Solar Power in NH Part 4 – Residential Solar Output and Net Metering

In a previous post, I pointed out that there are many reasons for installing solar in New Hampshire and that residents should be taking advantage of these and benefiting from energy delivered daily by the sun to our homes. In this post, I take a look at a typical NH home with an installed solar system and examine its electricity consumption profile and its generation of solar power.

Let’s consider a typical NH home that uses about 600 kWh/month (7200 kWh/year). Such a home uses approximately 20 kWh/day, but this is highly variable and depends on the season, the outside temperatures, the number and nature of the installed electrical devices, and whether there is someone at home during the day.

Let’s assume that this home has installed a 5 kW system solar system (about 17 panels), which would (according to the NREL PVWatts calculator) produce about 6500 kWh/year or about 18 kWh/day. On an annual basis, this is a close match between consumption and generation. However, solar electricity generation only occurs when the sun is up and, as pointed out in a previous post, is highly dependent on the time of day, temperatures, and the amount of cloud cover. As a result, there is a significant mismatch between the hourly solar power generation and the consumption profiles, as shown in the figures below for typical winter and summer days in NH. The hourly consumption data were generated from a smart meter at a NH home and the hourly generation data from the PVWatts calculator.

The daily electricity consumption profiles, shown in blue, are different in winter and summer. In winter, there is an early morning bump up in electricity use as the house is warmed up, showers are taken, and breakfast is made. It then it drops off until the evening, when the home is heated again, lights are turned on, cooking is done, and the TV is turned on. In the summertime, we don’t see as much of a bump in electricity use in the morning because home heating is not required, but towards the end of the afternoon, the air conditioner gets turned on, along with cooking, lights, and TV to produce a significant increase in electricity consumption. (For this particular home, the AC unit is clearly used very frugally because the late afternoon/evening AC bump up is typically larger.)

Overlaid on both charts is the generation of electricity from the solar panels. For both dates, a sunny day was chosen and it can be seen that, for a most of the daylight hours, the system generates more electricity than the home is using. In this case, the excess energy is fed back into the grid and is available to be used by someone else nearby who does not have an installed solar system. It is this excess electricity, produced from a multitude of solar systems in New England, that allows the coordinator of the electric grid, ISO-NE, to ratchet down the generation of electricity from large fossil-fuel generation plants during this period. However, as soon as the sun sets and solar electricity production plummets, these same plants need to be ready to turn on electricity production to keep on the lights in New England. This highly variable generation profile presents challenges for utility-scale electricity generation in these days of large-volume solar power generation.

This data is notable because it shows that approximately 15 kWh, ~70% of the solar electricity produced during the daylight hours, makes its way to grid because the home’s electricity consumption is low during the period of peak solar power production. Using generation data from the PVWatt calculator and residential load profiles for a NH residence from the Department of Energy, I did the same hourly analysis for a whole year and it turns out that more than 60% (!) of the generated solar power would be exported from the home and energy use profile I chose. For a home using more electricity, say 9500 kWh/yr, the exported amount drops to 51%. For homes with larger solar systems, the amount could increase to above 70%. It is not obvious, but it turns out that even if, on a daily (or monthly) basis, solar power production is short of a homeowner’s needs, most of the electricity generated by the solar system makes its way to the grid.

During the period of excess solar power production, the homeowner is delivering electricity into the grid and building up an electricity credit that can be used to offset their consumption during the nighttime hours. This, basically, is how the concept of net metering works – the homeowner gets credit for excess electricity generated and is only billed for their net consumption. In this example, the home consumed 20 kWh during the winter day but generated 19 kWh from their solar system, so the homeowner would only be billed for their net consumption of 1 kW (if it was done on a daily basis). For the summer day, the home used 22 kWh but produced 24 kWh, to earn the homeowner a credit of 2 kWh. Net metering is typically done over a month so the daily credits and debits are totaled and, at month end, the ratepayer is responsible for paying any shortfalls or enjoying any credits that they can then apply the following month’s electricity consumption.

