Italy : Enel Green Power and Sapio sign an agreement to supply green hydrogen produced by NextHy in Sicily


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Sicily Green Hydrogen accelerates decarbonization via renewable energy, wind farm electrolysis, hydrogen storage, and distribution from Enel Green Power and Sapio at the NextHy industrial lab in Carlentini and Sortino Sicily hub.

 

Key Points

Sicily Green Hydrogen is an Enel-Sapio plan to produce hydrogen via wind electrolysis for industrial decarbonization.

✅ 4 MW electrolyzer powered by Carlentini wind farm

✅ Estimated 200+ tons annual green H2 production capacity

✅ Market distribution managed by Sapio across Sicily

 

This green hydrogen will be produced at the Sicilian industrial plant, an innovative hub that puts technology at the service of the energy transition, echoing hydrogen innovation funds that support similar goals worldwide

Activating a supply of green hydrogen produced using renewable energy from the Carlentini wind farm in eastern Sicily is the focus of the agreement signed by Enel Green Power and Sapio. The agreement provides for the sale to Sapio of the green hydrogen that will be produced, stored in clean energy storage facilities and made available from 2023 at the Carlentini and Sortino production sites, home to Enel Green Powers futuristic NextHy innitiative. Sapio will be responsible for developing the market and handling the distribution of renewable hydrogen to the end customer.

In contexts where electrification is not easily achievable, green hydrogen is the key solution for decarbonization as it is emission-free and offers a potential future for power companies alongside promising development prospects, commented Salvatore Bernabei, CEO of Enel Green Power. For this reason we are excited about the agreement with Sapio. It is an agreement that looks to the future by combining technological innovation and sustainable production.

Sapio is strongly committed to contributing to the EUs achievement of the UN SDGs, commented Alberto Dossi, President of the Sapio Group, and with this project we are taking a firm step towards sustainable development in our country. The agreement with EGP also gives us the opportunity to integrate green hydrogen into our business model, as jurisdictions propose hydrogen-friendly electricity rates to grow the hydrogen economy, which is based on our strong technological expertise in hydrogen and its distribution over 100 years in business. In this way we will also be able to give further support to the industrial activities we are already carrying out in Sicily.

The estimated 200+ tons of production capacity of the Sicilian hub is the subject of the annual supply foreseen in the agreement. Once fully operational, the green hydrogen will be produced mainly by a 4 MW electrolyzer, which is powered exclusively by the renewable energy of the existing wind farm, and to a lesser extent by the state-of-the-art electrolysis systems tested in the platform. Launched by Enel Green Power in September 2021, NextHys Hydrogen Industrial Lab is a unique example of an industrial laboratory in which production activity is constantly accompanied by technological research. In addition to the sectors reserved for full-scale production, there are also areas dedicated to testing new electrolyzers, components such as valves and compressors, and innovative storage solutions based on liquid and solid means of storage: in line with Enels open-ended approach, this activity will be open to the collaboration of more than 25 entities including partners, stakeholders and innovative startups. The entire complex is currently undergoing an environmental impact assessment at the Sicily Regions Department of Land and Environment.

It is an ambitious project with a sustainable energy source at its heart that will be developed at every link in the chain: thanks to the agreement with Sapio, in fact, at NextHy green hydrogen will now not only be produced, stored and moved on an industrial scale, but also purchased and used by companies that have understood that green hydrogen is the solution for decarbonizing their production processes. In this context, this experimental approach that is open to external contributions will allow the Enel Green Power laboratory team to test the project on an industrial scale, so as to create the best conditions for a commercial environment that can make the most of all present and future technologies for the generation, storage and transport of green hydrogen, including green hydrogen microgrids that demonstrate scalable integration. It is an initiative consistent with Enels Open Innovability spirit: meeting the challenges of the energy transition by focusing on innovation, ideas and their transformation into reality.

