Stanford University

Natural Resources

Transmission Policies to Unlock America's Renewable Energy Resources

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On behalf of PESD, Stanford co-hosts PIE, TomKat, and SIEPR, and external sponsors Pillsbury Winthrop Shaw Pittman and the Kauffman Foundation, convened an all-day conference on September 15 on “Transmission Policies to Unlock America’s Renewable Energy Resources”   
   
The traditional transmission paradigm was well-adapted to fossil fuel plants built near cities and operated by vertically-integrated utilities.  We need a whole new transmission paradigm to realize the potential of intermittent wind and solar generation in today’s wholesale markets.  
   
The conference sessions (see Agenda) focused on different aspects of what this new paradigm will have to look like, focusing on the Western region.  How can markets for renewable energy credits help drive transmission policy?  Who will pay for new transmission that straddles state lines and service areas?  How can environmental impacts be weighed without bogging down transmission planning?  
   
Our distinguished speakers and discussants have many years of experience working on precisely these issues from the academic, industry, nonprofit, and government perspectives.  This event brought new insights into how to move forward on transmission in the West, and we thank everyone who participated.

 

For conference photos, click here

Opening remarks by Frank Wolak, Director, Program on Energy and Sustainable Development

 

Session 1: The Paradigm Shift in the Role of the Transmission Network

Speaker—Lorenzo Kristov, Principle, Market and Infrastructure Policy, California Independent System Operator (ISO)

Discussants: James Bushnell, Associate Professor, UC Davis Department of Economics and Udi Helman, Director, Economic and Pricing Analysis, BrightSource Energy

 

Session 2: Policy Tools for Meeting Renewable Energy Goals

Speaker—Harry Singh, Vice President, Goldman Sachs

Discussants: Sydney Berwager, Director, Strategy Integration, Bonneville Power Administration and Julie Fitch, Director, Energy Division, California Public Utilities Commission

 

Session 3: Developing a Regional Transmission Planning Process

Speaker—Brad Nickell, Director of Transportation Expansion Planning Western Electricity Coordinating Council

Discussants: Scott Cauchois, Transmission Expansion Planning Policy committee Chair, Western Electricity Coordinating Counsil and Rebecca Wagner, Commissioner, Nevada Public Utilities Commission

 

Session 4: Paying for Transmission

Speaker—Douglas Kimmelman, Senior Partner, Energy Capital Partners and Perry Cole, Managing Director, Energy Captial Partners

Discussants: Michael Hindus, Partner, Pillsbury Winthrop Shaw Pittman LLP and Darrel Thorson, VP, Business Development North America, BP Wind Energy

 

Session 5: Environmental Impacts of Transmission Siting

Speaker—Sean Gallagher, Managing Director, Government and Regulatory Affairs, K Road Power

Discussants: Julia Souder, Project Development Manager, Clean Line Energy Partners and Carl Zichella, Director of Western Transmission, Natural Resources Defense Council

 

Session 6: Lessons for Transmission Planning and Pricing   
from Other Jurisdictions

Speaker—Benjamin Hobbs, Director, Environment, Energy, Sustainability,  
and Health Institute, Johns Hopkins University

Discussants: Cristian Munoz, Engineer, AES Gener, Santiago, Chile and  
Alex Papalexopoulos, President and CEO, ECCO International, Inc.

 

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Koret-Taube Conference Center
366 Galvez Street
Stanford University

Conferences

Remaking the World's Largest Coal Market: The Quest to Develop Large Coal-Power Bases in China

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China's coal market is now in the midst of a radical restructuring that has the potential to change how coal is produced, traded and consumed both in China and the rest of the world.  The restructuring aims to integrate the coal and power sectors at giant "coal-power bases" that combined would churn out more coal annually than all the coal produced in the entire United States. 

Coal-power integration is now a focal point of the Chinese government's energy policy, driven by the dramatic "coal-power conflict".  Coal prices are market-based, but power prices are tightly controlled by the government.  This has caused massive losses for Chinese power generators in 2008 and 2010 and triggered government intervention in the coal market with attempts to cap the price of coal.  The pervasive conflict between coal and power is now driving the Chinese government to remake these markets.

Coal-power base policy aims to establish upwards of 14 major coal-power bases, each producing over 100 mt of coal with consuming industries on-site.  The plan envisions that roughly half of China's coal production would be produced at a handful major coal-power base sites that are controlled by key state-owned enterprises (SOEs) and the central government.    

