 Good afternoon everyone. Welcome to our briefing this afternoon. My name is Carol Werner. I'm the executive director of the Environmental and Energy Study Institute. We are delighted to see you all here today because we know that this is such an important topic and we think that you are going to be extremely interested in all of the findings that you're going to hear about this afternoon from our presenter and from our very, very interesting panel. This is the fifth year in a row that this sustainable energy fact book has been prepared by Bloomberg New Energy Finance and the Business Council for Sustainable Energy. And so on behalf of my organization, the Environmental and Energy Study Institute, we want to say how excited and privileged we are to be co-sponsoring this book, co-sponsoring this briefing with the Business Council for Sustainable Energy. I also want to mention that this briefing is being held in coordination with the bipartisan House and Senate Renewable Energy and Energy Efficiency Caucuses. We think this is very, very important. It gets to issues that these bipartisan caucuses on both the House and the Senate side are very interested in, have been eager to see new data. It affects how they look at issues and what is coming before the Congress in terms of both the House and the Senate. And I wanted to mention the names of the chairs on both the Senate and the House side. And on the Senate side, the chairs are Senator Crapo of Idaho, Senator Collins of Maine, Senator Jack Reed of Rhode Island, and also Senator Van Hollen of Maryland. On the House side, the chairs are Dave Reichert of Washington State, and Dave Lobsack of the State of Iowa. And so we are also very privileged to be working with these caucuses on these very important issues at a very important time for our country. And I also should say that from our perspective at EESI, this briefing is a very, very fitting way to kick off our briefings for 2017 in that we are launching a whole series of briefings during this year with regard to the issue of building a more resilient and secure infrastructure and society. And so stay tuned. You will be hearing lots more about this at this time. I would like to introduce the person who is going to be presenting the key findings of the fact book and explaining this, what the trends are, what we're seeing with regard to renewables, efficiency, natural gas and going through a whole fascinating set of slides to really explain how things are changing and changing actually quite rapidly from year to year. The presentation will be made by Colleen Regan of Bloomberg New Energy Finance, who is the head of environmental markets and cross sector research. She leads this group and in this role she has been directing her team's analysis of regional cap and trade schemes, power purchase agreements, utility strategy and renewable electricity certification markets. She also oversees Bloomberg New Energy Finance's research on EPA regulations, those impacts on carbon emissions and electricity markets. She has a long history of working in this whole area, working, having worked previously with the OACD as well as with other organizations. So at this time I am very privileged to introduce Colleen Regan to you. Thank you, Carol, for the intro and thank you everyone to coming and listening to our presentation today. My role is to share with you some of the key findings of the fact book. I'm only going to show you a small selection of our slides. The whole fact book is in fact 163 slides. I have about 10% of that for you today, if that. So I encourage you to take a look online. It is available on the BCSE website as well as the Bloomberg New Energy Finance website. So I'll get into the slides now. Lisa, did you want to talk about the founders first? Sure, thank you. My name is Lisa Jason. I'm pregnant at the McHouse with sustainable energy. I will serve as your moderator in a few moments. But do I need to use the mic? I guess I do. Sorry. Well, good afternoon. My name is Lisa Jacobson. I'm the president of the business council for sustainable energy. I will serve as your moderator for the industry panel in a few moments. But yes, we would very much like to acknowledge the sponsors that in addition to the business council for sustainable energy help make the fact book possible. And, you know, we will have a very robust conversation. But I just want to thank and maybe we can give a round of applause for all the sponsors that are listed here. Thank you. Thank you, Lisa. So I'm from Bloomberg New Energy Finance. As Carol mentioned, we put together the fact book. It is sponsored by the business council and we're very thankful for their support. This is the fifth year that we've put it together. And we're really excited to share some of our findings. Bloomberg, I won't give you the marketing spiel, but we are the energy market research firm arm of Bloomberg LP, which is the financial news data provider. And we look at a bunch of different sectors, which align quite nicely with what the fact book covers. And these are some of our clients. I'm supposed to show you this, but I know it's not what you came to see. So let's get into the actual meat of the presentation. If you are not familiar with the fact book. The idea is to be just that a book of facts on the various sectors that we cover. So it's data, it's