However, net metering is changing. The approach of just netting the consumption and generation of kilowatt hours and being billed for the monthly difference at retail rates is being reconsidered. There has been a lot of pushback from utilities across the country because they are concerned that net metering customers do not pay their fair share of the transmission and distribution costs that are built into rates. Homeowners with larger solar systems, who generate more electricity than they consume, end up not paying for transmission and distribution(T&D) costs but enjoying the privilege of been connected to the T&D grid and of drawing on it when the sun sets. Net metering is under review across the country and in NH the Public Utilities Commission (PUC) recently decided that the matter was an important one, that an interim change was necessary and further study was warranted.

The PUC issued new net metering regulations in June 2017, and, as a result, homeowners installing new solar systems could see a reduced benefit from net metering. If a home imports electricity - calculated by the monthly netting of imported kWh and exported kWh - the home owner will pay the full retail rate for their net usage. This includes all components of their electrical bill which includes the energy service charge, transmission and distribution charges. Other charges such as the system benefits charge, stranded cost recovery charge, and the state electricity consumption tax (the so called non-bypassable charges) will be billed for every kWh imported and the homeowner will not receive any credit for these charges for their exported kWh. However if, on a monthly netting basis, a home exports electricity,  solar system owners will receive for the net exports the full retail rates for the energy service and transmission charges but only 25% of the distribution charges and no credit for the non-bypassable charges.

In the table below I have calculated the implications of these changes for a typical Eversource retail customer in NH. The second column shows the components of present retail rates for electricity which total up a retail cost of electricity of 18.1 cents/kWh. The last column shows what the homeowner would be paid if they export more than they use after the recent net metering changes. The export rates take into account full credit for energy services and transmission charges, 25% of the distribution charges and no credit for the non-bypassable charges. My calculations show that the homeowner with monthly exports would receive 14.5 cents/kilowatt hour for their net exports which is a 20% reduction off the retail rate for imported electricity. Of course, the exact reduction depends on the particular utility and their retail rates in effect at that time. These changes will largely impact homeowners who install larger solar systems that deliver net monthly exports of electricity and will extend the payback period for their solar investment.

It should be noted that these changes do not impact homeowners who already have installed solar systems. They will continue to benefit from the strict monthly netting of consumption and generation and they will receive the benefit of full retail rates for exported electricity until 2040.

In my next post, we will take a look at the same home and look at the financing of a solar system and the importance of the various incentives, including the net metering changes, in generating a return from a new solar installation in NH.

Until next time, remember to turn off the lights when you leave the room. 

Mike Mooiman
Franklin Pierce University

mooimanm@franklinpierce.edu

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New Hampshire’s Renewable Portfolio Standard – Part 1

Just like the regular attempts to repeal New Hampshire’s participation in the Regional Greenhouse Gas Initiative, there are perennial attacks on the NH Renewable Portfolio Standard. It is important to know about these programs so that the associated debates can be fact-based. In my next couple of posts, I have assembled information on the Renewable Portfolio Standard and how it impacts NH. This post presents some general information; in follow up posts, I will dig into the details, money flows, and costs of these programs.

A Renewable Portfolio Standard (RPS) is a mandate by a government, local or state, that requires electrical utilities to source a certain amount of their electricity supply from renewable energy sources. The intent of an RPS is to promote and subsidize the use of renewable energy sources such as those produced by natural processes such as solar, wind, hydro, ocean, biomass, or geothermal sources. The use of renewable energy decreases the burning of fossil fuels, which, in turn, reduces emissions of greenhouse gases and other associated pollutants. In the process, it improves public health, uses local natural resources, and creates local business opportunities and jobs.

Most states already have an RPS in place: by April 2017, 29 states had a mandated RPS program, eight had renewable energy goals, and only 13 did not have any renewable energy requirements. The map below shows the RPS status across the US. The site from which I copied this information, the National Conference of State Legislatures, has a very useful interactive map that provides specific information for each state. Each state has different regulations and requirements for their RPS programs. The most ambitious is Hawaii, which mandates that 100% of their energy needs will be generated by renewable sources by 2045.

