We Don’t Need to Yell at the Utility Regulators or the Utilities but the Government Who Appoints Them

Is Iowa Doing Everything It Can?

By Paritosh Kasotia

A version of this article appeared as a guest column in The Des Moines Register on Earth Day, April 22, 2015

Today marks the 45^thanniversary of the Earth Day. To commemorate this important milestone, the environmentally conscious lot will probably attend an earth-friendly lecture, switch off our lights and many devices, and talk to our family and friends about the environmental challenges the Earth is facing. This year also marks the 25^th year anniversary of the Iowa’s Energy Efficiency Act. Most sustainability professionals preach “think globally, act locally”. On this important day and year, we have to ask ourselves, are we unreservedly doing either of the two parts?

At a Citizens Climate Lobby (CCL) event in April, founder Marshall Saunders talked about his early journey to mobilize citizens to take action to minimize the impact of climate change. He recommended actions such as switching light bulbs, improving energy efficiency of homes and buildings, and undertaking other conservation measure and soon realized that these, by all means, are important steps that we all should take but they are just a drop in the bucket to address the colossal issue of climate change.

We have to tackle big issues and the time is now. Less talk, more action. No Excuses, No Games, No political donor favors, No political hackery and No more political football Please!

Iowa has an exceptional opportunity to rethink and redesign its energy sector and establish a statewide comprehensive energy plan that is of the people, by the people, for the people. The timing could not be better. With the Environmental Protection Agency’s (EPA) Clean Power Plan, states have a golden opportunity to reduce carbon emissions and with sheer innovation and leadership, establish new clean energy economic sectors. Iowa has done it in the past with wind and biofuels and with right policies and regulatory structure in place, it can recreate that success story.

The opportunities are boundless. Take for example, solar. Iowa is ranked 16^th for technical solar potential in the nation which makes it incredible to grow the solar industry. Progressive utilities such as Farmer’s Electric Cooperative and its General Manager Warren McKenna have shown us the way that it is possible for utilities to adopt a profitable solar model that works. Moreover, Iowans have given up successful careers and founded companies such as Moxie Solar. Mike Howard, a local business owner from Elk Horn is personally invested in the clean energy sector through his ownership of companies that test and calibrate alternative energy devices such as solar PV panels. These Iowans foresee a bright future for the next clean energy economy in Iowa.

Other energy areas such as energy efficiency hold significant promise as well. Iowa’s Energy Bank program was highly successfully in providing low-cost capital for public sector energy efficiency projects. Moreover, the loan program was low risk for Iowa since the loans were given to cities, schools, counties, and universities, which are generally low-risk borrowers. But, as the federal funds dried up and no funds are injected from the state, the program is likely to fall apart, creating a void for our institutions and communities to become leaders in energy efficiency and sustainability.

Options such as solar, financing for energy efficiency, and others like biogas exploration hold significant value to outgrow Iowa’s clean energy economy, reduce emissions, and create a mark for Iowa. We can pass solar tax incentives and promote energy efficiency but this a very piecemeal approach and likely to result in half-baked outcomes. Without a comprehensive energy plan that is vetted through various stakeholders, Iowans will miss an opportunity to innovate and lead in the clean energy economy race that other states are aggressively pursuing.

Iowa has shown that with supportive leadership, progressive policy framework and lenient regulatory structure, it can be the front-runner in the clean energy movement. Iowa was first in the nation to enact the Renewable Portfolio Standard and has the prospect to be the first again.

Keeping the tenets of the Iowa’s Energy Efficiency Act of 1990 in mind of effectively utilizing energy resources and tapping into renewable energy resources, we can collectively catapult to another clean energy movement. Iowans has proven time and time again that when they put their personal will and influence to work, they can shape the future and in this case rise to the occasion and lead the nation in addressing one of the greatest threats facing humanity.

President John F. Kennedy, in his famous speech spoke

“We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one that we are willing to accept, one we are unwilling to postpone, and one which we intend to win, and the others, too.”

For most of us, the issue of addressing climate change can be a hard one to grapple with and for sure stirs up enormous passion from all sides but there is no greater satisfaction and pride when we come together and are willing to accept the challenge before us and mobilize our energies, knowledge, skill and the will to overcome it. I am up for it, are you?

Are Millennials Really Not Engaged?

By Paritosh Kasotia

I was at a Citizens Climate Lobby event last night. During Q&A, a lady who described herself as a baby boomer asked a very simple question, how do we engage the millennials? My first reaction was aren’t millennials already engaged? I thought data shows that we deeply care about issues such as climate change, human rights, democracy and other social subjects. We are even willing to give up lucrative careers to address the world’s toughest challenges. But, I don’t blame the boomers. In the room where we had our gathering, except for a handful of us, majority of the folks fell in the 40-70 age group.

