Contentious round of voting Saturday night, and the heavy threat of the president’s veto pen, but if we can get through the political fog, the House may well have accomplished something truly monumental.

Two big pieces in the energy bill worth noting, and following closely in any subsequent compromise. Both are transformative for our electricity markets — an area where past energy bills (at least since 1993) have favored the status quo over true reform. In addition, with >50 GW of already identified potential for zero-carbon electricity from industrial waste heat sources (compare to the entire US nuclear fleet at 100 GW), this has the potential to massively reduce carbon emissions associated with power generation, to a degree not likely (at least in the near term) from any other legislative activity:

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  1. Subtitle E. This section mandates the EPA to inventory all the places where it is possible to generate electricity from industrial waste heat, and then provides (a) $10/MWh credit to the project, to be shared with the utility (a nice incentive) if the project has to export onto utility wires, and (b) a requirement that the utility must provide competitive pricing for any purchased electricity. This latter point is truly transformative, as under present rules too many of these facilities are intentionally undersized to only serve the needs of the host, since you cannot otherwise get a fair price from the monopoly utilities. The details are subtle, but can essentially be understood to be nearly-net-metering for all clean energy facilities, without the arbitrary size caps that states have passed to date (which are good for solar, but don’t significantly impact total MWh of clean energy since they don’t apply for generation of any real size).
  2. The RPS. As I’ve said many times (Here, and more recently here), I don’t like RPS rules. They’re an inefficient way to reduce carbon and confuse paths with goals. That said — and as David capably points out — they are better than nothing, and as long as we don’t have a carbon program, maybe this is the best we can do. So in that spirit, I’m glad to see this RPS finally passed. But the part that makes me truly hopeful is that this RPS included provisions for CHP and energy efficiency. What I like about this is that — academic claims to the contrary notwithstanding — a pure RPS will never pass, because you simply can’t convince the majority of Senators that their states will not be net exporters of money to the couple states that have a lot of wind. And so for 15 years we have sought perfection and achieved nothing on the RPS front. It’s been clear for at least the last 10 that the only way to get progress was to get compromise — a political reality that the right has always been quicker to grasp than the left.

In the debate this week, the House first ratcheted from 20% to 15% but still didn’t have the votes. Then they added CHP/EE and they got the votes. There is a lesson there. We finally got something, and — much like my general feeling on RPS as a concept — something is better than nothing. My naive hope is that this reality may finally stick with the purists in the environmental community, so that we can collectively work on making change rather than arguing amongst ourselves over who is the prettiest.

This all, of course, may still be vetoed by the president, or get jumbled up in conference in the Senate. But it’s a heck of a start.

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