Energy and Climate Policy in NewEnergy and Climate Policy in New York, Paris and Shanghai: Generalized Lessons

Realizing Low Carbon Cities: Bridging Science and Policy International Symposium, Nagoya University/Global Carbon Project

Stephen A Hammer PhDStephen A. Hammer, PhDDirector, CEMTPP Urban Energy Program16 February 2009

CEMTPP overview• Home of energy policy concentration at SIPA• Academic program

– Courses on policy, energy geopolitics, energy systems, p y, gy g p , gy y ,technology, and dealmaking

– “both side of the balance sheet”• Research program

– Marine Transportation– Global Energy Governance– Urban Energy

2

Urban Energy ProgramA d i• Academic program– Seminar + workshop

• Research program -- energy markets, policy, technology and regulation, viewed through an urban lensregulation, viewed through an urban lens– City-scale system studies (“logic” studies)– Discrete system studies (Microgrids,CHP and renewable power

technology, carbon markets)Energy impacts of urban land use/transport planning– Energy impacts of urban land use/transport planning

• Bogota– Building-related energy use– Public opinion– Urban energy system modeling– Urban Energy Academy

• China Mayor’s Training Program on Energy Efficient Cities

3

Background – NYC energy system• Power/gas/steam system

– 11,500+ MW peak demand– Load pocket

80% rule

• Transportation system– 54% of commuters use public

transport (highest rate in US)– More than 50% of households do80% rule

10,300 MW in-city generation capacity– Largest district steam system in world– Regulated monopoly for gas/electricity

distribution

– More than 50% of households do not own a car (vs. 8% nationally)

– Walking and bicycling account for 21% of all trips around NYC

– Nonetheless traffic a historicaldistribution– Competitive supply marketplace (10-

25 ESCOs depending on market)– <3 MW of in-city renewable power but

growing local interest

Nonetheless, traffic a historical problem

• Highest asthma rates in US along key transport corridors

– City a leader on alt-fuel and hybrid growing local interest– Highest energy prices in US– Lowest levels of household electricity

use of any major US city (4480 kWh/year)

y yvehicles

• Legal challenge to hybrid taxi law• Waste system

– Landfill gas recovery

4

kWh/year)– Highly reliable grid, but spectacular

failures

Landfill gas recovery– Wastewater treatment methane-

to-energy

Key energy policy drivers (NYC)

• Cost containment• Security of supply = huge problem, city will

fall short of required capacity requirements by 2012y

– By 2030, gap = 20-25% of demand– New in-city power plants + transmission lines– “Repower” existing power plants

• Climate changeg– Diversify supply sources

• 600 MW renewables by 2030• 800 MW CHP by 2030

– Energy efficiency• New Building codes• New Building codes• Education campaigns

– Transport strategies• Congestion pricing (failed)• Infill development

5

• Biodiesel• Taxis

– Urban Heat Island (trees/roofs)– Energy system adaptation

NYC -- Climate Change a growing imperative

6

NYC -- Key takeaways from our research• Security of supply will likely trump all other concerns for long time,

but energy/climate sustainability is now on the local radar screen, and it will be hard to go backwards

• Transmission project = most likely supply solution due to minimal• Transmission project = most likely supply solution, due to minimal community impact– Renewables + CHP = don’t expect rapid change due to high installation

cost + interconnection difficultiesLong term prospects = promising but large projects (off shore wind old– Long-term prospects = promising, but large projects (off-shore wind, old landfill site) = will remain a policy priority due to supply shortfall

• NYS legislature refusal to support NYC efforts = highly problematic– Energy efficiency authority– Surcharge on local energy bills– Congestion pricing

7

Background -- Paris energy system• Electricity/gas/district heating and T t ti t• Electricity/gas/district heating and

cooling system– All energy distribution infrastructure

owned by the City, operations contracted out to EDF/GDF

• Transportation system– Extensive public transportation

system: subway, bus, rail– … and bicycles! (Velib’)

53% of Parisians don’t own a car– Nearly 14,000 GWh of electricity distributed citywide in 2006

– Per capita energy consumption of ~7000 kwh annuallyOne of the largest district steam

