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Corbett Agenda: Growing Pennsylvania's Coal, Renewable, Energy Resources
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As part of his campaign platform, Gov.-elect Tom Corbett laid out a series of commitments on protecting the environment, developing Pennsylvania's energy resources, enhancing agriculture and promoting sportsmen's  issues.

            In the last of this series,  PA Environment Digest is taking a look at the commitments he made on growing Pennsylvania's energy resources (Marcellus Shale was covered earlier)--
            As Governor, Tom Corbett will support and encourage the development of Pennsylvania’s energy resources in an environmentally sound manner. He will work with energy and environmental leaders, consumers and state and local governments to blend our diverse portfolio of energy resources with a common-sense environmental policy that protects Pennsylvania’s air, waterways and lands. 
            From cultivating natural gas to growing alternative energy sources, Tom Corbett is committed to fostering a 21st Century Pennsylvania energy industry with 21st Century environmental stewardship.
            Tom Corbett’s energy plan has five core areas:
-- Growing Our Energy Infrastructure;
-- Encouraging Renewable, Alternative & Clean Energy in Pennsylvania;
-- Cultivating Pennsylvania’s Coal Resources; and
-- Transitioning to Competitive Markets.
            Harnessing Pennsylvania’s energy potential to reduce our dependence on foreign oil and make energy affordable for all Pennsylvanians is an important priority for Tom Corbett. Pennsylvania is home to the second largest energy field in the world with our abundant coal, gas, oil and timber and our alternative energy sources such as wind, solar, nuclear, biomass, geothermal and hydroelectric facilities. 
            We have an energy infrastructure that not only needs to be maintained, but also enhanced to ensure safe and reliable energy supplies for Pennsylvania residents and neighboring states. And, equally as important, Pennsylvania’s energy resources are a critical component to revitalizing our economy, growing job opportunities and positioning the commonwealth in the global marketplace.
            Growing Our Energy Infrastructure
            Reliable and reasonably priced energy from a deep and diverse portfolio of sources, including natural gas, coal, oil, nuclear, hydropower, renewable and alternative, is critical to the prosperity of Pennsylvania. The commonwealth currently ranks second among states in the amount of electricity generated and is first in the amount of electricity exported. Pennsylvania’s electricity generation industry provides tens of thousands of good-paying jobs, and the abundance of electricity generated in the commonwealth helps to hold down the cost of energy to our citizens.
            The energy services provided to the citizens of Pennsylvania depend in large part on the quality of the infrastructure through which these services are provided. In Pennsylvania, and across the nation, much of our energy infrastructure is aging and is in need of replacement or modernization. Difficulty in siting is one of the main obstacles to building new energy infrastructure. On almost every project, there are economic, social and environmental considerations that must be balanced with the benefits that investment in infrastructure provides to consumers. In general, Pennsylvania has adequate laws in place regarding the siting of energy infrastructure, and the Public Utility Commission oversees that process. The commonwealth is fortunate not to have a statewide siting process for new electric generating plants, which has been an obstacle to building plants in other states.
            The growth of the Marcellus Shale industry further elevates the need for a reliable energy infrastructure. Given the potential of the Marcellus Shale and the projected gas production over the next few decades, it is critical that Pennsylvania is able to safely and swiftly get the gas from the wellhead to market. The siting of intrastate pipelines and “gathering lines” within this industry are important infrastructure issues that require balancing energy production needs with individual landowner concerns. This emerging issue requires thoughtful and prudent planning and oversight.
            As Governor, Tom Corbett will work to create an energy policy that encourages investment in Pennsylvania’s infrastructure, while protecting our environment and ensuring that consumers have access to affordable energy sources.
-- Create a Governor’s Energy Executive. While regulating aspects of energy use and production that may impact the environment and helping the regulated community comply with environmental regulations is a core function of DEP, the recruitment, promotion and growth of the energy market is not. Energy development, deployment, usage and marketing issues transcend the Department of Environmental Protection. As Governor, Tom Corbett will issue an immediate Executive Order to designate a senior advisor within the Governor’s office to serve as the state Energy Executive, who will be charged with coordinating the overall state energy policy, utilizing expertise within the relevant agencies of state government.
-- Create an Infrastructure Improvement Tax Credit Program. Encouraging private sector investment in Pennsylvania’s infrastructure is an important part of our energy growth. As Governor, Tom Corbett will work to create an Infrastructure Improvement Tax Credit to enable eligible infrastructure businesses to obtain a match for investments spent on infrastructure investments.