 Source:NCSL

New Hampshire’s RPS was implemented in 2007. Its main components are as follows:

• By 2025, 24.8% of electricity sold in NH must come from renewable energy sources;
• Four classes of renewable energy sources are considered;
• Sourcing of renewable energy by electricity suppliers is demonstrated by the purchase of Renewable Energy Credits (RECs) in each of the classes;
• An alternative compliance payment has been established for each class to provide a cost cap on  REC prices;
• The total amount of renewable energy increases each year: from 4% in 2008 to 24.8% in 2025 (although adjustments in the total amount and amounts in each class can be —and have been— made to accommodate market conditions).

The four NH classes of renewable energy are shown in the figure below. Classes I and II refer to newer renewable energy technologies and operations that have been commissioned since 2006. Class II is a special carve out for solar power. Classes III and IV are for the older biomass and smaller hydro operations that were established before the end of 2005.

The implementation of an RPS occurs through the generation, sale, and purchase of renewable energy credits, RECs.  A REC is a digital certification that the particular generator has produced 1 megawatt hour (MWh) of electricity from a renewable energy source, such as those listed above. Each megawatt of renewable electricity gets assigned a unique certificate number and a date of production and it then becomes a tradable instrument - a REC that can be bought and sold like a stock or bond. They give renewable generators two products to sell: the actual electricity that they produce and the RECs. The RECs therefore provide an extra revenue stream – in effect, a subsidy – for renewable energy generation.

RECs are issued and tracked by the New England Power Pool Generation Information System (NEPOOL GIS) and there is a regional market for these certificates. The sellers are generators of renewable energy and the buyers are usually electricity suppliers, like Eversource, that are looking to comply with the RPS program. Like any other market, there are supply and demand aspects and, should there be a shortage due to insufficient renewable generation, REC prices go up, signaling to the market that more RE sources are required. It is important to note that the price of RECs has little correlation with the price of electricity: REC prices are set by supply and demand in the markets where they are traded. The supply is set by the amount of renewable energy that is generated and the demand by the amount of renewable energy the utilities are required to source, which, in turn, is dictated by different RPS regulations in each state.

To comply with the RPS, the NH electricity suppliers, utilities (such as Eversource), and competitive suppliers (such as Constellation) are required to purchase a sufficient number of RECs to match their renewable energy obligations in each class for any particular year. This demonstrates that the required portion of their supplied electricity is generated by renewable energy sources. NH is a deregulated state, so utilities are not allowed to own power plants, even renewable ones: they must therefore meet their renewable energy requirement by purchasing RECs that are generated by non-affiliated renewable energy generators.

REC prices can fluctuate with changing demand and supply; in the case of short supply and/or high demand, prices can escalate so a price-cap mechanism has been built into the program. This is known as the Alternative Compliance Payment (ACP). It sets an upper limit on what the utilities are required to pay for each REC. If prices of RECs are above the ACP, the utilities are obligated to pay the ACP instead. A table of recent ACP prices published by the NH Public Utilities Commission is provided below, showing a separate ACP for each class of renewable energy. Adjustments in the ACP are made from year to year, depending on the rate of inflation and legislative modifications to the RPS program.

Before wrapping up this introductory post, I thought it would be useful to get a sense of what is involved in producing 1 MWh of electricity from a renewable energy source, which is the requirement to produce a single REC. One megawatt hour (MWh) is equivalent to 1000 kilowatt hours (kWh), which represents approximately six weeks of electricity use in an average NH home (assuming a monthly use of 600 kWh). This is also the approximate amount of electricity that a three-panel solar array, rated at 0.75 kW, would produce in one year. Most residential solar systems are larger, ranging from 2 to 5 kW, and produce ~2 to 7 MWh/year, or 2 to 7 RECs per year. At the other end of the scale, the Lempster wind operation,  which has 24 wind turbines each rated at 2 MW, would generate ~105,000 RECs per year (assuming a 25% capacity factor).