analysis, but there's no, there's nothing forward looking. It does not contain any of our own opinions. It's just meant to be objective. If you want to get a picture of what's going on in natural gas, renewables, energy efficiency, then this is where you can go just to get a nice, some nice graphs and data that, that give you an informed opinion of these sectors. And these are the sectors that are covered. So as I mentioned, natural gas, renewable energy, energy efficiency, another, what we'd consider sort of demand side technologies, energy storage, advanced transport, as well as the smart grid and demand response. So I'm going to show you some of the highlights here today of what I think is the most, some of the most interesting takeaways or milestones from this year's fact books. This is a nice summary slide. So if you don't want to listen to me for the next 10 minutes, you can just remember this, take a picture with your cell phones. But essentially we had a number of new milestones in 2016. We became more energy productive than ever. We grew our economy without actually growing our energy consumption. We installed record amounts of solar. We became a natural gas net exporter in several months of the year. As we started sending more natural gas to Mexico and we opened up our first LNG export terminal on the continental US. And this is part of what we're considering. We're calling this the new normal because we are seeing that sustainable energy, which was formerly called alternative energy is actually really what utilities and corporates are investing in. So if you look at just power sector installations in the past 25 years, 92% of them have been renewables or natural gas. So this really shouldn't be considered an alternative industry. It's really what we're considering the new normal here. We've seen natural gas displaced coal as the largest source of US power. That happened in the late 2015 and really accelerated in 2016. Renewables have surged in the past 10 years from 8% of our power generation to 15% in 2016. And as a result, we're seeing huge declines in our greenhouse gas emissions without any sort of long-term federal climate policy. And then finally, energy prices throughout all of this are actually falling. So conventional wisdom is that if you want to have cleaner sources of energy, it's going to cost you more, but we're not actually seeing that being the case. So I'll get into the graphs now. So the first takeaway that I mentioned was the fact that we are growing our economy without increasing our energy consumption. We are decoupling economic growth and energy consumption. And you can see this pretty clearly here. So the green line is showing you what's going on with GDP. And since 2007, we've increased our GDP in real terms by 12% while energy, total energy consumption has fallen by 3.6%. And by total primary energy consumption, I mean not just the power sector, but I mean commercial residential includes heating. It includes the transport sector. It includes industry. So across the entire U.S. economy, we've actually shrunk our energy consumption by 3.6% since 2007. And in 2016 alone, that trend continued. So our GDP grew by 1.6% while energy consumption fell by 0.2%. And this is a story that's there's two main drivers of this. One is structural changes in the U.S. economy, but more important than that, it's energy efficiency. So we're using our energy more efficiently in order to continue to grow as an economy. And I mentioned also that natural gas has superseded coal as the number one source of power in the U.S. And it's been amazing how quickly this has happened. So this is just showing you the past 10 years. Where our electricity, U.S. wide, has come from. And in 2007, 49% of that electricity came from coal. By 2016, it was only 30%. And so you can see the black bars at the bottom slowly declining over time. At the same time, we've seen a huge uptake in what natural gas and renewables are doing. So natural gas grew from 22% of the power sector in 2007 to 34% in 2016. Over the same timeframe, renewables grew from 8% to 15%. And I would argue that this is a result of some structural changes in the U.S. power fleet. So here you can look at what have we been building. I already made the claim that utilities and corporates are choosing renewables in natural gas. And this graph, I think, illustrates that point quite nicely. This is looking at power sector generating capacity. So how much are we adding to our electric grid every year by technology? And the gas here is the gray. Renewables are the blue. And you can see that overwhelmingly they have been the generating technologies that have been added to the U.S. grid since 1990. So a couple of stats there for you. In the past five years, 62% of power sector capacity additions have been renewables or large hydro. And just within the past 25 years, 92% have been renewables, large hydro, natural gas. And in 2016 alone, as you can see, this trend has really accelerated even more towards renewables. So in the past two years, 70% plus of power sector capacity additions have been renewables. So this is really my argument that this is the new normal. We are seeing utilities and corporates invest in these spaces. These are the technologies that they are choosing to put their money in. And one of the reasons for that is that we've seen a huge