 

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Michigan solar supporters make new push to eliminate rooftop solar caps

Michigan Distributed Energy Cap Repeal advances a bipartisan bill to boost rooftop solar and net metering, countering DTE and Consumers Energy claims, expanding energy freedom, jobs, and climate resilience across investor-owned utility territories.

 

Key Points

A Michigan bill to remove the 1% distributed energy cap, expanding rooftop solar, net metering, and clean energy jobs.

✅ Removes 1% distributed generation cap statewide

✅ Supports rooftop solar, net metering, and job growth

✅ Counters utility cost-shift claims with updated tariffs

 

A bipartisan group of Michigan lawmakers has introduced legislation to eliminate a 1% cap on distributed energy in the state’s investor-owned utility territories.

It’s the third time in recent years that such legislation has been introduced. Though utilities and their political allies have successfully blocked it to date, through tactics some critics say reflect utilities tilting the solar market by incumbents, advocates see an opportunity with a change in state Republican caucus leadership and Michigan’s burgeoning solar industry approaching the cap in some utility territories.

The bill also has support from a broad swath of legislators for reasons having to do with job creation, energy freedom and the environment, amid broader debates over states' push for renewables and affordability. Already the bill has received multiple hearings, even as DTE Energy and Consumers Energy, Michigan’s largest private utilities, are ramping up attacks in an effort to block the bill. 

“It’s going to be vehemently opposed by the utilities but there are only benefits to this if you are anybody but DTE,” said Democratic state Rep. Yousef Rabhi, who cosigned HB 4236 and has helped draft language in previous bills. “If we remove the cap, then we’re putting the public’s interest first, and we’re putting DTE’s interest first if we keep the cap in place.” 

The Michigan Legislature enacted the cap as part of a sweeping 2016 energy bill that clean energy advocates say included a number of provisions that have kneecapped the small-scale distributed energy industry, particularly home solar. The law caps distributed energy production at 1% of a utility’s average in-state peak load for the past five years. 

Republicans have controlled the Legislature and committees since the law was enacted, amid parallel moves such as the Wyoming clean energy bill in another state, and previous attempts to cut the language haven’t received House committee hearings. However, former Republican House leader Lee Chatfield has been replaced, and already the new bill, introduced by Republican state Rep. Gregory Markkanen, the energy committee’s vice chair, has had two hearings. 

Previous attempts to cut the language were also a part of a larger package of bills, and this time around the bill is a standalone. The legislation is also moving as Consumers and Upper Peninsula Power Co. have voluntarily doubled their cap to two percent, which advocates say highlights the need to repeal the cap . 

Rabhi said there’s bipartisan support because many conservatives and progressives view it as an infringement on customers’ energy freedom since the cap will eventually effectively prohibit new distributed energy generation. Legislators say the existing law kills jobs because it severely limits the clean energy industry’s growth, and Rabhi said he’s also strongly motivated by increasing renewable energy production to address climate change. 

In February, Michigan Public Service Commission Chairman Dan Scripps testified to the House committee, with observers also pointing to FERC action on aggregated DERs as relevant context, that the commission is “supportive in taking steps to ensure solar developers in Michigan are able to continue operating and thus support in concept the idea of lifting or eliminating the cap” in order to protect the home solar industry. 

The state’s solar industry has long criticized the cap, and removing it is a “no brainer,” said Dave Strenski, executive director of Solar Ypsi, which promotes rooftop solar in Ypsilanti. 

“If they have a cap and we reach that cap, then rooftop solar is shut down in Michigan,” he said. “The utilities don’t mind solar as long as they own it, and that’s what it boils down to.”  

The state’s utilities see the situation differently. Spokespeople for DTE and Consumers told the Energy News Network that lifting the cap would shift the cost burden of maintaining their territory-wide infrastructure from all customers to low income customers who can’t afford to install solar panels, often invoking reliability examples such as California's reliance on fossil generation to justify caution.

The bill “doesn’t address the subsidy certain customers are paid at the expense of those who cannot afford to put solar panels on their homes,” said Katie Carey, Consumers Energy’s spokesperson. 

