SERA Email 1.21.03


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Sectoral Emissions Reduction Agreement
Email 1.21.03

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SERA Email 1.21.03

  1. 1. "Cobb, Al" <Al.Cobb~hq.doe.9OV> < 7 01/21/2003 11:41 :52 AM Record Type: Record To: Phil Cooney/CEQ/EOP@EOP cc: Subject: FW: EEl letter of intent to Secretary Abraham Phil - Following up from our meeting here earlier this morning .. Al ---- Original Message --- From: Dobriansky, Larisa Sent: Friday, January 17, 2003 6:10 PM To: Cobb, Al Subject: FW: EEl letter of intent to Secretary Abraham Here are the documents. ---- Original Message --- From: Bill Fang [] Sent: Friday, January 17, 2003 5:37 PM Larisa; To:; john.quiflflconstellatioflcom; Dobriansky, Subject: EEl letter of intent to Secretary Abraham EEL letterhead are The letter and enclosures are attached. Signed copies on being delivered by messenger to DOE, CEO and EPA. Everyone, please try to keep this to yourself until Feb. 6. IE -abrahamkuhnletter0l 13SO3Enclosurel,'C 601dat.o 3 ~-abrahamkuhflletteroll3o3Enclosure2,0lo20 draft3.doc I limtplclte-l10,ia~o
  2. 2. January 17, 2003 The Honorable Spencer Abraham Secretary of Energy U.S. Department of Energy 1000 independence Avenue, S.W. Washington, D.C. 20585 Delivered by Messenger Dear Mr. Secretary. to support voluntary actions to reduce The Edison Electric Institute (EEI) pcontinuies U.S. supports the President's goal of reducing greenhouse gases (GHGs) and specifically 1 are world EEI and the electric utility industry GHG intensity over the next decadel sequester GHGs. In fact, in 2000 power leaders in voluntary actions to reduce avoid or and of the total reductions, avoidances sector activities comprised about 70 percent activities Infonnation Administration. These sequestrations reported to the EnerIgy and demand- to nuclear plants; energy efficiency primarily consisted of improvements' recovery, provements to fossil-fuel plants; methane side management (DSM) projects; i¶ renewables projects. forestry projects and fly ash reuse; and to industry allies and our member companies EEI has been working with our EICI to sector that reflects our fair contribution develop a joint response from the entire power umbrella EPICI plans to enter into a cooperative the President's goal. Accordingly, with DOE by May 1, 2003. In this agreement or memorandum of understanding (MOUT) reduce the industry allies and the government to decade, EEI will work with our EPICI equivalent of 3 to 5 percent. power sector's carbon intensity by the sector groups - Nuclear action, EEl j oined with six other power in response to President Bush's call for Council, National Rural Po>wer Association, Large Public Power Energy Institute (NET), American Public and Tennessee Valley Power Supply Association (EPSA) Electric Cooperative Association, Electric, primary Authority (TVA) - to form the Electric Power Industry Climate Initiative (EPICI). EPICI's and with voluntary climate activities in cooperation with, purpose is to coordinate the power sector's agencies. The partnership assistance fromi, the Department of Energy (OE) and other government 3m Partnerss. Poe Partners , along with other between EPICI and DOE has been designae "Power for Climate Action" (also kthe Administration's "Energy Partners industry partnerships with DOE, constitute participating in other Sevpa EEI member companies are also referred to as "Business Challenges"). Protection Agency (EPA)), Leaders (with the Environmental voluntary climate programs, such as Cliat d Table and Partnerships for Climate Action. Roun Chicago Climate Exchange, Business
  3. 3. 4. ~~The Honorable Spencer Abraham January 17, 2003 Page 2 as few sectors in the economy are likely to Accomplishing this goal will be very diffcult, our industry from 2000 to 2010. This goal experience the level of growth forecast for and their members - with government will be achievable only if all EPICI trad groups 2 together to implement robust supply- and support and appropriate policies _ wrk A combination of power sector and demand-side actions as well as offset projects. individual company actions reflecting government efforts will be necessaryicuig and fuel mix); government companies' particular circumstance (iacloperating or maintenance of nuclear and laws, regulations and policies favorn th uluiization and delivery infrastructure for supplies hydroelectric plant generating capacit; adequate and the full benefits of energy natural gas; economic incentives frrenewables; Since individual companies face different efficiency anid DSM as well as offset projects. not apply to companies individually. circumstances, the voluntary reduction gal does exceed this goal. And, as an industry, we Some companies individually may be ale to However, the achievement of any goal may be able to achieve a higher goal in the future. affecting our industry's fuel mix, and is dependent upon market-driven forces government laws and policies. IndiiulCmayAtvte steCresoe. has strongly recommended that member In order to reach the President's gll EEl specific activities to reduce, avoid or companies focus on quantitative, conreeand sequester GHGs. member companies may enter into once the umbrella MOU is completed, individual pledged in these documents will include company agreements with DOE. A ctivities as a member of EEI, NEI, EPSA or individual company actions - whetlkr undertaken (see discussion below). anj other group - and joint, industry-wde initiatives be the Power Partners Resource Guide, Supporting individual company actions will and demand-side options for companies to which will set forth a panoply of sply- GHGs. Among these activities will consider in order to reduce, avoid3 adsequester coal technology generation; additional likely be: additional natural gas and clean utilization, upratings and plant restarts)4 nuclear generation (through increase capacity DSM; additional offset projects (e.g., tree additional renewables, energy efficiec ad 5 projects and international projects); and planting and forest management, methane in Enclosure I to this letter. 2The critical area of government policies is addressed See EPSA letter of January 10, 2003, to you. 4 See NEI letter of December 23, 2002, tofou 4-5 million metric tons The forecast for carbon sequestered inth U.S. through power sector activities is in activities by the power sector are likely to result of CO, in the next decade. International sequstration similar numbers of sequestered tons.
