How Big Utilities’ Climate Pledges Fall Short — Episode 129 of Local Energy Rules

Date: 5 May 2021 | posted in: Energy, Energy Self Reliant States | 0 Facebooktwitterredditmail

Can a utility company be carbon neutral by 2050 if it builds a gas plant now? Maybe if it shuts off the gas plant well before its 40 years of useful life are complete, leaving electric customers to pay off millions in debt.

For this episode of the Local Energy Rules podcast, host John Farrell speaks with John Romankiewicz, Senior Analyst for the Sierra Club’s Beyond Coal Campaign. Romankiewicz and the Sierra Club released a report in January scoring utilities on their plans to transition from fossil fuels to clean power. Farrell and Romankiewicz discuss how utilities are doing far too little to retire coal, replace it with renewable energy generation, and fulfill their promises. The two had the conversation for a recent episode of ILSR’s Building Local Power podcast, republished here for Local Energy Rules.

Listen to the full episode and explore more resources below — including a transcript and summary of the conversation.

John Romankiewicz: You mentioned that resource plan in Minnesota happening right now, there’s new gas proposed in that plan. And our report highlights that that new gas is a false bridge, a stranded asset, and potentially a huge risk for customers. So utilities lose points if they’re building new gas. So when our report came out, I think our coalition there was ready to highlight the fact that they shouldn’t be building new gas. That’s not really compatible with what they claim to be doing long-term.
John Farrell: Monopoly utility companies control a majority of US electricity sales, so when they started lining up to make robust clean energy pledges in the past year, it seemed like time to celebrate. Unfortunately, research by the Sierra Club’s Beyond Coal campaign in a new report, The Dirty Truth About Utility Climate Pledges, uncovers the contraction between the utilities public pledges and their actual plans. Senior analyst with the Beyond Coal campaign, John Romankiewicz, joined me in February 2021 to talk about the shortcomings of utility pledges, the challenge it presents to the 150 cities with 100% renewable energy goals of their own, and what they can do about it. I’m John Farrell, director of the Energy Democracy Initiative at the Institute for Local Self-Reliance and this is Local Energy Rules, a biweekly podcast sharing powerful stories about local, renewable energy.

Listeners note: This podcast was originally released as part of ILSR’s Building Local Power podcast.

So joining me to talk about his report is Senior Analyst with the Beyond Coal Campaign at the Sierra Club, John Romankiewicz. John, welcome to Building Local Power.

John Romankiewicz: Thanks for having me.
John Farrell: Well, I’m really excited to talk to you about this. In part, because I always think it’s important to have a lot of scrutiny on utility companies, which often act as monopolies. Which is to say, in an anti-American fashion we have set aside the service territories that give these utilities customers, and therefore they have this really important public responsibility and sometimes are not living up to it. What I want to start with though is just… Before we get into the weeds of this report and the findings that you had, could you explain a little bit about what got you interested in this at Sierra Club, in tracking on this? And how did you come to doing this kind of work in general? Why are you working at Sierra Club on the Beyond Coal Campaign? What got you passionate about doing this work on climate and clean energy?
John Romankiewicz: Great. Lots to dive into there. I’ve been an energy analyst for 10 to 15 years with different types of organizations, government research labs, federal government, private consulting. Sierra Club was my first nonprofit, which I came to about four and a half years ago. Coming out of public policy school, I did a Master’s at UC Berkeley, I really wanted to dive into the advocacy directly. I read this article about the Beyond Coal Campaign, and was truly lucky and privileged to land a spot in the campaign after being inspired by what I was reading. I help a lot of our state and local teams, which are really multifaceted and focused on these utilities. They involve lawyers, volunteers, our local chapter leaders, as well as our campaigners and organizers, and we push so much on each individual utility.

But wind back about a year ago when this pandemic was starting, maybe there’s some extra time on my hands and I’m thinking about bigger ideas. And we’ve been collecting this data on coal, gas, and clean energy for a long time. I mean, essentially five to 10 years. And a lot of it informs our internal strategy and how we’re going to approach each utility. But some of it, we thought we should get out into the public, and we should really let the public know the truth about what we’re seeing. And so, we’ve been tracking coal retirements since we started our campaign officially in 2010, we’ve been tracking new gas plants since 2017, and we’ve been tracking all of the clean energy announcements. How much are utilities building out gas vs. clean? In other words, when they’re retiring coal, also for the past five years. So I got this idea to basically make this three legged bar stool, coal gas, and clean energy and come up with a grade. We want to call for the same things that we’ve been calling for all  along, retire, coal, stop new gas and build lots of clean energy. Well, let’s put a score to it because our hypothesis was that utilities don’t like being graded. And I think we found that they, yes, don’t like being graded.