However, clean energy advocates argue that studies have found that to be untrue. And even if it were true, Rabhi said, the utilities told lawmakers in 2016 that a new inflow/outflow tariff that the companies successfully pushed for to replace net metering dramatically reduced compensation for home solar users and would address that inequality. 

“DTE’s and Consumers’ own argument is that by making that change, distributed generation is no longer a ‘burden’ on low income customers, so now we have inflow/outflow and the problem should be solved,” Rabhi said. 

He added that claims that DTE and Consumers are looking out for low-income customers are disingenuous because they have repeatedly fought larger allowances for programs that help those customers, and refuse to “dip into their massive corporate profits and make sure poor people don’t have to pay as much for electricity.”

“I don’t want to hear a sob story from DTE about how putting solar panels on the house is going to hurt poor people,” he said. “That is entirely the definition of hypocrisy — that’s the utilities using poor people as a pawn and that’s why people are sick of these corporations.” 

The companies have already begun their public relations attack designed to help thwart the bill. DTE and Consumers spread money generously among Republicans and Democrats in the Legislature each cycle, and the two companies’ dark money nonprofits launched a round of ads targeting Democratic lawmakers, reflecting the broader solar wars playing out nationally. Several sit on the House Energy Committee, which must approve the bill before it can go in front of the full Legislature. 

The DTE-backed Alliance For Michigan Power and Consumers Energy-funded Citizens Energizing Michigan’s Economy have purchased dozens of Facebook ads alluding to action by the legislators, though there hasn’t been a vote. 

Facebook ads aren’t uncommon as they get “bang for their buck,” said Matt Kasper, research director with utility industry watchdog Energy And Policy Institute. Already hundreds of thousands of people have potentially viewed the ads and the groups have only spent thousands of dollars. The ads are likely designed to get Facebook users to interact with the legislators on the issue, Kasper said, even if there’s little information in the ad, and the info in the ad that does exist is highly misleading.

DTE and Consumers spokespersons declined to comment on the spending and directed questions to the dark money nonprofits. No one there could be reached for comment.

 

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Biden seen better for Canada’s energy sector

Biden Impact on Canadian Energy Exports highlights shifts in trade policy, tariffs, carbon pricing, and Keystone XL, with implications for aluminum, softwood lumber, electricity trade, fracking limits, and small modular nuclear reactors.

 

Key Points

How Biden-era trade, climate rules, and tariffs may reshape Canadian energy and exports.

✅ Reduced tariff volatility and friendlier trade policy toward allies

✅ Climate alignment: carbon pricing, clean power, cross-border electricity

✅ Potential gains for oil, gas, aluminum, and softwood lumber exporters

 

There is little doubt among industry associations, the Conference Board of Canada and C.D. Howe Institute that a Joe Biden White House will be better for Canadian resource and energy exporters – even Alberta’s beleaguered oil industry, despite Biden’s promise to kill the Keystone XL pipeline.

The consensus among industry observers in the lead-up to the November 3 U.S. presidential election was that a re-elected Donald Trump would become even more pugnacious on trade and protectionism, putting electricity exports at risk for Canadian utilities, which would be bad for Canadian exporters. The Justin Trudeau government would likely come under increased pressure to lower Canadian business taxes to compete with Trump’s low-tax climate.

“A Joe Biden victory would likely lead to higher taxes for both corporations and wealthy Americans to help pay down the gigantic fiscal deficit that is currently running at plus-US$5 trillion,” the conference board concluded in a recent analysis.

On trade and tariffs, the conference board said: “Many but not all of these ongoing trade disputes would wither away under a Joe Biden administration. He would likely run a broad trade policy favouring strategic allies like Canada.

While Canadian industries like forestry and aluminum smelting benefited from strong demand and prices in the U.S. under Trump, the forced renegotiation of the North American Free Trade Agreement failed end tariffs and duties on things like softwood lumber and aluminum ingots, even as Canadians backed tariffs on energy and minerals during the dispute.

