Michigan Energy Forum - April 4, 2013 - Jean Redfield, NextEnergy


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Governor Snyder has begun a process to deliver comprehensive energy policy recommendations by December 2013. How we address energy policy has broad impacts on climate, economic competitiveness, employment and job skills, environment, and health. What should be our major policy focus within Michigan? Can we find the right balance given divergent opinions? Our expert panel will discuss implications for goal setting, strategies, new technologies, and the legislative process.

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Michigan Energy Forum - April 4, 2013 - Jean Redfield, NextEnergy

  1. 1. Michigan Energy Forum: Ann Arbor Spark April 4, 2013 Jean Redfield, President & CEO 0
  2. 2. Outline NextEnergy Overview Energy Policy Framework Michigan policy issues 1
  3. 3. NextEnergy Overview Accelerate Advanced Energy Investment & Jobs in Michigan Industry & Venture Development Value Add Services Market Technology Public Sector Services Demonstration & Leadership • Vet technology Commercialization • Inform policy leaders • Consult with businesses • Shape funding priorities • Create matchmaking • Host partners • Encourage incentives and partnership • Build consortium • Remove market barriers opportunities • Develop programs • Provide access to • Secure funding funding • Build and run • Publish and iterate People NextEnergy staff and contributor network Assets Place NextEnergy’s testing, demonstration, laboratory, conference, and executive office space Relationships Industry; State, Federal; Universities; Philanthropy; Economic Developers; Entrepreneurial Ecosystem; Ventures 2
  4. 4. Energy Policy Framework What do we mean by “Policy”?  Laws  Rules  Funding streams What do we mean by “Energy”?  Electricity: Power  Natural Gas: Heating Fuel  Petroleum: Transportation Fuel Why does it matter?  Energy as “backbone” of economy  Energy as driver of quality of life 3
  5. 5. MI Aggregate Energy Use (1960-2009)MI’s energy portfolio has always been a mix Total Energy Use in MI (Includes Primary Energy used in Electricity Generation)Source: EIA, DOE 4
  6. 6. MI Aggregate Energy Use by Sector Energy Used by Sector in MI Electricity use and losses are included in each sector Source: EIA, DOE 5
  7. 7. Michigan Energy Usage“Preferred” View Energy for Electricity 100% = 1,413 Trillion BTU 5% Total Energy Use 8% 100% = 2,798 Trillion BTUTransportation 12% Coal 26%Natural Gas* NuclearElectricity 23% 53% Renewable Natural Gas 22% Petroleum 51% Michigan Energy Usage, Trillion BTU (2010) * Natural gas data excludes natural gas used in vehicles (Transportation) and to generate electricity (Electricity) Source = EIA/ DOE 6
  8. 8. Energy Policy Framework: SummaryPolicy Definition: Laws Rules/ Regulations Funding StreamsTransportation Formation of RTA DOT: CAFE Roads, Bridges, Gasoline Taxes EPA: Emissions, Ports, Waterways, NHSTA: Safety Rail, Airports, Land Vehicle registration use/ developmentNatural Gas Michigan: Acts 61 E&P Permits Reliability upgrades, (1939), 451 (‘94) (Wellhead Connection Supply contracts, US: NGPA (‘78), 436 Permits), MPSC rates E&P Investment, (‘85), Wellhead and program design Energy Efficiency Decontrol (‘89) and Investment 636 (‘92)Electricity Enabling legislation MPSC rates and Power Plants/ (Chapter 460), Energy Optimization generation, Choice (PA141, program design, FERC Reliability upgrades, 286), Renewable transmission Energy Efficiency Portfolio Standard investments (PA295) 7
  9. 9. Energy Policy: Two Simple Questions How Much?  Energy intensity: per capita, per GDP output What Mix?  Economic Competiveness: Near term costs/ long term costs; Economic upside as innovator in the transition  Environmental Responsibility: Fossil fuels/ GHG/ Other emissions; Extraction/ transportation/ use impacts  Social Value:  Energy Security: Deplete-able/ Renewable; Michigan/ US/ Global  Quality of life: Built environment, Transportation, Equity 8
  10. 10. US Energy Intensity vs. China/ Europe Per Capita: US is 2 to 6 X Per GDP: US is 2X more more intensive than intensive than Europe, Energy Intensity: China or Europe Energy Intensity: and 80% of China kgoil equivalent per capita kgoil equivalent per unit output*9000 0.358000 0.3070006000 0.25 China5000 Denmark 0.20 Germany4000 USA 0.153000 Canada 0.1020001000 0.05 0 0.00 2004 2009 2004 2009 * kilogram of oil equivalent of energy use per PPP GDP(gross domestic product converted to current international dollars using purchasing power parity rates) 9
  11. 11. Michigan Transportation Policy Issues Implicit strategies support Autos  Ubiquitous and cheap roads and gas  Economic development and mortgage deductibility favor “sprawl” Global markets demanding new options  Vehicles: Alternative fuels, higher mileage  Development: Mixed use, higher density  New Mobility: systems rather than personal autos Challenges for Michigan: Transition from “Auto Capital” to Innovation Leader in Transportation 10
  12. 12. Michigan Natural Gas Policy Issues Global market for Natural Gas vs. local Michigan supply  Near term/ long term tension as developing world develops  Extraction and transportation technologies vs. environmental protection goals Natural Gas Energy Efficiency in the current built environment Natural Gas as a transportation fuel 11
  13. 13. Michigan Electricity Policy Issues Economic impact of increased renewables? Age and makeup of fleet: coal, nuclear Regional Market Dynamics Role of Energy Efficiency 12
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