Policy fixes to unleash clean energy, part 7
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in part 2 that all barriers to clean energy deployment can be lumped into utility policy, environmental policy, and out-of-date policy — and having outlined the necessary fixes for the first two in parts 5 and 6 — we now address out-of-date policies.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.