Reports Underscore Role of Biofuels in Future High-Performance, Low-Carbon Engines

Ethanol advocates and industry leaders received good news last week when DOE officials unveiled two studies, one identifying high-octane blendstocks that could be blended into gasoline for better performance, and the other outlining a new mathematical equation that quantifies the fuel efficiency potential associated with different fuel properties.

Released by the department’s Co-Optimization of Engines and Fuels initiative (Co-Optima), the reports represent a major milestone in the first-of-its-kind research that aims to simultaneously transform both transportation fuels and vehicles to maximize performance and efficiency. The department and its scientists are also looking to minimize the environmental impact and accelerate the widespread adoption of innovative combustion strategies.

In addition to identifying blendstocks across five chemical groups, the study, Fuel Blendstocks with the Potential to Optimize Future Gasoline Engine Performance, determines that once co-optimized with advanced gasoline engines, the blendstocks have the potential to improve passenger vehicle fuel economy by 10 percent.

The companion study, Efficiency Merit Function for Spark Ignition Engines, aims to provide American industry with the scientific foundation needed to maximize vehicle and fuel performance and efficiency, thereby enabling increased fuel economy and more affordable transportation.

The reports build on Co-Optima’s research data first released last June that showed ethanol is the leading candidate fuel additive to achieve 2025 efficiency and clean air goals for the American transportation system.

The Co-Optima initiative aims to simultaneously develop advanced, more efficient engine technologies and enhanced transportation fuels that together can significantly increase fuel economy over today’s vehicles and reduce emissions. While advanced engine designs are being introduced commercially, they are limited by current fuels. However, the reports make clear that the advanced fuel components that can be derived from domestic biomass resources – that means ethanol – can increase U.S. energy security and create jobs in rural America.

The research builds on a large body of work that has already been done on various fuel additives, including ethanol, which is an inherently high-octane fuel additive that contains many of the benefits researchers are looking for, including commercial and economic viability.

The magnitude of the latest reports’ findings can be evidenced by the fact they are the products of a department- and sector-wide, research and development (R&D) collaboration between DOE’s Office of Energy Efficiency and Renewable Energy (EERE) – the department’s nine national laboratories, including the National Renewable Energy Laboratory (NREL).

It’s also important to note that the Co-Optima initiative involves and is supported by a variety of industry stakeholders, including automakers, biofuel feedstock and producer groups, agribusiness partners, infrastructure providers and technical experts.

The 25x’25 Alliance has been working with many of these stakeholders to develop strategies to accelerate the transition of transportation fuels to higher octane/lower carbon blends for use in the U.S. light duty vehicle fleet. Increasing the development and use of biofuels, including conventional feedstocks like corn and second-generation feedstocks such as corn stover, will encourage additional growth in the production of cleaner-burning cars and light trucks on U.S. roads and highways.

Advancements in biofuel production have helped to establish ethanol, both conventional and advanced forms, as an increasingly cost-effective, commercially viable pathway for increasing the octane of liquid transportation fuels in the near future and by the year 2025.

Given that the internal combustion engine will play a key role in our transportation mix for decades to come, the need to improve vehicle efficiency and reduce the greenhouse gases they emit is an ongoing objective. DOE says the next phases of Co-Optima will validate the potential fuel efficiency improvements developed so far through engine testing. 25x’25 calls on policy makers and industry partners to sustain work like the Co-Optima research initiative. Also, regulators should take a closer look at the rapidly growing scientific evidence around the GHG emission-reduction benefits of biofuels, and acknowledge that they are a smart choice for meeting clean energy targets, while also supporting the U.S. economy.

 

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Clean Energy Stakeholders Need to Keep Lawmakers Honest on Budget

There’s something unfortunately familiar about the fiscal 2019 budget proposal released by the White House this week: It bears the same draconian cuts to clean energy programs the Trump administration sought last year.

The proposal makes even clearer the Trump administration’s growing focus on fossil energy, like coal, gas and oil, and ever diminishing support for clean energy technologies. His proposal would slash or eliminate programs and services that benefit rural America, including those that promote the production of clean energy from our farms, ranches and forestlands.

Last year, Congress rejected nearly all of the reductions the White House sought in spending on renewable energy like wind, solar, bioenergy and hydropower. But that small victory came only after the Senate had to turn back House budget proposals nearly as harsh as those that came from the White House.

Congressional leaders offered either faint praise or outright condemnation of this week’s White House budget proposal. They remind any who ask that, ultimately, it is lawmakers who craft and adopt the annual spending plan, asserting that the suggested cuts will not survive.

