Background Report Prepared by Arizona State University NINETY-NINTH ARIZONA TOWN HALL
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Arizona’s Energy Future 99th Arizona Town Hall November 6 - 9, 2011 Background Report Prepared by Arizona State University NINETY-NINTH ARIZONA TOWN HALL PREMIER PARTNER CONTRIBUTING PARTNER COLLABORATING PARTNERS SUPPORTING PARTNERS CIVIC PARTNERS CORE Construction Kennedy Partners Ryley, Carlock & Applewhite Sundt Construction One East Camelback, Suite 530, Phoenix, Arizona 85012 Phone: 602.252.9600 Fax: 602.252.6189 Website: www.aztownhall.org Email: [email protected] ARIZONA’S ENERGY FUTURE September 2011 We thank you for making the commitment to participate in the 99th Arizona Town Hall to be held at the Grand Canyon on November 6-9, 2011. You will be discussing and developing consensus with fellow Arizonans on the future of energy in Arizona. An essential element to the success of these consensus-driven discussions is this background report that is provided to all participants before the Town Hall convenes. As they have so often done for past Arizona Town Halls, Arizona State University has prepared a detailed and informative report that will provide a unique and unparalleled resource for your Town Hall panel sessions. Special thanks go to editors Clark Miller and Sharlissa Moore of the Consortium for Science, Policy, and Outcomes at ASU for spearheading this effort and marshaling many talented professionals to write individual chapters. For sharing their wealth of knowledge and professional talents, our thanks go to the many authors who contributed to the report. Our deepest gratitude also goes to University Vice President and Dean of the College of Public Programs for ASU, Debra Friedman, and Director of the School of Public Affairs for ASU, Jonathan Koppell, who made great efforts to ensure that ASU could provide this type of resource to Arizona. The 99th Town Hall could not occur without the financial assistance of our generous sponsors, which (at the time of this printing) include Premier Partner APS; Contributing Partner SRP; Collaborating Partners Bank of America; Freeport, McMoRan Copper & Gold Foundation; Southwest Gas and Blue Cross Blue Shield of Arizona; Supporting Partners NRG Energy, Inc. and Carondelet Health Network; and Civic Partners CORE Construction, Kennedy Partners, Ryley, Carlock & Applewhite, and Sundt Construction. When the 99th Town Hall ends, ASU’s background report will be combined with the recommendations from the Town Hall into a final report. This final report will be available to the public on the Town Hall’s website and will be widely distributed and promoted throughout Arizona. The Town Hall’s report of recommendations and background report will be used as a resource, a discussion guide and an action plan for Arizona’s energy future. Sincerely, Ron Walker Board Chair, Arizona Town Hall NINETY-NINTH ARIZONA TOWN HALL Ninety-ninth Arizona Town Hall November 6-9, 2011 Arizona’s Energy Future Background Report Prepared by Arizona State University Editors Clark Miller, Associate Director Consortium for Science, Policy and Outcomes Sharlissa Moore Consortium for Science, Policy and Outcomes Authors Committee Members Scott Rhodes Nazli Aragon Warren Prostrollo, Chair Fred Rosenfeld Chris Baker Jay Kittle, Vice Chair Martin Shultz George Basile Arlan Colton David Snider William Brandt Kim DeMarchi John Sullivan Harvey Bryan Patrick Dinkel Allison Suriano Matthew Croucher Darryl Dobras Penny Allee Taylor Gary Dirks Debra Friedman Ron Walker Anthony Evans Susan Goldsmith Daran Wastchak Stephen Goodnick Steve Gunderson Devan Wastchak Joseph Herkert James Holway Larry Woods Tim James Dave Hutchens Graphic Design Patricia Mariella Tara Jackson Suzanne Landtiser, Kris Mayes Anna Jolivet Fine Line Studio Clark Miller Jonathan Koppell Sharlissa Moore Warren Kotzmann Front and Back Robert Pahle Rita Maguire Cover Design Martin Pasqueletti Robert Matia Hoi Cheung (Patrick) Benjamin Ruddell Elizabeth McNamee Copy Editor Clark Miller Sunanda Vittal Brian O’Donnell Elliott Pollack ARIZONA’S ENERGY FUTURE Table of Contents Author Biographies 6 Acronyms 12 Chapter 1: Introduction 13 Clark A. Miller and Sharlissa Moore SECTION I: ENERGY IN ARIZONA TODAY 28 A. BASIC ENERGY FACTS Chapter 2: Energy Sources in Arizona 30 Robert Pahle Chapter 3: Energy Consumption and Production in Arizona: Status and Trends 37 Stephen Goodnick Chapter 4: Energy and the Economy 51 Matthew Croucher, Anthony Evans, Tim James, and Nazli Uludere Aragon Chapter 5: Energy Efficiency — The Arizona Challenge 72 Harvey Bryan B. ENERGY IN CONTEXT Chapter 6: Arizona’s Energy/Water Nexus 79 Benjamin L. Ruddell and Martin J. Pasqualetti Chapter 7: Tribes and Energy within Arizona 91 Pat Mariella, Teresita Clashin, and Shawn Williams Chapter 8: Benefits, Risks, and