John Farrell: It’s so interesting because when we think about who is responsible for the climate crisis, when we think about who’s responsible for the pollution burden, when we think about who’s responsible for failing to have the power on in Texas, for example, in the last couple of weeks, electric utilities score pretty high in terms of responsibility. And pretty highly as well for their long standing use of fossil fuels to generate electricity. I think what’s interesting about this is that here you are gathering this data on what they are doing, and you’ve been doing that for a number of years, but what’s really changed in the last year is that lots of these utilities have been making very public commitments to lower carbon emissions to say, “Oh, we’re going to be net zero by 2050,” or “We’re going to be a hundred percent clean by 2040.” Is this the transformation we’ve been waiting for? Or what have you… What data… How does the data line up with the pledges that these utilities are making?
John Romankiewicz: Well, we wanted to grade them on what their actions are for the next decade. And we… Because we see this as, the electric sector, as being the key, the pivotal key, to unlocking kind of economy-wide decarbonization. And also, it’s the sector that has the tools at its hands to make a transition faster and more affordably in this decade. So as much as utilities don’t like to move too fast, unfortunately the burden really rests on them, and everyone is looking to them to do something ambitious in this critical moment. What we found is that their pledges are often for… Some are for 2040, but most are this 2050 pledge, and that’s 30 years away. That’s a long time away. When you look at most utilities, how they do resource plans, they only go out 15 years. So we have no idea what their… When they’re planning to do these reductions. By looking at the resource plans that go out to 2035, it doesn’t seem like they are planning to push up too many of their coal retirements. And so we’re seeing that disconnect between a 15 year plan and a 30 year target, and we have missing information. So we wanted to maybe catch them off guard a little, but also, in earnest, grade them on the date that we believe is really grounded in science, and that’s 2030.
John Farrell: So you had a lot of this data about coal retirements, about gas, about utility pledges. You start to piece this together, I imagine, looking at what a utility has promised and these resource plans. I’m just getting out of a docket myself here in Minnesota, where we’ve been looking at that 15 year plan of a utility. When it talks… Those plans, they talk about what they expect energy consumption to look like. They talk about what more power generation the utility thinks they’re going to need. They talk about conservation energy efficiency. So as you dug into what these utilities were planning to do, to compare it to their pledges, but also against this important next decade timeline, what were utilities planning to do? What were they saying that they had in mind for the next 15 years?
John Romankiewicz: Well, there’s some important aggregate findings. We can dig into individual utilities later, but this group of 50 utilities that account for half of the remaining coal and gas generation in the country, they’re only committed to retiring a quarter of their coal by 2030 or sooner. So, that’s a big red flag for us. The companies that we studied, they are really heavy on coal. And we see a lot of merchant coal retiring, because they have the direct economic signal. But coal that’s owned by regulated utilities, that can earn a rate of recovery on these coal assets, they are very leery of bumping up their coal dates for a lot of reasons that they’re obfuscating with. And basically, the data said they’re only committed to retiring 25% of their coal. We also found that, in aggregate, they’re building tens of thousands of megawatts of new gas, and that’s a big stranded asset risk. There’s a lot of talk in the industry of gas becoming the new coal, just becoming a big waste of money on a false bridge. And then the third finding is that we found in aggregate the building around a 100,000 megawatts of new clean energy, these 50 companies. But if you look at some of the latest reports coming out, that number needs to be like 400,000, 500,000 megawatt, in the next decade. We built 35 gigawatts of wind and solar last year in 2020, it’s a record year for each industry. And we need to definitely be doing 35 a year, and soon moving to 50 or even 75 gigawatts a year, to really get to the levels of ambition that are going to get us on a climate safe pathway.
John Farrell: So I want to ask you a little bit more about this interesting dichotomy you highlighted here as you looked into… So you’re looking at coal retirements, you’re looking at what they’ve got planned for gas, or you’re looking at clean energy. I’m really struck by what you said about coal. So you’re saying by 2030, these utilities that are monopolies, so they’ve got captive customers, the folks who own power plants that are bidding into the markets are saying, “We can’t make this coal plant work anymore. It’s not cost-effective. We’re competing against cheap gas. We’re competing against cheap wind and cheap solar. It doesn’t make sense to keep running.” So I… I had sort of written down here I wanted… The fall… This is such important quote I feel like in the way that you think about any kind of policy, just follow the money, right? What financial incentives are driving these utilities to keep coal plants open that we know are not really economic to run. And I guess… And who’s going to pay the price of this? So if the merchant plant, this is a plant that’s independently owned, it’s out in the market, it’s competing, these are owned by these monopoly utilities. So first of all, what’s our financial incentives? Let’s talk a little bit more about that. And who ends up paying to keep these coal plants running if they decide to keep doing so, even though there’s cheaper stuff out there?
John Romankiewicz: Yeah, that’s a really complex question, but a great one. I think my first point in following the money is that utilities asked for this money. Many, many of them, not all of them, through dockets, like you mentioned through rate cases. And so at least I think 30 out of the 50 companies we graded really are going through a public utility commission. And that commission has to approve or deny certain investments to be part of the rate base. Which coal plants are economic? Which ones aren’t? How are they running them? And so commissions can be different. They can look quite different. Some are elected, some are appointed, but we do see some commissions that rubber stamp what the utilities want, and that’s a problem because often utilities are acting in the interests only of their investors and not their customers. And so it’s important for the commission, first of all, to keep that… To keep the balance a little more oriented to consumers. In our eyes, we see a lot of alignment between basically an environmental advocacy and consumer advocacy at this stage. And so that’s my first point in following the money.