But given the chaotic ebbs and flows that have dominated much of the legislative process in Washington over the last several years, stakeholders would do well to continually remind lawmakers that the short-sighted spending cuts sought by the Trump administration would close down critical research and development efforts, and would delay the nation’s inevitable transition to a clean energy future.

Under the White House proposal, overall DOE spending would get a slight bump up over the next fiscal year starting Oct 1, climbing to $30.6 billion from this year’s $30.1 billion. But the new money would go to spending on the nation’s nuclear arsenal, which makes up about half of the DOE budget, and to fossil energy research and development.

As the White House proposal did last year, the 2018 budget blueprint is targeting DOE’s Office of Energy Efficiency and Renewable Energy (EERE), calling for a cut of some two-thirds of the EERE’s current budget, from nearly $2 billion down to just under $700 million. Such a cut would debilitate the agency’s mission to help support the development of clean, renewable and efficient energy technologies for America, and supporting a global clean energy economy.

The White House wants to kill the Advanced Research Projects Agency-Energy (ARPA-E) program because of what it says is an overlap of the agency’s ongoing research and development with that being undertaken in the private sector. The administration’s justification runs contrary to ARPA-E’s statutory obligation to focus on high-potential, high-impact energy technologies that are too early and too risky for private-sector investment. Last year, Congress not only rejected the administration’s call to kill ARPA-E, it added $15 million to its budget.

The White House would also eliminate DOE’s Loan Program Office (LPO), which was created by Congress in 2005 to help American innovative energy and advanced auto manufacturing projects gain access to financing to help bring new technologies to commercial deployment. The LPO manages a portfolio comprising more than $30 billion in loans, loan guarantees and conditional commitments covering more than 30 projects, and securing more than $50 billion in total project investment.

Under the heading of “Duplicative, Ineffective or Lower Priority Programs,” the 2018 White House budget for USDA would eliminate all funding for the Rural Energy for America Program (REAP), which has supported more than 15,000 energy-saving and clean energy-producing projects in rural areas across the country since 2012, and the Biomass Crop Assistance Program (BCAP), which supports U.S. cellulosic biofuel production.

The severity of these kinds of cuts makes it critical to repeat: Even though members of Congress have said the president’s proposal is just that – a suggested line of spending – 25x’25 calls on partners and renewable energy stakeholders to keep congressional budget writers honest and reject the Trump energy funding plan and any semblance of it. Instead, call on them to develop a fiscal 2018 budget that supports clean energy efforts that help shore up our small towns and farming communities. As always, we stand ready to work with lawmakers to develop a spending plan for the next fiscal year that enables the full potential of clean energy solutions from rural America to be realized.

 

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Rural Electric Co-ops Finding that Renewables Make Good Business Sense

A few short months ago, the International Renewable Energy Agency (IRENA) projected the share of the world power market held by renewables will grow from 24 percent in 2016 to 30 percent by 2022. IRENA says that the three nations accounting for two-thirds of the expansion leading that shift will be India, China and the United States.

That the United States is among those countries ultimately moving the world towards the inevitable transition to a future of low- and no-carbon energy sources – despite current policy uncertainty at the federal level – is not surprising given the uplift to clean power sources by states and businesses.

From Massachusetts to California, states are directing utilities to raise the amount of renewable energy they provide, in large part to reduce emissions that pose health risks and the high costs that come with them. Corporations of all sizes are expanding their carbon-free footprint, recognizing the cost savings that continue to grow with renewable sources of electricity and improve their bottom line.

In those contexts, it is not surprising that our nation’s electrical cooperatives – the principle source of power for most of rural America – are among those in the sector leading a trend away from coal as their major power source and boosting their use of renewable resources like wind, solar and biomass in the process.

The National Rural Electric Cooperative Association (NRECA) represents nearly 900 consumer-owned, not-for-profit electric cooperatives, public power districts and public utility districts in the United States. These co-ops are unique within the $391 billion U.S. electric utility industry. More than 900 cooperatives in 47 states provide electric service to almost three-quarters of the nation’s landmass.

NRECA’s co-op members serve an estimated 42 million people in 47 states. They provide the power for more than 19 million businesses, homes, schools, churches, farms, irrigation systems and other establishments in 2,500 of 3,141 counties in the United States.

So, when the NRECA says its members are making massive strides away from coal and toward more renewables and natural gas, it’s a move that reaffirms the transformation underway in this country towards a clean energy future.

Like other businesses across the nation, the association cites lower costs and a need to reduce emissions as driving the boost in lower-emission energy sources.

