy for more productive uses.
Ultimately, adoption of these common-sense energy policies, whether on a federal, state or local level, will stimulate investment in district energy and CHP and create additional opportunities for more resilient infrastructure to support continued economic growth with better environmental footprints. As more people understand and appreciate the benefits of district energy, we strengthen our chances to make a difference in our communities for the generations that follow. Momentum is building, but we all need to make our voices heard. I urge you to visit our website for more details on how you can help.