Analysis: Energy policies in the US

This week, analyses policies implemented in the US to boost technological development in the country’s energy sector.

We discuss the vision which US national regulatory officials and state energy regulators had in mind in drafting various energy policies.

We also look at how the regulations were and are being implemented and their level of influence in transforming the country’s grid system.

With calls for global utilities to reduce their carbon emissions through increased adoption of clean energy resources, the US is today one of the leading nations in adopting renewable energy resources.

The coming of the Obama Administration in power in 2009 led to the introduction of new energy policies aiming to help utility companies achieve stability of their grid networks.

Clean Power Plan, carbon emissions and grid stability

The Obama Administration had in mind to comply with recommendations set under the Paris Climate Change Agreement.

This led to an increase in the adoption of smart grid and smart energy technologies and programmes including energy efficiency and demand response initiatives.

The Clean Power Plan introduced by the government aimed to reduce carbon dioxide emissions from electrical power generation by 32% within twenty-five years relative to 2005 levels.

The Clean Power Plan and other various regulations set by federal governments made significant impacts on the country’s transition to a low carbon economy.

According to the Bloomberg New Energy Finance (BNEF) Group, over $507 billion was invested towards the clean energy sector over the past decade in the US.

The investments made in clean energy power generation resulted in the country’s greenhouse gas emissions reaching its lowest level in 25 years.

In 2016, the US recorded a total of 6.5GtCO2e of gas emissions per annum and gas emissions from power plants dropped by 5.3% and by 24% since 2005, states the BNEF. [CPUC defends solar net metering policy in 3-2 vote].

The Clean Power Plan forced utility companies to close coal-fired power plants and encouraged states to secure the stability of their grid networks by developing new energy efficiency codes/standards and programmes.

Funding and benefits of energy policies and programmes

On average, consumers now pay 4% less per kilowatt-hour for electricity than in 2007 due to energy conservation projects deployed within the past ten years.

In a press statement, the Joyce Foundation announced in mid-December that it will provide more than $10 million in grants for use for various projects including programmes supporting the development and implementation of clean energy and energy efficiency policies.

By 2016, 70 million smart meters were deployed under efforts to provide a two-way communication between utilities and their customers. The smart meters tend to help energy companies improve management of their grid networks and ensure consumers reduce their energy efficiency by having access to real-time data regarding their energy usage.

According to predictions made by the Environmental Protection Agency, the Clean Power Plan will save an average American family $85 per year in energy bills by 2030 and save energy enough to power 30 million homes.

At state levels, energy policies implemented meant to make sure that the US increases its adoption of Electric Vehicles (EVS) and that utilities are able to provide enough energy to charge the EVs without straining their grid networks. [EV adoption expected to increase with SDG&E infrastructure projects].

The presence of regulatory initiatives supporting the growth of the smart grid market drove stakeholders in the energy sector to come up with innovative smart grid solutions to enhance the status of the country’s energy system at all levels.

According to the Renewable Energy Magazine, in mid-December, the Smart Grid Interoperability Panel (SGIP) announced that the ANSI/ASHRAE/NEMA Standard 201-2016 Facility Smart Grid Information Model (FSGIM) has been approved by the International Organisation for Standardisation.

The standard helps electrical energy consumers participate in smart grid networks through the use of devices including smart meters and other digital utility services to communicate about electrical energy consumptions and forecast.

But with the coming of the new government under the leadership of Donald Trump, where are the energy policies to be implemented going to lead the US?

Conventional power generation

The Huffington post quoted the US president during his campaign saying: “I will cancel job-killing restrictions on the production of American energy, including shale energy and clean coal, creating many millions of high-paying jobs,” by removing the US from the Paris Climate Change Agreement and lifting restrictions set by the Clean Power Plan.

Some 21 federal states depending largely on coal-fired energy generation including Indiana and Kentucky united to support the new US president in out ruling the Clean Power Plan, reported the Courier Journal.

John Allan Yarmuth, US representative for Kentucky’s 3rd congressional district, said there is no doubt the Trump government is “committed to reversing course on the positive steps the Obama administration has taken to protect clean air, clean water, and address the dangerous consequences of climate change.”

During the Obama era, policies implemented meant to encourage the participation of all consumers in smart meter installation programmes deployed by utility companies.

However, with the coming of the new government, it is more likely that the US will introduce a number of new energy policies which will hinder utilities efforts to have all consumers participate in smart meter projects.

In late January, the Tenth Amendment Center reported that the New York Assembly introduced a new policy allowing consumers to opt out of utilities automated and advanced metering infrastructure programmes.

The Assembly Bill 3066 (A3066) stipulates utility companies not to issue penalty fees on consumers who choose not to have smart meters.


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