-- Support competition through infrastructure – smart grid and smart meters. If competition is going to thrive in Pennsylvania, our infrastructure needs to be updated to support a competitive marketplace. Smart meters are essential and promote several important policy initiatives in Pennsylvania beyond competition, including energy conservation and demand response and promote renewable energy, net metering and reduced greenhouse gas emissions. Smart metering also creates operational efficiencies that result in savings that benefit all utility customers. With respect to retail electric competition, smart meters give customers price transparency allowing them to compare alternative suppliers' rate offerings with their default service price. They can also take advantage of dynamic rate structures such as time-of-use rates, which give customers significantly more power to control the size of their electric bill.
            Given the critical policy initiatives that would be accomplished and the fact that electricity consumption is projected to increase, Tom Corbett will work with the PUC to encourage the cost-effective deployment of smart meters so that customers can benefit from the smart grid. He also believes that Pennsylvania's smart metering policy should emphasize that the new smart grid infrastructure must be interoperable and secure in accordance with industry and government standards.
-- Coordinate interagency support of intrastate pipeline development. To support the development of Pennsylvania’s mineral resources, Tom Corbett will direct the new Governor’s Energy Executive to consult with the PUC, DEP and the Department of Conservation and Natural Resources to coordinate interagency support of intrastate pipeline development.
-- Encourage energy conservation. Tom Corbett will work to encourage energy conservation through competitive markets. Energy conservation puts less of a strain on our existing infrastructure and potentially delays the need for new infrastructure

            Encourage Renewable, Alternative & Clean Energy In PA

            Given Pennsylvania’s growing role in the world energy market, Tom Corbett believes that our state’s renewable, alternative and clean energy sources should be an important part of a blended energy portfolio. Sources such as wind, solar, hydropower and nuclear are valuable supplements to our current fuels and augment and strengthen our current supply of electricity. This also includes the development and affordable use of other types of renewable and alternative energy sources, including coal-to-liquids, gas-to-liquids, biodiesel, and other types of biofuels, such as ethanol, syngas and methanol.
            As Governor, Tom Corbett will work to support renewable, alternative and clean energy sources in Pennsylvania to provide consumers with choices to meet their energy needs.
-- Meet Pennsylvania’s existing renewable energy objectives. When the Alternative Energy Portfolio Standards Act (AEPS) was enacted in 2004, it created a market for renewable energy in Pennsylvania by mandating all electric suppliers to include a percentage of their electricity from renewable sources. As Governor, Tom Corbett will work with the PUC to effectively and efficiently implement the current alternative energy standards and encourage sound and cost effective renewable energy investment. Pennsylvania should also explore opportunities to enhance alternative energy investments through the competitive market. Tom Corbett believes that a properly structured market place can effectively incentivize alternative energy investments – perhaps even more effectively than government mandates.
-- Improve the reliability of the grid. Reliable energy requires a solid infrastructure to get energy resources to market – whether alternative or traditional sources. As Governor, Tom Corbett will encourage the modernizing of the electric grid to better deliver alternative, renewable and clean sources of energy to all regions of Pennsylvania. This will give more consumers the opportunity to use alternative energies and also will support the growing alternative and renewable industry.
-- Educate consumers. Pennsylvanians have choices when it comes to how their energy is generated. For the first time in Pennsylvania’s history, the Electric Competition Act of 1996 gave consumers the opportunity to choose to be “green.” Electric customers now are able to pick their electric generation supplier, and they can choose electricity made from renewable sources. As part of his larger education campaign to educate consumers about new choices within the restructured marketplace, Tom Corbett will include information about the greening of the system and the ability for Pennsylvanians to choose green energy suppliers.
-- Support the development of coal-to-liquids & gas-to-liquids. Coal-to-liquids (CTL) and gas-to-liquids (GTL) technologies are available for producing superior clean liquid transportation fuels from coal and gas. The U.S. relies heavily on imported crude oil to meet consumer demand. In fact, 60-percent of the nation’s crude oil comes from other countries – translating to about 11 million barrels per day. Pennsylvania’s natural gas and coal reserves present great economic opportunities for the state. As Governor, Tom Corbett will encourage private industry and federal government investment in Pennsylvania to grow these clean energy sources and look to build facilities throughout the commonwealth that meet all best available control technology requirements and are fully bonded to ensure reclamation as required by law. In addition, he will encourage oil refiners in the state to accept and blend these CTL and GTL products into their downstream distribution network.