increase in our domestic natural gas production. It's been a great story in the United States that we have started to we're no longer importing as much natural gas. We are able to export natural gas now. And it's a result of the shale basins for the most part in Appalachia. So as you can see here, the gray on top is the amount of gas that we're getting from shale in the United States. And that really took off in 2006. And and also I would also call attention to that black line, which is showing you rigs. So that black line is going down, even as our total output is going up. So what that's saying is we're even getting more productive here. Drillers are being much more efficient about where they're drilling, their technology has improved, which is allowing them to get more gas out per well. So this has really helped having such an abundant domestic source of energy has helped to bring down costs and has helped natural gas to compete with coal, particularly in the power sector, but also to displace oil in the commercial and residential sector as a source of heating. So I mentioned this already, LNG exports. Because we now have this very abundant source of energy, we found that we actually don't need to import as much gas as we thought we did. The U.S. has long been a net importer of natural gas. But in 2016 we saw that we saw that start to flip. So in February 2017, Sabine Pass, the natural gas, well, LNG export terminal turned on and started shipping out LNG cargoes to over 16 destinations in 2016. And what I think, what I like about the story of Sabine Pass is how well that encapsulates what's gone on with our overall natural gas industry. Because Sabine Pass, the idea for Sabine Pass started in 2001 as an LNG import terminal. And then when the shale gas boom really happened in 2008, all of a sudden it was it was unnecessary. And so Cheneer, the company behind it, decided to reverse it. They were going to make it into an export terminal and finally came on in 2016. And going forward, I did tell you this wouldn't be any forecast, but I will say that Sabine Pass is going to double its export capacity in 2017. And pipeline capacity to export natural gas to Mexico is also increasing or due to increase if these pipelines come on as currently planned. And so we would expect the U.S. to actually grow their net export margin in 2017. So I've talked a lot about actual deployment of these technologies, but I haven't mentioned costs yet. And that's obviously a very important part of the equation. So I wanted to highlight the fact that costs have really been falling across all of these sectors. This is showing you what we call the experience curve for solar PV modules, which go into the panels that go on the roofs or in larger, larger rays. And you can see the if you can see the yellow triangles and I apologize if they're a little bit hard to see in the back. Those are observed values for solar PV module costs. And since 2008 alone, we have seen PV module costs fall by 90 percent. So in 2016, our best estimate is that a PV module costs 41 cents a watt. That's down from $3.88 a watt in 2008. And then in 2017 already, we're seeing prices a little bit lower than that because there's a huge global oversupply of PV modules. So that should continue to depress prices in the near term. So what that's meant, that's just one technology. But if you compare all current technologies that, well, this certainly isn't all it, but that we that we study within the US is that renewables are competitive with the more traditional power generating technologies. So as you can see here, wind is the blue, solar is the yellow, and these are very much in line with the cost. These are the costs over time to build a new a new plant. The levelized cost of electricity. So wind and solar are fully competitive in many parts of the country with gas and coal. And I would call your attention also to on the left side of that blue, that's the lowest cost that we observed across the entire country. So wind in particular areas of the country is actually the cheapest new technology that you can install, and that's in Texas for those that are wondering. And this is unsubsidized. So this doesn't include the benefits from the production tax credit or the investment tax credit. So if you actually included those in here, wind and solar would look even cheaper than they do right now. So wind, we've calculated a levelized cost of $37 a megawatt hour without the value of the production tax credit. When you take that into account, it's $22 a megawatt hour. But regardless, wind is amongst the cheapest technologies in the United States to install today. And obviously, cost is one thing, but what does that actually translate into? When the rubber hits the road, what does that mean for utilities that are buying power from these wind and solar farms? And what we've done here is plotted over time how much utilities are paying per megawatt hour for wind and solar contracts that they've signed. So if you just want to read it left to right, you can see 2008 to 2016, there's a nice downward trend, particularly noticeable on the solar side, which is the yellow. So I told you that module prices have fallen 90% in real terms since 2008. We are seeing that play out in terms of how utilities are spending much, much less now on their solar contracts than they were in 2008, 