The share of co-op electricity coming from coal was at 41 percent in 2016, the latest year pertinent data was available, compared with 54 percent just two years earlier. Association analysts attribute the reduction in coal as a fuel to the changes in the electric industry, specifically changes in market fundamentals, including lower renewable energy technology costs along with low natural gas prices and increased coal power plant retirements.

As coal use decreased, the share of non-hydropower renewable energy resources doubled from 4 percent to 8 percent over the same period. Hydropower resources remained constant at 9 percent. Natural gas grew from 18 percent in 2014 to 26 percent in 2016. Nuclear power remained about the same at 15 percent.

The transition is even more significant when looked at in a historical perspective. In 2009, coal accounted for 58 percent of the national retail electric fuel mix for co-ops, while renewables had only a 3-percent slice. Natural gas accounted for 12 percent nine years ago.

Another perspective on NRECA’s role in promoting clean energy development is offered by a look at the association’s overall renewable energy capabilities. Currently, 95 percent of NRECA’s distribution members offer renewable options to 40 million Americans. Including federal hydropower, co-ops own or purchase roughly 10 percent of all U.S. renewable capacity. Co-ops own more than 1.3 gigawatts (GW) of renewable capacity and have long-term power purchase agreements for nearly 7.4 GW – in addition to roughly 10 GW of preference power contracts with federal hydroelectric facilities.

The 25x’25 Alliance commends our rural electric co-ops who are taking a lead role in the development of renewable energy in this country. Co-ops are currently set to add more than 1 GW of additional renewable capacity over the next few years, with more announced every day. It’s strong evidence of the role rural America is playing in meeting our changing energy needs.

 

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USDA Farm Bill 'Principles' Fall Short by Omitting Energy Programs

Last week, Agriculture Secretary Sonny Perdue laid out USDA’s Farm Bill and Legislative Principles for 2018. USDA would like to see Congress address and adopt their list of priorities in 2018 as lawmakers deliberate over the five-year measure to guide farm policy through 2022.

The legislative objectives are broken down under nine categories, each covering USDA’s major program functions – from farm production and conservation, to trade and foreign agricultural affairs, to rural development, for example.

The principles have drawn little reaction from USDA’s wide range of constituency groups, mainly because they call for the same legislative goals as those long sought by everybody from general farm organizations to a wide variety of commodity trade organizations to crop insurers to food safety interests.

Indicative of the universality of the legislative goals is the very first offering: “Provide a farm safety net that helps American farmers weather times of economic stress without distorting markets.”

It’s important to stress – as Perdue did when he announced the list last week – that ultimately Congress will write the 2018 Farm Bill. So, the principles, though widely accepted and supported by most agricultural, forestry and rural constituencies, will likely undergo some changes before the farm legislation is adopted.

That’s an important point, given the omission of any reference in the principles to renewable energy and the farm energy programs that have contributed so much to rural America.

Over the past 20 years, the farm bill has encouraged and supported initiatives that have enabled our farms, ranches and forestlands to make a significant contribution to the nation’s energy strategy. For example, from 2009 through 2016, the Rural Energy for America Program (REAP) provided more than 11,100 grants totaling more than $357 million, and offered nearly 1,000 loan guarantees covering more than $625 million to farmers and small business owners for renewable energy projects and energy efficiency upgrades. USDA says that money has, in turn, leveraged some $2 billion in private investment. Considering REAP was originally created in the 2002 Farm Bill, total investment dollars leveraged over the life of the program are much higher.

Yet REAP and other farm bill programs only last year faced budgetary uncertainty, particularly in the House of Representatives, where lawmakers attempted to eviscerate virtually all clean energy programs.

A strong lobbying effort from stakeholders and clean energy allies in the Senate held off the assaults, reminding policy makers in Washington of something they always seem to forget – these programs generate revenues and jobs in parts of rural America that have been in a steady economic decline for at least four years.

The omission of any reference to farm energy programs in Perdue’s legislative principles is not the only indicator that stakeholders and clean energy advocates will have to double their efforts to see that the initiatives are maintained. In a separate development that reflects the harsh political environment in Washington, news outlets there are reporting this week that a draft, 2018-19 budget proposal from the White House calls for cutting DOE renewable energy and energy efficiency spending by staggering 73 percent.

The 25x’25 Alliance recognizes that Congress has the budgetary challenge of trying to do more with less. But the Alliance also recognizes the need to maintain a strong rural economy that supports a diverse energy portfolio. And stakeholders should caution lawmakers that any effort to boost fossil fuels in some short-sighted attempt to delay this nation’s inevitable transition to a clean energy future would sacrifice critical national priorities that would ultimately leave the nation on a sounder economic footing in the future. Farm bill energy programs are among those critical priorities because they strengthen our national security, create jobs, and produce new economic opportunities and investments in rural America.

