Financing the Decarbonized Electric Future Our biggest challenge yet? NARUC Summer 2010 Committee Meetings Sacramento, California Remarks of Ron Binz,

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Presentation transcript:

Financing the Decarbonized Electric Future Our biggest challenge yet? NARUC Summer 2010 Committee Meetings Sacramento, California Remarks of Ron Binz, Chairman Colorado Public Utilities Commission July 17, 2010

1 Outline of this presentation CapEx for US Electric Supply –With and without carbon regulation How big is the challenge? What are the regional differences? What are our regulatory and policy tools? Implications for design of carbon legislation

2 Caveat I am one of three equal commissioners My positions are my own I am confused by many things and have not made up my mind on much at all I dont even agree with some of the things I say Good advice: dont believe everything you think

What Would EPRI Do?

7

Efficiency Biomass Wind Hydro Nuclear Gas Retrofit CCS New CCS Non-CCS Coal

Efficiency Biomass Wind Hydro Nuclear Gas Retrofit CCS New CCS Non-CCS Coal

US Investor-owned utilities total assets: $1.1 Trillion Brattle Group estimates $2.0 trillion CapEx needed in under climate legislaton assumption; $1.5 trillion otherwise

Brattle Group CapEx Estimate

EIA Regional Groupings

Brattle Group CapEx Estimate

International Energy Agency View 17 $1.1 T$2.7 T $3.8 Trillion

Implications for Climate Legislation Urgency: important to start soon –Electric sector ready to move now –Encourage early action Cost containment: climate adds to cost pressure –Allocation of allowances –Curbs on speculation Innovation needed: Manhattan Project scale –Substantial R&D funding essential Keep options open: EPRI may be right –CCS and nuclear must be kept viable 18

19 Available at Electric power fIrst Carbon cap $4/ton CO 2 research fee Allowance allocation Dampened trading Early action provision

Implications for State Regulation

23 Thanks for the invitation. I look forward to your questions.