Having covered some introductory information about the RPS program, such as the different classes, RECs, and the ACP, I will turn my attention in my next posts to the renewable energy quotas for each class, REC pricing, and the money flow in the RPS program. Until then, reduce your need for both fossil and renewable energy by turning off the lights when you leave the room.

Mike Mooiman

Franklin Pierce University

mooimanm@franklinpierce.edu

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The Regional Greenhouse Initiative - Part 3

In Part 1 and Part 2 of my posts on the Regional Greenhouse Gas Initiative (RGGI), I reviewed the money flows in the program and presented data on the remarkable decrease in carbon dioxide (CO₂) emissions that we have seen since its implementation. In this post, I present some of the pros and cons of the RGGI program and some evidence that supports the assertion that RGGI has been responsible, in large part, for the decrease in regional CO₂ emissions.

Based on my research, the RGGI program seems to have some positive attributes, as well as some downsides. The advantages can be listed as follows:

• Since implementation of the program, CO₂ emissions have declined significantly. See figure below.
• The program puts a price on carbon in the electricity markets and provides incentives for us and the market to make economic choices regarding our electricity generation. Carbon pricing should lead the market to prefer lower carbon sources and thus provide economic support for low-emission sources, such as renewables.
• It is a market-based program, which provides generators with choices. They are required to participate but they can choose to purchase allowances or make investments in lower-carbon technologies to ensure that their carbon generation falls within their share of the particular cap specified at the time.
• The allowances generate a pool of money that is shared between participating states. This is returned to ratepayers in the form of direct rebates and used to fund energy-efficiency (EE) programs. The EE portion creates a virtuous cycle, in which carbon prices fund EE measures, which then lead to further reductions in energy use and carbon dioxide emissions.

One of the biggest criticisms leveled at the RGGI program is that the regional reductions in CO₂ emissions, noted in Part 2 of this series, are not attributable to more efficient plant operations induced by the RGGI program; rather, they are due to less in-state generation, conversion to natural gas which was already underway, and a slower post-recession economy.

A recent economic study examined this issue directly and reviewed reasons behind the decline in emissions. The authors of the study highlighted the following facts:

Carbon dioxide emissions from the RGGI states have declined, but the decrease is due to a number of factors, including:

1. The 2008/2009 Great Recession: with the economic slowdown, came reduced energy demand, less generation, and therefore fewer emissions;
2. Low natural gas prices, created by increased supply from the implementation of fracking technology: natural gas produces less CO₂ emissions per unit of generated electricity when compared with coal;
3. State programs promoting EE project implementation or renewable energy generation, such as renewable portfolio standards;
4. The RGGI program, which puts a price on carbon dioxide emissions.

The authors then carried out a complicated economic analysis to disentangle the effect of each factor on regional CO₂ emissions. What they concluded is the following:

• Without the impact of all the factors noted above, CO₂ emissions would have been 60% higher;
•  The bulk of decrease in emissions is, in fact, due to the RGGI program;
• Substitution by natural gas was an important factor, but less so than the RGGI impact;
• The impact of the recession on CO₂ emissions was minor;
• Some of the benefits of the RGGI program are undone by neighboring non-RGGI states that sell electricity into the regional power pools. Their coal-fired generation without the RGGI adder then becomes competitive and so more electricity is generated from their high-CO₂-emissions plants.

This provides good evidence to support the direct impact of the RGGI program, but is just a single economic study. I look forward to seeing others.

Other criticisms of the RGGI program include the following:

• It increases electricity costs to consumers in a region that already has high electricity rates.
• The implications of RGGI are only now starting to kick in. After recent implementation of the Adjusted Cap, CO₂ allowance prices have increased significantly and this could further impact electricity rates going forward.
• RGGI sets up unfair competition by neighboring states that don’t have these requirements. Their costs of generation do not include RGGI costs so their electricity is cheaper and they can sell into the RGGI markets with a built-in cost advantage.
• There are a lot of free riders – RGGI ratepayers lead by example by paying for reduced CO₂ emissions, but residents of non-RGGI states benefit from the cleaner air.
•  RGGI funds making their way to the states have been raided for other purposes, such as balancing state budgets, and are not always used to fund EE and renewable energy projects, which was the original intention of the program.
• Carbon pricing through the RGGI program is unfair to electricity ratepayers because other regional CO₂ emissions, such as those from transportation and heating, are not subject to carbon pricing.  