The uncertainty over trade issues, and Trump’s tax cuts, which made Canada’s tax regime less competitive, have contributed to a period of low business investment in Canada during Trump's presidency.

“For Canada, we’ve seen a period, since this administration has been in power, where investment has eroded steadily,” conference board chief economist Pedro Antunes said. “We are not doing well at all, in terms of private capital investment in Canada.”

Alberta’s oil industry has been hit particularly hard, with a slew of divestments by big energy giants, and cancellations of major projects, like the $20 billion Frontier oilsands project, scrubbed by Teck Resources.

While domestic policies and global market forces are partly to blame for falling investments in Canada’s oil and gas sector, up until the pandemic hit, investment in oil and gas increased significantly in the U.S., while declining in Canada, during Trump’s first term.

Biden is also expected to level the playing field with respect to climate change policies. Canadian industries pay carbon taxes and face regulations that their counterparts in the U.S. don’t. That has disadvantaged energy-intensive, trade-exposed industries like mines and pulp mills in Canada.

“With Biden in office, Canada will once again have a partner at the federal level in the states in the transition to a decarbonized economy,” said Josha MacNab, national policy director for the Pembina Institute.

Biden’s policies might also favour importing aluminum, cross-laminated timber, fuel cells and other lower-carbon products and commodities from Canada.

At least one observer believes that Canada’s oil and gas sector might benefit more from a Biden White House, despite Biden’s pledge to kill the Keystone XL pipeline.

“I think Joe Biden could be very good for Alberta,” Christopher Sands, director of the Wilson International Center’s Canada Institute, said in a recent discussion hosted by the C.D. Howe Institute.

Sands added that the presidential permit Biden has promised to tear up on the Keystone XL pipeline project is a construction permit, not an operating permit.

“The segment of that pipeline that crosses the U.S.-Canada border, which is the only place that the presidential permit applies, has been built,” Sands said. “So I think that’s somewhat of an empty threat.”

He added that, if Biden bans fracking on federal lands, as he has promised, and implements other restrictions that make it more costly for American oil and gas producers, it might increase the demand for Canadian oil and gas in the U.S. The demand would be highest in the U.S. Midwest, which depends largely on Marcellus Shale production, notably in Pennsylvania, and Western Canada for its oil and gas.

One of the Canadian industries directly affected by the Trump administration was aluminum smelting, which is relevant for B.C. because Rio Tinto plc’s Kitimat smelter exports aluminum to the U.S.

Jean Simard, president of the Aluminum Association of Canada, said one of Trump’s legacies was the reactivation of a little-used mechanism – Section 232 of the Trade Expansion Act – to hit Canada and other countries, notably China, with import tariffs.

The 10 per cent tariffs on aluminum cost Canadian aluminum producers US$15 million in the month of August alone, Simard said.

The Trump administration eventually exempted Canadian aluminum exports from the tariffs, then reintroduced them, and then, one week before the election, exempted them again.

These on-again, off-again tariff threats create tremendous uncertainty, not just for Canadian producers, but also for U.S. buyers. That kind of uncertainty is likely to ease under a Biden presidency.

Simard said Biden’s track record suggests he is well-disposed towards Canada and less confrontational with allies and trade partners in general, and some in Washington have called for a stronger U.S.-Canada energy partnership as well.

Meanwhile, softwood lumber tariffs have been imposed by Democrats and Republicans alike. But there are compelling reasons for ending the Canada-U.S. softwood lumber war.

Home renovation and repair in the United States has done surprisingly well during the pandemic.

As a result of sawmill curtailments in the U.S. due to pandemic restrictions and high demand for lumber in the U.S. housing sector, North American lumbers prices broke records this summer, soaring as high as US$900 per thousand board feet.

“It shows that there’s very strong demand for our product,” said Susan Yurkovich, president of the Council of Forest Industries.

Ultimately, the duties Canadian lumber exporters pay are passed on to U.S. consumers.

