Monday, March 11, 2013

Post 11 – Keeping up with the Joneses – How are We Doing Compared to Our New England Neighbors?

Over the past months, I have lasered in on the energy profile of New Hampshire but have provided relatively little comparative data to give you a sense of how we are doing relative to our New England neighbors. So this week we are going to look over the fence and see if we are keeping up with the Joneses.  

Let's start off by looking at energy intensity. If you recall from my last post, there are two measures of energy intensity: there is the amount of energy that goes into producing one dollar of GDP and then there is energy use per person. These energy intensity measures are presented in the table below for the six New England states. Averages for New England and the US are provided for comparison.
The first thing to note is that Connecticut is the most energy efficient state as they use substantially less energy than the rest of the New England states to produce a dollar of GDP. In fact, they are at an impressive 48% of the US average consumption. New Hampshire sits squarely in the middle of the pack, with energy intensities close to the New England average. Maine has the poorest energy intensity figure for New England. Their energy requirement per dollar of GDP is even above that of the US average. Part of this is due to that fact that Maine has more energy intensity industries, particularly the paper and pulp mills. Maine uses 34% of its energy consumption for industrial usage, the highest of any of the New England states. Here in New Hampshire we only use 14% of our energy consumption for industrial purposes.
When we look at the energy use per capita, we note that the New England states use less energy per person than the US average. However we also note, a little unexpectedly, that little Rhode Island has the lowest use per person, which suggests a complicated relationship between economic output, personal and industrial energy usage for the New England states. (It also leaves me with a mental image of all those Rhode Islanders huddled into those big, fancy Newport, RI mansions in the winter months collectively reducing their per capita usage.)
Because of its energy intensive industries, Maine tops the list in per capita usage for the New England states and New Hampshire again finds itself in the middle of the pack. By both measures of energy intensity, the New England states are at about 72% of the US average.
Let's turn now to the overall energy supply portfolio and compare the New England states. Energy supply is equal to the overall gross energy inputs into the states and excludes the effect of any energy exports. This is the most straightforward basis of comparison and also allows contrast with national numbers. The two doughnut charts below show how the New England states compare to the US as a whole.
A few key differences are notable. The New England states are more heavily dependent on oil and natural gas than the rest of the US, but a substantially smaller portion of our energy supply comes from coal – only 5% of our energy consumption comes from coal vs. 21% for the US. This suggests we are more vulnerable to oil price and natural gas prices increases. On the other hand, we have more energy from non-fossil fuel sources, nuclear and renewables, 22% vs. 17% for the US.
The collection of charts below shows the same set of energy source allocations for the individual New England states.

On examination of these charts we learn the following:
  • New Hampshire has the lowest dependence on oil and, except for Vermont, the lowest dependence on natural gas. Much of this is driven by the large amounts of nuclear power we generate.
  • Massachusetts is highly dependent on fossil fuels, particularly oil and natural gas.
  • Vermont has very little natural gas but a lot of nuclear power, no coal-burning plants, a decent amount of renewable energy and, of the New England states, the highest percentage of imported electricity. Seeing Vermont's high dependence on nuclear, all from the Vermont Yankee Nuclear Power Plant, makes one wonder what Vermont would do for power requirements if they closed down the plant.
  • Maine burns almost no coal but a good amount of oil and natural gas. However the large component of renewable energy in the ME energy portfolio took me by surprise and left me scrambling to do more research. According to the Energy Information Agency, Maine generates a lot of electricity from hydroelectric operation and burns an enormous amount of wood for electricity generation and heating purposes. They also have a larger number of wind projects than the other New England states.
  • Rhode Island is highly fossil-fuel dependent, with 96% of its energy requirement coming from oil and natural gas. There is no coal burning in RI and only a small amount of renewable energy.
  • Connecticut is similar to New Hampshire, with a good amount of nuclear power but the state is still heavily fossil-fuel dependent and has relatively little renewable energy.
So what are our main takeaways from all this information?
  1. Compared to the Joneses, i.e., our New England neighbors and the rest of the US, we, here in NH, have room for improvement. We are at 70% of the US average which is good, and we are neither the best nor worst of the New England states. Connecticut and Rhode Island set the standards for energy intensity.
  2. Clearly New England, and especially our neighbors, is not coal country. There is no coal burning in Rhode Island and Vermont and very little in Maine. Coal usage is low in New Hampshire, Massachusetts, and Connecticut and, driven by cheap natural gas and more stringent environmental regulations, there will be further reductions over time.
  3. Overall, in terms of renewable energy, New Hampshire does well, with 11% of the energy supply from renewable sources. Only Vermont and Maine do better. However, we are all still highly dependent on fossil fuels for our energy needs.
Each state has its own particular challenges. Vermont is struggling with decisions regarding an aging nuclear power plant, Rhode Island with its 96% dependence on oil and natural gas, and the rest of us with the fate of coal-fired power plants. Ultimately, I believe a portfolio approach to energy is best. We need more renewables, we need more nuclear, we need more natural gas and, in the meantime, coal has a place and needs to be part of our portfolio. Prudent energy planning requires that we reduce energy risk by not becoming too dependent on any one or two energy sources. We want to avoid the situation that the Rhode Island, with its over-dependence on oil and natural gas, finds itself in. Any substantial increases in the costs of these fossil fuels will have disastrous impacts on the already strained economy in Rhode Island.
I am fond of telling my students, in the MBA in Energy and Sustainability program at Franklin Pierce University, that when it comes to energy, there is no free lunch. Every time we turn on a light, drive to work or take a hot shower we create an impact on society, the environment and the future of our planet. Good energy decisions require data, analysis, planning, impact assessment and, ultimately, the implementation of difficult decisions that will impact someone. We owe it to future generations to make these difficult decisions now and to reduce our energy consumption. It really is time to stop kicking the empty oil can down the road or into our neighbor's yard. Most of us, I believe, understand that we need to do something concrete rather than fighting every energy project that comes our way. The challenge is figuring out what we need to do. What do you think we should be doing?
Until next time, remember to turn off those lights when you leave the room.

Mike Mooiman
Franklin Pierce University

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1 comment:

  1. Vermont is looking to expand it's portfolio and is in the process of surveying for a natural gas pipeline on the western side of the state.


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