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A State Policymaker’s Guide to Power Sector Modeling

In a new report, the Bipartisan Policy Center and Nicholas Institute for Environmental Policy Solutions explore the value, use, and limitations of economic modeling of the electricity sector. The report presents a suite of recent analyses by different organizations, showing how economic modeling can be used to simulate possible policy, market, and technology changes as the electricity sector transforms due to growth of domestic natural gas, increased use for electric generation, the rapid progress of renewable technologies, and environmental regulations.

It is meant to be a guide for state policymakers who have both the benefit and challenge of unpacking modeling results and figuring out how best to learn from diverse findings. It provides them with both an understanding of how to best utilize economic models and interpret their results as well as explores key modeling structures often being deployed to model carbon regulations such as the Clean Power Plan and input assumptions that impact power sector modeling results.

Authors: Blair Beasley, David Hoppock, Jennifer Macedonia, Martin Ross, and Tracy Terry

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Climate and Energy

Clean Air Act

Environmental Economics

State Policy

Reports

Unconventional Oil and Gas Spills: Risks, Mitigation Priorities and States Reporting Requirements

An analysis led by the Nicholas Institute for Environmental Policy Solutions, which appears in the journal Environmental Science & Technology, concludes that making state spill data more uniform and accessible could provide stakeholders with important information on where to target efforts for locating and preventing future spills. However, reporting requirements differ across states, requiring considerable effort to make the data usable for analysis. 
 
By examining state-level spill data, it finds that 2 to 16 percent of hydraulically fractured oil and gas wells across Colorado, New Mexico, North Dakota and Pennsylvania spill hydrocarbons, chemical-laden water, hydraulic fracturing fluids and other substances each year. The study characterizes spills associated with unconventional oil and gas development at 31,481 wells hydraulically fractured or "fracked" in the four states between 2005 and 2014, identifying 6,648 spills in the 10-year period. Across all states, the first three years of a well's life, when drilling and hydraulic fracturing occurred and production volumes were highest, had the greatest risk of a spill. It found a significant portion of spills (from 26 percent in Colorado to 53 percent in North Dakota) occur at wells that experienced more than one spill, which suggests that wells where spills have already occurred merit closer attention.
 
Authors: Lauren A. Patterson, Katherine E. Konschnik, Hannah Wiseman, Joseph Fargione, Kelly O. Maloney, Joseph Kiesecker, Jean-Philippe Nicot, Sharon Baruch-Mordo, Sally Entrekin, Anne Trainor, and James E. Saiers

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Hydraulic Fracturing and Water Use

Climate and Energy

Water Policy

State Policy

Journal Articles

North Carolina’s Ocean Economy: A First Assessment and Transitioning to a Blue Economy

North Carolina’s ocean and coastal areas and their resources shape a unique and important segment of the state’s economy, particularly for its eastern region. From seafood and commercial fishing opportunities, to access to global markets through shipping and transport, and finally tourism and recreation, thousands of jobs and billions in revenue for the state depend on the ocean and coast. Yet to date, this segment of North Carolina’s economy has not been identified as a discrete contributor in the state. This working paper provides a first assessment of the existing information available to measure the size and extent of North Carolina’s ocean economy, and proposes next steps to transition to a blue economy.

Authors: Jane Harrison, Amy Pickle, Tibor Vegh, and John Virdin

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Blue Economy

Ocean and Coastal Policy

Ecosystem Services

Environmental Economics

State Policy

Working Papers

Sharing Groundwater: A Robust Framework and Implementation Roadmap for Sustainable Groundwater Management in California

This working paper offers a framework and roadmap for development of a robust groundwater-sharing system consistent with California’s Sustainable Groundwater Management Act, which requires communities in priority areas to prepare groundwater sustainability plans. The proposed system draws on global experience. Robustness is its signature feature. Opportunities are maximized by a suite of robust local governance, allocation, and administrative arrangements. Additionally, the proposed system incentivizes innovation, stimulates investment, and facilitates low-cost adjustment to changes in groundwater demand. Among the dynamic components underlying this sharing system are a share register that records ownership and transfers of ownership in the basin’s available shares. These unit shares are fungible; each represents a proportional stake in access to the basin’s groundwater resources. Volumetric allocations are made in proportion to the number of shares held during determined periods throughout the water year.  These allocations are recorded in bank-like water accounts, affording account holders an efficient means to manage their resource but also ensuring that they cannot use more than is available. Unused water can be saved for later use. At the start of the transition to the new system, users are given an allocation buffer so that they have flexibility and time to adjust. Those who want to can make quick non-contestable trades at low cost.

Authors: Mike Young and Bryce McAteer

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Environmental Markets

Western

Water Policy

Environmental Economics

State Policy

Working Papers

Evaluating Flow Metric-Based Stream Classification Systems to Support the Determination of Ecological Flows in North Carolina

Streamflow is a main determinant of the ecological health of rivers and streams. Assignment of streams to classes is suggested as an initial step in the process of establishing ecological flow standards that ensure the appropriate environmental objectives are achieved. A new article in the Journal of the American Water Resources Association evaluated a hydrological model with two distinct hydroecological river classification systems of stream classes in North Carolina and found that stream classification was inconsistent between all three models and highly dependent on the period of record of the underlying data. Based on these results, it was surmised that classification systems based on streamflow metrics are not a reliable approach for guiding ecological flow determinations.