The argument that the RGGI program does increase the cost of electricity is valid, but it is important to put this into context. Let’s examine what the present carbon price means for individual ratepayers in terms of electricity rates. A review of RGGI state data from the Energy Information Agency (EIA) indicated the RGGI states, on average, emit 0.34 tons CO₂ per MWh of generated electricity. We can then calculate that a CO₂ price of $5/ton leads to an incremental cost of $1.70/MWh or 0.17 cent/kWh. If you use 600 kWh per month, this represents $1.02 in incremental costs on your bill. However, this calculation does not take into account that House Bill 1490 legislation mandated that only the first $1/ton CO₂ from the CO₂ emissions allowance auction proceeds could be used towards EE: anything beyond that has to be rebated directly to electricity ratepayers. As a result, most NH RGGI funds now go to direct bill rebates, so (assuming a $5/ton carbon price) ratepayers get about 80% of the RGGI costs back. If we back out the rebate, the cost to ratepayers is of the order of $0.20/month or 0.034 cents/kWh for 600 kWh/month electricity usage. This is in line with the rate impact calculations presented in the recent annual report on the RGGI program in NH. As you can see, there is an impact of RGGI on electricity rates, but the total amount paid by an individual ratepayer is tiny.

As I wrap up this three-part series on RGGI, it is clear that it is a complicated—but important—program. There is evidence that it appears to be having significant impact on regional carbon emissions, but, at the same time, it does impacts regional electricity prices; however, after including bill rebates, the utility bill impact to the average NH rate payer is tiny. A few years ago RGGI was viewed as a model program for the rest of the country and, if implementation of the EPA’s Clean Power Program had proceeded, participating states would have a considerable head start. Unfortunately, it looks like RGGI will remain a regional initiative only because there is no support from the Trump Administration for clean power or carbon pricing mechanisms. The most important development in the RGGI world is the review of the program that is currently underway, as this will set the tone for the RGGI program, carbon prices, and regional electricity rates going forward.

Until my next post, do your bit to reduce carbon emissions by remembering to turn off the lights when you leave the room.

Mike Mooiman

Franklin Pierce University

mooimanm@franklinpierce.edu

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Songs from the Wood* - Wood Fired Electricity in New Hampshire – Part 1

In my last post we took a look at energy sources and costs for home heating, and we saw how relatively inexpensive wood is compared to most other fuel sources in New Hampshire at the moment. Only natural gas is cheaper on a dollar per heat content basis. Wood as a fuel is particularly intriguing in the New Hampshire context. A great deal of NH is forested. In fact, 84% of the State is forested and, of the 5.7 million acres of land in New Hampshire, 81% is viable timberland. Therefore, tree harvesting for electricity or home heating applications is a way we can use a local in-state resource to reduce imports of fossil fuels like coal, oil or natural gas. Utilization of NH forests also provides a lot of local jobs and, over the 20 to 30 year life of a tree, wood combustion does have a lower carbon footprint when compared to fossil fuels. 

Many folks believe that, over the long term, the use of wood for energy purposes can be viewed as being carbon neutral. In other words, the carbon dioxide that is released in the combustion of wood is offset by the carbon that was absorbed by the tree during the process of photosynthesis which converted the carbon dioxide into the organic matrix of the tree. This is not entirely correct as there is not a one-to-one correspondence of carbon dioxide in = carbon dioxide out. We have to take into account that a great deal of fossil fuel energy is used to manage the forest, harvest the wood, transport it and convert it into a form, such as firewood, woodchips or wood pellets, which can then be combusted. As a result, the total amount of carbon emitted in utilizing wood as a fuel source is greater than that absorbed during photosynthesis.
 

