ML14304A696

Contingency Plan Final Generic Environmental Impact Statement, Part 2 of 4

ML14304A696
Person / Time
Site:	Indian Point
Issue date:	09/10/2013
From:	Ecology & Environment, State of NY, Dept of Public Service
To:	Office of Nuclear Reactor Regulation, State of NY, Public Service Commission
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ML14304A441	List: ML14304A693 ML14304A694 ML14304A696 ML14304A699 ML14304A700 ML14304A701 ML14304A703 ML14304A704 ML14304A748 ML14304A751 ML14304A752
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Why 80 by 50?

New York City committed to reducing citywide green- and have high per-capita emissions rates compared to house gas emissions by 30 percent before 2030 as part the global average, they would need to reduce their of its comprehensive sustainability agenda, PlaNYC, in emissions even more aggressively, by up to 80 percent 2007.1 Six years later, the city's emissions have fallen by by 2050 - hence "80 by 50."

over 19 percent. The City's power supply is cleaner, its buildings are more energy efficient, and residents drive Adoption of the 80 by 50 goal is growing at the national less and generate less waste. If the city is able to reduce and sub-national level. The European Union adopted the its emissions by one percent each year over the next 16 80 by 50 goal in 2005; the United Kingdom followed in years - only half the rate of annual reductions since 2008. Several U.S. states including New York and Califor-2005 - it will reach the 30 percent goal by 2030. nia have also adopted non-binding commitments to 80 by 50, but on a national level, the United States has com-Despite this local progress, global emissions are rapidly mitted to reduce its emissions by only 17 percent from accelerating: in the past five years, they have outpaced 2005 levels by 2020. Some regional efforts such as the the highest of the four scenarios that the Intergovern- Regional Greenhouse Gas Initiative (RGGI) in the North-mental Panel on Climate Change (IPCC) developed. If east have set more aggressive targets but have experi-emissions continue on this trajectory, temperatures enced political challenges in implementing programs to could rise by 4 to 60C by 2100 and yield up to six feet of reduce emissions.

global sea level rise. (See chart: Emissions and Tempera-2 ture Rise Under Different Scenarios). Cities, too, can act - both because they produce the ma-jority of global emissions, and because they often have To limit the increase in temperatures to 20C in the next the tools to curb emissions even in the absence of na-century - a limit that the United Nations Framework tional or regional action. New York City is responsible Convention on Climate Change (UNFCCC) says is neces- for close to half a percent of total global emissions if sary to "prevent dangerous anthropogenic interference consumption is taken into account - and City govern-with the climate system" -global emissions would have ment has substantial tools to promote emissions re-to be reduced by at least 50 percent below 1990 levels duction. These include its ability to regulate buildings by mid-century. Because developed countries have con- and land use, collect taxes and offer incentives, create tributed the majority of atmospheric emissions to date public-private partnerships, offer technical assistance, SNYC's Pathways to Deep Carbon Reductions

F Oeriew and develop and operate major infrastructure as well as solutions with a level of rigor that the seriousness of the thousands of public facilities. challenge requires. This report does not advance specif-ic policy proposals, but instead examines how New York Study Objectives City could move towards 80 by 50, or a more near-term The 2011 update to PlaNYC called on the Mayor's Office accelerated goal, if it chooses to.

of Long-Term Planning and Sustainability (OLTPS) to ex-amine the feasibility of achieving 80 by 50 in New York Study Approach City. The ensuing research was informed by other long- Because the city's carbon emissions come from four very term studies conducted locally and abroad.3 This result- different sectors - buildings, power generation, trans-ing document is a research study, however, and should portation, and solid waste - the study examines strate-not be misinterpreted as an endorsement of the 80 by gies in each one individually at first. The study analyzes 50 target. The appropriate long-term reduction target over 70 individual carbon reduction measures in all four for a city like New York - which has already reduced of the sectors, building on both city data and expert- and emissions aggressively and is far below the U.S. national experience-driven assumptions about the kind of actions average in per capita emissions - might well be lower that realistically could be accomplished.

and policy makers' focus may be better suited to short-er timeframes. Still, it is important to pose long-term It is also important to consider how the four sectors questions, diagnose problems, and assemble possible interact and function as a whole. For example, making I Emissions and Temperature Rise Under Different Scenarios Billions tons of CO e per year from fossil fuels, cement production, and gas flaring 30 High: RCP8.5 4.0-6.1[

25 20 2003 2014 15 Medium: RCP6 2,6-3.7C 10 5

0 2000 2020 2040 2060 2080 2100 Lowest: RCP3-PD 1.3-1.9C Source: NYCMayor's Office

I Oeve 0

buildings more energy efficient reduces the amount of clean power that is necessary, while electric vehicles are only as clean as the electric grid is. The study accounts for these interactions so that changes in one sector are GHG Accounting Scopes reflected in all others. A collective "package" of least cost New York City's GHG inventory follows standard in-measures across the four sectors is then assembled based ternational conventions for municipal GHG emissions on both the technical potential and economic analysis. reporting. The City's Inventory includes Scope 1emis-This package, or pathway, to 80 by 50 is then evaluated for sions from buildings and industrial facilities within the its impacts on jobs and the economy. cltN vehicle operated within the city, and solid waste and wastewater managed within the city, Scope 2 Converting technical potential into real emissions reduc- emissions from electricity and steam used In build-tions can be extremely challenging. The economics of a ings, Industrial facilities, streetlights, and transit sys-carbon abatement measure might be attractive in theory, tems within the city, and Scope 3 emissions from solid but any number of barriers may arise - financing may not waste generated within the city but disposed of out-be readily available, regulations might be too complex, or side of the city's boundary.

the opportunity cost, may simply be too high. Further-more, actions to reduce carbon would lie in the hands of GIG accounting practice has historically classified millions of people making countless daily and long-term emissions by "Scopes" per the World Resources In-decisions. stifttetWorld Business Council for Sustainable Devel-opment's Greenhouse Gas Protocol, the world's cor-With this in mind, the study carefully evaluates the barriers porate GHG accounting standard and the standard to implementing carbon abatement measures in each sec- up~on which many other GHG accounting protocols are tor and then proposes potential ways to overcome those based. Following the WRYWBCSI) guidance, New York obstacles. City defines Scopes as:

Scope 1: Direct emissions from on-site fossil fuel com-bustion or fugitive emissions from within the city's boundary Scope 2: Indirect emissions from energy generated in one location, but used Inanother, such as district elec-tricity and district steam M NYC's Pathways to Deep Carbon Reductions

I Oeiv3.

New York City's Emissions Profile Energy and GHG Fundamentals Fugitive emissions from landfills, the wastewater treat-ment process, and the energy sector account 4 for the re-New York City consumes enormous amounts of energy, maining 5 percent of the city's emissions.

and most of it - 81 percent - comes from the combus-tion of fossil fuels. This combustion occurs on a centralized In total, the city emitted nearly 48 million metric tons of basis - at power plants to create electricity and steam - carbon dioxide equivalent (C02e) in 2012. The City's emis-and on a distributed basis - in countless buildings and sions methodology only includes Scope 1 and Scope vehicles to provide basic services and mobility. 2 emissions; emissions from aviation are not included (though strategies to reduce emissions from planes while Energy use in buildings accounts for 71 percent of the they are on the runway are part of this report); neither are city's total emissions footprint. Of these emissions, rough- consumption-based emissions, which would capture the ly 55 percent come from the on-site combustion of natural emissions embedded in the goods that New Yorkers con-gas and liquid fuels to produce heat and hot water, and to sume. The methodology for capturing consumption-based cook; while the remaining 45 percent of emissions stem emissions is evolving, and future GHG inventories are likely from electricity production and consumption. The trans- to include at least some of them. (See sidebar: GHG Ac-portation sector contributes another 23 percent of the countingScopes) city's total emissions. Of these emissions, liquid fuel con-sumption in vehicles accounts for 85 percent, while the remainder stem from electricity used to power subways.

Energy and GHG Emissions Flows Petajoules and MtCO~e Source Energy (938 trillion BTU) Greenhouse Gas Emissions (47.9 million tCO2 e)

Natural Gas 545 trillion BTU Residential Buildings 16.3 million tCO,e Nuclear 178 trillion BTU Commercial Buildings 9.8 million tCOCe Industrial I Renewables Institutional Buildings 4.64 trillion BTU 7.8 million tCO e Coal 11 million BTU Public Transit 3.44 trillion BTU 1.4 million tCOe On-road Petroleum oirect Use of 1 Transportation 207 trillion BTU SPetroleum 9.7 million tCO[e

] 1(0 million i tiO e Landfills, Wastwater Fugitive Tretment, etc.

Emissions 2.9 million tCO,e 2.9 million tCO e Source: NYCMayor's Office

I vrve New York City's Emissions Relative to Other Cities New York City uses large amounts of energy - but per cap-ita, its dense built environment and extensive mass transit system make it one of the most energy efficient cities in the U.S. In a recent study of urban emissions done by the Carbon Disclosure Project (CDP), the average New Yorker was responsible for 44 percent less carbon pollution than the average US urban dweller. On the international level, New York City is competitive but a number of global city's have even lower per capita emissions levels. (See chart:

Per Capita GHG Emissions for Selected U.S. and Global Cities)

Per Capita GHG Gas Emissions for Selected U.S. and Global Cities' Emissions inMtCOe 20 18.4 17.6 15 CDP Cities U.S. Cities Average Per 13.5 Capita GHG Emissions: 11.8 11.8 11.6 10.9 CDP Cities Non-U.S. Cities Average Per 10 9.8 Capita GHG Emissions: 468 11111111111111111111 0 8.4 6-4 6.3 6.3 6.1606 5 4746.2 4.1 3.6 3. .

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ý NYC's Pathways to Deep Carbon Reductions

I Overiew I MtCO 2005eto 2012 GHG Emissions Reduction Drivers 62 61 60 59 006---

58 0.48 0 42 57 56 55 54 53 52 51 50 49 48 47, 1

0-2005 2012 co0*

Growth in Milder Mdiide ui treased Less Le,,b Recl~ined Red acd Improved Rleduced Imprioved Loss More Rduciaed C2 populationl Summer winter on road electricity heating 0 wast trr'r'thglt slid wastelarwifii (artiiiiiefficlient fugitive SI fiJUIUse ve il vsrit and vehicle fuel rse per 0it etficierrv generation methane intensive 'tram pr'mi'osn i'rri buildings ecoinomy buididrng per iiif0li' captiure electiricity genii ,itionr

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'e 51 tC2 1 -21 C2S 95 Source: NYCMayor's Office Emissions Reduction Since 2005 I Energy, Emissions, and Economic Indicators Indexed to 2005 New York City's emissions fell by 19 percent between 2005 1.10 and 2012, and the city is now nearly two-thirds of the way to meeting the 30 by 30 goal. The majority of reductions 1.05 5% stemmed from cleaner power as a result of fuel switching

.3% from coal and oil to less carbon intensive natural gas, as 1.00 well as the introduction of state-of-the-art power plants

-3% that replaced old, inefficient units. Improved energy effi-0.95 ciency in buildings and automobiles, fewer car trips and less waste have also contributed to the reductions. Emis-0.90 sions and energy use fell even as the city's population, building area, and economy all grew compared to 2005. If 0.85 -15% this trend continues, it would represent a significant struc-tural change, as energy use has closely mirrored economic

-19% growth throughout history. (See charts: 2005 to 2012 GHG 0.80 Emissions Reduction Drivers and Energy, Emissions, and 2005 2006 2007 2008 2009 2010 2011 20 Economic Indictators)

- Gross City Product * - Energy Consumpt ion

- Building Sq. Ft - HDD + CDD

- Population - GHG Emissions Source: NYCMayor's Office

I vrve.

Technical Methodology The analysis informing this report began with developing coal to natural gas in the power sector; then increase for projections for the growth of greenhouse gas emissions two decades after that in line with growing population; between today and 2050, assuming that no aggressive and ultimately fall as renewables become economically action is taken to reduce emissions. Once these projec- viable in 2040-2050 and displace fossil fuel generation.

tions - the "business as usual" scenario - were devel- The relative contribution of sectors to carbon emissions oped, quantitative models helped estimate the technical remains relatively constant: in the 2050 BAU, buildings potential for reductions in four key sectors-buildings, would contribute 77 percent of emissions, while trans-power, transportation, and solid waste - and to assess port would contribute 17 percent, with the balance com-the cost-effectiveness of each individual action as well as ing from solid waste and fugitive emissions (See chart:

impacts to the economy. Carbon Emissions Under the BAU Scenario).

Under the 'business as usual' scenario (BAU), 2050 GHG With the business as usual scenario in place, the tech-emissions would stand at 55.7 MtCO2e - roughly simi- nical potential for carbon reduction was evaluated using lar to emissions today and far above the 12.7 million three different models: a Marginal Abatement Cost Curve ton cap that the city would need to abide by in order to (MACC), the North American Energy and Environment achieve 80 by 50. Conservative assumptions about eco- Model (NEEM) from the consulting firm Charles River nomic growth and energy prices underlie the BAU pro- Associates, and the REMI Policy Insight model, run by jections. With these assumptions, emissions would fall AECOM.

between now and 2020 due to a continued switch from I Carbon Emissions Under the BAU Scenario 0 Waste 0 Transport Building!