-- Grow the biodiesel industry. Pennsylvania’s biodiesel industry is providing both new fuel and new refining capacity to the commonwealth’s energy infrastructure. In the past five years, biodiesel refineries built in Pennsylvania provided a production capacity of 110 million gallons of biodiesel per year, added over $190 million to the economy and created hundreds of jobs. With agricultural commodity prices approaching record lows, more can be done to utilize domestic surpluses of vegetable oils and animal fats while enhancing our energy security. Biodiesel can be manufactured using existing industrial production capacity and conventional equipment, and it reduces lifecycle carbon dioxide emissions by 78 percent. In 2009, Pennsylvania biodiesel consumption eliminated 828 million pounds of carbon dioxide, the equivalent of removing 9,000 passenger vehicles from Pennsylvania roadways – and this is expected to increase to 90,000 vehicles in the near future. Biodiesel is the only alternative fuel in the country to have successfully completed the EPA-required Tier I and Tier II health effects testing under the Clean Air Act. As Governor, Tom Corbett will work with the federal government to ensure that the Biodiesel Blenders Tax Credit Incentive is kept in place and will look for additional opportunities to grow the biodiesel industry and new alternative energy jobs in Pennsylvania.
-- Support nuclear power as a clean energy source. Nuclear provides over 35 percent of Pennsylvania’s electric generation and produces 70 percent of our nation’s non-carbon emitting energy. Not only are Pennsylvania’s nuclear plants essential to meeting the electricity needs of our region’s consumers, they also play an important role in reducing air pollution by producing emission-free electricity. Tom Corbett will work to help ensure that Pennsylvania’s nuclear plants continue to operate and provide clean, safe and reliable electricity to the citizens of the commonwealth.
-- Provide regulatory certainty to investors. Certainty in the marketplace is critical for the growth and success in any new industry. It welcomes investors, creates new business opportunities and leads to expansion and the creation of jobs. Renewable, alternative and clean energy companies are growing in Pennsylvania, and Tom Corbett believes that we need to create an environment in which these companies – and all job creators – can thrive. As Governor, Tom Corbett is committed to providing regulatory stability in Pennsylvania and directing state agencies to work with the energy industry to grow reliable and affordable sources of energy for all Pennsylvanians.
-- Grow a skilled energy workforce. Every new industry holds the promise of job creation, and the alternative energy market offers many opportunities for a skilled labor force – both retraining displaced workers and introducing new workers to this industry sector. As Governor, Tom Corbett will encourage public, private, career and technical schools, community colleges and universities to explore these career paths and support their growth. He has outlined his full vision for growing workforce development opportunities in Pennsylvania in his policy paper, “Developing a World-class Workforce.” 
            Cultivating Pennsylvania's Coal Resources
            Pennsylvania is home to one of the most abundant and diverse mineral resource fields in the world. 
            The Marcellus Shale natural gas reserves in Pennsylvania represent the single largest economic development opportunity in the commonwealth over the next several decades, and Pennsylvania still remains the fourth largest coal producing state in the country. The responsible development of these resources will make Pennsylvania a world leader in energy supply and reduce our dependence on foreign oil.   (Note: Marcellus Shale issues covered earlier.)
            With proper oversight, accessing these resources can be accomplished in an environmentally safe manner that protects Pennsylvania’s rivers, streams, lands and forests. Extraction of natural gas, coal and crude oil can co-exist with environmental protection thanks to innovative technological advances in drilling, mining methods, equipment, water protection and treatment, and clean coal technology.
            As Governor, Tom Corbett will encourage the development of our natural resources and support policies that improve extraction efficiency and maximize environmental protection.
-- Grow mining in Pennsylvania. Pennsylvania is the fourth largest coal producing state in the country with coal beds underlying approximately 15,000 square miles, or 33 percent of the state. Approximately 68 million tons of coal were mined in 2008, accounting for about seven percent of the United States’ total annual coal production. The industry has created 49,100 direct and indirect jobs, with a total payroll in excess of $2.2 billion. Taxes on these wages netted over $700 million for federal, state and local governments.
            Advancements in mining extraction technologies combined with a strict mine regulatory program and rigorous permitting process have allowed mining to proceed in Pennsylvania without posing permanent environmental impacts. As Governor, Tom Corbett will support the development and use of newer technologies and processes for coal extraction that renders mining more environmentally safe than it has been in the past.
-- Institute regulatory certainty. In order to better manage this great resource in a more efficient manner, Tom Corbett is committed to having an understandable and predictable mining regulatory program. DEP’s program staff will be directed to review existing mining regulations to ensure that they are clear, not subject to misinterpretation or inconsistent enforcement and do not impede innovations in compliance technology. He also will make sure that they are no more stringent than corresponding federal regulations, unless there is a demonstrated compelling Pennsylvania interest.
-- Embrace clean coal technologies. Clean Coal Technologies represent an environmentally responsible means for Pennsylvania to meet its energy needs while taking advantage of an indigenous resource. As Governor, Tom Corbett will form a task force to review this issue and develop a report that provides a status and overview of pending technology; describes any barriers towards development and deployment of these technologies; and includes recommendations on what needs to be done to make these technologies deployable as soon as possible.