 

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Solar Tariff Decision Undermines Growth of a U.S. ‘Economic Engine’

Monday’s decision by the Trump administration to impose tariffs on imported solar cells and modules was anticipated by the industry, given the president’s “America First” agenda on behalf of U.S. manufacturing, energy and other sectors.

Tariffs were also an outcome that most of the solar industry in this country feared. While claims were made that the punitive duties would generate U.S. jobs, the consensus – even from impartial analysts – suggests any increase in manufacturing jobs would be minimal.

In fact, the Solar Energy Industries Association (SEIA), the key U.S. trade group in the sector, estimates the tariffs will drive up the costs of solar components, drive down demand for new utility-scale solar plants and rooftop systems, and cost the industry upwards of 23,000 jobs.

The U.S. Trade Representative’s (USTR) office announced that it would impose 30-percent tariffs on imported crystalline silicon photovoltaic (PV) cells and modules, though it excludes the first 2.5 gigawatts (GW) of imports.

The tariffs will decline by five percent over each of the next three years, coming to an end at 15 percent in 2022.

Analysts say the 30-percent levy will add another 10-15 cents per watt to the cost of imported cells and panels, which are now forecast to drop anticipated solar installations by 11 percent, or 7.6 GW – down to 61.3 GW – from now until 2022.

Despite those numbers, those supporting the manufacturers’ petition argue the levies will not significantly harm the U.S. solar industry.

But this is a burgeoning industry – an economic engine that is growing 17 times faster than the rest of the U.S. economy and employing more than 280,000 American workers. Over the last five years, the sector has added more than 100,000 blue-collar jobs to the economy, including those in installation and those in the manufacturing of other solar components such as sun trackers, inverters, and framing and racking systems. In 2016, the solar industry created one out of every 50 new U.S. jobs.

Despite administration claims the tariffs would launch a new wave of solar manufacturing, they are unlikely to be enough to even save the two financially distressed solar cell and panel manufacturers that went to the U.S. International Trade Commission last April seeking the relief.

Suniva, a bankrupt, Georgia-based firm principally owned by a Chinese company, and SolarWorld, owned by an “insolvent” German company, joined in a petition to the ITC in April, asking that penalty tariffs be levied on imported solar cells and panels. The commission determined in September that the imports were causing “serious injury” to the manufacturers. Following a hearing in October, the commission formally sent its recommendations to the White House in November.

The four ITC members each offered their own recommendations, most of which were generally more severe than what the USTR announced Monday. And the first-year, 30-percent tariff is well below the approximately 50-percent remedy sought by the two petitioners (Suniva also sought a 74-cents-per-watt floor price on solar modules). The 2.5 GW duty-free quota set Monday falls in between what SolarWorld sought for solar cells (0.22 GW) and panels (5.7 GW).

Even if the USTR set the tariffs at the level sought by Suniva and SolarWorld, the solar manufacturing sector would only be expected to gain about 6,400 jobs, a number that could now be significantly lower.

The tariff decision is an unfortunate market disruptor that fails to consider the consequences for other domestic industries. It is dismissive of this nation’s inevitable move to a clean energy future. It will also drive up consumer costs. And with the anticipated drop in installations, particularly in utility-scale solar, there will be a decrease in leases for solar facility location sites, which are mostly found in – and offer financial benefits to – rural America.

The tariffs will slow the solar industry, but not stop it. Stakeholders are urged to engage federal, state and local policy makers and urge them to adopt the programs and financing tools that will accelerate the development of solar and other low- and no-carbon power sources so critical to this nation’s energy security.

 

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NACSAA Reaffirms Commitment to Enhance Adaptive Capacity of North American Agriculture

A gathering this week in Washington, DC, of leaders from more than 30 leading farm and sustainability organizations from across the continent has reaffirmed their commitment to enhance the adaptive capacity of North American agriculture. The meeting, held at the American Farm Bureau Federation headquarters, marked a revitalization of the North American Climate Smart Agriculture Alliance (NACSAA), which provides a platform for engagement, dialogue, knowledge sharing and application of climate science to the agriculture and forestry sectors.

NACSAA, an initiative of Solutions from the Land (the parent organization of 25x’25), has three complementing strategies: 1) sustainably increasing agricultural productivity and livelihoods; 2) enhancing adaptive capacity and improving resilience; and 3) delivering ecosystem services, sequestering carbon, and reducing and/or avoiding greenhouse gas emissions.