63.8 Assumes waste per 1;9.6 capita remain constant 55.7 - and growth in 52.9 population of 0.4%

Assumes 17% rise in VMT, with current CAFE standards andNYMTC RTP11 implemented Fuel demand CAGRse:

46.6 46.8 M Electricity: 0.7%

40.3 40.5 42.5 42.7 M Natural gas: 0.7%

M Steam: 0.1%

M Oil: (0.8%)

Decrease in emissions intensity of the grid lowers buildings 2005 2010 2020 2030 2040 2050 emissions Source: NYCMayor's Office SNYC's Pathways to Deep Carbon Reductions

I Oeri ew The first model, the MACC, estimates the potential for investor can only access financing at a 10 percent inter-emissions reduction in the buildings, transportation, and est rate, he or she would be unlikely to undertake an en-solid waste sectors by evaluating over 70 different car- ergy efficiency measure that only achieves a reasonable bon abatement measures. This bundle of potential mea- payback if lending is done at 4 percent. The cost curve sures focuses on existing technologies and makes the fol- would not capture either of these nuances.

lowing conservative assumptions:

A second proprietary model developed by the power sec-

" Learning curves are ambitious but achievable, tor consulting firm Charles River Associates, was used to based on historical factors and expert insight about find the least-cost solutions to supplying power to the the pace of advancement that improves technology or marketplace while complying with the carbon reduction lowers costs. trajectory. The Charles River NEEM model North Ameri-

" Equipment is replaced at the end of useful life to can Energy and Environment Model (NEEM) assumes a minimize costs, rather than replacing it on an ac- carbon cap for New York City that declines linearly from celerated basis to achieve energy savings or carbon 2012 to 2050. This serves as a simplified modeling tool reductions. and effective proxy for the power sector subsidies that

" No carbon price exists, or any other significant Fed- would be required to achieve 80 by 50 - it does not in-eral or regional action to reduce carbon that would dicate that the City is advocating for a city-level carbon lead to a price signal in the marketplace. cap. As the modeled cap declines each year, the model determines the lowest cost mix of providing electricity For each measure, the model calculates its annualized using existing conventional generation and new, lower capital cost and operational savings, estimates the result- carbon resources while remaining below the carbon ing carbon reduction, and computes the societal cost of cap. The model incorporates the demand projections abatement in dollars per ton. The calculations are com- produced by the MACC for the buildings, transportation, pleted for a point in time every 5 years and the results are and solid waste sector. In turn, it supplies the MACC with displayed on a graph - a so called "marginal abatement power price calculations for the 80 by 50 pathway, which cost curve". On the curve, the lowest-cost measures are the MACC then uses to adjust demand projections again on the left, the highest-cost ones are on the right; the based on assumptions about the elasticity of power de-width of the bar indicates each measure's carbon abate- mand. This iterative approach brings the two models to ment potential in millions of metric tons, and its height near-convergence and ensures consistency across all indicates its societal cost of abatement per ton - wheth- four sectors.

er positive or negative. (See chart: 2050 Marginal Cost Curve for Building Sector) Once the calculations are completed for all sectors, a model called REMI Policy Insight was used to estimate The purpose of introducing the concept of societal cost is the jobs and economic impact of the 80 by 50 pathway.

to be able to quickly compare the relative cost-effective- The REMI model is a standard tool of economic analysis ness of different carbon abatement measures without that integrates features of econometric, input/output and going into the details of each potential decision-maker's computable general equilibrium models to estimate the constraints and preferences. Its main simplifying assump- impact of policy measures on local economies through-tion is that all measures can be financed at a 4 percent out the U.S. A New York City specific version of the REMI discount rate - roughly equivalent to a long-term gov- model looked separately at 150 different local sub-sec-ernment bond. The concept is helpful - but it also has tors and analyzed the impacts of undertaking each indi-important limitations. For one, it does not differentiate vidual carbon abatement measure - as well as decar-between winners and losers for any given measure. If, for bonization in the power sector - on jobs, gross regional example, a landlord pays for better lighting, but tenant product, and personal income through 20306. The model captures the savings that outweigh the capital invest- accounted for one-time capital outlays, the opportunity ment, the model would consider the measure to have a cost of local spending, operational savings, and changes negative societal cost (e.g. a societal benefit), however to long-term regional competitiveness.

the landlord would experience it as a loss. Likewise, if an

I vrve Together the three models showed what is technically feasible, how much it would cost and how the econo-my would benefit, and what the theoretical timeline for achieving an 80 percent reduction would be. This theo-retical analysis then needed to be turned into concrete policies and initiatives that the City could undertake if it chooses to pursue 80 by 50. A broad range of stakehold-ers from the buildings, power, transportation, waste, and environmental sectors advised on possible approaches.

This then became the basis for a range of public policy initiatives, programs, pilots, and research studies that to-gether could unlock near-term investments and position the City along the pathway to deep carbon reductions by mid-century.

I 2050 Marginal Abatement Cost Curve for Buildings Sector

$/tCO e Commercial Lighting Controls - Commercial Cooking Residential New- Residential Bui iding Residential HVAC Controls ----Commercail Refrigeration Build Design Envelope Reno vation Comm. Cond. Boiler - -Comm. Low rise roof Residential electric Residential Liquid Desiccant AC Residential Water Heating cookin2 Abatem entcost Residential Dryers Commercial New Build Design Resigenti*

Com cialRes. Cond. Boiler iASHP 300 Commercial Continuous Commissioning -

1 200 Commercial Oil to gas-- SI-Commercial 100 Residential Oil to gas - Water Heating 0-Commercial Active Windows 1 - 4,1 CommercialASHP

-100 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19{ 10 21T 44 24 25 2A 27 28

-200 Abatemenlt potential MtCO 2 e/yr

-300

-400

-500 Commercial

ý?Comerc ial HVAC Controls electric

-600 Residential Submetering Residential Activei cooking ResidentialRooftop PV Win tnv*

-700 Commercial Rooftop PV Commercial Building

-800 l lCommercial Lighting Envelope Renovation

-900 ommercial Submetering

-1,000 l Residential Freezers Reside ntial Solar Water Heating-Residential Refrigerators Res. Low rise ro ...

Residential Dishwashers Res idential Lighting Controls Commercial Electronics Commercial GSHP

-Commercial Liquid Desiccant AC Residential Lighting Commercial Solar Water Heating

. Residential Electronics

-Commercial Non-PC Office Equipment Residential GSHP Residential Clothes Washers Residential Continuous

---Commercial PCs Commissioning Source: NYCMayor's Office M NYC's Pathways to Deep Carbon Reductions

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Overview From single-family homes to fifty-story skyscrapers, the More than 85 percent of the potential measures analyzed city's buildings number nearly a million. They provide for the building sector could yield cost savings that would homes to families and places to conduct business - but outweigh upfront costs. But that does not necessarily they also consume most of the City's energy and account mean that they would be implemented. Even for measures for the majority of its emissions. All together, the electric- that make economic sense for an individual decision-mak-ity that powers lighting, mechanical equipment and plug er, multiple obstacles may stand in the way, including lim-loads in buildings and the fuels that are burned to produce ited access to financing, the need for technical assistance, heat and hot water are responsible for 33.9 million tons of misalignment of interests with tenants, or simply the lack emissions - approximately 71 percent of New York City's of interest.

total. These emissions dropped slightly in recent years as thousands of buildings took advantage of low natural gas The City has already begun to address these obstacles.

prices and moved away from relatively more expensive The Greener, Greater Buildings Plan, a package of laws fuel oils for heating - but significant potential for emis- passed in 2009, laid the groundwork by requiring the city's sions reductions remain. largest buildings - those greater than 50,000 square feet

- to assess, or "benchmark," their energy and water con-In the future, in both new and existing buildings, envelopes sumption on an annual basis, and also to undertake audits, could be built tighter, building systems could be more effi- retro-commissioning and some mandatory upgrades to cient and intelligent, and renewable energy sources could building systems over a longer term horizon. These laws replace fossil fuels for heating, hot water, and cooking. provide the city's largest buildings with the basic informa-Taken together, these strategies could produce sufficient tion they need to take advantage of energy efficiency op-emissions reductions to put New York City on a pathway portunities and begin realizing the resultant cost-savings.

to 80 by 50. However, broader efforts would be needed to put the city on the pathway to 80 by 50.

SNYC's Pathways to Deep Carbon Reductions

I Build Aggressively reducing carbon emissions from the city's buildings would come at great cost, requiring an addition-al 4 to 5 billion dollars a year in retrofits and equipment I

upgrades. However, since the majority of this investment could lead to operational savings over time, New York City could not only become a lower-carbon city, but also a more affordable one. Saving energy would allow businesses and families to reallocate limited resources towards other pursuits that will help to drive the economy forward.

2012 Citywide Building's Emissions Intensity per Household MtCo e/SqFt

-f-I

<than 2 MTCO2e/yr IV 2 to 4 4 to 6 16 to 8 8 to lo

>than 10 MTCO 2e/yr Source: NYCMayor's Office

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I B ilig Buildings Fundamentals Building Stock Regulatory Framework New York City's one million buildings together add up to New York City government has a broad degree of con-more than 5 billion square feet of real estate. The build- trol over how buildings are designed and built. The City's ing stock varies significantly by age, ownership structure, building codes set criteria for structural integrity, the use, and construction type. design of mechanical systems, building envelope, and a whole range of life and safety issues for new buildings Residential buildings dominate the building sector: they and major renovations. The City's Energy Code, which represent 92 percent of the number of buildings and 70 was first adopted in 2009, establishes the minimum en-percent of total built area. Residential building types ergy performance standards for building envelopes, vary greatly, ranging from five-story Victorian era walk- heating and air-conditioning systems, and lighting. In ad-ups, turn-of-the-twentieth century brownstones, pre- and dition, the City's extensive zoning system governs land post-war elevator buildings, newly built curtain-wall high- use, building density and massing, and other criteria at rises, and single-family homes. Ownership types vary as both the individual building lot and neighborhood levels.

well: the majority of the city's multifamily housing units are rentals, with the remainder primarily cooperatives A number of recent regulatory efforts that grew out of and condominiums, and there is an overlay off affordable PlaNYC are beginning to impact the design, construction, housing regulations that can lead create variation even renovation, and operation of the city's buildings.

within individual buildings. Single-family homes are pri-marily directly owned. The Greener, Greater Buildings Plan (2009) requires the city's largest buildings - those above 50,000 square feet Commercial and institutional buildings - primarily of- - to measure and report, or benchmark, their energy and fices, but also hospitals, universities, and municipal facili- water use every year; to complete energy audits and ties - represent 5 percent of the number of buildings, retro-commissioning of building systems every ten years; but a disproportionate 22 percent of the built area. They and to install sub-meters and upgrade lighting in com-are also some of the city's largest buildings; properties mercial buildings. The City has implemented almost half exceeding 1 million square feet in built area are not un- of the 111 proposals developed by the Green Codes Task common. Large real estate companies often control tens Force (2010), a panel of leading architects, engineers, of millions of square feet of commercial space and con- construction, and real estate professionals that was tain a multitude of tenants in their portfolios. However, tasked by Mayor Bloomberg and City Council Speaker owner-occupied buildings also occur with frequency Christine Quinn to recommend code changes to promote among the largest corporations and institutions. sustainable construction and operational practices. The City's regulations to phase out the use of heavily pollut-Industrial buildings only represent a small share of the ing No. 6 and No. 4 heating oils and the accompanying city's space, accounting for 3 percent of the number of NYC Clean Heat program have led to over 3,000 large buildings and 6 percent of built area. Most are low-rise city buildings converting to cleaner heating fuels such as structures with flat roofs located in the city's industrial ultra-low sulfur (ULS) No. 2 fuel, biodiesel, or natural gas.

areas such as the South Bronx, or Newtown Creek and Finally, the City's Zone Green proposal (2012), modified Sunset Park in Brooklyn. the zoning regulations to remove barriers to energy effi-ciency and renewable energy technologies both new and The overall building stock is old relative to the national existing buildings.

norm, The average New York City building was built around 1940 and is 73 years old. Buildings turn over at approximately 0.5 percent a year, with the pace increas-ing in boom times, such as the years leading up to the Great Depression, during the 1960s, and in the early 2000'5. The average lifespan of buildings in New York City tends to exceed the national average, and as a result, over 80 percentof the buildings we have today will still exist in 2050.

SNYC's Pathways to Deep Carbon Reductions

I Buildi Sources of GHG Emissions In 2012, buildings were responsible for 33.9 million tons Residential buildings contribute the greatest share of of emissions - or roughly 71 percent of the city's total. emissions, accountingfor48 percentof all building-based Fifty-three percent of these emissions came from fos- emissions in 2012. Commercial buildings account for the sil fuels - largely natural gas and fuel oil for heating, second largest share, with 29 percent of emissions; and cooking, and hot water - while the remainder came industrial and institutional buildings accounted for the re-from electricity consumption. Emissions from electricity mainder. (See chart: BuildingEmissions by Building Type) consumption fell in recent years as power grid became cleaner; in 2005, electricity consumption was responsi-ble for 50 percent of all building emissions, but in 2012, that number dropped to 44 percent. (See charts: 2005 to 2012 Changes to Citywide Buildings GHG Emissions and Citywide Buildings and Streetlight Emissions by Source)

I 2005 to 2012 Changes to Citywide Buildings GHG Emissions GHG Emissions MtCo~e 62 +2.74 61 -17 60 59.20 59 -. 83*- -0.o6---

58 048 -0.42 -0.06 57 -0.53 56 55 54 53 52 51 50 49 48

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2005 Growth in Milder Milder Increased Less Less Reduced Reduced Improved Reduced Improved Less More Reduced 2012 COe populationsummer winter on-road electricity heating vehicle usesolid wastestreetlightsolid waste landfill carbon efficient fugitive SFpCO;e and vehicle fuelused per fuel used export efficiency generation methane intensive steam emissions buildings economy unit of per unit of emissions capture electricity generation building building generation floor area floor area Source: NYCMayor's Office

I B ildng Building Emissions by Type The 2 percent of buildings that are greater than 50,000 I Building PercentageEmissions by Building Type of MtCoze; 2012 square feet in area - those subject to the Greener Great-er Buildings Plan - have an outsized impact by consum-ing nearly 45 percent of the city's energy and producing Reside nearly 45 percent of its emissions. The City's analysis of Commercial benchmarking data collected through Local Law 84 re-vealed wide variations in energy use in these buildings. nti%

The per-square-foot energy use intensity within each of the five main building sectors varies between 4 and 8 times between the lowest and highest energy users, suggesting significant potential for efficiency gains. Ad-ditionally, analysis of the relationship between building age and energy use reveals that many of the city's least energy-intensive buildings were built before 1930, while Industrial a large number of the most energy-intensive buildings were built after 1991. While differences in building usage 12%

patterns may account for some of the variation, the evo-lution of construction methods over time, as well as the Institutional changing demands for certain space configurations, also Source: NYCMayor'sOffice play a role. (See charts: Variation in Median ENERGY STAR Score and Median EUI by Building Age and Variation in Source Energy Use Intensity (EUI) by Sector)

I Citywide Buildings and Streetlight Emissions by Source MtCo~e by source

1. 2 fuel oil Streetlights: I #4 fuel oil 0.07 million tCOe * #6 fuel oil

• Electricity Residential: *0 Natural Gas 16.3 millionA Steam tCO~e Commercial:

9.8 million tCOye 1.1%

Industrial:

4.2 million tCO2e Now- 011%

0.7%

Institutional:

3.7 million tCO2 e Source: NYCMayors Office SNYC's Pathways to Deep Carbon Reductions

Buld I Source Variation in Median EUI (Annual kbtu ENERGY

/ sq ft) STAR Score and Median EUI by Building Age 350 70 300 6o 250 50

• 200 40 L 0 ILD 195 199 ro 150 77 ............. 30 z 135 129 127 138 137 143 151 148 146 138 137 100 20 *

" ENERGY STAR Score 50 n Office EUI 10

" Multifamily EUI 0 0 Pre-199os 1900S 1910S 1920S 1930s 19405 1950s 196os 1970s 1980s 19905 2000S Year Built source:NYC Mayor;s Office I Source EUI (Annual Variation kbtuEnergy in Source / sq ft) Use Intensity (EUI) by Sector 500

• Dark: 5thpercentile

• Light: 9 5 th percentile 400 300 200 31.3x, 100 0

Multifamily Office Retail Hotels Education Source: NYCMayor's Office

in0 Asoof toand evlope renovations 4.7 Ef nd B nSig Ther le

Builig Emissions Abatement Potential The carbon abatement potential from building efficiency measures is significant, but the potential must be un-derstood relative to the costs. Improved building systems and reductions from plug loads have large potential to reduce emissions at relatively low costs, and could result in significant paybacks over time. Upgrades to the thermal performance of walls, windows, and roofs are similarly important, although higher costs require longer periods of time to realize a payback through energy savings. Improvements in building operations and the moni-toring and control of building systems offer practical solutions to saving energy that can be immediately realized with little cost. Despite the significant saving potential from energy efficiency, 80 by 50 cannot be reached with-out reducing fossil fuel consumption in buildings and switching to renewable energy sources. This transition to cleaner fuels on-site can be expensive, technically complex, and challenged by a range of regulatory, financing, and construction obstacles.