-- Expediting the permitting process. Obtaining a coal mining permit in Pennsylvania can be a cumbersome process that can tax the resources of the applicant. The length of time to secure a permit and redundant reporting and permitting requirements are impediments to the start-up of mining operations. The process itself generates volumes of paper that must be submitted to various bureaus and divisions within DEP. And while requests for additional information are common place, information transferred from one bureau to the next is not always timely sent by DEP. As Governor, Tom Corbett will insist upon transparency and efficient permit review procedures. In addition, any changes to the coal mining permitting process must:
-- Ensure that DEP staff executes their responsibilities in a results-oriented, cooperative manner.
-- Create a stakeholders group to examine the permit review process to ensure its transparency and to make changes intended to enhance process efficiencies, reduce permit lag and make the process more predictable.
-- Explore an electronic permitting process to cut down on the volumes of paper required for a typical permit application and to reduce delays and miscommunication within DEP.
            Transition To Competitive Electric Markets
            Pennsylvania is on the cusp of completing a transition to a competitive electricity market that has been over a decade and a half in the making. Pennsylvanians across the state are facing or are about to face changes that will have a significant impact on the way they manage their homes or businesses. 
            By January 1, 2011, all of Pennsylvania’s electricity consumers will be presented with opportunities associated with a restructured electricity industry. If Pennsylvania consumers are educated about these opportunities and empowered with the tools they need to take full advantage of them, the promise of a restructured electricity market is indeed bright.
            Pennsylvanians and their elected officials need to work together to understand this new market structure. While much has been done to prepare Pennsylvania for this new structure, there is still more work to do in order for Pennsylvanians to take full advantage of this change.
            In December of 1996, the Pennsylvania General Assembly sent a bold message, declaring that “competitive market forces are more effective than economic regulation in controlling the costs of generating electricity.” Prior to 1996, consumers did not have any choices. They were told by regulators the terms by which they were going to receive service and the only option was to take that service on those terms or not take it at all. Our electricity industry was plagued by inefficient plants and cost overruns that resulted in billions of dollars of stranded costs. Renewable energy had yet to really find a niche and conservation was a civic virtue, not an economic opportunity.
            Fourteen years later, Pennsylvania can be rightfully proud of the progress that has been made. Pennsylvania’s power plants are running with increased efficiency, renewable energy projects are being developed in all corners of the commonwealth, competitive options are driving prices down in areas where rate caps have expired and the reliability of the grid remains solid. 
            While we can be pleased with the progress that has been made to date, Pennsylvania can ill-afford to become complacent. A restructured electricity market demands vigilance and nurturing if Pennsylvania is to remain in the vanguard.
            As Governor, Tom Corbett will support competition and complete the transition to competitive markets for supplying and generating electricity and ensure that Pennsylvania consumers have access to the best service and best prices. If structured and regulated appropriately, competition will encourage innovation, efficiency, conservation and choice to meet the preferences of consumers. In order to complete the transition to competitive electricity markets, Tom Corbett will pursue a three-part agenda.
-- Create an Electricity Consumers’ Bill of Rights. Educated and empowered consumers are the keystone of a competitive electricity market. Consumers liberated from monopoly regulation will push the limits of the marketplace, demand technological innovation and participate actively in the market through their conservation. As Governor, Tom Corbett will work with the General Assembly and key stakeholders to pass an Electricity Consumers’ Bill of Rights to ensure that Pennsylvania’s consumers will have the tools they need to compete and win in a restructured market place.
-- Conduct additional consumer education. A restructured marketplace demands that consumers think differently about their electricity. After many years of capped rates, consumers must adjust to market-based pricing, prepare for potential increases in wholesale energy prices and take steps to prepare for and reduce their electric bills. Consumer education enables customers to realize the benefits of competition by offering access to innovative rate designs, renewable energy products, choice of a competitive supplier, conservation and energy efficiency. Education is also essential for low-income and vulnerable customers to maintain service by taking advantage of utility programs to control the size of their electric bills and seek customer assistance.
-- Focus state government on markets. Government is most effective when it empowers private investors and companies to solve problems through innovation. As Governor, Tom Corbett will spur productive investment in Pennsylvania’s energy sector by directing all of the government agencies involved in state energy policy to institute policies that promote private sector innovation and competition to meet the commonwealth’s energy needs. 
            He will direct the Energy Executive to oversee interagency coordination to ensure effective energy policy implementation without the need for additional state bureaucracy or taxpayer expense. He also will direct all agencies under the governor’s jurisdiction to streamline environmental permitting and prioritize energy projects that promote economic development and investment.
             In addition, Tom Corbett will appoint agency heads and Public Utility Commissioners focused on innovation and promoting competitive markets and solutions to energy problems.


            The entire Energy policy paper is available online.


12/6/2010

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