2009, 2010. So we were seeing contracts come in close to $200 per megawatt hour in those early years. Now we're seeing them come in under $50 a megawatt hour. Some big ones we saw in 2016 were $35, $36, $40 a megawatt hour for a solar contract. And wind, we've even seen them in the $20 range in Texas and Oklahoma. I wanted to talk a little bit more about things besides just power generating technologies. So I have this graph we included for the first time in the fact book this year on battery costs. This is becoming a little bit more important as we start to see EV sales pick up. EV sales topped, they're still very small in absolute terms. EV sales increased 38% year on year in 2016 to finally, so this is battery electric vehicles as well as plug-in hybrid electric vehicles. They finally breached 1% of US total automotive sales. So a little bit of ways to go, but it is picking up quickly. And this is one of the reasons for it. So we're seeing battery pack costs come down substantially. So similar story to what we saw in solar. So the more you install, you have a learning rate. Your experience improves your costs. And you've seen here that we went from $1,000 a kilowatt hour to only $273 in 2016. So still some ways to go. But given these recent fall-offs, you can actually get a battery electric vehicle for about the same cost as a typical internal combustion engine when you account for purchasing incentives from the federal and state governments. So without those incentives, the economics are not as strong right now. But we have seen fall-offs in battery prices and hopefully those will continue. So two more slides and then I'll turn it over to the panel. But I wanted to tie this back to consumers. What are consumers actually paying? So I've talked about what things cost. I've talked about what utilities are paying. But what about consumers? Because that's ultimately what we care about is how are the American people actually feeling this change? And what we saw in 2016 is that consumers dedicated less of their household spending to energy than at any other time on record. So what this is showing you is the share of household income dedicated to on the left electricity in blue, natural gas in gray. On the right, it's total energy. So that includes electricity, natural gas, gasoline, diesel. So that would include the transport side of things. All of those touched record lows in 2016. So we're growing our economy. We have more consumers in the economy. We have more people that are burning natural gas at home, consuming natural gas at home rather than oil. And we've added a bunch of consumer electronics and all the same. We're actually seeing that consumers are dedicating less of their household spending to energy than at any other time on record, which I think is a fantastic takeaway. And yet we've been doing this by choosing cleaner sources. And finally, last slide, is we've been able to do this while substantially reducing our greenhouse gas footprint. So the graphs on the left look at overall emissions from the U.S. economy. The graph on the right looks at the power sector only. Overall emissions in the U.S. economy hit a 25-year low in 2016. And in the power sector, it's been the lowest since, I'm afraid, I don't know when. I have this graph back to 1990, and it's the lowest since at least 1990. Year on year, the power sector released less than 5% fewer emissions than the year before and is 24% down from 2005 levels. The overall U.S. economy is 12% down from 2005 levels. So obviously, as you can see here, the majority of these impacts are being felt in the power sector. So more work needs to be done in other areas of the U.S. economy, like the transport sector. But nonetheless, I think is a really fabulous result, especially given that we have not had no federal climate policies that are supporting this movement. It's economics, it's state-level activity. So I'll just end here, and then we can go over to the panel. And thank you all for listening. Thank you, Colleen. That was excellent. Let me just get this a little lower. Terrific. OK, well, again, my name is Lisa Jacobson. I'm the president of the Business Council for Sustainable Energy, and I'm going to moderate a industry reaction panel to what we just heard from Colleen. The Business Council for Sustainable Energy. We're a trade association. We're based here in Washington, D.C. We're actually celebrating our 25th anniversary this year. So we were founded in 1992, about the time when the emissions were discussed. And think about what the world was like in 1992. For some of you, just think about how buildings were operated. Think about technology. You know, I mean, I don't mind telling you my age, but I graduated from college in 1992. And I have two girls. I have a 14-year-old and 11-year-old girl. And I show them movies from the 90s, where they have telephones with cords and typewriters, even electronic typewriters. They can't believe it. But that's what was going on at 1992. And I actually worked on The Hill at that time as well. So we were just getting computers and connectivity. I mean, so it's just a completely different world when you think about energy and transportation. So now that I've been completely embarrassed myself with my age, I wanted to show you what the fact book looks like. So this is the actual fact book. As Colleen