Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes,...
-
Upload
madison-small -
Category
Documents
-
view
220 -
download
3
Transcript of Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes,...
![Page 1: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/1.jpg)
Economic and Policy Context of Woody Biomass
Utilization for Electric Power
Healthy Landscapes, Thriving Communities Bioenergy and Wood
Products ConferenceJanuary 21, 2004 – Denver
Dr. Mark Nechodom, US Forest Service Pacific Southwest Research Station
![Page 2: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/2.jpg)
Mapping the Biomass Territory
With grateful acknowledgements to Bob Shleser
![Page 3: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/3.jpg)
![Page 4: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/4.jpg)
![Page 5: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/5.jpg)
A Pricing Problem?
5.37.5
11.42
15.22
0
2
4
6
8
10
12
14
16
Cen
ts p
er k
ilow
att-
ho
ur
Wholesale Power(CA 2002)
Cost of BiomassGeneration
(Nechodom & Mason2003)
EnvironmentalBenefits & Potential
Income (Morris1999; Nechodom &
TSS)
Env/Soc Benefitsand Avoided Losses
(ShamelesslyHypothetical)
Huh…?!
![Page 6: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/6.jpg)
Costs From Forest to Bus Bar = 7.5¢/kWh
Capital Amortization/ROI (.5)
Transportation (1.6)
Processing (.8)
Collection (.6)
Harvest (1.2)
Operation and Maintenance (2.8)
Sources: Nechodom, Mason & Hartsough in press; TSS Consultants Unpubl.
![Page 7: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/7.jpg)
2002 Wholesale price (5.3)
Landfill (1.9)
CH4 (7.52)
Capacity Payments (2.0)
Forest Thinning (.13)
Hydrocarbons (1.1)
CO2 (-.23)
SOx (.01)
NOx (.13)
PM-10 (.71)
CO (.15)
Sources: Morris 1999; Nechodom & TSS (unpubl)
(Based
on
Califo
rnia
Wh
ole
sale
Mark
ets
, 2002)Potential Income and Avoided Costs
(public benefits) = 18.7 cents/kWh
![Page 8: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/8.jpg)
Potential Income and Avoided Costs (public benefits) = 18.7 cents/kWh
CO (.15)
PM-10 (.71)
NOx (.13)
SOx (.01)
CO2 (-.23)
Hydrocarbons (1.1)
Forest Thinning (.13)
Capacity Payments (2.0)
CH4 (7.52)
Landfill (1.9)
2002 Wholesale price (5.3)
Sources: Morris 1999; Nechodom & TSS (unpubl)
(Based
on
Califo
rnia
Wh
ole
sale
Mark
ets
, 2002)
Huh…?!
![Page 9: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/9.jpg)
Environmental and Social Impacts and Costs of Wildfire: At What Price?
Timber lossesWatershed damageWater treatmentTourism and recreationAmenity valuesWildlife habitatDisaster relief costsLost jobs and wages
Rehabilitation and restoration costsTransportation (movement of goods and services)Human health Evacuation and displacement Cultural and archeological sites
![Page 10: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/10.jpg)
The Forest Thinning Problem:
1. How much does it cost?
2. How much do I get in return?
3. How do we calculate risk?
4. What is “it”?
1. (what is the level of public investment?)
2. (who benefits? who pays?
3. (what if we don’t invest?)
4. (what exactly are you planning to do out there?)
![Page 11: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/11.jpg)
“Creating” Renewable Energy Markets
1. Public Goods Funds: taken off the top of ratepayer bills; allocated by govt or utility
2. Renewable Portfolio Standards: require the market (suppliers and consumers) to respond
3. Green Power Pricing: connecting demand (consumers) to supply (e.g., biomass plants)
4. Subsidies: transfers financial resources from taxpayers to ratepayers
![Page 12: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/12.jpg)
Renewable Energy “Public Goods Funds”
$127 mil.
RI: $10 mil
MA: $332 mil
CT: $275 mil
NJ: $271 mil.
$85 mil.
$80 mil.
$32 mil.
$94 mil.
$1890 mil.
$40 mil.
$95 mil.
$10 mil.
$234 mil.• 16 states with
renewable funds• $4.3 billion to be
collected through 2012
DE: $11 mil.
$20 mil.
Source: Lawrence Berkeley National Laboratory
![Page 13: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/13.jpg)
States with Renewable Portfolio Standards
WI: 2.2% by 2011
IA: 105 MW
MN: 825 MW by 2012
NV: 15% in 2013
TX: 2,880 MW by 2009
PA: varies by utilityNJ: 6.5% by 2012
CT: 13% by 2009
MA: 4% new by 2009
ME: 30% by 2000
NM: 10% by 2011
AZ: 1.1% by 2007
• 13 states• ~33% of total U.S.
load covered
Source: LBL, NREL, author
CA: 20% by 2017
![Page 14: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/14.jpg)
Almost half of US electricity customers have access to a green power product
![Page 15: Economic and Policy Context of Woody Biomass Utilization for Electric Power Healthy Landscapes, Thriving Communities Bioenergy and Wood Products Conference.](https://reader036.fdocuments.in/reader036/viewer/2022062321/56649e745503460f94b75183/html5/thumbnails/15.jpg)
Policy-Level Support
MOU on Biomass Utilization – USDA, DOE, DOI – Signed June 16, 2003Healthy Forest Restoration Act (HR 1904 – Title II: Biomass)Increased policy-level interest in translating forest investments into cost-savings and revenues