Building Exteriors Better windows Building exteriors - roofs, walls, windows - are the first All across the city, leaky and inefficient win-point of energy losses. Renovating and maintaining the dows degrade overall building energy per- 2.4%

exteriors of existing buildings and improving building formance. Improving windows can save sig-codes that govern new construction could abate up to nificant amounts of energy and in some cases 7.0 million tons of emissions. may be as simple as sealing holes around win- 1.5 dow-mounted air-conditioning units. For new Roof and envelope renovations buildings, using triple-paned glass instead of double-paned glass is an easy way to save Building envelopes and roofs separate the in- 1 energy over the lifespan of the building, and pt0 terior environment from conditions outside. 4.7%a a relatively recent technology called "active While new buildings are designed to minimize windows" that dynamically respond to mini-thermal exchange between indoors and out- mize heat gains in warm months and heat losses in cold doors - making it easier to maintain comfort- 3.r months could reduce energy losses by up to 30 percent.

able temperatures indoors - many existing i,'on Improving the performance of windows citywide could buildings have envelopes that do not meet lead to reductions of 1.5 million tons -90 percent of this current standards. Opportunities abound to potential is within residential buildings at -$80/ton and improve building envelopes, whether through -$80 per ton the remainder is in commercial buildings at -$400/ton.

simple measures like weatherization and air-The blended cost of this abatement measure is -$120/ton sealing, or through comprehensive faacade ret- in 2030.

rofits. Across the city, there is the potential to eliminate 4.2 million tons of emissions through four types of mea-Efficient designs for new buildings sures. The greatest reductions could come from renova-tions to commercial envelope (2.0 million tons at -$110/ The City's energy code sets minimum stan-ton, assuming 50 percent of existing floor space is cov- dards for thermal performance but many 4.0%

ered) and low-rise residential roof insulation (0.8 million buildings still use excessive amounts of en-tons at -$10/ton assuming 50 percent of roofs are target- ergy, particularly those with high window-to-ed). Renovating residential envelopes and low-rise com- wall ratios (e.g. glass curtain wall buildings), F.6 mercial roofs could each reduce emissions by 0.1 million which offer limited protection from solar gain million tons (at -$210/ton and -$20/ton, respectively, assuming and have many thermal loss points. A highly renovation of single-family homes and high-rise curtain efficient new design paradigm known as Pas-wall residential buildings and targeting of 5 percent of sive House can yield well-insulated, virtually -$3n commercial floor space). The blended 2030 cost per7ton airtight buildings that require little additional from building envelops and roofs stands at -$80/ton. mechanical energy to keep indoor air com-fortable. Utilizing high-performance design standards to reduce non-plug load energy use by up to 70 percent a Percentage sector wide reduction b Amount of CO2e abated c Cost to abate carbon

Builig on the majority of new construction could abate up to power plants. Larger and newer commercial 2.6 million tons of emissions, with roughly half of this and residential buildings can be air condi- 2.8%

potential coming from residential buildings. Measures tioned through central HVAC systems; smaller in residential buildings would carry a 2030 cost of $60/ or older buildings use split systems mounted in ton (assuming 70 percent penetration), but measures in walls or windows that provide air conditioning 1.w non-residential buildings would be cost-saving at -$110/ for individual apartments or offices. More effi- Itons ton. The blended 2030 average would stand at -$30/ton, cient technologies are available, but they have falling to -$120/ton by 2050 as costs go down with tech- not yet been adopted commercially at scale.

nological maturation and the economies of scale. For example, in the early stages of commercial- -p4tn ization are air conditioning systems that utilize Building Systems, Lighting, Submetering, and liquid desiccants, which are able to dehumidify and cool incoming air simultaneously, thus reducing the Endpoint Controls need to overcool to control humidity and yielding energy Building systems consume vast amounts of energy to savings of up to 30 percent. Adopting similarly efficient provide heating, cooling, and lighting of spaces, particu- air conditioning systems could reduce emissions by up to larly if the systems are older and inefficient, or poorly op- 1.8 million tons, of which nearly 80 percent would come erated. Replacing equipment with more efficient technol- from large commercial buildings where they would prove ogies and improving operations could reduce emissions to be most economical at -$600/ton in 2030. Costs for by up to 9.5 million tons at negative costs. residential buildings would be high in 2030, at $370/ton, but they could drop to -$300/ton by 2050. The blended Thermal equipment efficiency and sizing cost for 2030 would stand at -$400/ton.

Thermal equipment in buildings - boilers used Lighting efficiency and controls for heating, hot water, and cooking - typically rely on the combustion of fossil fuels. Over- Lighting in non-residential buildings accounts sizing of equipment often occurs when speci- for almost 14 percent of the city's carbon emis- 4.2%

fications are based on rules of thumb or taken sions, and there is great potential for reducing from equipment manufacturers' generic rec- ton this share both through more efficient lights ommendations, instead of the results of de- and through better lighting controls. Most of 2.7 tailed analysis of the required loads. Replacing -$190 the potential would come from adopting the I tons milion I inefficient equipment with the best available per ton most efficient Light Emitting Diode or LED models at naturally occurring retrofit times lights, which are becoming more and more af-and conducting proper calculations to "right- fordable and accepted but have not yet been p 1 n size" equipment could abate up to 1.6 million tons of adopted en masse. Replacing 50 percent of emissions. More efficient boilers - including condensing existing CFL and incandescent lights with LEDs types - could yield 1.5 million tons of reductions, with by 2030 and 90 percent by 2050 could abate up to 2.4 two thirds coming from residential buildings. Improved million tons of emissions at the cost of -$670/ton assum-commercial cooking equipment could abate an addition- ing that. Over that time period, costs of LED lighting is al 0.1 million tons. The blended average cost would stand expected to fall by 50 percent. Lighting controls would at -$190/ton in 2030. play a smaller, but still prominent role: installing dimmers and occupancy sensors that shut off lights when a room Advanced air conditioning is not in use could reduce emissions by 0.3 million tons, with almost 90 percent of the potential in commercial Air conditioning is essential to maintain comfort during buildings due (-$200/ton). The blended cost for all mea-hot summer days and in densely occupied spaces, but it is sures would stand at -$61 0/ton.

a major drain on the city's energy resources. On hot sum-mer days, the increase in air conditioning use can cause electricity demand to spike by 1.4 GW by late afternoon (approximately 20 percent of the night-time load level),

which is equivalent to the output of three large gas-fired SNYC's Pathways to Deep Carbon Reductions

F Bilig HVAC controls Plug Loads Existing HVAC systems are often equipped with Efficient devices and appliances are available today - but inadequate controls. For example, building they are not universally installed. Deploying the most ef-tenants can find it impossible to control heat-0.o% ficient technologies at the point of equipment turnover ing or cooling directly, and resort to opening could abate up to 1.7 million tons of emissions highly windows to manage temperatures. Installing cost-effectively.

better endpoint thermal controls like thermo- ton stats and electrostatic microvalves could allow Better electronics and appliances better managed space conditioning. This could -$330 lead to 0.4 million tons of GHG reductions that per ton Computers, personal electronics, refrigera-would be split evenly between commercial and tors, washers and dryers and other appliances2.6%1 residential at an average cost of -$330/ton. continuously draw power in homes and busi-nesses whether they are being used or not.

Continuous commissioning Although many appliances and electronics 1.7 HVAC systems require careful tuning and fre- have become more efficient thanks to federal m,,on quent monitoring of building performance 2.6% Energy Star requirements, usage rates have data to run at optimal efficiencies. However, also increased and many older devices have building operators often neglect to undertake not yet been replaced. Furthermore, consum- perton this important maintenance measure, forgo- [.6 ers may not opt for the most efficient models available even if they are cost-effective. Mak-ing opportunities to capture an average of 12 percent energy savings from HVAC operations. ing sure that the most efficient appliances and devices Capturing these available reductions through are installed at the point of equipment turnover could "continuous commissioning" could abate as per ton reduce emissions by up to 1.7 million tons. Commercial much as 1.6 million tons of emissions, with 75% and residential electronics are two of the biggest oppor-coming from commercial buildings at a cost of tunities, at 0.4 million tons each; and with costs below

-$280/ton and the rest from residential, at the 2030 cost -$700/ton. Replacing commercial computer systems, of $50/ton, for a blended cost of -$190. commercial refrigeration, and residential freezers could yield 0.2 million tons of reduction each at costs below

-$570/ton. Average 2030 costs for plug load reductions Submetering stand at -$720/ton.

Commercial tenants and residents of multifam-ily buildings often have no ability to under- 2.2%

stand or control how much energy they use

- instead, energy is included in their overall rental bill. Electric submetering of individual 2.Y spaces changes this by allowing tenants to ob- ilon tain direct consumption and billing data, which could potentially enable them to undertake energy efficiency measures. Because this ac- -$460 tion can reduce energy use by an average of 10 percent, implementing submetering citywide -

already required of the largest buildings by 2025 - could lead to GHG reductions of as much as 1.4 million tons, split equally between residential and commercial proper-ties at a 2030 cost of -$460/ton.

Buildings -1 Sources of Energy for Heating, Hot Water, and Cooking Fuel switching from refined petroleum products to nat-ural gas can reduce but not eliminate greenhouse gas emissions, so while fuel-switching is an effective near-term measure, it is insufficient to reach 80 by 50. Sev-eral options are available to further decarbonize heating including solar hot water heating, ground and air-source heat pumps, and biofuels, but marketplace penetration is still very limited. The city could abate up to 7.2 million tons of emissions through a combination of highly cost-effective measures like switching to natural gas from fuel oil and costly ones like solar thermal and electric heat pumps.

Conversion to gas The City's regulations to phase out the use of heavy heating oil and its Clean Heat program to accelerate the transition to cleaner fuels has co-incided with historically low natural gas prices and the availability of new supply in the region.  !

In just two years, over 2,000 buildings have converted from heavy oil to natural gas. Future Drivers of Change to Building Sector Emissions conversions from oil to gas could contribute up Metric Ton Co e to 1.1 million tons of GHG reductions. Natural Etricit Gas Oi gas prices may increase as demand rises, but .... BAU B0uildig emisson*

m l427 even then, the 2030 cost of abatement would be hugely negative at -$730/ton. 2o0BAli0ilo asitchh41 Solar water heating *tfwiency Solar hot water heating (SWH) systems heat Cleaner.

eectricity water through solar energy collected on a roof- Addi-....abtm nteuie tio~nal -

top - though it requires a supplemental heat I abtemt * .

source when temperatures are below freezing *

• 80x50target and its efficiency drops to near zero. On a cost seO per ton basis, SWH systems are expected to be more cost effective than photovoltaic solar .......

power (PV) systems through 2030-at which point high electricity prices and technological advancements would give solar PV the edge.

However, SWH will likely prevail in terms of abatement potential on a per square foot basis: by 2030, to 1.8 million tons of emissions at a 2030 cost of $140/

SWH could abate 15 tons of carbon per 1,000 square feet ton, potentially falling to -$50/ton in 2050 as technologies of roof space, while PV could only abate 7, even with per- improve.

formance improvements. SWH systems could abate up l NYC's Pathways to Deep Carbon Reductions

I Buildings Ground source heat pumps Ground source heat pumps (GSHP) use electric- I System GroundTypes Source Heat Pump Feasibility by System Type ity to cycle fluid between a building and under-CI~sed LoopSystoo ground wells to transfer heat. The ground main- StandinCohimWells tains a stable temperature of approximately Al50 550 F year round, which makes it possible to use it as a heat source (in the winter) or a heat sink (in the summer) through transferring heat from the ground to the building or vice-versa. 9 Three major types of ground source systems are available and their applicability depends on the geology of a given location within the city. (See graphic: Ground Source Heat Pump Feasibility by System Type)

Actual penetration of these systems would be limited by s-.. A 10 the high cost of drilling wells under existing buildings, space requirements, and the complexities of integrating with existing heating systems. GSHPs could abate emis-sions by up to 1.7 million tons. The assumptions for the proportion of heating load (160 trillion BTU, down from Source: NYCDDC,NYCMayor's Office 300 trillion BTU today) that these systems would serve differ by borough. 10 Citywide, the 2050 cost of abate-ment would stand at -$30/ton. Cooking Most cooking in New York City relies on natu-Air source heat pumps ral gas stoves. Emissions from cooking would Air source heat pumps (ASHP) work similarly . . not be the first priority for abatement since to a GSHP, but they use outside air as the heat they are a relatively small source overall.

sink, which is less efficient given the seasonal However, on the 80 by 50 pathway, alterna-variation in air temperature. They are easier tives like induction stoves, which heat up to install than GSHP because they do not re- 31 more quickly but cost more than convention-quire subsurface construction work," but al equipment, would eventually need to be the lower efficiency levels mean that they are considered. If induction stoves were to be-less cost-effective overall, costing $140/ton in come the method of choice, the abatement 2050 compared to -$30/ton for GSHR ASHP's potential would add up to 0.8 million tons at could abate up to 3.1 million tons if deployed a cost in 2050 of $160/ton.

at scale but their ultimate role will depend on the cost and feasibility of other technologies for decar-bonizing building fuels.

