University of Vermont ScholarWorks @ UVM Graduate College Dissertations and Theses Dissertations and Theses 2016 Renewable Energy Transition: Dynamic Systems Analysis, Policy Scenarios, and Trade-offs for the State of Vermont Christopher Ernest Clement University of Vermont Follow this and additional works at: https://scholarworks.uvm.edu/graddis Part of the Natural Resource Economics Commons, and the Power and Energy Commons Recommended Citation Clement, Christopher Ernest, "Renewable Energy Transition: Dynamic Systems Analysis, Policy Scenarios, and Trade-offs for the State of Vermont" (2016). Graduate College Dissertations and Theses. 601. https://scholarworks.uvm.edu/graddis/601 This Dissertation is brought to you for free and open access by the Dissertations and Theses at ScholarWorks @ UVM. It has been accepted for inclusion in Graduate College Dissertations and Theses by an authorized administrator of ScholarWorks @ UVM. For more information, please contact [email protected]. RENEWABLE ENERGY TRANSITION: DYNAMIC SYSTEMS ANALYSIS, POLICY SCENARIOS, AND TRADE-OFFS FOR THE STATE OF VERMONT A Dissertation Presented by Christopher Ernest Clement to The Faculty of the Graduate College of The University of Vermont In Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy Specializing in Natural Resources October, 2016 Defense Date: April 13, 2016 Dissertation Examination Committee: Jon D. Erickson, Ph.D., RSENR, Advisor Paul Hines, Ph.D., CEMS, Chair Asim Zia, Ph.D., CDAE Brian Voigt, Ph.D., RSENR Cynthia J. Forehand, Ph.D., Dean of the Graduate College COPYRIGHT © Copyright by Christopher Ernest Clement October, 2016 ii ABSTRACT There is broad consensus that a transition to renewable energy and a low-carbon economy is crucial for future development and prosperity, yet there are differing perspectives on how such a transition should be achieved. The overarching goal of this dissertation, which is comprised of three interrelated studies, is to analyze and compare energy futures scenarios to achieve a renewable energy transition and low-carbon economy in the State of Vermont. In the first study, an analysis is presented of the role of energy pricing regimes and economic policy in the context of pursuing a renewable energy transition in the State of Vermont. Through the development and application of a system dynamics model, results address the limits to technological substitution due to path dependence on nonrenewable energy. The role of complementary economic policy is also highlighted to shift from a goal of quantitative growth to qualitative development in order to decouple economic welfare from energy consumption. In the second study, an analysis is presented of the impact of modeled energy transition scenarios to address energy development and land use trade-offs. Simulations with a spatio-temporal land cover change model find that Vermont could achieve a complete transition to renewable electricity using in-state resources through developing between 11,000 and 100,000 hectares of land for solar and wind, or up to four percent of state land area, including some environmentally sensitive land. This approach highlights the need for integration of energy policy and land use planning in order to mitigate potential energy-land use conflict. In the final study, trade-offs between energy, economic, environmental, and social dimensions of Vermont’s renewable energy transition are explored through the use of a multi-criteria decision analysis. Energy transition alternatives were designed to reveal trade-offs at the intersection of economic growth and carbon price policy. While there were no optimal pathways to achieving Vermont’s energy transition, some energy transition alternatives achieve a more socially desirable balance of benefits and consequences. Navigating the trade-offs inherent in the ongoing energy transition will require an adaptive approach to policymaking that incorporates iterative planning, experimentation, and learning. ACKNOWLEDGEMENTS This dissertation was only made possible by the loving, enthusiastic, and perseverant support I received from my family, friends, and, most of all, my wife, Danielle. I am also deeply grateful for the sage advice and generous aid lent to me by many smart, creative, fun, and hardworking colleagues. I would like to thank the valuable contributions of my advisor, Jon Erickson, and committee members, Asim Zia, Paul Hines, and Brian Voigt. I particularly want to call out Jon for taking a chance on this feisty aspiring Ph.D. student at the beginning of this adventure. I have been generously supported by a fellowship from the National Science Foundation Integrative Graduate Education and Research Traineeship (IGERT) program on Smart Grid: Technology, Human Behavior, and Policy. This fellowship enabled me to spend a summer working with a number of brilliant colleagues at Sandia National Laboratories, where I started to hatch my plans for my research. I have also benefited immeasurably from the vibrant community of kindred spirits at the University of Vermont Gund Institute for Ecological Economics, and my fellow comrades-in-arms in my IGERT fellowship program. I have had the fortune to also receive funding and assistance from the John Merck Fund through a grant coordinated by the Vermont Public Interest Research Group, as well as the Energy Action Network, Vermont Public Service Department, and many active participants in Vermont’s renewable energy transition. I want to dedicate my dissertation to my father, Ernest Clement, who many years ago nearly completed a Ph.D. of his own, and who maintained an unwavering faith in my ability to do so throughout the many ebbs and flows of my doctoral experience. ii TABLE OF CONTENTS ACKNOWLEDGEMENTS ................................................................................................ ii LIST OF TABLES ............................................................................................................ vii LIST OF FIGURES ........................................................................................................... ix CHAPTER 1: INTRODUCTION TO ENERGY TRANSITIONS .................................... 1 1.1 A Historical Perspective on Energy Transitions ........................................... 2 1.2 Energy and the Economy ............................................................................ 10 1.3 Energy and the Environment ...................................................................... 14 1.4 Energy Transition Policy ............................................................................ 16 1.5 Setting the Stage for Vermont’s Energy Transition .................................... 25 1.6 The Challenge of a Renewable Energy Transition ..................................... 33 1.7 References ................................................................................................... 36 CHAPTER 2: MODELING THE RENEWABLE ENERGY TRANSITION ................. 47 2.1 Introduction ................................................................................................. 48 2.2 Energy Transition Modeling ....................................................................... 50 2.2.1 Overview of Energy Transition Models ............................................... 50 2.2.2 The System Dynamics Approach to Energy System Modeling ............. 52 2.2.3 The Energy Futures Simulation ........................................................... 53 2.2.4 Strengths and Advantages of the EFS Modeling Approach ................. 57 2.3 Methods: EFS Modeling, Calibration, and Scenario Analysis ................... 61 2.3.1 Relationship between Economic Productivity and Energy .................. 62 2.3.2 Baseline Projections ............................................................................ 69 2.3.3 EFS Model Calibration ........................................................................ 72 iii 2.3.4 Scenario Modeling ............................................................................... 74 2.4 Scenario Modeling Results ......................................................................... 77 2.4.1 Renewable Grid Parity ........................................................................ 77 2.4.2 Peak Oil ............................................................................................... 80 2.4.3 Carbon Pollution Tax .......................................................................... 85 2.4.4 Scenario Comparison........................................................................... 87 2.5 Discussion ................................................................................................... 90 2.6 Conclusions ................................................................................................. 99 2.7 References ................................................................................................. 102 CHAPTER 3: THE ENERGY-LAND NEXUS ............................................................. 113 3.1 Introduction ............................................................................................... 114 3.2 Study Area and Context ............................................................................ 118 3.3 Methods: Renewable Energy Development Modeling ............................. 122 3.3.1 An Overview of Spatio-Temporal Modeling with Dinamica EGO .... 122 3.3.2 LUCC Model of Future Renewable Energy Development ................. 124 3.3.3 Renewable Energy Development LUCC Model