Second is, these utilities are not… They’re continuing to run their coal assets and often they’re running them basically more than they should be. Way more than the market would allow. It’s called non-economic dispatch. There’s a lot of different terms about it. There’s been a lot of reports and investigations by FTP and MISO into these practices of non economic dispatch, but Sierra Club and other organizations have found billions of dollars are being wasted just in terms of… Let alone retirement, you’re just operating the coal units way too much. And customers are getting pinned with those costs at the end of the day.

And then following the money, I think it’s the partner of a rate case is in a resource plan, which can help you determine when you have a lower cost alternative to go with. And for that follow the money, I go to, what assumptions are you using in the resource plan? Are you using outdated wind and solar costs, or are you excluding battery storage from your modeling explicitly because you don’t think it can provide the services? And so in that case, we look at a utility, Northern Indiana Public Service Company, they get the highest score of any parent company in our report. And they used what’s called the all source request for proposal to get bids on what the latest wind, solar, and battery costs are, so that they could use that to inform their planning. So rather than going to some technical study off the shelf, they’ll say, “Hey, what are the actual providers in the market able to provide to us in terms of competitive costs?” And then when they plug those numbers into their model, they’ve got this coal to clean energy result with no new gas. And it’s really remarkable. And we think serves as a key best practice for utilities across the country.

John Farrell: I just find this so fascinating. We actually were just partners with Sierra Club on a filing in a resource plan in Minnesota. So the formal comments were due just in the second week of February. One of the things that we were pushing for, so in addition to really checking their numbers on the resource costs was to also encourage them to think carefully about distributed resources. So in other words, stuff they’re not going to own, but that might happen anyway. And in partnership with Vote Solar and with Sierra Club, we were able to show with our alternative model that we could do twice as much distributed solar as the utility had originally forecast in their resource plan. And that it would still cost less than what they were planning to do, which did include building a new gas plant. This was for Xcel Energy’s resource plan in Minnesota. So it’s no surprise to hear you say, there are better ways to do this. And I’m just so grateful for Sierra Club and others that get out there and intervene in these resource plans to make sure that commissioners at least have to see some of these alternatives, which otherwise the utility doesn’t necessarily tell them about.
John Romankiewicz: Yeah, and I’m really glad you brought up distributed solar and community solar, and are focusing your comments there. Because when I think about it, jumping from 100,000 megawatts of clean energy to 500,000 megawatts of clean energy, I think we need to build all types of solar. And there’s been a lot of studies, like by Vibrant Clean Energy, that are highlighting this is not a just utility solar or community solar, and it’s not a zero sum game. We need to be building both types of resources to build the most resilient system, and least cost. There’s certainly, just with the amount we need to build, we need to be exploring all avenues and also leaving opportunities open for customers to own some of this solar generation.
John Farrell: I feel like it’s so hard to explain to folks outside the utility sector, just how different this is from so many other ways that the American economy operates. That we have these utilities that manage our grid system with these… In this monopoly structure. And it varies from state to state. Essentially each state has its own utility market that’s a little bit different. But hard to imagine that you have to describe for folks, to explain to folks why, even though you have this electricity system out there, and even though everybody really has the right to put solar energy on their own rooftop, that there are all these rules and policies and procedures that can get in the way of folks doing that.