probably mentioned, it's about 165 different pages, about 200 figures. And what you may have noticed from some of her slides is that we try to provide some punchlines down after each chart, because sometimes it's hard to absorb all the information they're putting in there. But I really encourage you to take a look at this. If anybody's here from a congressional office, we do have some copies. And we're more than happy to get them to you if you would like to have one on your desk. But it's all available for free online. There's a standalone website. It's listed in all the materials. You can also get to it from the Business Council for Sustainable Energy's website or BNF's website. So please dive in and we will be taking time for questions. So please think about some questions that we'll get to in probably about 15 minutes or so. So let's see. I wanted to just share a little bit about the membership of the Business Council. We have a number of members up on the panel here. But we're about 55 companies and trade associations. They work, some companies are global, but just looking at North America and the US, they are in every state and in every congressional district. They're working on transportation and electricity and the grid. They are service providers. They're equipment manufacturers. They're project developers. They're utilities, public power. And if you want to learn more about them, you can go to our website where we have an interactive map and you can click into a state. And we also have district information at our office if you were looking to find out in the Efficiency Renewables Natural Gas Arena who is in your district, we'd be happy to connect you. So what I'm going to do is moderate her first. It's give you an opportunity to learn more about the panelists. So I'm going to go to each one of them and ask them to introduce themselves and their company and where they fit into the clean energy space. They also have been asked to pick one slide or a few slides in some cases from the fact book that discusses their industry trends and is a springboard from opening comments they'd like to make. And then we'll go into a moderated discussion. So the first person who's going to speak is Mark Wagner with Johnson Controls. He also serves as the chair of the Business Council for Sustainable Energy. So Mark, please introduce yourself and I will be happy to advance your slides. Thanks Lisa, I really appreciate it. And thanks everyone for joining us. Again, I'm Mark Wagner with Johnson Controls. We make buildings and vehicles energy efficient and you can learn more about us at jci.com when you get a chance. As chairman, I guess I get to go first in front of this wonderful panel of women up here and I apologize for getting in front of them but I do appreciate it. I do want to, as chairman, I do want to thank first of all Carol Warner for an EESI for putting on this event and co-sponsoring it and really getting you all here today. So thank you to her. Thanks to Colleen and the BNF team. She gave her wonderful presentation of this great fact book that they've put together. We appreciate all their help. And of course Lisa and the BCSC team for working hard with BNF on this and putting it out there. You know, the fact book is great because it not only gives you a snapshot of what happened in 2016 but also as you can see from the slides, it gives you trends of what's been going on and I think that's really key. And I'm gonna ask Lisa and she's already got it up there. See, she's so great. This slide that Colleen put up, it was her first slide and that's my favorite slide in the deck partly because if you, let's just review what she said about this one because she threw a lot of slides at you. Over the last 10 years, GDP grew by 12%. Energy use fell by 3.6%. That means energy productivity, which is the ratio of US GDP to energy consume grew by 16% over that last decade. Pretty phenomenal slide and as she pointed out, that continues. I wanna talk a little bit about energy efficiency because that's where my world revolves. And if Lisa can jump to the slides, she's gonna get there real quick. There it is. This is energy investment both by framework and by sector. And if you just look at what happened in the last 10 years, which is about 05 and beyond, you can see the investment in energy efficiency has risen dramatically. And I think that has a lot to do with that energy productivity numbers that we just talked about. Let me just drill down to one other factor. The next slide talks about the square footage of energy star building space. Look what happened over the last 10 years. Really dramatic increases there. So those are just two slices, two things you can find in the fact book that back up the type of things that we're talking about, how important energy efficiency is along with renewable and natural gas trends in here. And those are the kind of trends that you can see in the fact book. Finally, I just wanna bring up one last slide and that's a new slide we've got in the book. And this shows the uptick of start-stop technology in vehicles. How many people own a vehicle with start-stop technology? Okay, what it is, is it's a regular internal combustion engine car, not a hybrid, okay? That's about 95% of the cars that are out there, all right? What happens is when you put your foot on the brake and come to a