Sponsored by the advocacy group Business for Social Responsibility, Tuesday’s session drew together agriculture and forestry leaders from the United States, Canada and Mexico who share the mission of making our food, feed and fiber production systems resilient to changes in our climate while intensifying production levels in the face of a growing global population.

Equally important, these farm and forestry leaders also renewed their commitment to the role of agriculture and forestry in significantly reducing greenhouse gas (GHG) emissions – which most scientists say is a major contributor to climate change – through methane capture, soil carbon sequestration and biofuels (including biofuels for transportation and woody biomass for power) that burn more cleanly than fossil fuels.

The people in Tuesday’s meeting have the first-hand knowledge and experience to address the challenges that science is telling us to expect.

As documented in the Fourth National Climate Assessment Report (Vol I), record-setting hot years are projected to become common in the near future; the incidence of large wildfires like those that gripped California in recent months has grown since the early 1980s and is projected to further increase; annual trends toward earlier spring melt and reduced snowpack that are already affecting water resources in the western United States are expected to continue; and extensive drought is likely to become a persistently recurring threat in the years ahead.

This week’s meeting was held in large part to reinforce the role of climate-smart agriculture and help ensure U.S. farm and forestry interests remain a strong player in shaping global plans to address climate-related challenges and deliver solutions to achieve the United Nations’ Sustainable Development Goals. In November, the UN Framework Convention on Climate Change announced the Koronivia Joint Work on Agriculture, a two-year initiative charged with exploring and recommending “bold actions” agriculture and forestry can undertake to meet climate, adaptation and food security challenges, and presenting those strategies at the next UN climate meeting in 2020.

In their efforts to secure a place at the negotiating table now and in 2020, NACSAA members can cite federal government data showing that U.S. working lands have been sequestering much more carbon than they emit (a net “carbon sink”) for the last three decades. There are numerous projects at work reinforcing how biofuels can reduce emissions, including a University of Florida initiative to identify and deploy regionally adapted carinata (an oilseed member of the mustard family) as the basis of a biobased jet fuel; and a Washington State University project that takes a holistic approach to building a supply chain within the Northwest U.S. based on using forest harvest residuals to make aviation biofuel.

NACSAA members will urge policy makers at all levels to support programs that not only prepare agriculture and forestry for climate change, but enhance the sector’s role in mitigating it. As other nation’s make dealing with climate change a priority, U.S. interests must overcome the policy constraints at the federal level, knowing full well that failing to do so endangers the U.S. position in foreign agriculture and forestry trade and commodity markets.

The impacts wrought by climate change that scientists predict will happen are already underway.  In 2017, natural disasters caused $306 billion in damage across the nation. The United States is the world’s biggest breadbasket, but it is not immune to the impacts of a changing climate. We urge all stakeholders – be they farmers, foresters or renewable energy developers – to follow NACSAA’s lead and help develop the enabling policies and initiatives that will ensure the resilience of our food, feed and fiber production, and innovate the land-based strategies that will nullify the effects of changing climatic conditions and extreme weather events.

 

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FERC Rejection of Perry ‘Resiliency’ Proposal Renews Focus on Value of Renewables

The Federal Energy Regulatory Commission (FERC) reached the right conclusion this week in rejecting a DOE proposal to essentially subsidize money-losing coal-fueled and nuclear power plants. The five-member panel also rendered its decision forcefully, voting unanimously in finding existing market rules were not “unjust, unreasonable, unduly discriminatory or preferential” – all conditions that must be present under the law to adopt Energy Secretary Rick Perry’s plan.

Last August, Perry called on FERC to issue new rules to ensure that power generating facilities with a 90-day fuel supply – nuclear and coal – be compensated for the reliability they add to the grid, in addition to the power they supply.

Some saw the DOE proposal as a ploy to boost the financial fortunes of certain base load energy interests. At the very least, it was a misguided effort to skew the energy market, even if its intentions were to ensure U.S. energy security.

A grid reliability study ordered by Perry and delivered to him last August clearly showed that the ongoing decline in the so-called “base load” energy sources – increasing coal and nuclear plant closures – was attributable primarily to less expensive natural gas, flatlining energy demand and significant increases in net generation capacity since 2002.

And it found that the dramatic drop in the price of installing renewables like wind and solar has led to wider implementation of wind turbines and solar panels across the country.