Sands said Biden’s climate action pledges, including a clean electricity standard, could increase opportunities for trading electricity between Canada in the U.S., as the U.S. increasingly looks to Canada for green power, and could also be good for Canadian nuclear power technology.

Strong climate change policies necessarily result in an increased demand for low-carbon electricity, and advancing clean grids, which Canada has in abundance, thanks to both hydro and nuclear power.

“[Biden] does share the desire to act on climate change, but unlike some of his fellow party members who are more signed on to a Green New Deal, he’s open to pragmatic solutions that might get the job done quickly and efficiently,” Sands said.

“This is a huge opportunity for small, modular nuclear reactors, and Atomic Energy Canada has some great designs. There’s a real opportunity for a nuclear revival.” 

 

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Renewables became the second-most prevalent U.S. electricity source in 2020

2020 U.S. Renewable Electricity Generation set a record as wind, solar, hydro, biomass, and geothermal produced 834 billion kWh, surpassing coal and nuclear, second only to natural gas in nationwide power output.

 

Key Points

The record year when renewables made 834 billion kWh, topping coal and nuclear in U.S. electricity.

✅ Renewables supplied 21% of U.S. electricity in 2020

✅ Coal output fell 20% y/y; nuclear slipped 2% on retirements

✅ EIA forecasts renewables rise in 2021-2022; coal rebounds

 

In 2020, renewable energy sources (including wind, hydroelectric, solar, biomass, and geothermal energy) generated a record 834 billion kilowatthours (kWh) of electricity, or about 21% of all the electricity generated in the United States. Only natural gas (1,617 billion kWh) produced more electricity than renewables in the United States in 2020. Renewables surpassed both nuclear (790 billion kWh) and coal (774 billion kWh) for the first time on record. This outcome in 2020 was due mostly to significantly less coal use in U.S. electricity generation and steadily increased use of wind and solar generation over time, amid declining consumption trends nationwide.

In 2020, U.S. electricity generation from coal in all sectors declined 20% from 2019, while renewables, including small-scale solar, increased 9%. Wind, currently the most prevalent source of renewable electricity in the United States, grew 14% in 2020 from 2019, and the EIA expects solar and wind to be larger sources in summer 2022, reflecting continued growth. Utility-scale solar generation (from projects greater than 1 megawatt) increased 26%, and small-scale solar, such as grid-connected rooftop solar panels, increased 19%, while early 2021 January power generation jumped year over year.

Coal-fired electricity generation in the United States peaked at 2,016 billion kWh in 2007 and much of that capacity has been replaced by or converted to natural gas-fired generation since then. Coal was the largest source of electricity in the United States until 2016, and 2020 was the first year that more electricity was generated by renewables and by nuclear power than by coal (according to our data series that dates back to 1949). Nuclear electric power declined 2% from 2019 to 2020 because several nuclear power plants retired and other nuclear plants experienced slightly more maintenance-related outages.

We expect coal-fired generation to increase in the United States during 2021 as natural gas prices continue to rise and as coal becomes more economically competitive. Based on forecasts in our Short-Term Energy Outlook (STEO), we expect coal-fired electricity generation in all sectors in 2021 to increase 18% from 2020 levels before falling 2% in 2022. We expect U.S. renewable generation across all sectors to increase 7% in 2021 and 10% in 2022, and in 2021, non-fossil fuel sources accounted for about 40% of U.S. electricity. As a result, we forecast coal will be the second-most prevalent electricity source in 2021, and renewables will be the second-most prevalent source in 2022. We expect nuclear electric power to decline 2% in 2021 and 3% in 2022 as operators retire several generators.

 

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EV Boom Unexpectedly Benefits All Electricity Customers

Electric Vehicles Lower Electricity Rates by boosting demand, enabling fixed-cost recovery, and encouraging off-peak charging that balances the grid, reduces peaker plant use, and funds utility upgrades, with V2G poised to expand system benefits.