We’re going to take a short break. When we come back, we talk about the equity implications of the utilities actual plans and its intersection with another Sierra Club initiative, the over 150 cities that have made commitments to 100% renewable energy. You’re listening to a Local Energy Rules rebroadcast of a Building Local Power interview with John Romankiewicz., Senior analyst with Sierra Club’s Beyond Coal campaign, about their report: The Dirty Truth About Utility Climate Pledges.

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John Farrell: So I did want to ask you a quick question on… When we were talking about the costs, I had been thinking about, what’s the equity implications here? And you touched on one piece of it already, which was when we’re thinking about the cost of these coal plants, you have utilities that have shareholders, they have investors, and then they have customers. And supposedly our public utilities commissions, these public regulators are looking out for the customer and making sure that the utility has to come up with the best deal for us. But that right there is one of the big tensions, right? So when I talk about equity, we have shareholders and customers. Are there other facets of equity that you came across in this or that we should be thinking about in terms of how these plans can impact electricity customers?
John Romankiewicz: There’s a couple angles there that I’d like to take. The first that comes to my mind is, the reason we’re doing this report is to avoid catastrophic climate change, which there’s a lot of research that shows if we get to three or four degrees Celsius scenarios, most of those costs are going to fall on low income and marginalized communities, which already takes huge burdens. So we’re… At the end of the day, we’re trying to lower the costs of adaptation by amping up our ambition around what we can do in terms of getting to clean power quicker. And I think there’s a huge equity lens just in terms of we’re trying to move the electric sector as fast as possible, so we have as best of a chance of avoiding high temperature rise.

The second is that, although our score did not directly take into account efficiency, we did build out an efficiency leaderboard as part of our data dashboard. And so, most utilities are required to report how much energy efficiency savings are they finding and helping their customers implement, with a view towards, you need to be doing at least 2% or maybe 3% per year in terms of energy efficiency savings compared to that utility sales in order to A, help keep energy affordable, but also B, as a critical piece of the climate puzzle. And so we look at that in terms of residential customers and commercial customers, how much are the utilities helping those people and businesses achieve? And we found a pretty low average, only about 1% or maybe a little lower. Some utilities are doing 2%, but only a handful. And where we found good state policy backing that, I think Michigan, Minnesota are probably some of the better places for some of that energy efficiency focus due the interveners such as yourself. That is a good thing. But overall, the average is kind of abysmal, and that’s bad for equity is bad for affordability, et cetera.

I think the other equity lens is that a lot of these coal plants, many of them are in urban communities, and impact frontline communities with air pollution for… Not just now, but they have been doing that for decades. And it really provides an impetus to get this coal offline as soon as possible. There’s huge just health benefits that will really accrue to frontline communities if we get these coal units offline sooner.