FERC’s ruling came just after Winter Storm Grayson, charged by an Arctic air blast, brought frigid temperatures, heavy snow, punishing winds and even coastal flooding from the Northeast United States down the Eastern seaboard. Conditions last week were similar to those experienced during the 2014 Polar Vortex – an event that pushed grid operators to their limits and did cause some disruptions of service. The conditions experienced last week could not have presented a better scenario to reinforce the need cited by Perry for his resiliency price proposal hiking the rates consumers pay for nuclear and coal power.

But the grid, in fact, suffered little disruption, and operators, who learned some lessons from the 2014 storms, attributed their success to a diversity of power sources, including natural gas and renewables like wind and solar, in addition to nuclear and coal. Operators made clear they had no issues with on-site fuel supplies.

FERC did give regional grid owners and operators 60 days to offer their own positions on grid resilience, including how they define and assess it within their service areas, and whether there is any action the commission can take to help them.

It’s a smart move. It will give FERC commissioners a chance to take a truthful, holistic look at the energy market. And it will give power system operators a window for input wider than that offered during the hurried rush the DOE forced on the commission to consider its proposal. Operators now have the opportunity to fully show policy makers that they have included deeper renewable energy penetration in their grids in addressing resiliency and reliability in recent years.

It should not be lost on the Trump administration, which came to Washington touting a free-market philosophy, that much of the overwhelming opposition to the DOE proposal was based on its effort to tip the market scales in favor of coal and nuclear power. It is hoped the White House recognizes that we are at a time when homeowners and businesses are increasingly looking to purchase power from renewable sources because they are increasingly cost-competitive and part of a reliable grid. And dozens of states and hundreds of cities are pursuing renewable energy development to lower power costs and assure reliability through diversity.

FERC will learn over the next 60 days that the U.S. energy market is best served by those policies that meet its demands for low costs, reliability, resilience, flexibility and security. Innovation will continue to be a driver of the development of renewable energy technologies that will increasingly meet those demands. Initiatives to modernize the grid don’t require much action from policy makers. Let competition and market-based solutions, including renewables, define the ideal energy mix of the future. Allow power providers to deliver the lowest-cost, most reliable energy solutions to customers across the United States.

 

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Congress Needs to Restore Tax Breaks for ‘Orphan’ Renewables

As Congress ratchets up its ongoing budget battles – the continuing resolution that is currently funding the government expires Jan. 19 – clean energy advocates of all stripes must hold lawmakers to their longstanding promises to renew tax credits for a long list of “orphaned” renewable energy technologies that were not included in major legislation adopted two years ago.

In December 2015, when Congress reauthorized and extended the Production Tax Credits (PTC) and Investment Tax Credits (ITC) for major wind and solar projects, lawmakers said tax credits for smaller renewable energy projects – geothermal facilities, for example – were inadvertently omitted, and they made promises to return to them the following year.

Two years have passed with no forward movement on those technologies.

But with a major tax reform measure passed and signed into law, a serious effort to renew and extend tax credits for those smaller renewable energy sources appears to be afoot. Senate Finance Committee Chairman Orrin Hatch (R-UT) introduced late last month the Tax Extenders Act of 2017 (S. 2256), a measure that would restore the tax credits intended to sustain the development of these lesser-known but vital clean energy technologies.

The legislation from Hatch indicates some real movement can be expected on tax credit extenders from the House and Senate tax writing committees.

Among the dozens of tax credits that congressional leaders said had been inadvertently omitted from the vast package of benefits passed in December 2015, and which ultimately died at the end of 2016, is a Biodiesel Blender Credit of $1 per gallon for biodiesel mixed with diesel fuel, and the Alternative Fuel Excise Tax Credit of 50 cents per gallon that can be taken against the taxpayer’s fuel tax liability.

The biodiesel credits are included in Hatch’s bill, as is a Small Agri-Biodiesel Producer Credit, which runs 10 cents per gallon for up to 15 million gallons when agro-biodiesel production capacity does not exceed 60 million gallons per year. Other provisions in S. 2256 are a Second-Generation Biofuel PTC of $1.01 per gallon for cellulosic biomass from agricultural residue, wood or waste; an Alternative Fuel Vehicle Property provision, a 30-percent credit for up to $30,000 for installing blender pumps that would sell fuels up to E85 and 20-percent biodiesel; and a 30-percent ITC for installing alternative vehicle refueling property.

While long-term extensions were granted in late 2015 only for big wind and solar projects, advocates are hopeful for provisions in the Hatch bill that will renew and extend a Distributed Wind ITC for installing electrical power generation, including distributed wind projects and community-owned wind farms that have local financial participation and control. The ITC currently stands at 24 percent for 2017, 18 percent for 2018 and 12 percent for 2019, before expiring in 2020.