We generate a good amount of electricity in New Hampshire from the combustion of wood. In 2011 we produced 1.03 million megawatt hours (MWh) of electricity from wood-fired operations, which is equivalent to 5.1% of the total electricity produced in the State. There are presently seven wood-burning plants that generate electricity from wood chips in New Hampshire and this year we should see the commissioning of the State's largest wood-fired power plant, the Burgess Biopower plant, which is located in Berlin on the site of the old Frasier Paper Mill. This new power plant will increase the overall percentage of electricity generated from wood from 5.1 to 7.5%.

 

The map below shows the location of the various wood-fired electricity plants in NH and the table that follows provides the key for the locations shown on the map as well as information about the various operations.

The data in the table show that most of the wood-fired power plants are smaller operations with capacities of the order of 15 to 20 MW. At this time, the largest operating plant in the state is the 50 MW Northern Wood Power plant. This facility is owned by our largest utility company, Public Service of New Hampshire, PSNH, and is located in Portsmouth on the Schiller power plant site. This plant was started up in 2006, when PSNH converted one of the three large boilers at the Schiller station from coal to a wood chip fuel source. Most of the other wood-fired operations were built in the late 1980s when New Hampshire was encouraging home grown energy and PSNH was required to sign 20-year power purchase agreements with these new wood-fired operations. Over time, there has been a fair amount of change in the ownership of some of these plants as the attractions and economics of renewable energy have waxed and waned.

 

The generation of electricity from wood is an intriguing business and one that is full of opportunities and challenges – some of which I will discuss my next post. In the figure below I have sketched the value chain for the wood-fired electricity business, along with some of the important inputs and outputs.

 

In the first step, we have the lengthy process of tree growing and the incorporation of carbon into the organic matrix of the tree and sunlight into stored chemical energy – both of which will eventually be released during combustion. Active and scientific forest management is required to allow trees to grow to their full potential. This has to be done while countering insect infestations, drought, fire and a host of other problems. The average life of a tree is typically 20 years before it is harvested.

 

In step 2, we have the harvesting of trees from public and private lands. This process is now highly mechanized and involves large machines to take down the trees, remove the brush and load them for transportation. Because it is highly mechanized, a lot of fossil fuel, in the form of diesel and gasoline, is used, so there is a net energy input into this step.

 

In step 3, the logs are transported to the saw mills where they are converted into lumber, wood chips for paper pulp, wood chips for combustion and waste sawdust. A great deal of the waste sawdust is converted into wood pellets which many folks use as fuel in their wood-fired home furnaces. The sawmill conversion process is also highly mechanized and automated, and it too requires a large energy input. I will note that it is possible to combine the harvesting and chipping operations right on site where the trees are harvested. In these operations, the trees are taken down and are immediately run through a large wood chipper. The wood chips are then directly loaded onto trucks for transportation to the wood-fired power plants, thus bypassing the saw mills.

 

Finally in step 4, wood chips from the saw mills or chipping operations are then transported to the wood-burning plant, where they are stored in enormous storage piles. The wood chips then become the fuel for the power plant, and they are burned in large furnaces where the heat is used to boil water. The steam is then used to drive a turbine which drives an electrical generator that produces electricity. Other than wood chips, there are inputs of water and skilled labor as well as fossil fuels used to transport the wood chips into the feeders.

 

These wood-burning operations produce electricity that is fed into the electrical grid but an enormous amount of waste heat is produced as well. In a previous post, I provided data that showed that only a small fraction, 23%, of the chemical energy in wood is converted into electricity. In contrast, coal-fired power plants have conversion efficiencies of 31% and natural gas plants, on average, have efficiencies of 45%. The 77% of waste heat from these wood-fired operations is dissipated by the evaporation of water and by the hot gases exiting the tall emissions stacks from these operations.