John Farrell: It’s really striking how it’s on both ends for a lot of these policies, whether it’s, like you just explained it, the coal plants, it’s striking that you’re talking about the costs financially and environmentally have already fallen hardest on marginalized communities, on communities of color, and that continuing to operate them will continue to have that disproportionate impact, the health impacts and the cost impacts. Shutting them down is a win-win. And same things for energy efficiency. You not only get people who have lower bills and more comfortable homes, but then everybody pays less for energy because you have to use less of it. I keep thinking about that of course, with what’s happened in Texas, where they talk about the homes weren’t insulated and neither were the power plants. And so you have all of these cascading problems now from that. And it just makes me wonder, if homes in Texas had as much insulation as homes in Minnesota, certainly it wouldn’t be for the typical conditions, although insulation helps against heat as well as cold, how much of a difference that could have made? I don’t know. It’s really… It’s quite striking.
John Romankiewicz: It is. I think a lot of that… Sorry, I just was reading that so many new homes are being built in Texas and yeah, a lot of them have electric heat. I would wonder how much of them are resistance heating versus heat pump heating. Because, we know heat pumps are… Both rely on electricity, but heat pumps are so much more efficient, and especially would work very well in a climate like Texas, even for those colder spells.
John Farrell: So let’s pivot a little bit. I want to talk about… Sierra Club’s not just doing this amazing work around the Beyond Coal campaign and talking about the enormous costs if we let utilities ram through these resource plans that are not in the customer’s best interest for their environmentally speaking or economically speaking. But it’s also led a really impressive and successful campaign to get US cities to adopt ambitious, renewable energy pledges, generally a hundred percent renewable energy, usually by a much sooner date than these utilities are pledging, like 20 30 or earlier. And you’ve got over 150 cities representing a hundred million Americans that have signed on. We’ve been doing a whole interview series for our Local Energy Rules podcast, talking to the cities that have made these pledges and asking these key questions about, well, how can you get there? What are the strategies that you’re thinking of? And I… First of all, I just have to say, I’m always amazed at all of the things that they’re thinking of, at the kind of planning that they’re trying to do, the way that they’re communicating with the community, that reflects in a lot of ways the organizing work that Sierra Club members have done. So I’m curious, have you spoken with some of the city leaders about this report? And if not, how would you imagine they might react, hearing that the utilities that they’re relying on in many ways to help them get to these renewable energy goals are going to fall really far short?
John Romankiewicz: I think the first thing that comes into my mind is that in terms of these utility climate pledges, the first one out of the gate was in 2018, and that was Xcel. They were the first utility to make a big pledge, this net zero emissions pledge. 2050, of course, it’s far in the future. But they also had a 2030 pledge that seemed, seem pretty ambitious. And we know from city leaders that in Denver, Minneapolis and Saint Paul, those are all different cities that are in Xcel service territory, they passed resolutions and those resolutions put a lot of heat on Xcel to clean up their act faster. And those coalitions that have been built, continue to put pressure on Xcel, to not just have this goal, but to actually follow through on it. And, for example, you mentioned that resource plan in Minnesota happening right now, there’s new gas proposed in that plan. And our report highlights that that new gas is a false bridge, a stranded asset, and potentially a huge risk for customers. So utilities lose points if they’re building new gas. So when our report came out, I think our coalition there was ready to highlight the fact that they shouldn’t be building new gas. That’s not really compatible with what they claim to be doing long-term.

The other thing I thought of is, yeah, there’s a lot of different avenues for these city leaders to take with their utilities. I remember a workshop that was convened by the Ready For 100 campaign in conjunction with city leaders, and the National Renewable Energy Lab, this was almost three years ago at this stage. And there was four cities up on stage. There was a Georgetown, Texas, there was San Diego, there was Boulder and there was Salt Lake City. So it was, like you mentioned before, all these different energy markets and types of utilities, there was four different kinds of cities and four different kinds of utilities. So it was Georgetown, Texas, a municipal utility and deregulated ERCOT, which we’ve heard a lot about in the past week. Then you’ve got San Diego, which is San Diego Gas and Electric, but the utility was looking at forming a community choice aggregation. Boulder went through a huge municipalization campaign, but was in Xcel’s service territory. Still is, I don’t know if that campaign ended up winning, but it was a key tactic that city was using to try and get their goal. And then in Salt Lake City, Pacific Corp or Rocky Mountain Power, is the local utility there. And I remember the city mentioning that they were using the franchise agreement that they have, that the utility is allowed to use part of the streets and byways for utility poles as a key kind of leverage, because the renewal of that agreement was coming up, in order for the city to get more clean energy that it wanted to supply its community. So there’s different ways of tackling it, but I think city leaders are being pretty innovative in terms of what’s the right approach for them and what are the citizens calling for.