Under the Hatch bill, the same phase-out rates would apply to a Small Wind ITC program that provides credits toward the installation cost of a system for small generators to produce power for individual homes, farms and small businesses.

Also included in the Hatch bill is a 2.3-cents-per-kilowatt-hour (kWh) credit for electricity produced from closed-loop biomass, and a 1.2-cent-per-kWh credit for open-loop biomass. The credits are generally available for 10 years after a facility begins production.

Lawmakers are being urged by groups like the American Farm Bureau Federation, along with other rural and clean energy advocacy groups, to retroactively renew and extend the tax credits. In a letter to lawmakers, these proponents point out that the expired provisions impact sectors vital to the U.S. economy, and that the credits also support tens of thousands of jobs nationwide. Any failure to renew them, the advocates say, “creates confusion in the marketplace and effectively increases taxes on entities that create jobs and economic growth.”

It is critical for stakeholders and clean energy advocates to maintain the pressure on lawmakers to adopt these tax credits. Remind policy makers that it’s a matter of fairness, given that fossil fuels have garnered the benefit of tax breaks for a century. The production and investment tax credits represent a step forward in the effort required over the next several decades to sustain the renewable energy development that can boost this nation’s economy, ensure energy security and enhance the environment.

 

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Dropping Climate Threats from National Security Strategy Is Nonsensical

On Monday this week, the White House released a new National Security Strategy, a statutorily mandated document that outlines for the American public, U.S. allies and partners, as well as the federal agencies, what the nation’s major security concerns are, and how President Trump plans to deal with them.

Among the strategy’s targeted aspirations is to ensure the United States “will remain a global leader in reducing traditional pollution, as well as greenhouse gases, while expanding our economy.”

That passage is the only place in the 60-page document that mentions greenhouse gases. Incredibly, this administration’s national security strategy is devoid of any mention of climate change, despite scientific-based evidence of the damage resulting today from rising global temperatures and ocean levels, as well as additional risks anticipated to result from climate change over the decades ahead.

Climate-related events affect national security by disrupting food production, spreading disease, interrupting commerce, forcing migration and sparking conflict.

There is a growing body of evidence that demonstrates that climate change is occurring now, and that it is a major threat multiplier to production agriculture across the globe. Toward that end, the North American Climate Smart Agriculture Alliance (NACSAA) is meeting Jan. 16 in Washington, DC, where farmer leaders and their value chain partners from the United States, Canada and Mexico will share adaptive management strategies, and discuss opportunities that now exist for the agriculture sector to deliver food, feed, fiber, clean energy, climate change solutions and other ecosystem services.

The nonsensical omission of climate change from the administration’s new security strategy also runs contrary to the Pentagon’s efforts over the past 10 years to reduce fossil fuel use – a leading source of greenhouse gases (GHGs) that contribute to climate change – and power military installations with renewables like wind, solar and biomass, as well as fuel planes, ships and vehicles with biofuels.

Earlier this year, Reuters news service published an extensive analysis offering in full detail the reasons why the Department of Defense continues to pursue clean energy alternatives. Senior military officials told the news service that the nation’s armed forces remain committed to an effort to transition high fuel-demand operations to renewable power, citing logistical reasons that have remained unchanged since the move to shift power sources began more than a decade ago.

The U.S. armed forces are the nation’s single largest consumer of energy. Twenty percent of the military’s energy consumption occurs at its installations, and the Defense Department pays around $4 billion annually to provide power to its 300,000-plus facilities in the United States and around the world. And while the military uses more oil than any other organization in the world, defense officials and military officers say there is no real control over this single source of energy. U.S. reliance on oil empowers countries and regimes that are hostile to the United States and continue to be identified as national security threats.

More recently, the Climate and Security Consensus Project, a nonpartisan, Washington-based think tank initiative involving foremost experts in the military and national security arenas issued a rather pointed statement that climate change poses a major security risk both in the United States and abroad, and that a wide-range of policy measures must be adopted to address the pending hazard.

Retired Navy Vice Adm. Dennis McGinn, a former 25x’25 Steering Committee member and a member of the Center for Climate and Security advisory board, maintains the position that reducing the military’s use of oil is essential to national security and troop safety, while helping to eliminate susceptibility to fuel price spikes. The former assistant secretary of the Navy for Energy, Installations and Environment and a past commander of the Navy’s Third Fleet cites the economic benefits of the military’s pursuit of clean energy, pointing to data showing that the Defense Department’s investment in the military’s use of biofuels alone will generate at least $10 billion in economic activity and create more than 14,000 jobs by 2020.