 

A fact that is not often appreciated is that a lot of water is utilized in the production of electricity. The water is used to produce steam and to cool the off-gases and, as such, a lot of water is lost to the atmosphere via evaporation. It has been estimated that water consumption for electricity generation is of the order of 4000 to 8000 gallons per MWh of electricity produced. One megawatt hour represents the approximate monthly electricity consumption for a US home so every month your electricity usage results in the consumption of 4000 to 8000 gallons of water. However, it should be noted that the water consumption numbers for wood-fired power plants are substantially lower. Saving on water consumption is just another reason to turn off the lights and save electricity. A point I often make to students in the Franklin Pierce University MBA in Energy and Sustainability Studies program is that if you are in the energy business, you are in the water business as well.

 

A small amount of wood ash is produced from these operations and this is a valuable soil additive that is used by local farmers.

 

So if we step back and look at the energy and carbon dioxide flow aspects of the wood-fired electricity business, it is clear that it is a lengthy and involved pipeline from photosynthesis to electricity. It takes time, money, energy, labor, and fossil fuels to get forests to incorporate sunlight and carbon dioxide into the body of tree and for us to release that energy (and carbon dioxide). As a result of all the various fossil fuel-based energy inputs all along the way, it is clear that wood burning cannot be viewed as entirely carbon neutral. However for us, here in forested NH, wood does represent a better fuel source than imported fossil fuels which have no offsetting carbon absorption and the wood-fired electricity does provide a lot of jobs and livelihoods as we move along the chain from photosynthesis to electricity. Now if we could only do something about that 77% of wasted energy…..

 

In my next post I will take a brief look at the economics of producing electricity from wood, and I will wrestle with the issue of just how much wood could we burn in New Hampshire before we overtax our forests. In the meantime, remember that it takes a lot of fossil fuel, labor and water to convert the chemical energy in wood into electricity we use in our homes. Many times the songs we play in our homes on our CD players are powered by our forests. These, indeed, might be Songs from the Wood.

 

Until next time, remember to turn off the lights when you leave the room. You will be saving energy and water.

Mike Mooiman
Franklin Pierce University
mooimanm@franklinpierce.edu
4/8/13
 

(*Songs from the Wood was the title of and a song from Jethro Tull's tenth album. This album, with its distinct British folk rock sound, was quite a departure from Tull's earlier heavy rock and blues influenced recordings. This recording cemented Jethro Tull's reputation as a bunch of odd ducks making interesting and influential music. The cover art on the album also features the results of some wood harvesting. An old tune but worth a listen).

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The New Hampshire Energy Picture – Part 3: What Happens to the Energy that is Supplied to the State?

In my last post we looked at the direct use of energy in the State. We followed the various components of the energy supply into transportation, residential and commercial heating, industrial use and the generation of electricity. However, I also made the point that electricity is not an energy source - it is an energy transfer medium. It is the way we get the energy out of a lump of coal or a nuclear fuel rod so that it can power the coffee maker in our kitchens. I think we can all agree that buckets of coal or enriched uranium in the kitchen do not work well in powering the toaster and microwave. Therefore, if we are to determine the final allocation of energy use in NH, we have to follow the flow of electricity into its final end use: that is the focus of this blog post.
 

Here is the NH Energy picture I have been working through in the last few posts. In the last post we looked at energy flows from the left column to the center one. This week we are going to focus on the energy flow from the center column to the rightmost one.

So let's start off by looking at the largest slice of the center column so we can determine what happens to all the energy that goes into the production of electricity. We note that 224 Trillion BTUs, or 55% of our total energy supply, goes into the production of electricity. The arrows radiating out from the electricity slice tell the following story:

Approximately two thirds of the energy that goes into the production of electricity is lost as waste heat during the energy production and transmission process. If you are not familiar with electricity production, this might be a rather startling fact. It indicates how inefficient transmission and especially the generation of electricity is when only 35% of the energy input ends up as useable electricity in our homes and businesses. This is a result of the physics of the electricity generation process, and since the advent of commercial scale electricity production, engineers and scientists have been working hard to improve conversion efficiencies. The first commercial electricity generating operation was established by Thomas Edison in New York in 1882. Edison's first operation converted less than 2.5% of the energy in coal to electricity. The average coal plant operating today has a conversion efficiency of ~28% and the latest generations of combined cycle coal power plants have conversion efficiencies of the order of 45 to 50%. We have indeed come a long way efficiency-wise, but we cannot escape the fact that electricity generation produces a lot of waste heat. Not only is energy lost in the generation process, but some of it dissipates during transmission where losses are typically of the order of a further 7%.