I Bid Biogas the city's residual heating loads, though at a significant Biogas production through wood gasification, relying on cost. Installing distributed systems in all five boroughs sustainably harvested wood from regional forests could - which would require laying up to 4 thousand miles of potentially satisfy the city's entire remaining heating pipe - could cost up to $27 billion. When coupled with an load. Although biogas is not carbon-free because its pro- additional $3 billion in cost for the equipment itself, this duction requires energy, it still offers a 70 percent reduc- would result in 2050 abatement cost of $220/ton.

tion in lifecycle GHG emissions compared to conventional natural gas. It is unclear if there is sufficient sustainable Advanced biodiesel biomass located near regional ports to be transported Biodiesel from cellulosic ethanol and soybeans has been economically, especially given the risk of long-term com- available for some years now, but its costs were gener-petition for supply amongst other cities that follow suit ally too high. Recently, the production of biodiesel using with their own biogas demands. Still, the technology is algae or bacteria has started to become viable - and if worth exploring - in Europe, at least three biogas power the emerging trends continue and biodiesel production plants are currently in various phases of completion.13 scales as expected, the fuel could in the future become a Abatement costs of biogas are very sensitive to future large-scale abatement option - especially because it can natural gas and biomass prices, but conservative as- easily be substituted for conventional liquid fuels in ex-sumptions based on current prices of coal gasification isting heating systems. By 2050, assuming a production plants being built at scale suggest that $16 billion in capi- cost of $75 per barrel of biodiesel equivalent, abatement tal investment would be required to satisfy all of the city's costs would come in at $100/ton if replacing natural gas remaining heating needs in 2050 and that abatement and at -$210/ton if replacing heating oil, potentially of-costs could run at above $250/ton. fering lower-cost abatement than either biogas or bio-mass district CHR (See chart: Abatement Costs by Biofuel Biomass district CHP Technology)

CHP systems use a heat engine to generate electricity and then capture and reuse the waste heat to supply space heating, cooling, or hot water. As a result, CHP systems offer an efficiency improvement over the alter-native combination of electricity from New York City's I Abatement Costs by Biofuel Technology current grid and heat from a natural gas boiler - but the US$/ MtCOe improvement is not high enough to make it a viable large- " Cost for replacing natural gas scale solution on the 80 by 50 pathway (see Power chap- " Costforreplacing heating oil ter for additional discussion of CHP's electricity produc-tion potential). If biomass were used instead of natural $1200 gas, however, CHP systems constructed at a district level $1,000 could provide more than enough abatement to cover ~$:32o 1 $280 (AS HP cost) I Cellulosic Soybean Advanced ethanol biodiesel biodiesel targets Source: NYCMayor's Office e NYC's Pathways to Deep Carbon Reductions

I Carbon Abatement Costs by Year Percentage of total; Metric tons Co-e I Thousands; Employmentby Impacts of Buildings Sector Carbon Abatements type of impact 4.0- Net impact

• Long term shift in competitiveness 3.5.

2021I 5.2 3.0-m Capital expenditures M Opportunity cost of local spending 5%

2.5-2031I 14.5 2.0-1.5-27.8 2o5(

11/0 1.0-0.5-I/

m <$o/tCO2e 100%

0.0.

m >$o and <$1oo/tCO2e

-0.5-

• >$SOO/tCo2e 2015 2020 2025 2030 Source: NYCMayor's Office Source: NYCMayor's Office

Bulig

-1 0

Challenges Awareness is limited about the financial and Energy costs are relatively low and opportu-operational benefits of energy efficiency nity costs are high While it is possible to identify the city-wide potential for Compared to other sources of energy, fossil fuels are reductions across building classes, individual building relatively cheap. In the commercial sector, energy rep-owners, operators, tenants and other decision-makers resents only a small fraction of overall rental costs, and may not understand the full scope of opportunities in building owners are much more likely to spend limited their specific buildings. The marketplace does not cur- capital on more tangible projects to improve the value of rently have sufficient levels of education and technical their buildings. In multifamily buildings - many of which assistance to help decision-makers understand their op- have low operating margins and limited available capital tions and identify available resources. - building owners tend to defer capital investments until the end of the useful lives of equipment, or beyond.

Financing options that recognizes the value of energy savings are not widely available Innovative technologies are slow in coming to market and building owners are risk averse Although energy efficiency projects can yield substantial savings, most lenders are not willing to recognize these Although most of the potential carbon reductions could savings as part of the underwriting of a loan. A variety be achieved with today's tools, new and emerging tech-of factors have limited the development of financing op- nologies could accelerate the pace of change. However, tions that recognize the value of energy savings, includ- building owners and managers are slow to adopt new ing lack of performance data, limited expertise in under- technologies without a proven track record or tangible writing such transactions, challenges verifying energy examples of successful implementation in similar New savings, and apprehension that changes in building use York City buildings.

will diminish potential returns.

SNYC's Pathways to Deep Carbon Reductions

I B id Capturing the Potential Strategy 1 As building systems monitoring becomes more and more Improving Information and Data Transparency sophisticated, enormous amounts of data can reveal real-time performance. This can lead to a much better picture The City's approach to measuring energy efficiency poten- of the aggregate efficiency of New York City's building tial through benchmarking has already yielded a wealth of stock, pointing the way to developing new strategies to information about the opportunities in the largest build- reduce energy use. Because the volumes of data are stag-ings. This approach could be expanded and improved. gering, the analysis should be carried out in partnership with specialized institutions, including New York City's Better benchmarking and energy performance metrics existing and newly developed Applied Science Campus-Implementation of Local Law 84 - the benchmarking es, creating a foundation for ongoing innovative research component of the Greener Greater Buildings Plan (GGBP) into the city's building stock and nurturing a knowledge

- has revealed that large buildings have tremendous po- base in energy use metrics.

tential to save energy and water. But in a city as complex as New York, measurement and assessment methods can Strategy 2 always be improved. The City is partnering with the Envi- Expanding Education and Training ronmental Protection Agency, the Department of Energy, NYSERDA, and research institutions to refine the bench- Building operator training marking process to better account for the range of usage Continuous commissioning of building systems has the and economic factors that impact local energy consump- potential to eliminate 1.6 million tons of emissions - but tion. The City is also partnering with the Federal govern- capturing this potential requires well-trained building ment and utilities to simplify the process of energy dis- operators. The City could work with key organizations to closure while maintaining customer privacy and security. develop a training program for building operators to be-come skilled in continuous commissioning that can coin-Data transparency for midsize buildings cide with the recently enacted Local Law 87 of 2009 that requires periodic energy audits of base building systems The city could build on the existing benchmarking pro- and retro-commissioning of those systems.

gram for large buildings by encouraging voluntary - or eventually mandatory - benchmarking for midsize build-Demonstrations centers for professionals and ings. The segment of buildings between 10,000 square practitioners feet and 50,000 square feet accounts for 5 percent of to-tal built area, but it is responsible for nearly 19 percent Despite compelling advances in lighting technologies of energy used by buildings. Expanding GGBP to cover and controls in recent years, many designers and building these buildings would bring thousands of new buildings professionals lack awareness of the full potential of the into the marketplace for energy efficiency. possibilities. A new lighting and energy efficiency center known as Green Light New York, due to open in Lower Comparative billing for residential utility customers Manhattan in 2014, will begin to address this issue. The center will offer training to a broad range of disciplines as Research suggests that people are more likely to con- well as a physical venue to exhibit and mock-up emerging serve energy if they understand how their consumption and accepted technologies. It will also provide a forum compares to their neighbors. Utilities across the coun- for discussion that will help to promote wider market try are incorporating simple to read, visually dynamic, transformation.

'comparative billing' indicators on customers' bills. For households that use higher amounts of energy, the util- Educating building decision makers ity bill suggests performance targets and provide tips for saving energy. Some utilities have also created rewards In multifamily buildings that are cooperatively owned and programs for reducing energy use. A research pilot in managed, nothing gets done unless board members are partnership with utilities and academic institutions could educated and enthusiastic about the project. Even then be undertaken to assess the potential benefits of com- decision-making and project-implementation timelines parative billing in New York City. can span years because of competing demands for atten-Building informatics tion and limited capital. Reaching 80 by 50 would require

I B ilig

• cultivating champions for energy efficiency at buildings clean energy projects that leveraged significant levels of far and wide. The city could partner with multifamily private investment. NYCEEC is taking on the most chal-housing organizations to create programs to train board lenging building segments by financing projects in afford-members and cultivate excitement and follow-through able and market-rate multifamily buildings, Class B com-for energy efficiency projects. mercial buildings, and institutions. Continuing its work with NYCEEC, major lenders, and businesses to diver-Consumer education campaigns sify and standardize financing offerings, improve perfor-Building decision makers need better information, but so mance monitoring, and foster the development of retail do average New Yorkers. The City's sustainability market- infrastructure could greatly benefit the marketplace for ing program, GreeNYC - and its winged mascot, Birdie- energy efficiency.

-encourages New Yorkers to alter their behaviors, from eliminating paper waste to installing energy efficient light Providing technical support and assistance bulbs in their homes. The program could be expanded Starting in January 2014, buildings covered by the Green-to promote broader messaging about the importance of er, Greater Buildings Plan will begin to report the results energy efficiency as well as product-specific plug load re- of their mandatory energy audits. These audits will enu-duction campaigns that could be paired with rebates and merate specific opportunities to reduce energy use and incentives offered by utilities and NYSERDA. quantify potential savings, however, buildings are not re-quired to act on the findings. Buildings that choose to Strategy 3 act could also encounter the practical difficulties in im-plementing energy efficiency measures: navigating mul-Removing Barriers to Energy Efficiency and tiple incentive programs, selecting quality contractors, Incentivizing Action securing financing, and managing the implementation Aligning interests to undertake energy efficiency process. The City could undertake a similar program to the successful NYC Clean Heat program, which utilized a Building owners often cite the existence of 'split incen- sales-force approach to help thousands of buildings con-tives' as a major obstacle to undertaking energy effi- vert their boilers to cleaner fuels ahead of the required ciency. What they mean is that they cannot achieve a timeline through providing technical assistance, general financial payback on their investments because most of information, and help accessing financing. A similar pro-the energy savings accrue to tenants - as an obstacle to gram can be developed to assist owners and managers of pursuing energy efficiency projects. The City has already the city's large and mid-size buildings to follow through made some progress by working with leading real estate on the recommendations of their energy audits. It could executives to develop terms that could be incorporated also seamlessly link them to financing options available into standard commercial leases to specify how owners through NYCEEC and incentives through NYSERDA and and tenants could share in both the costs and benefits of local utilities-thereby acting as a one-stop shop for energy retrofits. Standardizing this practice could go a resources.

long way to overcoming split-incentives.

Tailoring incentive programs to NYC realities Improving access to financing Multiple NYSERDA and utility incentives are available The Greener Greater Buildings Plan has created a market- to encourage buildings to undertake energy efficiency place for energy efficiency technologies and services of projects - but too many buildings in New York City may an unprecedented scale - but major lenders are only just be ineligible, particularly those that use heating oil. NY-beginning to respond with financing offerings that rec- SERDA has recommended allowing all buildings to gain ognize the value proposition and the stable returns that access to state energy efficiency programs - including investments in energy efficiency can yield. In response, buildings that utilize fuel oil - and to ease restrictions the City created the New York City Energy Efficiency Cor- that prevent efficiency measures that span energy types poration (NYCEEC), which has pioneered energy efficien- (for example solar thermal hot water heating). Following cy financing solutions and provided capital for dozens of through on this recommendation would present a great

ý NYC's Pathways to Deep Carbon Reductions

I B id opportunity to capture additional emissions reductions Promoting efficiency in historic and landmarked and the City could help accomplish this by partnering buildings with NYSERDA and the Public Service Commission to de- Historic preservation and energy efficiency are often velop a near-term pilot program to expand offerings to misperceived as competing priorities. With over 30,000 buildings that are seeking to convert to convert to clean- historically landmarked buildings and a world-class com-er heating fuels. munity of design and preservation professionals, the city can revolutionize the discipline of energy efficient Expanding programs to recognize top achievers historic preservation. Demonstration projects jointly car-The City launched the Mayor's Carbon Challenge in 2007, ried out by the City, building professionals, NYSERDA and inviting 17 local universities to match City government's building owners and covering a suite of historic building GHG reduction target of 30 percent in just ten years. Since types could seek up to 50 percent energy savings without then the Carbon Challenge has been expanded to include compromising architectural character and could create over 50 hospitals and a dozen major corporations. More examples that the rest of the industry to follow. Targeted and more organizations are being attracted to the Car- incentives, voluntary performance-based energy stan-bon Challenge because it inspires high-level commitment dards, and an education program could facilitate these among decision makers, provides basic technical assis- projects and increase market uptake of best practices.

tance and a platform for exchange for facilities manag-ers, and fosters a spirit of competition. The results have Strategy 4 been extremely encouraging: university and hospital participants have cumulatively reduced their emissions Strengthening regulations and development by 10 percent and six of the participants - NYU, Barnard incentives College, the Fashion Institute of Technology, the Rock- Incorporating weatherization into existing fa*ade im-efeller University, New York Hospital Queens, and Weill provement programs Cornell Medical College - have already reached their 30 percent target already in less than half the time allotted. Since 1998, the city has required buildings that are larger Expanding the Carbon Challenge or similar recognition than six stories to conduct regularly scheduled fa*ade programs to multifamily buildings, hotels, retail spaces, inspections to ensure structural stability and safety (Lo-and commercial real estate could enroll tens of millions cal Law 11). This program could be expanded to include of additional square feet of space and broadly showcase measures for improving thermal performance of facades the benefits of energy efficiency for relatively minimal through simple weatherization and air-sealing techniques commitment of City resources. that would be inexpensive to implement and would save building owners money.

Promoting energy efficiency measures for small buildings Zoning for ultra-efficient buildings and developments The city has over half a million one- to four-family houses. The city's zoning ordinance governs the allowable heights Achieving 80 by 50 will require action at many of these and sizes of new buildings. Over the past decade the City properties, but programs are not in place to accommo- has proactively employed zoning incentives to promote date the extraordinary scale and uniqueness of this mar- policy objectives such as creating affordable housing, ketplace. A program could be developed in partnership and developing open space and community infrastruc-with the real estate industry, home inspectors and build- ture. Zoning can also be used to encourage energy ef-ing trades to target energy efficiency improvements at ficiency. One way to do so could be to offer bonuses to the time of sale or tenant turnover in these buildings. The new buildings that are built to ultra-high-performance

'point-of-sale' is an ideal time to implement simple con- standards or that include on-site clean energy technolo-servation measures such as pipe insulation, duct sealing, gies- a measure that would have no fiscal impact to the and weatherization and allow prospective buyers to fac- City and would help to prepare the construction industry tor energy performance into their decision making. for more stringent future codes.

