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National Biodiesel Board National Biodiesel Board 1331 Pennsylvania Avenue 605 Clark Avenue Washington, DC 20004 Jefferson City, MO 65110 B1O@0@@@!1® (202) 737-8801 phone (800) 841-5849 phone America's Advanced Biofuel August 28, 2020 Comments submitted to the New York State Department of Public Service (DPS) and New York State Energy Research and Development Authority (NYSERDA) Relating to Case 15 – E – 0302 White Paper on Clean Energy Standard Procurements to Implement New York’s Climate Leadership and Community Protection Act The National Biodiesel Board (NBB) represents the biodiesel, renewable diesel, and renewable jet fuel industries. NBB members play an important role in displacing petroleum, improving public health, and protecting the environment. Our members vary in size from large companies to small, family-owned businesses. Many NBB members are members of environmental organizations and are supportive of state and local initiatives to achieve a sustainable energy future. Many of our members are located, or do business, in New York State. New York State has recently passed and implemented a B5 standard for Bioheat in the downstate region. New York City has also implemented a comprehensive Bioheat standard that will progressively lead to a B20 level citywide by the year 2034. The National Biodiesel Board is also participating in further legislative discussions with the legislature relating to the implementation of even higher blend levels statewide by the year 2030. We would offer that biodiesel can be a significant contributor to the accomplishment of climate protection goals established by the Climate Leadership and Community Protection Act. The heating oil industry in New York is proactively working toward further reducing the carbon intensity of its products. The heating oil industry’s goal, as set forth in its “Providence Resolution,”1 adopted in 2019, is to adopt B50 by 2030. 1 https://nefi.com/news-publications/recent-news/heating-oil-industry-commits-net-zero- emissions-2050/ NBB commends DPS and NYSERDA for allowing stakeholders to participate in its consideration of the Clean Energy Standard and other low carbon programs. We believe that stakeholder involvement will enable New York to successfully chart a path forward to a sustainable energy future. NBB is supportive of the CLCPA initiative and wishes to offer comments and suggestions relating to the white paper that was recently published and policies that could be implemented under the new program. As an introduction to our comments and suggestions, we would offer the following principles for your consideration: 1. Biodiesel is commercially available now in significant quantities. 2. Given the urgency of climate change mitigation, carbon savings achieved today are far more valuable than what might be accomplished 20 or 30 years from now. Biodiesel is a drop-in fuel that can be implemented with only limited or no equipment modifications. 3. An enormous scope of work would be required to transition residential and commercial buildings to heat pumps for space heating and domestic hot water purposes AND to provide the renewable electricity that would be necessary. 4. We fully support the statement that we need to require rising renewable content in all energy resources used for heating. 5. Taxpayers in the renewable fuel and agricultural industries should be allowed to participate in low carbon programs in New York State. Summary Comments 1) Eligibility of biomass under the Climate Leadership and Community Protection Act. The recently enacted Climate Leadership and Community Protection Act of 2019 did not include biomass and biogas as eligible technologies under the definition of renewable energy systems. We believe that the exclusion of biomass and biogas is a major shortcoming of the new law and we will be seeking corrective legislation so that taxpayers employed in the renewable fuel and agricultural industries can fully participate in the achievement of our sustainable energy goals. We would ask for your consideration as we seek legislative amendments to make climate protection programs open to all New Yorkers. 2) Need for realistic forecasting of NYISO grid load impact from building electrification. The white paper forecast of New York grid loads needs to use more realistic assumptions of expected impacts from building electrification. Estimated reductions in grid loads due to energy efficiency are overly optimistic. Likewise, projected increases in grid loads due to heat pumps fall far short of what we would consider as reasonable figures. The white paper concludes that overall New York electricity consumption will remain constant in the range of approximately 150 million MWh/yr from present through the year 2050. We would offer that such projection artificially and substantially reduces the calculated level of offshore wind power installations that would be necessary to serve NYISO grid loads during the winter. We would encourage DPS and NYSERDA to instead use data published in the NYISO 2020 Load and Capacity Data (Gold Book) published just a few months ago. The NYISO Gold Book data are in alignment with NBB estimates and show the peak grid load impact of building electrification in New York as amounting to approximately 40,000 MW or higher by the year 2050. The Gold Book forecast translates into the need for approximately 90,000 MW of nameplate wind power capacity just for heat pumps, using a 45% winter capacity factor. The Gold Book CLCPA forecasting scenario also indicates a total New York peak winter grid load of about 75,000 MW, approximately triple the current peak winter load. This points to the challenge that New York State goals for offshore wind, including the benchmark of 9,000 MW of nameplate wind capacity by 2035, would fill only a small fraction of the power generation gap that would result from the widespread use of heat pumps for space heating and domestic hot water in the residential and commercial sectors. If NYSERDA focuses exclusively on heat pumps, rather than including biomass-based energy resources, the concept of 100% renewable electricity by 2040 will remain unfulfilled and just a distant vision. The question of winter grid load impact from building electrification has been the subject of increasing attention recently. The recent NYSERDA report entitled, “Pathways to Deep Decarbonization in New York State”, published in late June, provides a capable overview of the balanced, multi-technology approach that would be necessary for achieving our climate protection goals. The NYSERDA report recognizes that the direct use of biomass-derived fuels would enable the building sector to become carbon neutral while reducing the challenge of NYISO grid operations during periods of high-carbon intensity. So again, we would ask for your consideration as we seek to address the energy resource shortcomings of the CLCPA through legislation. 3) Funding for renewable heating technologies NBB is supportive of incentive programs for efficiency and renewable energy measures that can be implemented within the building sector. Energy efficiency should be the foundation for all other types of energy programs in New York State. While this comment goes beyond the scope of the white paper, we would suggest that carbon program funds currently directed to heat pump installations also be allowed to support other heating system technologies that can efficiently utilize renewable fuels. NBB would suggest the use of financial incentives to encourage the purchase of B100-ready burners, fuel storage systems, and ancillary hardware by residential and commercial Bioheat customers. We would also suggest that incentives be provided for infrastructure improvements that would foster the accelerated distribution and market availability of renewable fuels. Such improvements could include new biodiesel bulk storage and blending equipment that will be necessary for ramping up biodiesel supply in New York State. 4) Biodiesel for Power Generation. Laboratory and field testing have shown that biodiesel can also help to reduce NOx emissions in steam-cycle power generation. The natural, 10-12 percent oxygen content of the biodiesel molecular structure can reduce fuel-rich pockets and peak temperatures, which are the primary culprits for NOx formation within the flame. A significant percentage of existing, gas-fired, combined-cycle power plants in the Northeast United States have the ability to also operate with liquid fuels including biodiesel. Major manufacturers of gas turbine systems, such as GE Power Systems, offer full technical and warranty support for the use of B100 and biodiesel blends in their equipment. The use of biodiesel in combined-cycle power generation offers a huge opportunity for replacing natural gas and thereby reducing greenhouse gas emissions in the power sector. The use of biodiesel as a low carbon fuel in combustion turbine power systems could also enable the continued operation of such systems in a carbon-constrained economy. This would resolve the potential problem of stranded capital assets if such power systems were to otherwise be forced into retirement due to curtailed use of fossil fuels such as natural gas. The ability of existing natural gas-fired power plants to “stay alive”, through conversion to the use of biodiesel, in a carbon-constrained economy, would provide enormous practical and economic benefits to the NYISO Forward Capacity Market (FCM) auction process by offsetting much of the growth in capacity that would otherwise be necessary