by Sean Casten
Having noted in part 2 that all barriers to clean energy deployment can
be lumped into utility policy, environmental policy, and out-of-date policy—and having outlined the necessary fixes for the first two in parts 5 and 6—we now address out-of-date policies.
This is perhaps the hardest to address, because it is such a
catch-all. It is also, somewhat
uniquely, a case where we don’t even know where all the bodies are. In my experience, it is hard to build any
clean energy project without running into some antiquated law that impedes
progress. Which by extension means that
until such time as I am never again surprised by one of those laws, I can’t
credibly say I know where all, most, or even the biggest of those barriers are. But the truth is out there. Here’s how to find it.
At
every level of government, convene a regulatory modernization committee. Task this committee to identify any law that
blocks the deployment of clean energy (including energy efficiency), determine
the original purpose of that law, determine whether that purpose still applies
and—if necessary—eliminate or modify accordingly. This is perhaps the most naïve idea in this
series of posts, because of its sheer scale. There are barriers in our tax code, in municipal building codes, in
utility rate-making protocols, in our environmental laws and even in our
criminal statutes. Merely cataloging all
these challenges is a monumental task—so let’s acknowledge that the idea is
ridiculously idealistic. But they are
massive. A few examples may
illustrate. Insulation that is retrofit
into storage facilities has a tax depreciation life that exceeds the length of
the facility, creating a financial incentive not to insulate. Many municipal building codes require
full-time lighting of all emergency exits, inadvertently precluding the
installation of motion-sensors. Steam vessels
at pressures of >15 psig require full-time operators in many jurisdictions,
creating a barrier to waste heat recovery (to understand how crazy this is,
note that you can have a 250 psig propane storage tank without an
operator!) In many states, it is a
felony offense for anyone but a regulated utility to run a private wire across
a public thoroughfare, causing people with opportunity fuels to often undersize
their electric generator. All these,
and many more preclude efficiency for reasons that no longer make any
sense. This list is far from complete, and I’d love to hear about other ones that readers have run into. Maybe we can start the list here!
For all
laws identified above, ask whether the law follows the guiding principles
outlined here. As noted earlier, it is hard to craft good
policy if you are not first explicit about your principles. Suffice to say that many laws don’t follow
any consistent set of principles. To be
sure, sometimes this inconsistency is a virtue; utility law for years has
struggled with the conflict between the consumer interest (in lower energy
costs) and the public interest (in a solvent utility) and coalesced around a
single operative theory: “it all depends.” While some of the outcomes of that particular debate may be goofy, this theory
of rate-making is obviously superior to a dogmatic insistence on One True
Path. Nonetheless, if we do seek to
reform existing barriers to clean energy, they ought to be reformed with a map
in hand; we may occasionally decide to go off-roading anyway, but let’s at
least know when we’re about to veer off the pavement. Does a policy reward a goal or a path? Does a policy place the economy and
environment in unnecessary conflict? Does
a policy favor businesses or markets? Does a policy strike an appropriate balance between carrots and
sticks?
Let’s quickly review the key points of this series. Massive policy barriers to clean energy exist,
blocked by massive political barriers to reform. On the other hand, a better policy
environment is possible that need not sacrifice our environmental
responsibility nor economic growth. Change
will be hard, but the benefits will outweigh the costs. So that leaves one remaining question: What
do we do next? If we know where we want
to get to, and understand the political landscape that constrains our incremental
advances, what should we do? My effort
to answer that question in the next (and final) post.
Related Links:
Policy fixes to unleash clean energy, part 6
A $22 Billion Decision on Water Heaters? Tell DOE to do the right thing
Job losses push need for energy bill