That conversation made me wonder if there is simply a perceptive disconnect or the millennials are truly disengaged from the political process when it comes to the issue of climate change. Research strikingly shows not much. A study conducted by Statista in March 2014 observed attitudes about climate change among different age groups. On the question of whether climate change is real and whether humans are to blame for it, 50% of millennials (18-36) answered yes compared to 37% Matures (68+), 43% Gen X (37-48) and 47% Baby Boomers (49-67). On another University of Texas-Austin Energy poll last year, 66% of young adults (18-34) indicated they would prefer to vote for a political candidate who supports cutting greenhouse gas emissions and increase financial incentives for renewable energy compared to 50% of seniors (65+) who indicated they would support such candidates. 56% of the Millennials are also willing to pay more to protect the environment compared to 20% of seniors. The real issue is not that we don’t know about climate change or don’t care enough about it but maybe we are not engaged in ways that would result in meaningful outcomes.

So, what could we, the millennials, do differently to have profound impact? For one, we need to get more active “offline” than “online”. I, similar to many others, “like”, “share”, and “post” number of climate related articles, blogs, and commentary on social media space. We even give our strong opinions on these topics. But, how many of us actually present our views in front of our elected officials, our policymakers and our stakeholders. Powerful lobbying groups, on the other hand, have an army of individuals circling around our elected officials trying their best to get policies passed in their favor. There are indeed millennials who are very active in the public space but those numbers are very few. To create a force, we need more than just a handful.

Secondly, we are certainly vocal about our opinions but those are not necessarily reflected in our voting patterns. Studies have documented multiple times that older voters are likely to vote on a consistent basis than young voters. An NBC article shows that electorate in midterm elections was much older than in presidential elections. In 2012 presidential elections, 25% of voters were age 60 and older while 19% were under 30 years old. In the 2014 midterm elections, 37% of the voters were over the age of 60 and only 12% were under 30 years old. Not being active in midterm elections is a missed opportunity to advance critical topics such as climate change, wage laws, education and so on. Despite having a President who is working towards aggressive climate goals, without a Congress that is able to provide some level of meaningful support, carrying the climate change movement forward will be tough.

In a world filed with special interest groups and campaign finance, it is very easy to give up on the system and disengage. But doing do will only make the system hard to mend.

The millennials and the generations that follow will be hit hardest by the calamities of climate change. Having an opinion on climate change may not be enough. As Marshall Saunders, founder of Citizens Climate Lobby spoke last night, “I assumed that the important people were making important decisions”. That, of course, is far from reality. And so, it is imperative that everyone, millennials and boomers, rise and engage in what is important.

We Don’t Need to Yell at the Utility Regulators or the Utilities but the Government Who Appoints Them

By Paritosh Kasotia

David Roberts of Grist had a great article, “Why Are We Yelling at the Utilities and Not Their Regulators” out on February 20th that brought attention to the role of regulators in supporting clean energy choices. It’s the regulators through the Public Utility Commissions that decide what policies are implemented and which ones are crushed before they see the light of day. But, shouldn’t the bigger question be who are these regulators answerable to? Except for fifteen states, utility commissioners are appointed by the Governor of that state which means that they serve at the pleasure of the Governor.

This brings up the question whether the public utility commissions can operate in an objective and transparent manner. Case in point: Iowa’s Governor recently demoted Iowa Utilities Chairwoman to a member status and replaced one of the existing member with a new appointee. This was most likely a result of a meeting between the Iowa’s largest utility and the Governor where the utility displayed their displeasure over the Board’s decision to return $2 million annually to customers in a wind project. The role of a public utility commission is to make objective decisions but in this case, it came with consequences. Iowa’s utility commission already has two high level and controversial projects lined up, transmission line and an oil pipeline. Both have strong opposition from the public and significant support from the Governor. In fact, the Governor of Iowa went so far to say that the Iowa legislators should stay out of the pipeline issue and let the regulators do their job. The irony of the story is that the Governor himself imposed his views on the Iowa Utilities Board’s leadership because of the power imposed by the utility company.

What does all of this tell us? For one, the utility regulatory structure is not free from special interest groups. In Wisconsin, for example, the Public Service Commission voted on a rate structuring decision that would have a detrimental effect on the solar and DG industry. The commissioners are appointed by the Governor and in Wisconsin’s case, the two commissioners who voted in favor of the rate case were appointed by Governor Walker and those that favored against the case was appointed by the previous Governor. Some states such as Florida, where commissioners are also appointed by the Governor, have started to recognize this as an issue worthy of acknowledgement. Under Bill SB 288, lawmakers hope to remove the closeness between state utility regulators and power companies.

So, why does such a cozy relationship exist between the Governors, the public utility commissioners, and the utility companies? The answer comes down to money. Last year, Florida’s three largest utilities made significant contributions to the re-election campaign of Republican incumbent Governor Rick Scott. Similarly, Governor Walker’s one of the top contributors was a power company.

In order to minimize the impact of such relationships, there are two steps one can take. One is to create strong anti-lobbying rules so that utilities’ influence on the elected officials is diminished. While this is an excellent solution, it is rather difficult to achieve. So, the second solution which has the power to impact how utility business is conducted is for the citizens to unite and demand answers from their elected officials on why certain decisions are made and more importantly how do they safeguard the interests of the public. We can all certainly hope for and work towards a more transparent decision-making process.

Why are Companies taking a Myopic View on EPA’s Clean Power Plan?