John Farrell: I was just thinking about too, I’ve worked with the city of Minneapolis here in Minnesota, which also used its franchise agreement as a point of leverage. And one of the things that they’re doing is that they have a full-time staff person now who pays attention to what’s passing all through the public utilities commission. What’s going in front of regulators regarding Xcel energy, the city’s electric utility and its gas utility as well. And they’re intervening in a lot of places as the city and saying, “Look, we’ve made these climate goals. We’ve established goals for local energy production. We’re trying to lower costs. We’re trying to address equity and make sure our low income customers, our minority residents, are having better access to clean energy.” And it’s really having a big impact in terms of changing the way that the commission thinks about, both who are the customers of the utility, traditionally speaking. That it’s not just the end users, but it also can be these municipalities that represent the folks that live there. Are there other things that you’ve seen? I think the examples you gave already are terrific. Anything else that you’ve seen about how cities can help hold the utilities accountable?
John Romankiewicz: I love that you brought up that the cities as interveners example, I was thinking of that one myself. I think the other best practice we’re hoping our report can be is that this is an accessible tool with an easy to understand metric and grade, that the data set’s already ready, the citizens can look up their utility and can find out what grade they’re getting, can look at the more complex data set in the dashboard and be able to say, “What are you doing here?” Most of the utilities in Florida, for example, where there’s been a lot of ready for 100 activity, a lot of those utilities are still getting D’s and F’s. And so citizens there could take our report card, and wave it in front of the utility as a more accessible way for any normal citizen to say, “What are you doing on coal and clean energy? Because this report card says you’re getting an F.” So we really that the Dirty Truth is a tool, and hopefully we’ll be keeping up to date each year. And it’s an accessible tool, A through F grading scale, that can really show what’s a good utility versus what’s a bad utility that’s really not moving on climate.
John Farrell: Whether or not Sierra Club is working on it or not, just knowing that you’ve been in this space, you’ve been watching folks work on these issues, are there any transformative approaches on the table that you see that can help cities or communities or are folks advocating around climate and clean energy, that can either help bring utilities along or find some other way? I just… I keep thinking about Florida. It’s so funny, you know, it’s the sunshine state, right? And I feel like those utilities have been getting D’s and F’s for years on clean energy. And just wondering, are there things that you’ve seen that can really help change this game, and meet, as you said, we have this ambitious and urgent timeline by 2030 to really see transformation in the electricity sector.
John Romankiewicz: There’s a lot of tools in the toolbox. Another way of looking at this would be to say, I know who my utility is. I’m going push on them. But also, who are my investments in? And so we’ve been thinking a lot about pension funds that are invested in these utilities. If you look at big pension funds, or big investment funds, like BlackRock, they own eight to 10% of all the investor owned utilities in our report on average. Vanguard, BlackRock, these big firms. So if they own that much of a company, they have a lot of influence in voting on what the shareholders should do and push for themselves, and where that… What direction that company can go. Concurrently, we know BlackRock’s such a big player, so we want to be hammering on BlackRock. And we also want to be hammering on any state pension funds that might be invested in any particular, one of these utilities, even if it’s just a couple of percent, that’s a lot of voting power to bring forward shareholder resolutions, clean up their acts. We’ve seen that some of those shareholder resolutions, work with key utilities. And the people that work at the utility and investor relations, they’re very reactive to that. They don’t like to be in the press as a utility. That’s everyone’s saying, sell this stock because, nope, it’s not good. It’s not looking good financially for them because of their bad climate and clean energy plans. They don’t want to be on that sell side. They want to be on the buy side. And so investor pressure, I think is a pretty innovative approach, a little more wonky, but I think also a good avenue for cities to explore.
John Farrell: I got just so many thoughts that bubble to the fore for me there. One is cities themselves often have pension plans for employees. So there’s… You’ve got 150 cities that have these pledges, how many of them are already using their pension funds as part of their clean energy advocacy portfolio? A second one is I feel like I read somewhere, and I don’t know if this was a change in a particular utilities approach to investor relations or if it was legislation being considered. But it was something about essentially saying, “How do we reduce the power of these institutional investors to pressure us to do better things?” And I can’t remember if it was a utility company saying, we’re going to dilute their voting shares or something, or not allow them to carry resolutions. I guess, rather than dwell too much on the way that utilities are going to push back, I’m curious, are there changes to the market rules for utilities, or to advocacy rules? Are there policy ideas at the state or federal or local level that you see as helpful in creating the pressure on these utility companies, or reducing their influence, or lifting up other actors that can help us get to the same goals, but rely less on winning over the utilities or pushing them to do something different?
John Romankiewicz: I really think some sort of state or federal standard, if it could be swung, around the out the all source requests for proposal, that allows clean energy, and demand side technology, to compete on a level playing field with coal and gas. And I think that’s just a really key way that should be bipartisan. Let’s let the market speak, and let businesses speak and provide their costs and the performances of their various technologies, and compare them on a level playing field. Because I feel like that’s something we’ve just seen as pretty transformative practice for utilities that are getting A’s and B’s versus ones that are getting D’s and F’s. They wouldn’t touch on all source request proposal with a 10 foot pole. And also, yeah, I think there’s other characteristics as F utilities that we didn’t highlight as much in the report, but bubble up from time to time or quite frequently. And it’s things around democracy and participation. A lot of F utilities don’t have compensation for consumer advocates to participate in commission proceedings. And so you don’t have those voices at the table. Sometimes they also just redact all sorts of information from their public documents. And so then the question is, what’s the point of having public participation in your resource plan if you’re just going to redact all the important information about your clean energy plans and your coal assets?