stop, the engine shuts off. The batteries are still robust enough to run all the accessories in your car. Lights, radio, air condition, whatever's going on. Take your foot off the brake, engine starts back up again. Fuel savings anywhere from five to 7%. And we're talking about the uptick now, we're almost at 10% of the new vehicles in the United States are stop-start vehicles and you're gonna find the fleets are being flipped and you'll find more and more of the traditional vehicles. F-150, the best-selling vehicle, not just truck, the best-selling vehicle in the United States has start-stop technology in it. Okay, so it's a growing movement in the US. Right now, if you go over to Europe, they're ahead of us on this because they started this technology center. You go in a showroom floor in Europe, 80% of the vehicles are start-stop technology. So it's coming to the United States. So we are making both our buildings and our vehicles more energy efficiency which is leading to increases in energy productivity. Thank you very much. Great. Next, we're gonna hear from Emily Duncan at National Grid and I know we handed out full bios for everybody so if you're interested in learning more about the speakers beyond how they introduce themselves, you can read in the handout that we provided. So Emily. Great, thanks Lisa and thanks to all of you for coming on a Friday afternoon. So National Grid is an electric and gas transmission and distribution company also known as a utility. We did a bunch of polling though and found out that people don't know what the heck a utility is. So we're the ones that send you those gas and electric bills on a monthly basis. We serve about seven million gas and electric customers up in New York, Massachusetts and Rhode Island. So that equates to about 20 million people up in that region of the country. We employ 15,000 Americans in our communities. We're one of the largest utility companies in the world and our headquarters are actually in the UK. So when I say transmission and distribution we're in a part of the country that's what we call deregulated. So we typically don't own generation. We focus on the transmission and distribution network. And in this last year we invested about $2 billion in capital expenditures on that network. So what I wanna point out today is this slide here that Lisa's put up which talks about US natural gas demand by end use. And the portion I'd like you to look at is the power generation piece which has been growing over the past few years. I think what a lot of people don't recognize is that we use natural gas to heat our homes but we also use it to create electricity. So up in the Northeast we're actually one of the rare parts of the country where natural gas demand is rising both in the natural gas to heat your home sector but also on the electricity side. So just to give you an example we had 6,000 customers in Rhode Island and 38,000 customers in Massachusetts converted from home heating oil to natural gas in just the last three years. And we're gonna see that trend continue. On the electric side we're seeing a lot of plant retirements up in the Northeast. Cold plants are going offline even some nuclear plants may be going offline in the next few years. And as I think Colleen pointed out the transition to renewables and natural gas is happening quite rapidly up in the Northeast which is great because natural gas prices have been really low and so that's good for our customers it means lower gas and electric bills. But one of the issues we're facing up there is that we don't have the pipeline we need to get the gas to our customers. And so that's again both on the heating side but also on the electric generation side. So one of the things we continue to be concerned about is getting that infrastructure built and getting gas up to our customers. So as you see this power sector piece continue to grow that's where the concern is for us in the coming years. But happy to be here and look forward to answering questions. And next we're gonna hear from Yvonne McIntyre with Calpine. Hi and thank you everybody for being here today. Yvonne McIntyre Vice President of Federal Affairs for Calpine Corporation. Calpine is a Houston based independent power producer and retail energy services provider. We also operate in the deregulated competitive markets. We are the ones that own the power plants in those markets. We own about 80 plants and through the power plant operations as well as retail service operations we operate in 25 states, Canada and Mexico. We sell our power into the grid or through bilateral contracts but when we sell them into the grid that's where companies like National Grid get their power resources from. We are one of the largest consumers of natural gas in the country. We are the largest consumer of natural gas in the power industry. We are the largest operating combined cycle natural gas fired power plants in the country. We are also the largest producer of power from geothermal energy resources in the country. We have 13 plants generating 725 megawatts in Northern California at the Geysers which is the largest geothermal resource in the world. Also the largest operator of combined heat and power resources. Then we have a small solar facility in New Jersey and we just started to win business. So we touch on almost everything and even