Maine wants to promote beneficial electrification – it needs a regulatory reform roadmap

Note: the following is testimony regarding LD 1464 “An Act To Support Electrification of Certain Technologies for the Benefit of Maine Consumers and Utility Systems and the Environment” in the Maine Legislature. The Act would require the Efficiency Maine Trust to conduct a study regarding the barriers to beneficial electrification of the transportation and heating sectors in the State; and require the Public Utilities Commission to issue a request for proposals from utilities and entities that are not utilities to conduct a pilot program to support beneficial electrification of the transportation sector of the State.

Senator Lawrence, Representative Berry, members of the Joint Committee, my name is Gerry Runte. I am a constituent of Senator Lawrence and live in York.  Thank you for the opportunity to testify today in opposition to LD 1464.

“Beneficial electrification” is an essential step in the decarbonization of our economy and absolutely required to achieve anything close to the current goals for reducing greenhouse gas emissions. Removing barriers and promoting the electrification of most energy use, especially transportation and heating, when combined with increasing the mix of renewable sources of electricity must happen if we are to succeed.  And as we are increasingly aware, there is great urgency in taking action.  While LD 1464 has the right intent, I believe it might unnecessarily delay taking such actions.

There are a lot of things we already know without further study:

  • Significant growth in overall electricity demand for electrification of heating and transportation will prompt the need for added infrastructure. Growth in that demand is uncertain: the Brattle Group projects a doubling of demand by 2050;
  • NRDC has projected a more modest growth over today’s demand.
  • Both Brattle and NRDC rely on significant installations of renewable distributed generation, including behind the meter, and energy efficiency measures – they are a given under any scenario.
  • That said, demand growth greater than what we have recently experienced is inevitable if even modest GHG goals are to be achieved.  And this leads to another inevitability – electric utilities must be involved in getting this implemented.
  • Utilities could have a role in facilitating electric vehicle charging beyond just selling electricity to appliances
  • Increased demand reductions through end use appliance controls will be essential; major changes in utility distribution planning necessary, etc.

Regardless of the portfolio of steps taken to electrify, an efficient implementation must begin with regulatory reform that reshapes utility business models.  At one end of the spectrum of possible models would be an expansion of the scope of utility operations and services and at the other end, treating the distribution system as a neutral interface for services (both generation and demand reduction). In the latter case an independent distribution system operator would be created, similar to ISO-NE, but for the state’s distribution network. The IDSO would run demand reduction, promote distributed resources and review/approve utility integrated resource plans – sort of an expanded version of the NWA Coordinator as envisioned by LD 1181.

In a few states there are utilities who actually see this as a win-win for them: they are pushing for regulatory reforms that allows them to conduct major surgery on their business models. Unfortunately there are still a number of utilities that are unwilling or unable to see the opportunity here to do well by doing good and who interpret these new paradigms as threats to be countered.  For these recalcitrant utilities, the only effective strategy is to reform the regulatory structure so that it drives changes to utility business models.

I therefore recommend the Committee consider a study whose deliverable is a roadmap to regulatory reform. I believe such a study would be more appropriate – and get things going much faster – than the proposed study that will take over a year to identify what is already known.  That proposed study is most likely to conclude that what is needed is innovative regulatory reform and a program to achieve such reforms – a roadmap.

My recommendation of moving directly to the development of a roadmap does not preclude, and in fact, would require completion of an analysis not unlike what is described in the bill as its first step in laying the framework and context for the roadmap.

As to the proposed pilot- the concepts to be demonstrated are fine, but then what?  The bill is silent on what happens with the information generated. More importantly, the pilots ought to be defined by the study.  They are not concurrent exercises. If, instead, the study is reworked to be a regulatory reform roadmap, the pilots would be a logical step after that begins.  Either way, the pilots seem out of sequence and perhaps premature.

I should add that we are already out of step in the state with regard to electric vehicles.  We have Efficiency Maine Trust  constructing and subsidizing electric vehicle charging stations and state subsidies for the purchase of vehicles, yet nothing has been done to deal with a regulatory structure that hampers these programs.  DC fast charge stations incur absurd demand charges (rendering them totally uneconomic) because there is no electric vehicle charging tariffs to handle them so they are treated like any other MGS 3 phase customer.  Individual consumers who own vehicles and charge them at night do not have the benefit of time of use rates to reduce charging costs.

I urge you oppose LD 1464 as proposed but also consider redrafting legislation that is more expeditious and timely to identify and remove barriers to beneficial electrification.

The Recent “Mind Bogglingly Stupid”* Arguments Against Fuel Cell Vehicles

During a press conference at the Automotive News World Congress in February Elon Musk was famously quoted saying hydrogen fuel cells are “extremely silly,” and that fuel cell electric vehicles (FCEVs) are “incredibly dumb.” He made two arguments to support this view – that electrolysis to generate hydrogen is way less efficient than using solar to charge vehicle batteries and that hydrogen was an unsafe fuel. So this is pretty transparent: it’s just the old slam-your-competition marketing ploy.  Musk’s Tesla must feel pretty threatened by the spate of fuel cell electric vehicles coming on the market, especially in Japan and California. But then a month later we get Climate Progress publishing an article by Joe Romm seconding Musk’s view and supporting his opinion with actual charts.   Romm’s analysis, with all its credentials, is no better than Musk’s uninformed off the cuff commentary.

Romm essentially recycles an article he published in Scientific American in 2006 where his primary criticism, as I interpret it, follows this equation:


REI=> (CHG) or (EWMFC) => EMP


REI=Renewable power in

CHG= Charge battery

EWMFC=Electrolyze water for hydrogen, make fuel cell

MP=Energy expended motive power

In the case of a FCEV fueled with hydrogen from renewably generated electrolysis, only 20% to 25% of REI ends up as EMP.  An electric vehicle (EV) charged with renewably generated electricity gets 75% to 80% of REI.


That’s it.  The sum total of the argument. Note the complete absence of any economics. Eliminating cost (and the discussion of other paths for zero emission FCEVs) relegates this whole argument to the realm of fierce debates over how many angels dance on the head of a pin.  Perhaps intellectually challenging, but irrelevant to the market or to policy decisions.  Think about it: install a solar array at a particular cost. Use its output to operate an electrolysis unit for hydrogen or use it to charge batteries.  Is one more efficient in the use of solar power? Sure.  But does it matter? No. Either way you have a true zero emission vehicle.  And as long as the cost per mile is competitive, it makes sense in the market place. Might the battery vehicle be a little cheaper in cost per mile? Perhaps, but what if the end user is willing to value range, where the FCEV wins hands down?

The reality, however, is that we are on the cusp of a new market of lower emission vehicles.  The zero emission world is still a good distance away because economics are a real factor.  That means we need EVs and FCEVs, and it also means that they are not completely “green” but rather olive drab.  EVs in most places will not be charged with renewable electricity but from whatever the local grid supplies, and that can be pretty dirty.  Most FCEVs will get their hydrogen from natural gas – its use in a fuel cell is an improvement over direct combustion but still results in carbon emissions.

The bottom line here is that simplistic assertions are no more than that, and while soundbites in headlines attract, they are not analysis and should not be taken seriously.

** Headline in EV World, July 7, 2014 “Musk: Fuel Cells ‘Mind Bogglingly Stupid'”