I B ilig Ensuring Energy Code compliance New York City's Energy Code applies to both new build- Expanding biodiesel use ings and major renovations and system replacements, Biodiesel holds the potential to reduce millions of tons of and the codes, through a revision in 2014, will lead to emissions in the future - and progress has already been a 30 percent improvement in energy performance com- made. The City is already showing leadership by using pared to the original code adopted in 2009. The City is B5 biodiesel in all buildings that utilize heating oil and significantly strengthening code enforcement efforts to the municipal fleet is transitioning to B20 for non-winter achieve 90 percent Energy Code compliance by 2017. months. City buildings and fleets can becoming a prov-Partnering with building trades and professional organi- ing ground for biodiesel use at higher-concentrations zations to provide Energy Code training, and developing and facilitate broader uptake in the private marketplace.

incentives with NYSERDA, Con Edison, and the PSC, could In tandem, the City could work with ASTM International accelerate this goal and encourage projects to exceed and boiler manufacturers to accelerate development of code standards. specifications for higher levels of biodiesel use and could also partner with NYSERDA, Brookhaven Labs and private High performance energy conservation codes buildings to undertake B20, B50, and B100 pilots. Ulti-The energy code evolves through regular review by build- mately, the City could consider increasing the current B2 ing professionals and over time it demands higher perfor- requirement for heating oil to higher levels.

mance from new construction and renovations. Further iterations, could be developed in partnership with the Enacting performance targets International Code Council, the building industry, and re- Over the next decade, the city's largest buildings will be search institutions, and by 2015, could potentially yield a conducting deeper analyses of the potential benefits of 50 percent improvement over today's standards. improving operations and equipment through energy audits. With the exception of lighting upgrades, building Green Codes Task Force implementation owners are not required to execute specific retrofits; and The Green Codes Task Force, convened at the request such a requirement would likely be less cost-effective of the Mayor and City Council Speaker, put forward 111 than allowing businesses to determine the best ways to proposals to increase efficiencies in building energy use save. Setting performance targets, however, could help and ensure sustainable construction methods. Since the to drive buildings towards improving operations and un-recommendations were finalized in 2008, over 40 of the dertaking retrofits. The City could consider, for example, proposals have been enacted - but many more are still seeking to raise average energy utilization performance under development or consideration by the City Council to the top 25th percentile by class as compared to build-and are worth implementing. ings nationwide before 2025.

SNYC's Pathways to Deep Carbon Reductions

I B id Strategy 5 Fostering Innovation Conducting pilot projects for high-potential technologies A number of promising building technologies could yield substantial carbon reductions but face technical barriers to implementation in New York City, and may therefore be good candidates for pilot projects that would estab-lish their feasibility. One technology worth piloting is ground source heat pumps. Heat pumps are proven in other geographic settings and at several City buildings in New York, but generally they are difficult and expensive to site because of the diversity of the city's underground geology and infrastructure, space limitations, and inex-perience in the marketplace. Another technology is liq-uid desiccant air conditioning, which is only in the early stages of commercialization but shows extraordinary promise. A demonstration program in partnership with a national laboratory partner and industry manufactur-er could help foster understanding of these and other promising technologies.

Making New York City a living lab New York City can demonstrate leadership and foster the commercialization of new low carbon technologies.

The City operates 4,000 public buildings, over 300 public housing sites, 15 hospitals and health care centers, and 14 wastewater treatment plants. The City is currently ex-ecuting a plan to increase its demand response capabili-ties from 20 MW of peak load reduction to 50MW, in part through the use of an innovative system that will perform automatic peak load shedding. The City could work with research institutions, Con Edison, NYSERDA, and the pri-vate sector to identify and test out other promising tech-nologies, making New York's public facilities living labo-ratories for energy innovation.

I Power The power supply is both the rifeblood of the city's economy and a major source of its green-house gas emissions. The power sector has become significantly cleaner in recent years, but a fundamental reconfiguration would be re-quired to achieve a deep emissions reduction of 80% by 2050. The technical potential for such a low-carbon power sector exists, but the level of capital investment needed would have sig-nificant impacts to the city's economy, includ-ing higher electricity prices, the costs of poli-cies to incentivize such a shift, and implications for the number of jobs. Power prices would rise by up to 9 percent over a business-as-usual scenario, carbon prices would reach up to $150 per ton, and the impact on jobs would depend on the future energy supply mix. A regional framework would be less costly and more ef-ficient, reducing global greenhouse gas emis-sions by a greater amount. There are several other challenges to balance including an aging infrastructure and sea level rise. No single strat-egy can achieve an 80 by 50 goal, rather, a port folio approach is needed, including: the mod-ernization of existing power plants; increased market penetration of distributed generation technologies such as solar photovoltaic (PV) and combined heat and power (CHP); and in-vestment in large scale renewable energy tech-nologies such as hydro and wind generation.

Overview On a late summer evening in1882, workers atthe Edison Electric indude sea-level rise and more intense and frequent precipita-Illuminating Company power station in Lower Manhattan threw tion, wind, and heat waves in the future. More than two-thirds the switches on a set of 27-ton generators, and 800 lamps lit of critical generation and distribution assets are located within up a 50-square block area of Manhattan's Financial District. In the 1-100 year flood zone today. These challenges raise funda-an instant, the electric age was born. For more than 120 years, mental questions about how to reconfigure and redefine the electricity has illuminated New York City's most iconic landmarks power sector in order to balance GHG mitigation and resilience and powered the city's dimb to world preeminence. investments.

The city's people and economy depend on power. New York- Reducing global power sector emissions by 80 percent by 2050 ers spend $11 billion a year on electricity. Fortunately, the city cannot be done by any city alone. Yet, New York City is a test is served by one of the world's most dependable and deanest case for many of the key energy policy questions of the day.This power generation and delivery systems. The frequency of inter- includes innovations in energy efficiency financing, integration ruptions to Con Edison's electric customers is the lowest of any of renewables indense urban environments, transition from car-investor owned utility inthe nation. The per capita GHG footprint bon intensive fuels to natural gas and renewables, tradeoffs in of the city's power sector is also among the lowest of any ma- the potential retirement of nudear power plants, and the emer-jor city inthe United States. Locally produced power is primarily gence of 21st century regulation of an increasingly complex generated with natural gas-as opposed to higher carbon in- power sector.

tensive fuel oil or coal-and significant amounts of carbon-free energy is already transmitted from outside of the city, primarily The technical potential exists in the regional endowment of re-from nuclear power. newable resources across the State, Canada, and offshore Great Lakes and Atlantic. However, because of the capital required, However, our energy sector faces significant challenges in the the interdependent nature of power systems, and an already-coming years. Power plants are aging and in need of modern- established regulatory and market framework, there are signifi-ization. Renewables comprise less than 1 percent of installed cant challenges to achieving a dean, diverse and resilient port-generation capacity within city limits. Furthermore, Hurricanes folio. This chapter explores the lowest cost pathways for the Sandy and Irene have demonstrated that our energy systems power sector to meet this carbon goal while meeting reliability are vulnerable to the impacts of climate change, which will standards and improving climate resilience.

NYC's Pathways to Deep Carbon Reductions

Conceptual Framework for Power Analysis To understand perspectives on what the city's energy portfolio should look like under a low-carbon pathway, the City as-sembled a group of experts including power producers, energy project developers, utilities, environmental stakeholders, and consumer advocates. A key challenge for the 80x50 goal is to meet the electricity demand of the city's businesses and resi-dents in a reliable and affordable manner while significantly altering the generation technology resource base. Not surpris-ingly; for a system as complex and facing as many potential tradeoffs as the New York power sector, no single vision prevailed.

However, several principles emerged.

Principle 1 Principle 4 Pursue a balanced portfolio, as there is no Balance climate mitigation and resilience magic bullet In the aftermath of Hurricane Sandy and recent sum-This report attempts to incorporate the best available mer heat waves, some members of the advisory group climate science, technology learning curves, and power felt that scarce ratepayer and taxpayer dollars need to sector modeling appropriate for the long time frame of be spent on making the power sector not only less car-the analysis. However, long-term forecasting in the en- bon intensive, but also more resilient to extreme weather ergy sector is inherently risky and therefore calls for a events through storm hardening power assets and other portfolio approach to resource planning and policymak- measures. In June of 2013, Mayor Bloomberg released ing, rather than identification of specific technological PlaNYC: A Stronger, More Resilient New York, an action "magic bullets." plan to protect the city's coastline, critical infrastructure, businesses and communities from the risks of climate change. Although climate resilience is beyond the pur-Principle 2 view of this particular report, the power sector recom-Major changes are disruptive mendations attempt to complement the City's planned resiliency measures.

The advisory group agreed that an 80 by 50 solution would require a major shift in technologies and markets over the long-term, but also cautioned that a realistic approach Principle 5 would take into consideration the utilization of existing as- Cities cannot do this alone sets to the extent possible. Some members of our advisory group also felt that a well-crafted 80 by 50 program should A deep reduction in New York City's greenhouse gas emis-seek to balance the role of regulation and markets to drive sions is only the beginning, and action will eventually be re-private investments. quired at a regional or national scale. While evaluating the viability of pursuing deep carbon reductions at a local level, the study should also emphasize the need for strong Federal Principle 3 and regional action.

Meet reliability standards, including costs of integration Principle 6 At a minimum, any vision must meet the minimum reli- Use City government as a test bed for new ability criteria set forth by NERC and NYISO. A realistic technologies analysis must include the "hidden" costs of integrating new resources, including deliverability within the utility With over 4,000 facilities including 14 wastewater treatment distribution network, load balancing of intermittent re- plants, over 1,200 schools, hundreds of firehouses and ga-sources, and the need for long distance transmission. rages, and other properties, the City is a major consumer of energy. In cases of market uncertainty, the City can use its resources to pilot emerging technologies and drive private investment.

New York City's electricity supply system is designed to keep up with the dynamic needs of its consumers. In-city plants are able to satisfy most of the local demand, but over half of the city's energy is generated in surrounding regions and then transmitted into the city. The system is owned, operated, and regulated by a wide array of private and public entities, all working together to keep the power flowing wherever and whenever it's needed.

energy demand and has not recovered with the economy due to lower industrial energy consumption, investments Electricity is primarily consumed inside the city's build- in energy efficiency in buildings, and increasing amounts ings - residential, commercial, institutional and industrial- of distributed generation.

where it powers mechanical systems, lighting, and equip-ment, adding up to 94 percent of total usage; subways are Despite the stagnant growth of aggregate energy con-responsible for 5 percent, and streetlights account for less sumption, peak demand has grown at an annual rate of than 1 percent. In 2012, New York City consumed over 53 1.1%. As summers get hotter due to climate change, in-TWh, amounting to approximately 0.25% of global electric creasing the demand for air conditioning, the growth in consumption. peak demand can be expected to continue - projections from the New York City Panel on Climate Change indi-The city's demand for electricity has evolved with changes cate that the city may see 3-4 heat waves per year by the in the population and building stock, structural changes in 2020's, and 5-7 heat waves per year by the 2050s, up from the economy, emergence of new electronic devices and an average of 2 today. As highlighted in PlaNYC: A Stron-equipment, and innovations in energy efficiency. From ger, More Resilient New York, heat waves have impacted 2003 to 2008, electricity demand grew at an annual rate the city's electrical grid more frequently and more signifi-of 1.5%. After the Great Recession of 2008 until 2012, how- cantly than any other type of weather event, including the ever, energy demand reduced at an annual rate of 0.6%. Long Island City blackout in 2006, and historic peak load The NYISO now forecasts energy demand in New York City days in both 2011 and 2013. (See chart: Growth in Peak to grow at an annual rate of 0.49% over the next decade. and Annual Demand)

According to the EIA, this trend is consistent with national Growth in Peak and Annual Demand Hourly Demand Index to 2003 2012 - Megawatts Fall Summer Peak Peak 120 12.0 Hour Hour 10.0 11.0 Summer Demand (July 21, 2011) 110 108.5 Annual *4.1 GW Peak (5910 8.0 TotalAnnual 105.2 EnergyDemand -2,7 GW 8.0 6.9 (33"',) Fall Demand 100 6.0 (Sep 29,2011) 5.3 4.0 90 2.0 80 0.0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 0 2 4 6 8 10 12 14 16 18 20 22 24 Source: NYCMayor's Office Hour Ending Source: NYCMayor's Office NYC's Pathways to Deep Carbon Reductions

Daily Utilization Levels of In-City Power Plants Color denotes days on which power plant is operational. Width of bar corresponds to size of power plant.

Gowanus Gas Turbines :0%

Astoria Gas Turbines 3%

Narrows 3%

Astoria 12%

Bayonne i 22%

Arthur Kill 22%

Ravenswood 22%

Linden Cogen 45%

East River 46%

71%

87%

9%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Hurricane Sandy Source: NYCMayor's Office

Electricity demand also varies hourly and seasonally. On New York City Electricity Supply Mix a hot day in July, demand can rise almost 60 percent from In-city and Imported, TWh 6.9 GW at four in the morning to 11 GW by six at night, while on a balmy day in September it will only go up by a 60 third, from 5.3 to 8 GW within a day. In 2011, peak daily de- 55 1 mand was at 6.9 GW in March, but at 11.4 GW in July - an 50 6ý1 m - - - I increase of almost two thirds. To maintain system reliabil- 45 18%

ity, supply must meet demand at all times, requiring the 30%

40 existence of generation that often sits idle until needed.

35 30 29%

25 The 24 power plants serving New York City directly have 20 a capacity of approximately 10,398 MW, enough to meet 15 63%

at least 86 percent of the city's forecasted peak demand 10 44%

- a reliability requirement by the New York Independent System Operator. However, generation from these power 5 0

plants provides only half of the electricity needs of New 2005 2006 2007 2008 2009 2010 2011 York City, with a majority of the balance originating from cheaper and cleaner sources in New York State and sur- Other Renewables Coal Nuclear rounding regions. In addition, most of the generation N Hydro Oil Gas Source: NYCMayor's Office fleet is located along the waterfront, with more than half concentrated in Astoria and Long Island City in Queens. Energy is imported by high-voltage transmission lines that Today, nearly two thirds of the in-city plants are located connect the city with up to 6,000 MW of power supply from within the existing 100-year flood plain, even before tak- areas as close as the Hudson Valley, Northern New Jersey, ing into account future sea level rise of up to 2.5 feet by Long Island, and as far as Northern and Western New York the 2050s. (See map: In-City Electric Generating Facilities State. Each region has a different fuel supply mix serving in the Floodplain) New York City's demand. In 2011, power transmitted into the city consisted of nuclear (56%), natural gas (31%), hydro (7%), coal (4%), wind (1%), and oil-fired (<1%) generation.