PESD's new research analyzes China's coal-power base reforms and how they will impact Chinese and global coal markets.  Several key findings are:

First, the implementation of coal-power bases would enhance central government's control over the coal sector and over coal prices.  The government could control coal pricing in a large share of the market and mitigate power sector losses by mandating lower coal transaction prices within integrated SOEs.  Using this kind of internal transfer pricing at below market prices for up to half of China's coal would represent a meaningful shift in how coal is priced in China.  If a large share of China's coal were transacted in this manner, it might create an unofficial two-tiered pricing structure in the coal market.

Second, coal-power base policy would bring about modernization and mechanization of a larger share of China's coal production, in theory bringing larger economies of scale to the sector.  While up-front capital investment per ton produced will certainly increase, the marginal cost of coal production should decrease, all other things equal. 

Third, the massive rebalancing of China's coal market implied by coal-power bases is poised to have important impacts on the globally traded coal market.  Since 2009, China's import behavior has become a dominant factor determining the price of globally traded coal.  In simple terms, when Chinese domestic prices are higher than global prices, the country imports.  The development of coal-power bases could radically alter coal price formation in China and directly impact China's appetite for imports, and therefore has the potential to alter coal price formation globally.

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Publication Type
Working Papers
Publication Date
Journal Publisher
Program on Energy and Sustainable Development
Authors
Dr. Huaichuan Rui
Richard K. Morse
Gang He
Gang He

Property Market Effects of the Endangered Species Act

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Abstract
The federal Endangered Species Act (ESA) and California's Endangered Species Act (CESA) aim to protect species from extinction by restricting property development on the habitats of imperiled species. Proponents of these laws argue that the development restrictions are necessary in order to protect valued species, whereas opponents argue that the burden is too restrictive. The controversy surrounding species protection is especially intense in California, where many species are subject to protection and where developmental pressures are particularly acute.

This paper provides estimates of the impacts on housing supply in California due to protection of animal species provided under the ESA and CESA. Specifically, the paper estimates the effect on housing development in California census tracts that contain protected endangered animals. The main empirical complication in addressing this research question is that census tracts that contain one or more protected species are likely different from census tracts that do not contain such species. Further, these differences could also contribute to differences in housing supply, therefore biasing the estimated effects. We attempt to address this concern using a unique research design and data set. We find that a census tract that has an endangered animal listed by the federal or state government in the 1990s does not have a subsequent reduction in the development of housing units. This suggests that species protection in California does not impede housing supply.

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Reuben W. Hills Conference Room

Ted Gayer Professor of Public Policy Speaker Georgetown University
Seminars
Instruments of Energy and Environmental Policy

Jeremy Carl

616 Serra St.
Encina Hall E415
Stanford, CA 94305

(650) 723-2136 (650) 724-1717
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Jeremy_Carl_June_2011.jpg

Jeremy Carl is a research fellow at the Hoover Institution whose work focuses on energy and environmental policy, with particular emphasis on energy security, climate policy, and global fossil fuel markets. In addition, he writes extensively on US-India relations and Indian politics.

Before coming to Stanford, he was a  research fellow in resource and development economics at the Energy and Resources Institute (TERI), India’s leading energy and environmental policy organization.

He is the editor of Conversations about Energy: How the Experts See America’s Energy Choices, and his work has appeared in numerous publications including the Journal of Energy Security, Energy Security Challenges for the 21st Century, Natural Resources and Sustainable Development, and Papers on International Environmental Negotiation.

In addition to his work on energy, the environment, and India, Jeremy has written about a variety of other issues related to U.S. politics and public policy; Jeremy’s work has been featured in and cited by the New York Times, Wall Street Journal, San Francisco Chronicle, Newsweek, South China Morning Post, Indian Express, and many other leading newspapers and magazines. He has advised and assisted numerous groups including the World Bank, the United Nations, and the staff of the U.S. Congress.

Jeremy received a BA with distinction from Yale University. He holds an MPA from the Kennedy School of Government at Harvard University and did doctoral work at Stanford University, where he was a Packard Foundation Stanford Graduate Fellow.

Research Fellow

Recovering Sustainable Development

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Sustainable development - the notion that boosting economic growth, protecting natural resources, and ensuring social justice can be complementary goals - has lost much appeal over the past two decades, the victim of woolly thinking and interest-group politics. The concept can be relevant again, but only if its original purpose - helping the poor live healthier lives on their own terms - is restored.

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Publication Type
Journal Articles
Publication Date
Journal Publisher
Foreign Affairs
Authors
David G. Victor
David G. Victor
External URL
http://www.foreignaffairs.org/20060101faessay85109/david-g-victor/recovering-su…
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