  4. 4. The Honorable Spencer Abraham January 17, 2003 Page 3 (e.g., additional natural additional actions related to compliance with new air regulations gas and less coal generation). ... .uppeete yIdutyIitaie In addition to individual compn cinwih are the cornerstone of Power Partners s in industry initiatives. voluntary programs, EEI mebrcopneswl also participate six headed by EEl and two led Our industry currently has eight initiaties underway, with 6 by EPRIL Other Actions in conjunction with our EPICI idsIallies and federal agency partners, EEI also plans SMatiiien inutr to issue an interim report that examines the progress of Power Partnerssatviis n by member companies, will seek to identify additional actions~that could be undertaken s individually and collectively, to help meet the President's goal. in Power Partners Furthermore, EEI will strive to obtain full company participation 87 percent of EEI member Companies currently participating comprise more than company generation. other agencies as part of the We appreciate the opportunity to work with DOE and look forward to participating in Administration's Energy Partners for Climate Action, and the kickoff event in Washington, D.C. Sincerely, Thomas R. Kuhn TRK:lsf Enclosures (2) cc (w/ encs): Hon. Christine Todd Whitman Administrator Environmental Protection Agency Hon. James L. Connaughton, Esq. Chairman Council on Environmental Quality this letter. 6The cur-rent forecast for these initiatives is contained in Enclosure 2 to
  5. 5. The Honorable Spencer Abraham January 17, 2003 Page 4 Hon. Robert G. Card DOE Under Secretary for Energy, Science and Environment Hon. Vicki A. Bailey Assistant Secretary DOE office of Policy and International Affairs Barton Marcois Principal Deputy Assistant Secretary DOE office of Policy and International Affairs; Larisa Dobriansky, Esq. Deputy Assistant Secretary DOE office of Policy and International Affairs Philip A. Cooney, Esq. Chief of Staff Council of Environmental Quality
  6. 6. The Honorable Spencer Abraham January 17, 2003 Page 5 bee (w/ enes): All CEOs Environmental EAC GCC Subcommittee Washington Representatives Power Partners representatives BET GCC Issue Team
  7. 7. Enclosure 1 for the power sector is the One key to the success of voluntary climate programs Overall, increased support for implementation of appropriate government policies. or practices - such as renewables, ,emissions-free or less fossil fuel-intensive tbchnologies and demand-side management clean coal technologies, natural gas, and enprgy efficiency - can help drive down greenhouse gases(Hs) infrastructure are * Access to natural gas supply adntrlgas transportation critical. that the Department of Energy's • We are heartened by the annunemntlast fall carbon sequestration will be nearly $50 million of annual suppor for geological increased up to $90 million. also be helpful. * Funding for international power poects would the following are necessary to help With regard to changes in policies and regulations, directly or indirectly decrease GHGs: * Hydroelectric relicensing reform. * Nuclear power plant licensing extenisions. under th Clean Air Act (in order to * Reform of the new source review rgulations thereby decrease GHGs). facilitate improvement of power pln efficiency and (which would ease * Transmission siting authority for te federal government seriously constrained transmission capacity in the U.S., which has required additional generation or power plans). section 1605(b) are critical to Reporting reforms under Energy Policy Ac:t (EPAct) February 14 presidential statement industry participation in voluntary prograi us. The credit and not penalizing those articulated these reforms as the award of transferable future climate policy (which some have taking voluntary measures for their action's under the July 8, 2002, four-agency letter characterized as "baseline protection"). 1it addition, previously reported under the to the President recommended a placehol~ler for activities EPAct section 1605(b) guidelines. GHGs include accelerated Government tax policies that would assist in reducing equipment. Other important financial depreciation and amortization of pollutio control - such as wind, biomass and incentives include production tax creditsKo renewables vehicles. cell solar energy - and tax incentives for hybrid and fuel
  8. 8. Enclosure 2 Contibuion fro E~ an EPRI Industrv-wide Initiatives initiatives is as follows: The current forecast for FEI's industry carbon mfIfh as 2 million metric tons of * ForestTree Carbon Company: As projects.' sequestered over the lifetime of the dioxide (CO2) are expected to be This partnership with the Environmental *Coal Combustion Products Partnersip: of coal combustion products, and luse Protection Agency will increase the million C902 avoidances from the current 16 therefore is projected to increase annually. 30 million metric tons Of CO 2 metric tons Of C02 to as much as with the Department of *international Power Partnerships: T his partnership tons Of or sequester 1.8-18 million metric Energy (DOE) could reduce, avoid depending ( GHs) annually from 2002-2010, CO 2 -equivalent greenhouse gases n rjcs and member compan netet on government (DOE) funding of, Of abandoned mine lands: iitiaive on indbioass, and restoration Thee as resl fteernwbe n Tons of GHGs reduced, avoidedo01 sequestered are developed, but are until projects restoration initiatives are uncertain potentially high. roadmap initiatives: These EPRI's carbon capture and storage and climate technology are unlikely to yield and depoyent programs long-term, research, development in the short to medium term, significant tons of GHGs reduced, avoided osequesteredis high. GHGs in the long term but their potential for addressing two workshops on revision of the 'The Department of Agriculture this month is holding carbon guidelines that may address unresolved Energy Policy Act section 1605(b) a larger number of sequestered tons sequestration accounting issues, such as reporting during the early years of projects.