(See figures: New York City Electricity Supply Mix)

In-City Electric Generating Facilities in the Floodplain New York City Electricity Supply Mix 2012 New Jersey In-city Hudson Valley region Source: NYCMayor's Office Source: NYCMayor's Office NYC's Pathways to Deep Carbon Reductions

Fuel Purchases for Electric Generation 280 28 - Generation 260 26 Distillate Fuel Oil 240 24 Residual Fuel Oil c 220 22 N Natural Gas

.2 200 20-180 18 m 0

=o 160 16 c' 14 .0, E 140 Un 120 12 2-C3

) 100 10 4-.j U,

,, 80 8 .aý G

.o 60 6 cý 4-6.

cu 40 4 C=

a 20 2 0 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: NYCMayor's Office The power sector emitted 15.8 million tons of C02e in city's electric supply mix (including imported generation) 2012, or approximately one-third of the city's total emis- is now 63 percent natural gas-fired, with oil- and coal-fired sions - a large number in absolute terms, but less than generation accounting for less than 3 percent.

three times the U.S. per capita average. Because the ma-jority of in-city generation is capable of burning natural gas - as opposed to more polluting coal or heavy fuel Fuel Prices for Electric Generation in New York State oil - and half of the city's power is imported from cleaner 2005 $/MMBtu sources located outside of the five boroughs, New York City's power system GHG footprint is relatively low. 16

- Residual Fuel Oil 14 Natural Gas Between 2005 and 2011, the power sector's emissions de-

- Coal creased by 31 percent despite modest growth in demand 12 over the same period. The greatest contributor to carbon reductions came from changes in market fundamentals 10 due to the increase in the price of oil since 2005, and the development of new natural gas resources. As a result, 8 "dual fuel" generators (capable of burning either natural 6 gas or fuel oil) shifted increasingly towards cheaper natu-ral gas. Second, natural gas-fired generators in the region 4 became more competitive in the electricity market relative to coal and fuel oil-fired units, thus increasing their utili- 2 zation rates. Over this period, heavy oil-fired generation 0

from in-city plants decreased from 30 percent to just 2 per- 1996 1998 2000 2002 2004 2006 2008 2010 2012 cent (and was as high as 50% in the 1980's and 1990's). The Source: Energy Information Administration

Electricity Generator Retirements and New Additions 2005-2012 2005 Repowering: East 2012 River - 360 MW New Build: Bayonne natural gas-fired co- 2007 2010 Energy Center 512 generation unit built Retirement: Lovett Retirement: Charles MWhigh efficiency to replace 16o MW 240 MWcoal-fired Poletti 885 MWnatu-gas turbines fuel oil-fired unit unit (downstate) ral gas-fired unit

() () ()

2011 2OO6 2008 New Build: Astoria New Build: Astoria Retirement: Lovett Energy 11550 MW Energy 600 MW com- 150 MWcoal-fired bined cycle natural combined cycle unit (downstate) natural gas-fired gas-fired unit New Build: NYPA 500 unit MWcombined cycle natural gas-fired unit Source: NYCMayor's Office The development of state-of-the-art power plants also re-duced the city's greenhouse gas emissions from the pow-er sector by 1 million metric tons. Over 2,500 MW of new in-city capacity were placed in service over the past seven years and 1,000 MW of old generation were retired. An ad-ditional 900 MW of coal-fired generation was retired in the Hudson Valley, resulting in the further decarbonization of power transmitted into the city. These changes helped to improve local air quality, reducing emissions of sulfur, ni-trogen, and other criteria pollutants.

NYC's Pathways to Deep Carbon Reductions

The city's grid has become cleaner in recent years - but there is a long way to go to achieve the deep reduc-tions in greenhouse gas emissions analyzed in this study. No one technology would be able to reduce emissions enough by itself; a cleaner system would have to rely on a portfolio of options including the repowering of existing plants, high penetration of "behind-the-meter" technologies such as solar PV and CHP, and large-scale hydropower and wind generation.

Repowering in-city generation Repowering Projects in Today, nearly 60 percent of the power plants in the City are more than forty years old, and most of these plants New York City utilize less efficient "single cycle" design. Repowering these plants with "combined cycle" units that are able to The City of New York has worked with its elec-capture and reuse waste heat to generate additional elec- tricity supplier, the New York Power Authority, tricity, can boost efficiency from -30 percent to almost 60 to enhance the efficiency and environmental percent, thus reducing carbon emissions by almost one- profile of the power sources that serve the city.

half for each MWh of electricity generated. Repowering For example, the City entered into a contrac-in-city plants could also yield other public policy benefits, tual arrangement with NYPA that allowed the including increasing reliability, reducing criteria pollutant 500-megawatt Astoria Energy II power plant emissions, and incentivizing generators to invest in storm in northwest Queens to be built, and to enter surge protection for new equipment. However, repower- service in 2011. The AE II plant has improved ing fossil fuel-fired power plants alone will be insufficient air quality and reduced greenhouse gas emis-to achieve an 80 percent GHG reduction. sions in the region by displacing generation from less efficient plants. In a similar fash-Achieving deep carbon reductions at the city or regional ion, the City supported the 2010 retirement level would ultimately have significant implications for of the former Poletti Power Plant owned by existing in-city power plants. A carbon policy (such as a NYPA in Astoria. The highly polluting facility declining cap on emissions) would make existing plants was replaced by NYPA's state-of-the-art 500 gradually become less competitive relative to newer, more MW combined-cycle plant, further reducing efficient plants. However, many of the in-city power plants emissions. The 500 MW plant, along with AE would need to remain online in 2050 in order to meet criti- II, contributed to a 5% reduction in the City's cal system reliability standards, requiring additional com- carbon footprint the year following startup.

pensation (for example, in the capacity market).

Carbon Capture and Storage Carbon capture and storage (CCS), in theory, could mitigate the greenhouse gas emissions of conventional fossil fuel generation by capturing carbon dioxide and then either storing it in geologic formations or reus-ing it in industrial applications. Since New York City lacks the space necessary for a feasible carbon "sink,"

CCS would require the siting and construction of dedicated pipelines and compressor stations to pressurize and pump the carbon dioxide to neighboring states. Although CCS may be technically possible, it has not yet been developed at a commercial scale in the power sector, and significant regulatory and engineering ques-tions exist. Therefore, the study does not include CCS in the portfolio of large-scale mitigation measures for in-city gas generation - although it does allow it to emerge as a viable technology elsewhere in the region.

Currently Proposed Power Projects NYC, New York Canadian Hydro transmission (TDI) 0 O

S Build 1,ooo MW capacity high- A voltage transmission line from Lower Hudson Valley Projects Quebec, over 300 miles long under the Hudson River Proposed new combined cycle plants from Bowline (775 MW), Cricket Valley (1,oo0MW), and CPV Valley (650 MW)

Ravenswood Repowering would generate electricity transmitted (Transcanada) into New York City Option 1: Retire 265 MW of existing gas turbine capacity and replace with 265 MW of new equipment fueled by natural gas or kerosene (zero net capacity addition)

Option 2: Retire 377 MW of existing gas turbine capacity, replace with 265 MW simple cycle cogeneration and 159 MW I Astoria Gas Turbines (NRG) of peaking gas turbines Replace existing 4o-year old simple cycle gas turbines with 440 MW of new combined cycle units 0

South Pier Improvement (USPG)

Luyster Creek (USPG)

Anew gas turbine facility would add 1oo MW at site of existing Gowanus Retire existing 18o MW steam turbine gas turbine facility to be operated as unit and replace with 410 MW a peaking power plant. Would be

_F combined cycle unit combined with an overall facility emissions reduction strategy that will improve the emissions profile of Offshore Wind Collaborative Project existing on-site facilities.

Build 350 - 700 MW of offshore wind 13 miles off the coast of the Rockaways V'

Source: NYCMayor's Office

Proposed Route Transmission Linefor Canadian Hydropower to satisfy de-The city needs a diverse portfolio of power mand, and although repowering can improve the efficien-cy of generation, it cannot provide a deep reduction in greenhouse gas emissions alone. For that, the city would have to rely on clean resources in other areas, whether new or existing, transmitting power via long distance lines. The three available options - hydro, nuclear, and wind - all have different tradeoffs, including transmission constraints, siting difficulty due to local opposition, and in-termittency (in the case of wind).

Hydroelectric power Hydroelectric power has several attractive features: op-erating costs are relatively low, it is available nearly all the time, and is most abundant when it is needed. Most of the regional potential lies in the Canadian Province of Quebec, located just north of New York State, where, according to the public utility Hydro-Qudbec, close to 36 GW of capacity is already installed and an additional 35 GW of technical po-tential exists, of which the utility is planning to capture 5.5 GW by 2016. Because Quebec has a winter-peaking demand for electricity, significant excess capacity - up to 10 GW - is already available during the summer months, exactly when Source: NYC Mayor's Office New York City's demand is greatest.

Transmission, however, is a challenge: less than 900 MW of England, and 0.8 GW in the New Jersey area. Off-shore wind transmission capacity links Quebec to New York State, and potential is greater yet: up to 150 GW across different feasi-within the state, weak transmission interconnections make bility classes around the region, though for the purposes of it more difficult for energy to reach the downstate markets. this study, it was assumed that a total of 21 GW of off-shore Developers propose a 1,000 MW line directly linking Canadi- wind is available in the Northeast from New York (2.8 GW),

an hydro-power to New York City; this proposal was recently New England (8.5 GW), and the Mid-Atlantic area (9.6 GW).

authorized for construction and operation by the State of New York. (See map: Proposed Route for CanadianHydro- However, whether on-shore or off-shore, wind is less reliable power TransmissionLine) than hydro or nuclear power. Since wind blows irregularly, wind turbines only produce electricity around 30 percent Nuclear of the time on-shore and around 40 percent of the time off-There are significant questions about the continuation of shore. The New York Independent System Operator (NYISO) existing nuclear generation that serves New York City. The "derates" wind generation to 10%during the summer due to nuclear power sector also faces significant regulatory un- lower average wind speeds. Effectively, a 1,000 MW of on-certainty, although this could change when next generation shore wind generation (nameplate) is estimated to generate technologies, such as modular reactors that promise to be 100 MW during summer periods.

smaller, cheaper, and more reliable, become commercially available. In 2011, the City released its Indian Point Retire- Due to a significant decline in the capital and installation ment Analysis, describing the impacts of the potential clo- costs, on-shore wind generation is nearly cost-competitive sure of the Indian Point Energy Center. Presently, nuclear with fossil fuel generation. Off-shore wind still has very high power provides approximately 30 percent of the city's elec- capital costs, especially in the US where not a single com-tricity; phase out of nuclear energy with natural gas-fired mercial project has been completed. Although it has also generation is estimated to increase New York City's green- fallen on a per-MWh basis, it is still far costlier than hydro, house gas emissions by approximately 15%. The city also de- nuclear, or onshore wind. (See chart: Levelized Cost of New pends on Indian Point for reliability, as congested transmis- Generation) sion lines limit power imports from more distant locations.

This study assumes a 20 year extension for both units of the Levelized Cost of New Generation Indian Point Energy Center. $/MWh Wind 250 Wind sources represent a small but growing portion of our 222 energy supply mix. Since 2005, NYSERDA has funded large-scale renewable energy projects through the Main Tier of 200 the renewable portfolio standard. Over three-quarters of a billion dollars have supported the development of approxi-150 144 mately 1,800 MW of renewable energy, 90 percent of which consists of on-shore wind resources located in Northern and Western New York State. However, only a small portion of 1o8 100 90 the renewable power generated in these far regions has 87 been able to serve demand in New York City and the down- 67 state area.

50 The technical potential for wind is, however, abundant in New York State, estimated at 29.5 GW (though only 2.8 0

GW of it is in the most achievable wind classes based on Natural Gas On-shore Hydro Advanced Solar PV Off-shore wind power density and wind speed). Surrounding regions COrynt ined Wind Nuclear Wind also have significant technical potential of wind resources:

an additional 7.6 GW of potential is estimated within New Source: EIA-Annual Energy Outlook 2013 NYC's Pathways to Deep Carbon Reductions

CHP Pipeline Map Another small but growing source of energy in the New York City market is customer-sited distributed generation (DG).

• CHP Pipeline Projects (2013-2018)

These resources are comprised of several technologies in- Existing CHP, Fuel Cells, and other OG cluding combined heat and power (CHP), fuel cells, and solar PV. DG resources have grown in recent years from under 50 MW in 2007 to over 160 MW today. With DG, customers have an alternative to the bulk power supply, adding power re-dundancy and reducing strain on local distribution systems depending on configuration and location.

Combined heat and power units generate electricity using fossil fuels or biofuels, recovering waste heat for onsite heat-ing and cooling needs. They can be highly efficient and less carbon intensive than power generated at power plants - 0 as high as 70 percent efficiency depending on the electric and heat loads they serve, compared with single-cycle units 9

with efficiencies in the 30 percent range and more than the best combined-cycle units with efficiencies of up to 60 per-cent. CHP units can also be configured to operate during Source: ConEd,NYCMayor's Offe grid outages and reduce strain on certain local distribution has provided incentives through its CHP Market Accelera-networks with high demand, adding resilience to the facili-tion Program. As a result of these policies, investment in CHP ties they serve as well as portions of the grid.

projects have begun to rise. Recent City-owned CHP projects under development include a 12 MW unit at the North River Policy support at the City and State levels have led to in-creased investment in CHP in recent years. Con Edison has Wastewater Treatment plant and a 15 MW unit at Rikers Is-land. Many private investments have been under develop-adopted the CHP "offset tariff," allowing larger CHP systems ment as well, including CHP systems at NYU Langone Medi-serving campuses to more easily interconnect. NYSERDA cal Center, Columbia University, as well as several hotels, and residential and commercial buildings. However, the high capital costs of CHP and the need for large and consistent Efficiency of CHP vs. the Grid and Other Technologies thermal loads limit its potential application to only certain Emissions rate in lbs. C02/MWh buildings. (See figure: CHP PipelineMap) 1,400 1,354 1,219 1,162 1,200 1,000 890 4 In-city Generation Average:

9 Ibs. C02e/Vft 800

---

571 -- 4 In-dry +Iml ts Average:

&nn 675 ,bs. CO2e/IM 400 200- - --------------------- - - - - - - - - - --- 8-x50 goal:

191 IbS. C02e/M 0

Gas turbines Steam Internal CCGT CHP (70%

turbines Combustion efficiency)

Source: NYCMayor's Office

Cumulative Installed Capacity Map: a web-based tool able to easily display the technical MW potential for PV on any rooftop in the city. Through NYSER-1,000 DA, the State also offers incentives for PV in the forms of 900 upfront rebates (per installed kW, systems less than 200 kW),

8OO-------- PlaNYC Goa and competitive production incentives (per kWh produced, 8ooMW systems greater than 200 kW).

700 Other 6oo Solar Given the amounts of solar radiance that New York City re-500 ceives on average and current technological capability, solar 400 panels produce approximately 14 percent of their full theo-300 CHP retical output on an annual basis. Using current commer-20O cially available technology, 2.3 GW of rooftop solar PV would 100 provide 5 percent of the city's annual power needs.

0 o" 2010 2015 2020 2025 2030 New York City Installed Solar PV Capacity and Costs Source: NYCMayor's Office Solar photovoltaic power 12 16 Installed solar PV capacity in New York City has grown from 14 1 MW in 2007 to just under 20 MW today. However, solar PV 12 8 5.98 Cumulative is still a small share of overall power production, amounting Installed 6.16 6.25 5.05 10 Installed to less than 0.2 percent of the city's peak load. Investment in Cost 6 3.26 8 Capacity (S/Watt) 4.34 PV, however, is growing: the number of installers grew from 4 (MW) 4-5 in 2006 to more than 60 in 2013. This growth is the result 4 2 3.97 4.24 4.65 4.30 3.58 3.68 2 of several factors, including reduced equipment costs and robust incentive support both at the Federal, State and local 0 0 levels. (See chart: New York Cty InstalledSolar PV Capacity 2007 2008 2009 2010 201] 2012 and Costs) Installed Capacity Panel +Inverter New York City has a sizeable technical potential for roof- Labor +BOS top PV with roughly 1.6 billion square feet of rooftop space across approximately one million buildings. However, de- Source: NYCMayor's Office veloping solar PV in dense urban environments with high transaction costs, a complex and varied building stock, and many building owners either without enough knowledge or financeable credit remains challenging. The growth rate of Forecasted New York City Solar PV Capacity GW AC Cumulative at Private lO% Pre-tax Discount Rate PV in New York City lags behind other regions with similar solar radiance such as neighboring Long Island, New Jersey, and Germany (the global leader).