Trump’s exclusion of climate change from the new security strategy runs contrary to not only military concerns, but also to a report issued in October by the General Accounting Office – an independent, nonpartisan agency that works for Congress. The so-called “congressional watchdog” charged with investigating how the federal government spends taxpayer dollars, recommended the White House take action to address climate change. The agency reported that without implementing measures that mitigate the impacts of extreme climate events, which has resulted in the spending of billions of disaster assistance dollars, the federal government will only have to respond with even more spending in the future.

The 25x’25 Alliance calls on all stewards of the earth, be they agriculture producers, clean energy stakeholders, or even everyday citizens, to tell policy makers that the reality of climate change cannot be ignored. The president must be made to understand that addressing this issue directly and substantially is imperative for the United States to maintain its position of global leadership.

 

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U.S. Has Innovation, Determination to Return to Top of Global Clean Energy Market

Early on, the Trump administration announced with some fanfare its “America First” energy initiative, promising to take advantage of the nation’s untapped shale, oil and natural gas reserves, especially those on federal lands. The White House also expressed a very strong commitment to bolstering clean coal technology.

During those grand pronouncements this past spring, touting our nation’s energy prowess, little mention was made of clean and renewable energy sources like wind, solar, biomass, hydropower and others – despite the persistent growth in the sector over the past decade.

As a result, the reality is that the United States has ceded its position of global leadership in the clean energy sector; largely handing the mantel to China, which is working vigorously to move away from its dependency on coal.

China began its energy transition with several focused policies three years ago that aimed to move the country away from coal, which comprised 62 percent of the nation’s energy mix at the end of 2016, and towards renewable and clean sources of energy. Data analyzed by Greenpeace and other groups shows coal consumption has fallen the past three years in China.

Earlier this year, China’s National Energy Administration set a mandatory target to reduce coal energy consumption, while establishing a goal for clean energy to meet 20 percent of China’s energy needs by 2030. Most analysts contend that the latter target is quite modest, and will be met well before the next decade passes.

China’s surge in its standing as the lead nation in renewable energy development is not surprising, given its position as the largest energy consumer in the world. What makes its growth in the sector even more significant is the aggressiveness that the Asian giant has exhibited in pursuit of its clean energy goals.

While the Asian nation’s consumption of coal-fired power declined in recent years, clean energy consumption rose by some 25 percent in 2016 alone. In fact, power generation from hydro, wind and solar rose in China by 153 terawatt hours last year. That increase over one year approaches Germany’s entire renewable energy generation of 186 terawatt hours.

Beijing said earlier this year that it will spend more than $360 billion investing in renewable power generation from solar, wind and hydro through 2020. It’s an investment that is expected to create 10 million jobs in China, which currently boasts more than 3 million jobs in the sector – by far the most among all nations. On the other hand, the United States comes in third with a little more than 800,000 workers in the sector, falling second to the EU, which employs 1.2 million. China is also a major clean energy manufacturer, supplying more than two-thirds of the world’s solar panels, and almost half of its wind turbines.

China’s surge in the renewable energy sector over recent years, resembles the United States’ vigorous push towards a clean energy future earlier this decade. And while that ambitious approach to clean energy development has seemingly been abandoned at the federal level, the resources, innovation and determination among stakeholders is still strong, and we could easily reignite the intensity needed to meet our 21st-century energy demands.

Despite the Trump administration’s unfortunate bias towards fossil fuels (especially coal) and nuclear, this nation’s renewable energy sector continues to grow, driven by the state and local policies that encourage clean energy development, as well as through the push from successful businesses that recognize the contributions less expensive renewables make to their bottom lines, while also adopting aggressive sustainability goals.

In EIA’s latest Short-Term Energy Outlook, DOE’s Energy Information Administration’s says that non-hydro renewable energy resources will gain about two percentage points, reaching 10 percent of the U.S. electricity generation market in 2018 (hydro will add another 6.5 percent). Leading the growth will be wind power, growing from 88 gigawatts (GW) this year to 96 GW (6.4 percent) in 2018.

Forward thinking policy makers at the state and local levels, as well as businesses and renewable energy advocates, are refusing to relinquish the clean energy role the United States has long played on the global stage. This country’s powers of innovation and pride are too great to settle for a “participation trophy” in the world’s clean energy market. Even with the policy indifference in Washington, the resources and determination to drive our renewable energy course abound and are ready to be put to use. China may hold the stage today, but the United States will find its way to the top again.

 

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