Authors: Michele C. Eddy, Jennifer Phelan, Lauren Patterson, Jessie Allen and Sam Pearsal

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Water Policy

State Policy

Journal Articles

Fish and Invertebrate Flow-Biology Relationships to Support the Determination of Ecological Flows for North Carolina

Following recent droughts in North Carolina, the General Assembly convened an Ecological Flows Science Advisory Board to develop a strategy for establishing flow regimes that could protect the ecological integrity in the streams and rivers of North Carolina. A new article in the Journal of the American Water Resources Association describes the method developed to characterize fish and invertebrate responses to flow alterations in the state of North Carolina to aid in setting ecologically sensitive flows that achieve appropriate environmental objectives.

Authors: Jennifer Phelan, Tom Cuffney, Lauren Patterson, Michele Eddy, Robert Dykes, Sam Pearsall, Chris Goudreau, Jim Mead and Fred Tarver

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Water Policy

State Policy

Journal Articles

Flow-Biology Relationships Based on Fish Habitat Guilds in North Carolina

The health of freshwater animal and plant life is dependent on streamflow, yet identification of the flow regimes required to maintain ecological integrity remains challenging to states in the U.S. seeking to establish ecological flows that achieve environmental objectives. A new article in the Journal of the American Water Resources Association tests the relationship between decreases in streamflow and Shannon-Weaver diversity index of fish species for four flow-based habitat guilds: riffle, riffle-run, pool-run, and pool in North Carolina. The study finds that species who prefer shallow habitats, such as riffles and riffle-runs were the most sensitive to decreases in streamflow, while using all fish data greatly underestimated the response of fish species to decreases in flow. Since ecological flows are designed to protect the integrity and diversity of aquatic ecosystems, ecological flows should be established to protect those species most sensitive to changes in flow.

Authors: Lauren Patterson, Jennifer Phelan, Chris Goudreau and Robert Dykes

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Water Policy

State Policy

Journal Articles

Revisiting the NAAQS Program for Regulating Greenhouse Gas Emissions under the Clean Air Act

The future is uncertain for the regulation of greenhouse gases from power plants, including the U.S. Environmental Protection Agency’s (EPA) Clean Power Plan, which covers existing plants. The rule is under review in the D.C. Circuit Court of Appeals, and the Supreme Court has indicated its interest in hearing the case. Moreover, during his presidential campaign, president-elect Donald Trump promised to “scrap” the Clean Power Plan. If the rule is overturned or is severely weakened, whether through litigation or executive action, stakeholders are likely to litigate to seek to force the EPA to use other authorities under the Clean Air Act to regulate greenhouse gas emissions.

This working paper examines the opportunities and challenges associated with regulation of greenhouse gases under the National Ambient Air Quality Standards (NAAQS) program, drawing a comparison with the Clean Power Plan’s approach under a different section of the Clean Air Act. The paper offers no opinion on the Clean Power Plan litigation, nor does it advocate for the Clean Power Plan or the NAAQS approach. Its focus is on understanding how the NAAQS program might incorporate greenhouse gases in in the event that the EPA pursues that approach.

Authors: Christina Reichert, Franz Litz, Jonas Monast, Tim Profeta, and Sarah Adair

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Climate and Energy

Clean Air Act

Environmental Economics

State Policy

Working Papers

Unconventional Oil and Gas Spills: Materials, Volumes, and Risks to Surface Waters in Four States of the U.S.

A new article in the journal Science of the Total Environment examines spill data associated with unconventional oil and gas wells from Colorado, New Mexico, North Dakota, and Pennsylvania from 2005 to 2014. The authors used the data to evaluate the environmental risk of spills. They found that there were 21,300 unconventional wells and 6,622 reported spills. Across all states, the average distance of spills to a stream was highest in New Mexico, followed by Colorado, North Dakota, and Pennsylvania. Pennsylvania spills occurred in watersheds with a higher relative importance to drinking water than the other three states.

Authors: Kelly O. Maloney, Sharon Baruch-Mordo, Lauren A. Patterson, Jean-Philippe Nicot, Sally A. Entrekin, Joseph E. Fargione, Joseph M. Kiesecker, Kate E. Konschnik, Joseph N. Ryan, Anne M. Trainor, James E. Saiers, and Hannah J. Wiseman

Filters

Hydraulic Fracturing and Water Use

Water Policy

State Policy

Journal Articles

North Carolina Electricity Planning

The electricity system is facing new pressures from a changing generation mix, new technologies, consumer demand, and evolving utility business models. Planning for these changes will require participants in the process—utilities, regulators, consumers, and other stakeholders—not only to engage with these coming shifts but also to think critically and collectively about ways to address them. In North Carolina, two regulatory bodies share responsibilities for electricity planning: the North Carolina Energy Policy Council (EPC) and the North Carolina Utilities Commission (NCUC). The EPC is responsible for setting the state energy plan; the NCUC approves utility-developed integrated resource plans that forecast future electricity demand and options for meeting it. These two planning processes have different stakeholder-engagement opportunities, forecasting requirements, and outcomes. Robust electricity planning that is based on a comprehensive and coordinated policy framework across agencies and that creates strong stakeholder alignment has multiple benefits, including increased regulatory certainty, diverse stakeholder engagement in a common goal, and clear understanding among stakeholders and decision makers of electricity generation, transmission, and distribution options. North Carolina has a range of options to institute comprehensive electricity planning that is aligned with effective planning principles and that builds on its past successes.

Authors: Kay Jowers and Amy Pickle

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State Policy

Working Papers

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