Several policies at the local, State, and federal levels have attempted to overcome these challenges. At the federal 41I2.3 level, the investment tax credit (ITC) for solar PV has been the main driver of investment, reducing business and per-1.2 sonal tax liability by 30%of eligible PV system costs, and will 2.3 2.3 continue to do so until the end of 2016. The City currently of-fers a property tax abatement for systems installed between 0.4 2008 and 2015. Working with CUNY, Con Ed, NYSERDA, and 0.0 0.0 0.1 0.1 0.1 the Department of Energy, the City developed the NYC Solar 2010 2015 2020 2025 2030 2035 2040 2045 2050 Source: NYCMayor's Office NYC's Pathways to Deep Carbon Reductions

Measuring the Technical Potential for Photovoltaic Solar The city's available rooftop space could theoretically translate Into as much as 16.1 GW of solar PV potential, Hourly Building Demand and Solar PV Output but only a small share of that potential can be realisti- Normalized to 12 noon demand cally captured. Screening for high-rise buildings (due to technical challenges and costs) and adjusting for Hourly building demand and solar PV output estimates of structurally unsound roofs, occupied, or Normalized to 12 noon demand shaded space decreases the potential from 16 GW to 5 GW - but even that amount cannot be fully captured PV is 60% -.

under current "net metering" rules. of peak PV is 27%

of peak As written today, net metering rules allow building own- 1 12 24 1 12 24 ers to offset their retail electricity bills by the amount of Commercial Residential electricity generated by their rooftop solar installations, including generation in excess of load that is injected PVcapacity limitations by building type into the network. However, as a conservative assump- AW Limited by roof space tion, this study assumes that these rules will not be Limited by peak demand expanded in the long-term.

45 3.4 For the purposes of the model used in this study, a conservative assumption was made that the installation 1.2 rate of solar technologies continues along a historic trend until prices reach grid parity around 2025-2030, by which point a combination of lower solar system costs Commercial Residential and naturally higher electricity prices makes solar PV Source: NYCMayor's Office In New York City competitive on a retail basis. Technical potential Is estimated at 2.3 GW based on both available roof space and load matching. (See charts: Forecasted New York City SolarPV Capacityand NPV and Capital Expenditureof 100kW System) NPV and Capital Expenditure of o00kW System

$ Thousands Pretaxed Unlevered 4% disc. rate -Capex 1o% disc. rate 500 . . . . . ...

r N.

400 300 200 100 -,7' 0

-100

-200

-300 2015 20 25 30 35 40 45 2050 Source: NYCMayor's Office

The 2050 Power Supply Mix Several approaches to reach the 80 by 50 goal in the power technologies, and learning curves of new and emerging sector were evaluated, including different scenarios for (1) technologies. The model tested the results of a carbon cap demand, (2) generation technology constraints, as well as for New York City, as well as one for RGGI states, that de-a (3) comparison of a NYC-only emissions reduction versus clines linearly from 2012 to 2050. (See charts: Power Sector a regional reduction. Generation constraints were imposed Emissions Under Different Cap Scenarios) in order to explore different bounds for the penetration of nuclear, hydropower, and renewables technologies, as the Although the City is not advocating for a city-level carbon development of these resources will be determined in many cap, it serves as a useful modeling tool and effective proxy cases by regulatory and legislative realities (see the previous for the power sector subsidies that would be required to section for technology constraints). achieve 80 by 50. As the carbon cap declines each year, the model determines the lowest cost mix of existing conven-There are several potential electricity demand pathways. Un- tional generation and new, lower carbon resources needed der a "business as usual" scenario, demand is estimated to to stay below the cap. The model utilizes exogenous de-increase by 33 percent by 2050 (0.72%annually). Our 80 by mand projections that incorporate the deep energy efficien-50 Abatement Scenario assumes a 30 percent reduction in cy gains as well as increased electrification (described in the aggregate energy demand by 2030. By 2050, demand could Buildings chapter) that are needed to achieve 80 by 50.

either fall further (36 percent) if buildings do not extensive-ly rely on electric heating and power, or rise slightly if they do. (See chart: Power Demand Scenarios on the 80 by 50 Pathway)

Demand-side measures should be aggressively ,

Power Demand Scenarios on the 80 by 50 Pathway pursued V Indexed to 2010 The least cost pathway would rely heavily on energy efficiency measures and behind-the-meter distributed 140 BALI+33% generation technologies such as solar PV and CHP. If ag-gressive demand reduction measures are met, the car-120 bon cap would not be "binding" on the power sector until the early 2030s, and could be met on the margin 10 0 - - ,- .............................. nt with12% with cleaner imports as well as the "endowment" from Abatemei the local power sector switching away from heavy fuel oil electrif ication 80 from 2005-2011. Conversely, without a significant reduc-tion in demand, the carbon price would be prohibitively 6o Abatement -36%

expensive.

40 The technical potential for achieving deep carbon re-ductions through large scale clean energy exists - in 20 theory New York City and the surrounding region has ample 0 technical potential to reduce carbon emissions through 2010 2020 2030 2040 2050 higher efficiency conventional generation and renewable Source: NYC Mayors Offce resources such as Canadian hydroelectric power, Atlantic offshore wind, and distributed solar generation. In the-To analyze the feasibility and costs of reaching 80x50, an op- ory, the technical potential that is available to New York timization model for the power sector was used to find the City for zero-carbon resources is close to 30 GW, which least-cost solutions to supplying power to the marketplace would exceed existing installed capacity in the City even assuming a linearly declining carbon cap to 2050. Several after de-rating capacity factors to account for the inter-different assumptions were explored to test the robustness mittency of solar and wind resources. There are, howev-of the modeling results, such as the definition of the geo- er, significant and untested challenges to achieving this graphic carbon "boundary," penetration of behind-the-meter potential.

NYC's Pathways to Deep Carbon Reductions

In-city options for low-carbon generation are limited Under a regional GHG emissions reduction strategy, NYC would not meet 80 by 50, but regional reductions The opportunities for decreasing carbon emissions with low-cost or incremental solutions such as fuel switching would more than offset the effect in the local power sector are limited as the city's genera- With a NYC cap, the city's emissions would fall from 15 tion mix has already shifted almost entirely to natural gas million tons today to 4 million tons, allowing it to meet within the past 10 years. Repowering and solar PV would 80 by 50. With a RGGI cap, they would only fall to 11 mil-help reduce emissions, but the scale of their impact lion tons within a RGGI cap, meaning that the 80 by 50 would not be sufficient for the 80 by 50 pathway. Large goal would not be achieved. This, however, is more than scale options such as hydro, nuclear and wind would offset at the regional level - instead of only dropping need to be developed to bridge the gap for the 80 by 50 10 million tons if NYC acted alone, RGGI power emissions trajectory. This study limits achievable hydro to 1 GW, not would drop an enormous 126 million tons within the RGGI adding any nuclear beyond existing capacity, and closing framework, dwarfing the city's total emissions. The city any remaining gaps through wind generation. may not reach its goal, but from a public policy perspec-tive, this outcome would be preferable - both because of System integration of large-scale intermittent resourc- the scale of emissions reductions and because of the eco-es is untested in the U.S. nomic impacts, explained below. (See charts: NYC power sector emissions under different cap scenarios and RGGI Although Europe has successfully developed more than power sectoremissions under different cap scenarios) 3 GW of offshore wind power, no utility-scale resources exist in the US. Navigating and aligning the objectives of numerous layers of government and regulatory oversight would be a process with little precedent that could take many years to work out. There are also significant techni- The technical potential for a low carbon power system cal questions regarding how the grid will remain reliable exists if New York City acts without a regional or national with large amounts of intermittent resources supplying a solution in place, but it would be costly. Carbon prices substantial portion of the energy. The experience of inte- would need to reach up to $150 per ton to drive a renew-grating large-scale renewable power resources into Eu- ables portfolio for NYC. The development of renewables ropean electric grids poses both optimistic and caution- with transmission requires a significant financial incen-ary tales. In Germany, where renewable resources now tive over and above wholesale power prices. A regional ower up to 20% of peak load, the rising costs of energy strategy would be more economic with the ability to re-ave recently caused regulators, legislators, utilities, and tire coal plants and greater potential to site renewables.

private sector actors to rethink costly renewable energy (See chart: Implied Carbon Costs per Ton) goals. Due to the high penetration of solar PV, California is beginning to implement energy storage to balance the peak generation with non-coincident peak demand. Installed In-City Capacity and Generation Mix GW and TWh, respectively Meeting 80 by 50 in NYC would require "leapfrogging" to large scale renewables 18.7 55.4 51.6 51.6 If the city acts alone without regional or national carbon regulation frameworks, and assuming the constraints on 1o.8 i ° hydro, nuclear, and on-shore wind, most of this capacity 13.77 .4 53%

would have to come from off-shore wind - almost 7 GW of 1.2 it by 2050. Carbon prices (or other incentives) would need 0.8 64%

to rise substantially to incentivize a massive investment Z3 2.3 in utility scale renewables. Gas-fired generation capacity would also remain, though it would be used primarily for load balancing, as discussed below. In-city or dedicated 45%

10.0 7.5 7.8 resources would produce 70 percent of the city's power, 6%

and imports would only account for the remaining 30 per-cent, far less than today.

Today NYC Cap RGGI Cap Today 2050 RGGI Cap Within a regional framework, the need for incremental capacity within NYC would be much lower: instead of adding 8.3 GW, the city would only add 3.2 GW of rough- Imports N Hydro Solar ly equal shares of hydropower, off-shore wind, and on- N Coal Wind Other Renewables shore wind. Those would generate about 27 percent of the city's total energy needs, and the rest would be cov- U Wind Offshore Gas ered through cleaned-up regional imports. (See charts:

InstalledIn-City Capacityand GenerationMix) Source: NYCMayor's Office

Electricity prices would increase, but magnitude Implied Carbon Costs Per Ton would depend on the level of demand reduction Dollars NYC cap Carbon cap becomes 149 Power prices are expected to increase at a rate of 2.30%

annually in real terms under the business as usual sce-150 binding after 2030 due to energy efficiency 1 nario: new generation alone would require at least $14 -43%

billion of capital investment in the next 37 years. In an 80 100 86 by 50 compliance scenario for New York City only, which assumes that demand would be reduced due to energy -33% Regional cz efficiency, wholesale prices would instead rise by 2.51% (RGGI) 50 annually. Under a regional solution, power prices would 57 rise less, at 2.47% annually.

0 2020 2030 2040 2050 NYC Power Sector Emissions Under Different Cap Scenarios MTCO2e Source: NYCMayor's Office 25 Macroeconomic impacts vary by technology pathway 20 18 18 Employment and GDP impacts of clean power projects BAU emissions are mixed. As with any other investments, they impact the economy in three ways: they create direct jobs in 10 1 construction, displace them in the rest of the economy 10 8 RGGI cap scenaric through diverting spending from other sectors, and cre-ate or displace jobs through changing economy-wide power expenditures.

5 - NYC-only cao For solar PV, the positive effect of capital expenditures 0 is slightly outweighed by the negative effect of the op-2015 2020 2025 2030 2035 2040 2045 2050 portunity cost of local spending (up to 1,300 jobs created and 1,500 jobs destroyed), but this in turn is more than Source: NYC Mayor's Office outweighed by the increasing economic competitive-ness. Solar PV installations ultimately translate into sav-ings, and the money that would have been spent on fossil fuels is spent throughout the economy instead (creating RGGI Power Sector Emissions Under Different Cap Scenarios 1,200 jobs in the example case, for a net effect of 1,000 MTCO2e jobs created).

For offshore wind, the calculus is different: capital expen-ditures still create jobs, but the resulting power prices 160 16o 159 1 NYConly cap scenarolo have uncertain economic impacts that depend on as-140 SBAU emissions sumed technology learning curves, construction costs, and the amount of local economic activity (e.g. manufac-120 114 139 turing and research) that could make New York a hub of 100 005 off-shore wind.

80 60 51 40 RGGI cap 20 0

0 2015 2020 2025 2030 2035 2040 2045 2050 Source: NYCMayor's Office NYC's Pathways to Deep Carbon Reductions

Paying a premium for clean energy The level of investment required to obtain deep carbon re-Finding and siting energy projects are difficult ductions poses basic questions about who will fund these in-Large scale energy projects face high capital risk in New vestments. Until the capital cost of clean energy is reduced, York. Onshore wind projects are generally not located such projects will require subsidies in the forms of incentives close to areas with energy demand. Offshore wind proj- and financing. There are two basic sources of subsidies for ects have not yet been built to scale in the US and still energy projects: ratepayers and taxpayers - although practi-face a lengthy permitting process at the federal, state cally the same, they have different implications. Using the and local level. Transmission projects that would deliver former source results in higher energy rates, while using the wind or hydro power also go through lengthy permitting latter either results in opportunity costs or in higher taxes.

processes and face significant challenges to financing. Ultimately, any subsidy must balance the needs of consum-For distributed energy, developers often site difficulties ers with their willingness to pay.

in finding customers with the combination of enough technical knowledge, the right building characteristics, and high enough credit. All of these challenges require a lot of developer resources, resulting in projects facing higher costs and taking several years to come to fruition.

Existing infrastructure and regulations do not support the utility of the future The traditional utility model of centrally located power plants delivering power across a single entity-owned dis-tribution system has been around since the 1800's. As such, infrastructure, markets, and regulations were all designed to support this model. New concepts emerging today in which customers have a choice to generate all or a portion of their own energy would require new ways of assigning costs and benefits of distributed systems. As DG market penetration increases, several questions arise:

What will the role of the utility be in a distributed world?

What costs are to be borne by individuals vs. all custom-ers? What fundamental changes to energy markets are needed? Greater penetration of distributed generation will not happen until these questions are answered.

Power markets would need a new set of rules The rules for today's power markets are written based on the assumption that most power generation carries a significant marginal cost. Gas-fired plants need to burn natural gas to produce electricity; they do it with differ-ent efficiencies, occupying different positions on the sup-ply curve - and where the demand curve intersects the supply curve, power price is established. Since renew-able generation has high capital costs and low operating costs, the traditional paradigm breaks down. especially with increased market penetration. On the 80 by 50 path-way, power market rules would have to change to follow the evolving realities.