– 53% of Parisians don t own a car– Walking accounts for 54% of in-city

trips; public transport for 30%– Traffic still a problem, however

• Less-efficient public transportation– One of the largest district steam systems in Europe

– Supply marketplace open to competition (20 ESCOs for electricity, 17 for gas), though EDF/GDF are still the

Less efficient public transportation outside the city is primary culprit

• For Paris-suburb trips, 46% occurs with private vehicles and 49% by public transport

– 3.6 million trips airplane trips by “heavyweights” in the market

– Relatively low energy prices in comparison to other European countries thanks to reliance on low cost national energy grid = low recourse to

p p p yParisians annually

– 1.8 million tonnes of freight traveling by air

• Waste

8

energy grid low recourse to DG/renewables – 1.9m metric tonnes of waste

consumed by district heating system annually (exceeds 1.2m metric tonnes generated by city)

Key energy policy drivers & dynamics (Paris)y ( )

• Sustainability and climate preservation– Local Agenda 21

• Climate preservation is primary objectiveClimate preservation is primary objective– Plan Climat de Paris

• Establishes emission reductions, energy efficiency, and renewables targets for municipality and city as a whole

• Renewables = part of sustainability agendaE ffi i i b ildi• Energy efficiency in buildings

– “100,000 Buildings” plan– City Hall = lead by example– Eco-quarters development

• Transport strategies– Revamp city roads to accommodate buses and “soft”

forms of transport• Reduce in-city vehicle emissions 60% by 2020

Improve public transport access between city + suburbs

9

– Improve public transport access between city + suburbs– Air travel by far the largest source of emissions, yet

beyond Paris’ control

Paris -- Key takeaways from our research

• Paris’ energy policy couched in sustainability, energy efficiency, and emissions reduction / climate protection concerns (e.g., the Plan Climat)– Climate resonates with the public creating opportunity to ‘repackage’Climate resonates with the public, creating opportunity to repackage

other energy-relevant initiatives• Buildings and transport sectors = priority focus

– Buildings focus (primarily thermal, but electric too)P t l l b f b t t ti l f t li bilit ?– Power sector largely carbon free, but a potential future liability?

• Adaptation currently not a significant part of the agenda• DG/renewables: large projects and feasibility studies in the pipeline,

but a general lack of specific timelines for implementationbut a general lack of specific timelines for implementation• Local capacity to act: evolving but highly constrained

– Can Mayor deliver on Plan Climat?– BUT, climate issues a catalyst/legitimizer for Paris to expand its energy

policymaking powers vis à vis regional/national government

10

policymaking powers vis-à-vis regional/national government

Background -- Shanghai energy systemenergy system

• Constant growth, by almost any metric• 22,000 MWp demand in summer ‘08, of which 14,000 can

be met by local supplyy pp y– 1/2 of imported power from 3 Gorges Dam– LNG soon to come?

• Coal = 53% of total energy consumption, Oil = 35% (in ‘05)• Renewables = 3 local wind farms (24.4 MWp), but big plans:

300 MW b 2010300 MWp by 2010– CHP = going nowhere until LNG arrives

• Electricity prices set by user type, time of day, and season– Shanghai authorities have room to adjust prices to influence

demand

MunicipalityPopulation (millions)

Energy Use (ton sce)

Energy Use per capita (ton sce/ person)

GDP (billion RMB)

Energy Intensity (Energy Use/GDP)

Source: CEIC [Table CN.RBC02 (Energy Consumption), CN.AA02 (GDP), CN.GE02 (Population)]

Table _Comparison of City-level Energy Intensity Levels (2006)

11

China 1314.5 2462.7 1.87 21,192.0 1.16

Shanghai 18.15 89.67 4.94 1,036.6 0.87Beijing 15.81 59.04 3.73 787.0 0.75Chongqing 28.08 47.23 1.68 345.2 1.37Tianjin 10.75 45.25 4.21 434.4 1.04

Key building energy policy drivers & dynamics (Shanghai)(Shanghai)

• China 20% reduction in energy intensity by 2010 mandate– Local authorities partly responsible for delivering this result

• Can issue policies/regulations, but must “do so in manner consistent with central level mandate”– In Shanghai, slow and steady progress, but unlikely to achieve targetIn Shanghai, slow and steady progress, but unlikely to achieve target

• Lack of consistent message within local government– “National policies, local countermeasures”– Siloed agency responsibilities, hard to ascertain where priorities lie– Corruption?