Costs of Electricity Generation 100 Joseph Herkert Chapter 9: Arizona’s Energy Security 109 Martin Pasqualetti SECTION II: ENERGY IN ARIZONA’S FUTURE 118 Chapter 10: Electricity in Arizona: Current Status and Future Trends 120 Kris Mayes, George Basile, and Christopher Baker Chapter 11: Transportation Fuels from Solar Energy 134 Gary Dirks Chapter 12: A Green Silicon Valley in Arizona 146 Bill Brandt Energy Units of Measurement 101 157 Glossary of Organizations and Terms 159 NINETY-NINTH ARIZONA TOWN HALL Author Biographies Nazli Uludere Aragon Nazli Uludere Aragon is a freelance economic researcher specializing in the economics and policy issues of energy, infrastructure, and natural resources industries. Her research interests include the political economy of climate change, emissions trading, allowance and credit markets, and the economics of renewables, biofuels and non-traditional fossil fuels, and advanced coal and nuclear generation technologies. Nazli has been serving in an advisory capacity to private clients based in the U.S. and abroad. In that capacity, she has taken part in a wide array of projects involving asset valuation, price forecasting, ratemaking, performance and productivity measurement, and other issues relating to competitiveness in the electric power industry such as transmission open access, retail choice and wholesale market power. She has also completed research assignments for the academia that focused on the economic and policy evaluation of traditional as well as renewable and unconventional energy sources, energy end-use patterns, energy efficiency and global climate change. Christopher Baker Christopher Baker is currently a resident of Chandler, Arizona and is a graduate of Chandler High School. Mr. Baker has a Bachelor’s Degree in Business Management from the W.P Carey School of Business at Arizona State University and is currently a third year law student at the University’s Sandra Day O’Connor College of Law, where he is focusing on environmental and energy law. He plans to practice law in the areas of business development, natural resources, water, and land use. Mr. Baker has a diverse professional background, including an accomplished sales career in the fields of logistics, hospitality, and construction. George Basile Dr. George Basile is professor in the School of Sustainability and a Senior Sustainability Scientist at the Global Institute of Sustainability at Arizona State University. He is an internationally recognized creative thinker in the field of sustainability. He has served as the executive director of the Decision Theater at ASU, exploring decision making, resource intelligence, and sustainability; as Chief Scientist and EVP of the Natural Step, an award-winning international nongovernmental organization (NGO) focused on strategic planning for sustainability; and led his own consultancy. He has worked extensively in the area of “resource intelligence” (such as energy, water and product development), led strategic planning and sustainability efforts with numerous Fortune 500 companies and served on the boards of commercial start-ups and NGOs. He has published and presented widely in the field of sustainability, including more than 30 articles and reports, and he is coauthor of the textbook Strategic Leadership toward Sustainability (Blekinge Institute of Technology: Psilanders Grafiska, 2005 and forthcoming new addition, Studentlitteratur Press, 2011). His latest work includes the forthcoming three-volume set “the Business of Sustainability” (Praeger Press, Fall, 2011). 6 AUTHOR BIOGRAPHIES ARIZONA’S ENERGY FUTURE William Brandt Bill Brandt is the Director of Strategic Integration at Light Works at Arizona State University. He is a senior executive leading complex business development and M&A transactions in Asia and Europe with 20 years of experience. He has directed, executed and delivered private market refining, chemical and oil and gas transactions typically ranging from $50m to $1bn and public market transactions ranging from $500m to $30bn. He was recognized within BP as a Distinguished Advisor for expertise in business development, M&A, joint ventures and financial valuations. He has deep experience in China including transactions with CNOOC, Sinopec and PetroChina. He is an outstanding team developer and creator of the learning and development program for the next generation of BP M&A executives. He is also an internal consultant and university lecturer on negotiation in different cultures. Harvey Bryan Dr. Harvey Bryan is a specialist in building technology who has written over one hundred papers and articles, many of which focus on the interface between technology and the design of ecologically responsible environments. He has previously taught at MIT and Harvard and is currently a full professor at Arizona State University,