So we see that a lot. A lot of these F utilities are just taking the black highlighter pen and redacting out big… Most important parts of the documents, they’re just hiding things. And it’s very sad to see. So better practices a state could enforce around public disclosure, and public participation, in these different types of venues, I think are key. And then all source request for proposals requirement, and allowing those technologies to compete on a level playing field is also another key policy we should try and push at state levels.

John Farrell: Well, John, I just want to thank you so much for taking the time to talk about this report. So the Dirty Truth About Utility Climate Pledges, we’ll have a link on our show page, make sure folks can find the report. Are there other resources of Sierra Club’s or otherwise that you think are important for folks to learn more about this important issue of utilities making pledges, but then not necessarily living up to them?
John Romankiewicz: We’re certainly going to be keeping our report card up to date. Beyondcoal.org is the easiest website to find our different resources, our coal map about where the remaining coal plants are. And it’s also… Our report is linked there on that webpage as well. So that’s probably our best go-to resource where our members and supporters and our growing network can find the best information.
John Farrell: Well, thanks again, John, for taking the time. Really appreciate your overview of the report and the great research. Looking forward to sharing it with as many people as we can.
John Romankiewicz: All right, thanks so much for having me.
John Farrell: Thank you so much for listening to this episode of Local Energy Rules, with John Romankiewicz,  Senior analyst with Sierra Club’s Beyond Coal campaign, discussing their new report uncovering The Dirty Truth About Utility Climate Pledges. On the show page, look for links to the report and Sierra Club’s website where you can look up the grade of your electric utility. On ILSR’s website, you can also find our interactive Community Power Map showing all of the cities with 100% renewable energy pledges as well as the interactive Community Power Toolkit, with stories of how cities have used their leverage to get close to their energy and climate goals. Local Energy Rules is produced by myself and Maria McCoy, with editing provided by audio engineer Drew Birschbach. Tune back into Local Energy Rules every two weeks to hear more powerful stories of communities taking on concentrated power to transform the energy system. Until next time, keep your energy local, and thanks for listening.


With Great Power Comes Great Responsibility

U.S. electric utilities were granted monopoly control because building competing sets of delivery wires in one area would be costly, wasteful, and would have delayed electrification. This market dominance, because it was granted with the condition of state oversight, then comes with a responsibility to customers, and as a result, a responsibility to the climate.

As much as utilities don’t like to move too fast, unfortunately the burden really rests on them, and everyone is looking to them to do something ambitious in this critical moment.

Utilities are meeting their responsibility with ‘net zero’ and ‘carbon-free’ pledges, but are they holding to their promises?

Romankiewicz and the Sierra Club’s Beyond Coal campaign track utility clean energy commitments and whether they correspond with utility resource planning (in most cases, they don’t). To present this information to the public, the Sierra Club has released The Dirty Truth About Utility Climate Pledges.

Grading Utilities on their Climate Action

The Sierra Club describes The Dirty Truth report as “a comprehensive assessment of whether utilities are committing to the actions needed to avert a cataclysmic climate crisis.” The report grades utility plans for the next decade on a scale from A to F.

Many utilities have made clean energy pledges with a target date of 2050 — nearly 30 years away, says Romankiewicz. Meanwhile, their energy resource plans only account for the next 15 years. Romankiewicz is interested in the steps that utilities are taking now, rather than lofty goals with no implementation plan.

The 79 companies analyzed in the report “account for 68 percent of the remaining coal generation in the United States.” Together, they only plan to retire 25 percent of that coal by 2030. The utilities also plan to build 36 gigawatts of new gas this decade, but only 100 gigawatts of new clean energy, says Romankiewicz. He predicts that to reach carbon neutrality and avoid climate disaster, the U.S. should install 400 to 500 gigawatts of renewable generation capacity by 2030.