0 P\'ýf _'ý _"'o 0 AL, cdýdoow'h%ý Pilot a demonstration scale off-shore wind power Advocate for improved market rules that encourage project repowering and cleaner generation Planning for a large-scale off-shore wind project can take The regulatory rules governing the wholesale electricity years, but the City can begin acting even as it participates markets create barriers and disincentives to repowering. in the long-term planning processes. Specifically, the City Those rules restrict the ability of repowered units from could work with the State to explore options to develop fully participating in the capacity market and compet- a smaller, demonstration scale 20-30 MW project in state ing against incumbent units for market share. Altering waters - similar to what Maine, Rhode Island, New Jersey, NYISO capacity market rules to remove the disincentive and Virginia are pursuing now. A smaller demonstration to repowering would be an important step to reducing project would allow New York to advance on the learning carbon emissions in New York State and regionally. The curve and test the concept of off-shore wind with rela-City has been involved through public commenting, and tively minimal capital risk.

should continue advocating for improved capacity mar-ket rules to the NYISO and FERC. Local, State and federal coordination to accelerate siting Djeveop~ng Grid 5cale Cean [Energy Siting and leasing processes can add significant amounts of time to any off-shore wind project timeline. The City Hydroelectric Power can work with New York State and the Department of In-Study the supply impacts of increased hydropower terior to expeditiously designate the federal waters off The Champlain Hudson line connects the city to only a of New York as a Wind Energy Area (WEA) in order to small part of resources available in Canada. Increased accelerate the siting and leasing processes. WEAs have hydro imports could reduce electricity prices for resi- already been established in waters off of most other Mid-dents of New York City - but the economic, technical, and Atlantic and New England states.

political constraints of integrating so much hydro power into the city's energy mix would need to be investigated Explore measures to lower financing costs separately. Technical concerns about generation portfo- Off-shore wind projects require hundreds of millions of lio diversity and system integration, regulatory and politi- dollars. Working with the State, NYPA, LIPA, Con Edi-cal issues surrounding market competition, the impacts son, the Green Bank, and the Federal government, the within New York State, and environmental questions City can explore creative financing support mechanisms about new hydropower development in Eastern Canada such as loan guarantees, public-private ownership, and still remain unaddressed. power purchase agreements for offshore wind that will help overcome the challenges of financing offshore wind, Off-shore Wind a major untapped resource.

Convene Northeastern Atlantic offshore wind collaborative Analyze regional economic benefits of off-shore wind Scaling up off-shore wind projects would require a re- Off-shore wind costs are high, and the share of local gional approach - and one way to jumpstart the discus- spending relatively low - but shifting as much of the pro-sion would be to assemble a Northeastern Atlantic off- duction and installation process to New York State could shore wind collaborative that would bring together the help make the projects more economically attractive. A states of Delaware, New Jersey, Connecticut and Massa- rigorous analysis of the economic benefits of offshore chusetts along with the Department of the Interior, FERC, wind could examine the establishment of a regional hub and regional transmission operators to create a regional in New York State. The City could work with the State, strategy to develop offshore wind resources and trans- the Port Authority of NYNJ and NYSERDA, among others, mission interconnections. To support the collaborative's to develop an economic development plan for off-shore work, the NYISO, PJM East, and the PSC could integrate wind. This plan could both identify appropriate sites for offshore wind into long-term transmission planning offshore wind port facilities and recommend actions that processes.

NYC's Pathways to Deep Carbon Reductions

should be taken by the City and State to realize the great- don't own roof space to invest in solar PV systems. Ex-est economic development benefit from this emerging isting incentives and regulations are untested for group-sector. owned systems. Through the US Department of Energy's Rooftop Solar Challenge, the City and CUNY committed Dýstftbutsd Gsn*arat~n ýIDGý to pilot a community solar project in New York City. This pilot would clarify the eligibility of both the personal in-Develop a "one-stop-shop" for information and come tax credit as well as the NYSERDA standard offer permitting rebate, and test the applicability of this new business DG development has been subject to a complex permit- model in New York City.

ting and interconnection process that spans several city, state and private agencies including Department of Build- Another emerging model is group purchasing of PV at ings, Fire Department, Department of Finance, Landmarks the local level. By engaging with communities, pooling Commission, Con Edison, NYSERDA, and more. Multiple customer interest, and locking in low installation costs, handoffs between agencies and separate processes that these programs have proven to cost effectively increase do not run in parallel result in project delays, increased solar PV capacity in other cities. This model is now being labor and permitting fees, and high opportunity costs. adopted through the "Solarize Brooklyn" program, a part-The City University of New York (CUNY) has begun to ex- nership between the Sustainable Kensington-Windsor amine these issues with the creation of ombudsmen who Terrace and Sustainable Flatbush neighborhood organi-work with all of the agencies involved, and each agency zations and Solar One. This group purchasing model will has simplified their own internal processes, but recent determine the ability of community outreach to reduce progress has not brought down balance-of-systems costs customer acquisition costs, and test the permitting and enough. Developing a standardized installation process interconnection processes with large volumes of applica-spanning every party would reduce the installed cost of tions for PV installations. Analysis of the successes of, distributed generation. and challenges faced by the Solarize Brooklyn program for expansion across other neighborhoods in the five bor-Further, lack of customer knowledge of DG options, avail- oughs will also be conducted.

able incentives and guides, and complexities of the per-mitting and interconnection processes has presented a Evaluate the role of net metering in the short and high information barrier to those property owners who long term are interested and financially able to install DG in the city Net metering allows for a customer to receive energy

- and there currently is no repository of the information credits at the retail rate for solar PV generation exported that property owners need. The City is in the process of to the grid (i.e. not consumed on-site). Remote net meter-developing a web-based tool to better inform property ing allows this to occur across multiple properties, disag-owners, providing them with the information needed to gregating the location of demand from the location of a convert interest in DG into actual investments. CUNY and PV system. Both mechanisms allow for investments, but the City will also expand the NYC Solar Map, a tool used existing requirements for these mechanisms have result-to evaluate the feasibility of PV on every rooftop in New ed in the inability of emerging PV ownership models to York City, to connect property owners with PV develop- exist in New York City. In addition, there is no long-term ers and installers, as well as evaluate a customer out- vision for net metering beyond the current aggregate ca-reach, education and acquisition program. pacity that Con Edison is required to allow to net meter.

Short term revisions to net metering are needed to allow Pilot emerging models for increasing solar PV for new business models that would drive investments, One emerging model that is growing the market in other while a long-term plan that addresses the true value of areas is shared ownership of PV systems, or "community exported renewable energy is needed for high penetra-solar." Much of the city's population and businesses do tion of PV in the Con Edison system. The City should eval-not have access to the roof space required to install PV. uate short-term and long-term revisions to net metering Community solar systems conceptually allow those who that satisfy the needs of ratepayers and long-term envi-ronmental goals.

Expand solar PV on government facilities Another innovative approach to solar PV on government Government customers, including City, NYCHA, MTA, and property is through private ownership. The City, in 2013, Port Authority, own thousands of buildings and facilities announced the selection of Sun Edison to develop, own, throughout the city: Municipal operations alone consist and operate up to 10 MW of solar PV at the former Fresh of over 4,000 buildings including schools, wastewater Kills landfill. However, several regulatory challenges treatment plants, hospitals, office buildings, garages, ahead will require careful coordination between the City, firehouses, and other facilities. Together these buildings State, and Con Edison. Completion of the project will test have a total of 25 million square feet of viable roof space the technical feasibility and impacts of integrating large and a vast technical potential for PV estimated to be over scale solar PV into the grid. It will also test new concepts 200 MW. Working with NYPA, NYSERDA, NYCHA, MTA, of remote net metering and electrical interconnection, the Port Authority, and other government parties would the limits of the existing incentive structure at the State develop a plan to achieve at least some of the potential. and local levels, and regulations surrounding landfill post-closure care in New York.

To overcome high upfront capital costs, the City, in 2013, announced the completion of a power purchase agree- Evaluate a feed-in-tariff ment with Tangent Energy Solutions, allowing the City to Existing incentives have led to growth in solar PV capac-purchase energy from solar PV systems on its property ity, but are insufficient to achieve scale, with many proj-without owning it. A total of 1.85 MW will be installed ects having proven to be too difficult to complete. Build-between the Port Richmond Wastewater Treatment Plant ing owners still require high credit in order to secure in Staten Island, Staten Island Ferry Maintenance build- financing, net metering is still required to build many ing, and two high schools in the Bronx. These projects systems, and customers still require the knowledge and serve as an innovative model for siting privately-owned interest to contact a PV developer. These requirements solar PV on City-owned property without incurring up-front capital costs.

NYC's Pathways to Deep Carbon Reductions

alienate a large portion of the New York City market from world-class universities and technology companies, in-accessing incentives and investing in solar PV. Feed-in- cluding IBM, Cisco, and Siemens. It will focus on 'urban tariff programs in other regions offer certain direct pay- informatics', or the science of using large data sets to ment for PV power from the State or utility, circumvent- analyze and find solutions to urban operations and sus-ing all of the above requirements. The piloting of a PV tainability challenges. Both campuses, as well as the Co-system will yield an analysis of the applicability of such a lumbia Center on Global Energy Policy, CUNY Sustainabil-program in New York City. ity, USDOE Northeast Clean Energy Application Center at Pace University, and other local institutions could play Analyze integration of energy storage instrumental roles in solving some of the technological Solar power's potential contribution to carbon emissions challenges behind clean energy deployment.

reductions is limited by its intermittency - but energy storage can potentially address some of the issues. In Evaluate energy from tides and thermal flows one example, a project at the Brooklyn Army Terminal Tidal and thermal flows are one example of an area integrates a 100 kW PV system, 400 kWh battery, and a that could benefit from greater research. The potential building management system. This project will demon- is available: New York is one of only a few states that strate how these technologies interact with each other possess sufficient free-flowing waters in tides, rivers, and the existing Buildings and Fire Codes. and waves to make kinetic hydropower a viable energy source. Already, the City has partnered with a private New vyork City as a Center for EEnargy sector innovator to pilot underwater kinetic turbines that Mno~vada~n convert energy from tidal flows into electricity. Turbines are completely underwater, silent, and invisible from New York City's dense urban environment is both a chal- shore. They do not require dams or other structures and lenge and opportunity for reducing power sector emis- they have minimal impact on aquatic life. The City could sions. As systems integration will need to take place on investigate opportunities to expand kinetic hydropower an urban level, the city has an opportunity to transform resources and where possible, interconnecting tidal re-into a 'living laboratory' for clean energy systems. City sources with wastewater treatment plants and other in-government could play an important role: it operates dustrial facilities.

roughly 4,000 public buildings, 14 wastewater treatment plants, 11 hospitals, and over 27,000 vehicles across vari- Another promising area for research is the option of tap-ous fleets. With this in mind, the goal of the Living Labo- ping the kinetic and potential energy in water supply and ratory concept is to demonstrate leadership and foster wastewater treatment, including, for example, by using market development of new technology - both by pro- the sewer system to assist in conditioning space (e.g., to moting innovation in the private sector and by leveraging serve MTA's Second Avenue Subway Line Stations, there-City assets as a platform for testing and demonstrating by reducing the size of cooling towers).

commercial viability of new technologies.

Support clean energy entrepreneurs Research and private sector innovation Promoting clean energy technology through creating a Support world class research on clean energy stable policy framework, cutting red tape, working with Innovation and commercialization in the energy sector utilities and permitting authorities to clarify and stream-not only requires the right policy environment but also line installation and interconnection procedures, and world-class engineering expertise and workforce - and provide information resources to decision-makers is a that is something that the City can help advance. Cornell necessity - but the city also needs locally based entre-NYCTech, a new applied science campus administered preneurs who intimately know New York City and the through the partnership of Cornell University and Isra- opportunities of starting businesses here. To encourage el's Technion University, is one example: it will focus on entrepreneurship, the NYC Economic Development Cor-both software and hardware in environmental science poration (EDC) has built a network of "incubators" across and green energy. Another applied science research the city that provide low-cost office space - currently institute, known as the Center for Urban Science and over 120,000 square feet - as well as training and net-Progress (CUSP), is led by NYU-Poly with a consortium of working opportunities to hundreds of start-ups and small

management and energy use monitoring are two exam-ples. With peak demand, the City is currently on track to increase its ability to curtail peak loads to 50MW in five years - 5 percent of the City's peak - in part through the use of a system that will perform automatic peak load shedding. To support energy monitoring, the City can pilot facility and campus level equipment and aggre-gate nodes of energy usage across agencies and facili-ties. This will improve the City's capability to view energy consumption, therefore improving energy management optimization.

Launch competitive program to pilot technologies at City facilities Almost 75% of New York City's annual greenhouse gas emissions come from buildings, so the success of any reduction strategy hinges on building efficiency technol-ogies. To that end the City will open up the over 4,000 businesses. Approximately 600 startup businesses with buildings it operates as a proving ground for new tech-over 1,000 employees currently reside at City-sponsored nology. Specifically, the City will work with clean energy incubators, and these companies have raised more than partners to develop a process for energy technologies

$125 million in investor funding. Future efforts could that could be piloted and tested in City buildings and build on what has already been achieved. operations, involving both the private sector and gov-ernmental partners like the MTA, the Port Authority of Support clean energy technology and energy efficien- New York and New Jersey, the General Services Adminis-cy demonstration centers tration, and State governments. The marriage of readily It can take time for new and emerging technologies to be available City assets and technology entrepreneurship adopted en masse - but New York City can become a will support growth of New York City as a center for en-hub for demonstration facilities for the public and private ergy innovation.

sector to have hands-on experience with them. Having physical centers of energy excellence that can showcase Pursue "net-zero" energy consumption at a wastewa-implementations of new energy technologies will enable ter treatment plant people to tangibly appreciate the benefits of technolo- In December 2013, the City announced one of the na-gies in lighting improvements, clean resources, building tion's first biogas to local natural gas distribution projects management systems, and more. There are already bur- at the Newtown Creek Wastewater Treatment Plant.

geoning centers within the City such as the new lighting This innovative partnership will reduce greenhouse gas center which will be a demonstration of lighting tech- emissions by diverting waste from landfills, reducing nologies as well as energy efficiency education. More emissions from the plant itself, and producing renew-centers for specific resources could help bring more real able energy. Several other projects are already under-examples of clean energy technologies directly to future way, including a 1 MW solar PV system to be installed users. at the Port Richmond facility and a 12 MW cogeneration facility under development at the North River facility. In Using City facilities as test beds for new the next decade, the City could seek to achieve further technologies reductions in energy consumption at other wastewater Pilot advanced systems for monitoring electric con- treatment plants through decreasing demand, increasing sumption and on-demand curtailment onsite power generation, recovering and reusing biogas, City government is one of New York City's largest ener- and undertaking co-digestion of organic wastes.

gy users, meaning that any improvements to its opera-tions could have a sizable citywide impact. Peak demand NYC's Pathways to Deep Carbon Reductions