 

Key Points

By boosting off-peak demand and utility revenue, EVs spread fixed costs, cut peaker use, and stabilize the grid.

✅ Off-peak charging flattens load, reducing peaker plant reliance

✅ Higher kWh sales spread fixed grid costs across more users

✅ V2G can supply power during peaks and emergencies

 

Electric vehicles (EVs) are gaining popularity, and it appears they might be offering an unexpected benefit to everyone – including those who don't own an EV.  A new study by the non-profit research group Synapse Energy Economics suggests that the growth of electric cars is actually contributing to lower electricity rates for all ratepayers.


How EVs Contribute to Lower Rates

The study explains several factors driving this surprising trend:

  • Increased Electricity Demand: Electric vehicles require additional electricity, boosting rising electricity demand on the grid.
  • Optimal Charging Times: Many EV owners take advantage of off-peak charging discounts. Charging cars overnight, when electricity demand is typically low, helps to balance state power grids and reduce the need for expensive "peaker" power plants, which are only used to meet occasional spikes in demand.
  • Revenue for Utilities: Electric car charging can generate substantial revenue for utilities, potentially supporting investment in grid improvements, energy storage solutions and renewable energy projects that can bring long-term benefits to all customers.


A Significant Impact

The Synapse Energy Economics study analyzed data from 2011 to 2021 and concluded that EV drivers already contributed over $3 billion more to the grid than their associated costs. That, in turn, reduced monthly electricity bills for all customers.


Benefits May Grow

While the impact on electricity rates has been modest so far, experts anticipate the benefits to grow as EV adoption rates increase. Vehicle-to-grid (V2G) technology, which allows EVs to feed stored power back into the grid during emergencies or high-demand periods, has the potential to further optimize electricity usage patterns and create additional benefits for electric utilities and customers.


National Implications

The findings of this study offer hope to other regions seeking to increase electric vehicle adoption rates and support California's grid stability efforts, which is a key step towards reducing transportation-related greenhouse gas emissions. This news may alleviate concerns about potential electricity rate hikes driven by EV adoption and suggests that the benefits will be broadly shared.


More than Just Environmental Benefits

Electric vehicles bring a clear environmental advantage by reducing reliance on fossil fuels. However, this unexpected economic benefit could further strengthen the case for accelerating the adoption of electric vehicles. This news might encourage policymakers and the public to consider additional incentives or policies, including vehicle-to-building charging approaches, to promote the transition to this cleaner mode of transportation knowing it can yield benefits beyond environmental goals.

 

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California introduces new net metering regime

California NEM-3 Tariff ushers a successor Net Energy Metering framework, revising export compensation, TOU rates, and non-bypassable charges to balance ratepayer impacts, rooftop solar growth, and energy storage adoption across diverse communities.

 

Key Points

The CPUC's successor NEM policy redefining export credits and rates to sustain customer-sited solar and storage.

✅ Sets export compensation methodology beyond NEM 2.0

✅ Aligns TOU rates and non-bypassable charges with costs

✅ Encourages solar-plus-storage adoption and equity access

 

The California Public Utilities Commission (CPUC) has officially commenced its “NEM-3” proceeding, which will establish the successor Net Energy Metering (NEM) tariff to the “NEM 2.0” program in California. This is a highly anticipated, high-stakes proceeding that will effectively modify the rules for the NEM tariff in California, amid ongoing electricity pricing changes that affect residential rooftop solar – arguably the single most important policy mechanism for customer-sited solar over the last decade.

The CPUC’s recent order instituting rule-making (OIR) filing stated that “the major focus of this proceeding will be on the development of a successor to existing NEM 2.0 tariffs. This successor will be a mechanism for providing customer-generators with credit or compensation for electricity generated by their renewable facilities that a) balances the costs and benefits of the renewable electrical generation facility and b) allows customer-sited renewable generation to grow sustainably among different types of customers and throughout California’s diverse communities.”