The report also evaluates utilities on their energy efficiency investments – which are critical for reducing energy burden and increasing equity. Romankiewicz believes that two percent of retail sales should be the minimum for utility energy efficiency investment. Altogether, the utility companies studied only invest 0.7 percent of their retail sales in energy efficiency improvements.

We’re Way Beyond Coal

Coal-fired power isn’t cost effective. This is not news; no one has built a coal plant in the United States since 2013. Furthermore, regulated utilities are wasting billions of dollars by ‘self-scheduling’ when to employ existing coal plants. Given the security of a captive customer base, monopoly utilities can carelessly dispatch coal “more often than is dictated by market conditions.”

To prevent further losses, Romankiewicz asks utility regulators to step up to the plate for coal plant retirement — protecting the interests of consumers, rather than utility shareholders.

Billions of dollars are being wasted just in terms of… you’re just operating the coal units way too much. And customers are getting pinned with those costs at the end of the day.

Coal plants have disproportionately burdened low-income communities and communities of color with their toxic emissions. Retiring coal plants now would prevent additional damage to our climate and ease additional burden on these same communities, which are especially vulnerable to the impacts of climate change.

Doing the Same Thing and Expecting a Different Result

Often described as a ‘bridge fuel,’ gas-fired electricity generation faces the same trajectory as coal. It may become uneconomic to run existing gas plants as early as 2030. Besides, gas may have a lower carbon footprint than coal, but it is far from clean. Given the risks of stranded investments and continued greenhouse gas emission, gas-fired electricity is energy we can’t afford.

Romankiewicz resists the idea of gas as a bridge for retiring coal plants. He believes that utility resource planning, when done properly, will find that renewable energy is the real bridge to the future.


Don’t count out distributed solar within utility resource planning! Find out why utilities in Minnesota and other states need to plan for more competition in our Utility Distributed Energy Forecasts report.


Cities Can’t Reach their Goals Without Utilities

Another campaign from the Sierra Club is Ready for 100: a campaign to support communities as they commit to 100 percent clean, renewable energy. So far, eight states and more than 170 cities have made the pledge. Though the committed cities range in size and geographic location, there is a common factor that determines when they might reach their goal: utility cooperation.


Find interviews with leaders from ‘Ready for 100’ cities in our Voices of 100 series of the Local Energy Rules podcast.


Cities that own their utility have had the most success transitioning to 100 percent renewable energy. For communities served by a regulated utility, Romankiewicz lists several ways to leverage more control: municipalize (or threaten to), form a community choice aggregation (in the nine states that allow it), negotiate using a franchise agreement, form a clean energy partnership, or intervene at the public utilities commission.

Individuals can pressure their utility using the Sierra Club’s Dirty Truth report card. Romankiewicz also suggests pressuring investment companies, such as Black Rock and Vanguard, that own large shares in utility companies.

Citizens there could take our report card, and wave it in front of the utility as a more accessible way for any normal citizen to say, ‘What are you doing on coal and clean energy? Because this report card says you’re getting an F.’

Outside of utility pressure, Romankiewicz hopes that a state or federal requirement for all source “requests for proposal” in energy sourcing would help level the playing field for renewable resources. He also endorses compensation for consumer advocates who engage in regulatory intervention.


Episode Notes

See these resources for more behind the story:

For concrete examples of how cities can take action toward gaining more control over their clean energy future, explore ILSR’s Community Power Toolkit.

Explore local and state policies and programs that help advance clean energy goals across the country, using ILSR’s interactive Community Power Map.


This is episode 129 of Local Energy Rules, an ILSR podcast with Energy Democracy Director John Farrell, which shares powerful stories of successful local renewable energy and exposes the policy and practical barriers to its expansion.

Local Energy Rules is Produced by ILSR’s John Farrell and Maria McCoy. Audio engineering for this episode by Drew Birschbach.

This article originally posted at ilsr.org. For timely updates, follow John Farrell on Twitter, our energy work on Facebook, or sign up to get the Energy Democracy weekly update

Featured Photo Credit: Robert Daly via iStock

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Maria McCoy

Maria McCoy is a research associate with the Energy Democracy Initiative. In this role, she contributes to blog posts, podcasts, video content, and interactive features.