By Paritosh Kasotia

An article that appeared in The Guardian cites large corporations such as FedEx stating that they don’t have to take a stand on the EPA’s Clean Power Plan rules because they are not directed at their industry sector. Another unknown company also stated that “there’s a reluctance if a regulation doesn’t get into your core competency to get into somebody else’s backyard. It’s an unspoken acknowledgment that you stick to your knitting.”

I am baffled by this logic. It’s one thing if you are addressing a topic that is very clear cut and only impacts certain industries but the point of the Clean Power Plan isn’t just to make power companies cleaner but address a bigger cause which is of climate change. These companies need to be reminded that the Clean Power Plan is much more than just a set of regulations imposed at electric power companies. Here’s how it would impact different business industries:

Financial institutions: All financial and investment institutions plan for unknown risks imposed by climate change. As we have seen, climate related events are becoming a recurring phenomenon with massive economic loss. We are witnessing the increased frequency of heavy rainfalls and subsequent flooding, droughts as well as rise in the sea levels. The surest and the cheapest way to hedge against these risks is to mitigate the impact of climate change by supporting policies such as Clean Power Plan which addresses the number one cause of emissions – electricity generation. According to the Final Assessment Report of the Intergovernmental Panel on Climate Change (IPCC), investors and financial institution decisions have a critical influence on how our society responds to climate change. More than anything, these institutions should realize the emerging opportunities in new clean energy markets where they can leverage their capital to build a clean energy economy.

Food and Retail Companies: Food and retail companies such as McDonalds, Ocean Spray and Walmart have a lot to gain from supporting the Clean Power Plan. These companies have substantial environmental and sustainability goals of their own. Walmart, for example, has a goal of being powered by 100% renewable energy. Co-incidentally, one of the building blocks to comply with EPA Clean Power Plan is to invest in renewable energy sources. Being vocal about its goals and how the Clean Power Plan provides Walmart an opportunity to meet its sustainability goals, the company will strengthen its commitment to sustainability and in turn please its stockholders who are increasingly demanding accountability on environmental and social metrics. Moreover, sustainability goals and actions of these companies by themselves are futile if they are done in a vacuum. For them to realize the impact of their efforts, they need to use their power to get other industries on board that contribute significantly to greenhouse gas emissions.

Transportation Companies: These companies are especially vulnerable to the damages caused by flooding, hurricanes, rising sea levels, or other natural disasters. Moreover, the transportation companies are a vital link to our economy. Any impediments in our air, water, or rail infrastructure will have drastic disruptions and negative economic impacts on our other industries such as food and agriculture that are so heavy reliant on the transportation sector.

Climate change is everyone’s business. Companies need to rise about the politics and the rhetoric and support a cause that is more than just a set of regulations directed at a particular industry. Each sector, whether it’s electric, agriculture, transportation, or financial, has a role to play and the clout to impact how we, as a society, respond to the grave challenges of climate change.

So, the big companies out there, don’t be a bystander. Take a stand.

Conflicting Views on St. Louis’s Business Stand on EPA’s Clean Power Plan

By Paritosh Kasotia

In an article appearing in St. Louis yesterday, it’s no surprise that St. Louis business and political leaders criticize the EPA carbon regulations as a threat to the state economy. The panel was hosted by the St. Louis Chamber of Commerce and organized by the Partnership for a Better Energy Future, a group affiliated with the US Chamber of Commerce and the coal industry groups.

So, does the article represent the majority opinion of businesses in St. Louis? Ameren, a major utility company based in St. Louis which gets 70% of its power from coal power plants has offered a different perspective regarding the EPA Clean Power Plan rules which are more conciliatory and productive in reaching a middle ground that would address the concerns of all stakeholders.

Similarly, in a letter to the editor of the MinnPost, Mary Timmel, Midwest Outreach Manager of the Small Business Majority provides an opinion in support of the EPA Clean Power Plan. According to a survey conducted by the Small Business Majority, climate change and extreme weather events cause real financial hardships for small employers. According to Natural Resources Defense Council (NRDC), Missourians paid an estimate $1.8 billion or $1,100 per taxpayer, in federal taxes to clean up the damage from extreme weather events in 2012. EPA’s Clean Power Plan aims to reduce carbon emissions and in turn mitigate the climate change impact, and is seen as a positive development among small business owners. By just investing in energy efficiency, which is one of the building blocks of the Clean Power Plan, Missouri businesses could save $183 million in 2020 alone.

Other benefits that cannot be overlooked include the health benefits and the economic benefits. Substituting coal power plants with clean energy industries such as wind and solar have the potential to create thousands of jobs. In addition, advancing wind and solar industries would keep the Missouri dollars in Missouri which are currently spent outside the state to import $1.6 billion worth of coal from surrounding states.

Bottom line is that the EPA Power Plan does create some losers but mostly a lot of winners. Coal companies who see this as a threat to their business and economic models can take a proactive approach and strategically plan to shift their investments from coal to clean energy technologies. It’s not only the US government that is pushing for it but also the US citizens who are demanding cleaner options.

The clean energy future is here and is a level playing field. Those who are able to see the opportunities amidst the threats will be the winners in the long run.