This successor tariff proceeding was initiated by Assembly Bill 327, which was signed into law in October of 2013. AB 327 is best known as the legislation that directed the CPUC to create the “NEM 2.0” successor tariff, which was adopted by the CPUC in January of 2016.

The original Net Energy Metering program in California (“NEM 1.0”) effectively enabled full-retail value net metering “allowing NEM customers to be compensated for the electricity generated by an eligible customer-sited renewable resource and fed back to the utility over an entire billing period.” Under the NEM 2.0 tariff, customers were required to pay charges that aligned them more closely with non-NEM customer costs than under the original structure. The main changes adopted when the NEM 2.0 was implemented were that NEM 2.0 customer-generators must: (i) pay a one-time interconnection fee; (ii) pay non-bypassable charges on each kilowatt-hour of electricity they consume from the grid; and (iii) customers were required to transfer to a time-of-use (TOU) rate, with potential changes to electric bills for many customers.

NEM 2.0

The commencement of the NEM-3 OIR was preceded by the publishing of a 318-page Net Energy Metering 2.0 Lookback Study, which was published by Itron, Verdant Associates, and Energy and Environmental Economics. The CPUC-commissioned study had been widely anticipated and was expected to act as the starting reference point for the successor tariff proceeding. Verdant also hosted a webinar, which summarized the study’s inputs, assumptions, draft findings and results.

The study utilized several different tests to study the impact of NEM 2.0. The cost effectiveness analysis tests, which estimate costs and benefits attributed to NEM 2.0 include: (i) total resource cost test, (ii) participant cost test, (iii) ratepayer impact measure test, and (iv) program administrator test. The evaluation also included a cost of service analysis, which estimates the marginal cost borne by the utility to serve a NEM 2.0 customer.

The opening paragraph of the report’s executive summary stated that “overall, we found that NEM 2.0 participants benefit from the structure, while ratepayers see increased rates.” In every test that the author’s conducted the results generally supported this conclusion for residential customers. There were some exceptions in their findings. For example, in the cost of service analysis the report stated that “residential customers that install customer-sited renewable resources on average pay lower bills than the utility’s cost to serve them. On the other hand, nonresidential customers pay bills that are slightly higher than their cost of service after installing customer-sited renewable resources. This is largely due to nonresidential customer rates having demand charges (and other fixed fees), and the lower ratio of PV system size to customer load when compared to residential customers.”

Similar debates over solar rate design, including Massachusetts solar demand charges, highlight how demand charges and TOU decisions can affect customer economics.

NEM-3 timeline

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The preliminary schedule that the CPUC laid out in its OIR estimates that the proceeding will take roughly 15 months in total, starting with a November 2020 pre-hearing conference.

The real meat of the proceeding, where parties will present their proposals for what they believe the successor tariff should be, as the state considers revamping electricity rates to clean the grid, and really show their hand will not begin until the Spring of 2021. So we’re still a little ways away from seeing the proposals that the key parties to this proceeding, like the Investor Owned Utilities (PG&E, SCE, SDG&E), solar and storage advocates such as SEIA, CALSSA, Vote Solar, and ratepayer advocates like TURN) will submit.

While the outcome for the new successor NEM tariff is anyone’s guess at this point, some industry policy folks are starting to speculate. We think it is safe to assume that the value of exported energy will get reduced, with debates over income-based utility charges also influencing rate design. How much and the mechanism for how exports get valued remains to be seen. Based on the findings from the lookback study, it seems like the reduction in export value will be more severe than what happened when NEM 2.0 got implemented. In NEM 2.0, non-bypassable charges, which are volumetric charges that must be paid on all imported energy and cannot be netted-out by exports, only equated to roughly $0.02 to $0.03/kWh.

Given that the value of exports will almost certainly get reduced, we expect that to be bullish for energy storage as America goes electric and load shapes evolve. Energy storage attachment rates with solar are already steadily rising in California. By the time NEM-3 starts getting implemented, likely in 2022, we think storage attachment rates will likely escalate further.

