Carbon Market Cooperation in Northeast Asia: Assessing Challenges and Overcoming Barriers

China, Japan, and the Republic of Korea are emerging as major players in the global carbon trading landscape. As Northeast Asia's biggest industrial economies, these three countries are connected through deep commercial and trade ties, and shared environmental challenges. There are thus growing calls for these markets to manage differences to build a foundation for more extensive carbon market cooperation. This Asia Society Policy Institute report draws on the expertise of a wide range of scholars and practitioners to help equip policymakers and other stakeholders with information and guidance on the potential of and pathway toward carbon market linkage in Northeast Asia. This volume includes 11 chapters that examine the challenges of and approaches to carbon market cooperation and linkage in Northeast Asia.

Effects of Technology Assumptions on US Power Sector Capacity, Generation and Emissions Projections: Results from the EMF 32 Model Intercomparison Project

This article is one of two syntheses in a special issue in the journal Energy Economics on the EMF 32 study, a major modeling study of the electric power sector’s emissions in various policy intervention scenarios. This article focuses on the effects of technology and market assumptions with projections out to 2050. A total of 15 models contributed projections based on a set of standardized scenarios. The scenarios include a range of assumptions about the price of natural gas, costs of end-use energy efficiency, retirements of nuclear power, the cost of renewable electricity, and overall electricity demand. The range of models and scenarios represent similarities and differences across a broad spectrum of analytical methods.

The EMF 32 Study on Technology and Climate Policy Strategies for Greenhouse Gas Reductions in the U.S. Electric Power Sector: An Overview

This introduction to a special issue of Energy Economics presents the key findings of Energy Modeling Forum Model Inter-comparison Project Number 32 (EMF 32) entitled “The EMF 32 Study on Technology and Climate Policy Strategies for Greenhouse Gas Reductions in the U.S. Electric Power Sector.” This study focused on the development and cross-model comparison of results from U.S. climate policy intervention scenarios focusing on policy strategies for achieving greenhouse gas emission reductions in the electric power sector and the sensitivity of emissions and economic results to changes in technology and market assumptions. This overview article describes the motivation for the EMF 32 study, identifies the models used in the study, describes the study's scope and design, and reviews insights in the special issue's articles. A related article focuses on the effects of technology and market assumptions with projections out to 2050. 

PURPA’s Midlife Crisis: Will Its 40th Birthday Be One of Fundamental Change?

The Public Utility Regulatory Policies Act of 1978 (PURPA) has played a key role in the spread of independent power producers and the dislodgment of the classic monopoly utility model. Although drastic changes in the law appear unlikely at this point, some changes at the national level seem to be in the offing. This article in The Electricity Journal lays out the issues that could lead to changes.

Managing Dynamic Change in the Midwestern Power Sector: Power Shift Midwestern Regional Workshop

Market-shifts, technological innovation, and clean energy policies are driving a fundamental transformation of the U.S. power sector. This proceedings describes four critical grid issues in the Midwest discussed at the Power Shift's Minnesota meeting: evolving stakeholder processes, power sector fleet transfer, the impact of electric cars on the grid, and responses to changing consumer demand. The range of potential research inspired by the discussion—including whether state regulatory processes help or hinder big shifts underway on the grid, how state climate goals affect regional generation patterns, how stakeholder processes and market trends interact, whether utilities should attempt to spark demand for electric vehicles, and whether customer demands or public policies are driving innovation—points to the sea change in the U.S. power sector.

Regional Implications of National Carbon Taxes

This analysis published in the journal Climate Change Economics examines impacts of nationally-imposed carbon taxes on different regions of the United States. The goal is to see what can be learned about the drivers of regional political support for and opposition to such measures. Whether at the state, regional or national levels, carbon taxes are one option for reducing greenhouse gas emissions; several state and regional programs are already under way and lowering emissions. This analysis uses a U.S. regional version of the Dynamic Integrated Economy/Energy/Emissions Model (DIEM) computable general equilibrium model to explore relationships between carbon taxes, emissions, and economic growth.

The Future of the Electricity Industry: Implications of Trends and Taxes

This analysis published in the journal Energy Economics examines how changes in market trends and technology costs are likely to affect electricity generation in the United States in the context of possible future carbon taxes. It uses the Dynamic Integrated Economy/Energy/Emissions Model (DIEM) electricity-sector model to examine a wide range of sensitivity cases for technology and fuel costs under different economic conditions. The model finds that carbon taxes can be an effective way to quickly lower emissions. Shifts among natural gas and renewable generation can vary significantly, depending on capital and operating costs.

Understanding the Interaction between Regional Electricity Markets and State Policies

Regional electricity markets—operated by regional transmission organizations (RTOs)—span multiple states and bring significant benefits to the electricity grid. States policies—such as renewable or clean energy portfolio standards or procurement mandates—have always helped shape market outcomes, but increasingly they are aimed at addressing perceived market shortcomings. Recent state policy actions to support new or existing resources in RTO markets have renewed attention to issues of RTO market design, including how RTO markets and state policies interact. Those actions, a rapidly changing electricity sector, and low electricity and capacity prices have heightened the urgency of calls for changes in market designs to address perceived inequities, such as market designs that fail to value certain environmental or reliability attributes. This primer is aimed at policy makers and stakeholders who seek an understanding of regional electricity markets and the effect of state policies on those markets as well as an understanding of recent market design proposals that are designed to address the RTO-state policies interaction. 

Potential Pathways: Future of the Electricity Sector in the Southeast—Workshop Summary, October 5, 2016, Durham, North Carolina

The electricity sector is rapidly changing due to the shale gas revolution, a precipitous decline in coal generation, steep declines in the cost of solar generation, the proliferation of smart grid technologies, and a suite of new environmental regulations. On October 5, 2016, Duke University’s Nicholas Institute for Environmental Policy Solutions and the Duke University Energy Initiative co-hosted a one-day workshop that brought together experts on the electricity sector in the Southeast—including representatives of electric utilities, other market participants, nonprofit organizations, and energy and environmental agencies—to discuss factors affecting the region’s electricity sector. The main topics were future demand uncertainty, the ways that technology innovation could affect business models and regulatory structures, and the role of nuclear energy in the Southeast’s electricity future. This proceedings describes the main ideas that emerged from the workshop. It concludes with issues ripe for future research.

The Uncertain Future of Nuclear Power in the Southeast: Implications of an Aging Fleet for Electricity Sector Planning and Emissions

Nuclear power provides about one-quarter of the electricity in the Southeast and the majority of the region’s non-fossil generation. Beginning around 2030, nuclear plants in the Southeast, as in the rest of the country, will start to reach the end of their initial operating license extensions. How many nuclear units will seek and receive a second license extension is unknown. Replacing existing nuclear capacity with new nuclear capacity requires approximately 10 to 15 years. If a high percentage of nuclear units in the Southeast do retire, it is unlikely that they can simultaneously be replaced with new units, given the long lead times and limited applications for new nuclear plants at the Nuclear Regulatory Commission. This policy brief explores how the potential loss of existing nuclear power plants in the Southeast interacts with the region’s other electricity sector challenges and it proposes steps states can take to address these challenges.