The other distribution arrows in this figure show us that 7% of the energy that into goes into electricity production ends up as electricity routed to our homes. A similar amount ends up in commercial operations and industrial usage accounts for 3%. Finally, and for me quite interestingly, a significant 17% ends up as electricity that is exported out of state.

To get a better view as to what happens to electricity after its production, I have sliced and diced the data a little differently in the figure below. I have subdivided the tall electricity slice into its two main components – electricity and waste – because I wanted to examine the allocation of generated electricity in the state. The subdivided column shows that the electricity generation slice is one third generated electricity and two thirds waste heat. Now, if you follow the arrows radiating out on the electricity only piece, you can see that, of the electricity generated in the state, 21% is used in our homes, 21% in our commercial operations, 9% is used to drive our factories and an impressive 51% is exported out of state into the New England Electricity Pool.

It is this exported pool of electricity that often gets politicians, ordinary folks and even less ordinary folks worked up into an absolute lather here in New Hampshire. It has been used at various times to justify the closing down of the Seabrook Nuclear power plant, our coal burning plants and even the Northern Pass project. In a future post I will weigh in on this debate but for the moment you should know that my viewpoint is a highly pragmatic one. I believe that as we continue our rather slow transition to renewable energy, we need to draw upon as many different energy sources as we can so that we are not trapped and reliant on one or two energy sources sometime in the future. Diversification in energy supply, just like picking investments, reduces future risk and my focus is on reducing risk and creating a sustainable future for my children.

It is crucial to note that even though we presently export 50% of the electricity produced in the State, this has not always been the case, and it might not be the case in the future. Prior to the Seabrook Nuclear plant, we were net importers of electricity. We are part of a regional and national pool and at this time we are in the good position to be making a positive contribution.

This final figure combines the allocation of the energy that goes into electricity production with the other energy flows we saw in my previous post. From this figure we learn the following:

• In our homes 71% of our energy comes from fuels, largely fossil fuels, for direct heating applications. The remainder of the energy supplied to our homes is from electricity usage.
• For our commercial businesses 58% comes from direct heating and 42% from electricity. The higher percentage of electricity use in our commercial operation is likely due to increased use in lighting for displays and air conditioning in the summer.
• Our factories are more like our homes where 75% of energy use is from direct heating and 25% is from electricity.

Finally, if we examine the percentages in the leftmost column and working from the bottom up we learn that, of the 409 trillion BTU of energy supplied to the state, 36% of it is lost as waste heat during the generation and transmission of electricity, 9% leaves the state as exported electricity, 7% is used to power our factories, and 9% is used to keep our office buildings and stores lit up, warm and air conditioned. Our homes are responsible for 13% of NH's energy appetite and transportation uses up the remaining 26% of our energy supply.

So there you have it. After slogging through three detailed posts you should now have an understanding of NH's energy picture and a good idea of where our energy comes from, how it is used, where it ends up and how much is wasted as a result of electricity generation.

Before I ride off into the power line sunset shown on the background of my blog, some of you might be ready to point out that this picture is not quite complete: if I have shown how much energy is lost as waste heat during electricity generation, I should have done same for the energy used in transportation and that lost from our homes and businesses. I totally agree with you, but that brings in another level of analysis, more complications, more columns and spider webs of arrows and, I think, for the moment, we have all had enough of those. There is a better way to show this and that brings me to the topic of flow diagrams which I will be discussing in my next post.

Let me know if this rather lengthy explanation over the past few posts has helped you understand the statewide energy flows and, as always, I am interested in your opinion.

Until next time, remember to turn off those lights when you leave the room.

Mike Mooiman

Franklin Pierce University

mooimanm@franklinpierce.edu

1/13/2012

 

 

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