We would not be surprised to see future storage attachment rates in California look like the Hawaiian market today, which are upwards of 80% for certain types of customers and applications. Two big questions on our mind are: (i) will the NEM 3.0 rules be different for different customer class: residential, CARE (e.g., low-income or disadvantaged communities), and commercial & industrial; (ii) will the CPUC introduce some sort of glidepath or phased in implementation approach?

The outcome of this proceeding will have far reaching implications on the future of customer-sited solar and energy storage in California. The NEM-3 outcome in California may likely serve as precedent for other states, as California exports its energy policies across the West, and utility territories that are expected to redesign their Net Energy Metering tariffs in the coming years.

 

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US: In 2021, Plug-Ins Traveled 19 Billion Miles On Electricity

US Plug-in EV Miles 2021 highlight BEV and PHEV growth, DOE and Argonne data, 19.1 billion electric miles, 6.1 TWh consumed, gasoline savings, rising market share, and battery capacity deployed across the US light-duty fleet.

 

Key Points

They represent 19.1 billion electric miles by US BEVs and PHEVs in 2021, consuming 6.1 TWh of electricity.

✅ 700 million gallons gasoline avoided in 2021

✅ $1.3 billion fuel cost savings estimated

✅ Cumulative 68 billion EV miles since 2010

 

Plug-in electric cars are gradually increasing their market share in the US (reaching about 4% in 2021), which starts to make an impact even as the U.S. EV market share saw a brief dip in Q1 2024.

The Department of Energy (DOE)’s Vehicle Technologies Office highlights in its latest weekly report that in 2021, plug-ins traveled some 19.1 billion miles (31 billion km) on electricity - all miles traveled in BEVs and the EV mode portion of miles traveled in PHEVs, underscoring grid impacts that could challenge state power grids as adoption grows.

This estimated distance of 19 billion miles is noticeably higher than in 2020 (nearly 13 billion miles), which indicates how quickly the electrification of driving progresses, with U.S. EV sales continuing to soar into 2024. BEVs noted a 57% year-over-year increase in EV miles, while PHEVs by 24% last year (mostly proportionally to sales increase).

According to Argonne National Laboratory's Assessment of Light-Duty Plug-in Electric Vehicles in the United States, 2010–2021, the cumulative distance covered by plug-in electric cars in the US (through December 2021) amounted to 68 billion miles (109 billion miles).

U.S. Department of Transportation, Federal Highway Administration, December 2021 Traffic Volume Trends, 2022.

The report estimates that over 2.1 million plug-in electric cars have been sold in the US through December 2021 (about 1.3 million all-electric and 0.8 million plug-in hybrids), equipped with a total of more than 110 GWh of batteries, even as EV sales remain behind gas cars in overall market share.

It's also estimated that 19.1 billion electric miles traveled in 2021 reduced the national gasoline consumption by 700 million gallons of gasoline or 0.54%.

On the other hand, plug-ins consumed some 6.1 terawatt-hours of electricity (6.1 TWh is 6,100 GWh), which sounds like almost 320 Wh/mile (200 Wh/km), aligning with projections that EVs could drive a rise in U.S. electricity demand over time.

The difference between the fuel cost and energy cost in 2021 is estimated at $1.3 billion, with Consumer Reports findings further supporting the total cost advantages.

Cumulatively, 68 billion electric miles since 2010 is worth about 2.5 billion gallons of gasoline. So, the cumulative savings already is several billion dollars.

Those are pretty amazing numbers and let's just imagine that electric cars are just starting to sell in high volume, a trend that mirrors global market growth seen over the past decade. Every year those numbers will be improving, thus tremendously changing the world that we know today.

 

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Live Online & In-person Group Training

Advantages To Instructor-Led Training – Instructor-Led Course, Customized Training, Multiple Locations, Economical, CEU Credits, Course Discounts.

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Whether you would prefer Live Online or In-Person instruction, our electrical training courses can be tailored to meet your company's specific requirements and delivered to your employees in one location or at various locations.