L l t “ t d ” h hi t i ll i iti d i d l t– Local government “report cards” have historically prioritized economic development over environmental protection

• A new energy/enviro report card for mayors?• Little central government funding to support goals• Market challengesg

– Technoloy lock-in (e.g. lack of sufficient natural gas system deployment to sustain widespread CHP deployment)

– ESCOs finding difficulty gaining traction– Commercial vs. residential buildings = fundamental energy system differences– Market price for fossil fuel-based energy = adjustable by City Hall but still low compared to

12

Market price for fossil fuel based energy adjustable by City Hall, but still low compared to alternatives

Central Government Lands Bureau releases land

Shanghai Lands Bureau issues

tender (via District?)

Developer submits design concept + alternative control

plan

Planning Bureau responds to design

concept + alternative control

plan

Architecture firm + Design Bureau create new design plan)

Control Plan

plan

Shanghai Energy Conservation

Concept Master Plan (consistent

with District Plan)

Supervision Center reviews design plan

B ea of

Shanghai Planning Bureau develops overarching goals

for land

District Plan

Building contractor

Bureau of Construction

monitors construction

Building Design process in Shanghai (DRAFT) User fits out space according

to needs

13

Shanghai -- Key takeaways from our research

• Inconsistent messages by SMG: Dongtan vs. everything else• Lack of decisionmaking transparency by local government + lack of

systematic sustainability message – Developers responding to visible local policy signals e e ope s espo d g to s b e oca po cy s g a s– Huge failure to capitalize on multiple opportunities within decisionmaking process

to instill/force change• Low/no market demand for more efficient design or systems

– Huge wealth effect taking place, energy seen as minor (or worthwhile) costg g p , gy ( )– Standard design practices?– Cultural response to Central government policy approach?

• Immature green/efficiency marketplace has yet to catch up to policy goals• But:But:

– Local authority has incredible ability to move, and move quickly– Large model projects and eco-cities = helpful but unknown value in shifting

market practices– International “green” development trends coming to Shanghai as way of

14

g p g g ydifferentiating developers from one another

Generalized Lessons?• Governance issuesGovernance issues

– Mayoral leadership counts, but is insufficient– Cities are “creatures of the state”, typically giving them diminished capacity to act

• China an exception?

– Policy implications:• Devolution of powers to local authorities?

– Only works if local authorities have sufficient resources/knowledge/capacity to use powers wisely– Focus on capacity building (e.g., JUCCCE mayoral training program, sub-Mayoral level training?)

• “Capacity to Act” assessment?• Local authorities influence provincial/national policy through model of strong local action?

– Unknowns:• Coherence of global/transnational policy structures (e g CDM) with local action?Coherence of global/transnational policy structures (e.g., CDM) with local action?• Level of public participation/involvement?

– Cultural/political acceptability?• Policy complexity & incrementalism?

15

Lessons for cities in developing countries?• Policy driversPolicy drivers

– Cities policies/plans vary widely based on policy drivers seen as most critical/relevant

• Link energy/climate change to existing policy priorities to enhance public support and improve funding support prospects

Climate change adaptation = NOT on radar screen– Climate change adaptation = NOT on radar screen

• Market issues– Unknowns

• Policy planning in an ever-changing market environment?• Market restructuring efforts -- helping or hindering cities?• Utility ownership structures?

• Technology choice• Technology choice– Technology lock-in

• Current infrastructure limitations may affect use of ‘bridge’ technologies• Opportunity for ‘generation-skipping’ technologies?

– Unknowns

16

Unknowns• Focus on greater self-reliance for power supply (fossil or renewable) or import from

“away”

谢谢 / Merci / Thank you.

Questions?Questions?sh2185@columbia.edu

17