efficiency but on the production side. So we incorporate everything that the business council stands for. Because we are so large in natural gas and geothermal those are where I'm gonna kind of focus my comments on and both Colleen and Emily touched on a lot of the issues but again looking at the, oh no, I need natural gas still. I'm gonna talk about geothermal later. A couple of things and not on this slide but it was touched on previously is just the productivity gains in natural gas primarily from the shale plays. It's been pretty incredible. Particularly in the Northeast where the, or I guess it's considered Northeast Pennsylvania the Marcello-Shale region. They have now become a net supplier to the surrounding regions which is incredible given that about 15 years ago there was barely any natural gas production in that region. With that increase in production and the exports to the surrounding regions it is causing a reversal of natural gas flows from the region. Used to be that we have pipelines that were piping up gas from the South or down from Mexico. And so a lot of the natural gas pipeline projects that are in the hopper that had come on in the last year or so have been because they've had to reverse the flows of natural gas into the opposite directions. And we didn't show it but if you look in the fact book there is a slide that shows the pipeline completion rates over the last few years. There was a dip in 2016, but again one of the other issues that are going on with pipeline infrastructure build is the fact that because of where the shale plays are a lot of it is more populated centers in these states. And so it's a lot more complex to permit them and there's a lot more resistance to bringing them online. But we think towards the end of 2017 and beginning of 2018 you are gonna see a lot of new natural gas pipelines coming online and into production. I know there's been a lot of concern lately about the lack of quorum over at FERC now and what that means for pipeline infrastructure build out. But before we lacked the quorum as of the end of last week FERC did clear the decks and certified over 6.6 BCF of new pipeline project that we are expecting to come on. So and all these projects have significant job numbers associated with them. Then as a chart behind me shows with the steady growth in natural gas demand again with those pipelines coming online we expect 2017 and 2018 to show even more demand again from pipeline build out. So I think the key industrial projects that are coming online as well as a trickle of new natural gas fire power plants coming online as well. But one thing I wanna touch on and again Kelly touched on this a bit too is the growth in exports to Mexico. I think there was a lot of consternation over the past few years about the number of LNG export projects that have been proposed. Because we're in Houston and we do a lot of business kind of are looking into business in Mexico we have seen the significant increase in exports to Mexico. And we believe that again while this is all kind of looking past and showing trends that by 2020 Mexico if the exports continue the trajectory that they're on now could comprise about 10% of the demand for US natural gas. So it is an issue that we have been watching. We had concerns initially about that more concerns than LNG exports but again with technologies improving there is an increased productivity coming out of the Permian base and that we see as offsetting the future demand growth to Mexico. And finally the slide showing that there is that the pace of renewables growth has pretty much out done every other resource. Natural gas is still growing. Natural gas fire power plants are still growing and we're not gonna go away. Energy storage is improving cost are coming down but it is not there yet as far as cost and reliability. At the same time it also doesn't provide the same reliability assets that natural gas fired or kind of quick turn on basal generation has. And so we believe that natural gas fire power plants are gonna be a continued important component of our mix for many years to come. Okay, switching to geothermal. You know a lot of people don't know about geothermal and we consider geothermal as kind of this forgotten child in the renewable energy business. But it is an abundant domestic baseload clean energy resource that brings a lot of economic benefits as far as jobs and tax base, high paying jobs and it is a fairly low cost energy resource once it comes online. But as you look at the chart, we have not been growing pretty much at all over the year. I think we've gone up one megawatt over a one year period but it pretty much remains stagnant. And right now there are actually over 30 gigawatts of geothermal capacity with 83 plants that are stuck in development limbo. One of the reasons or a couple reasons that are behind that are we don't have the favorable policies behind us that allow to the other renewable energy technologies do. We did not have the favorable tax treatments. We did become eligible to get PTC and ITC but those were one of those orphaned resources that got left off of the extension at the end of 2015. But at the same time, with the year by year, every couple of years extension of those tax credits, it never benefited our industry. First of all, we're a very capital intensive industry. We, the way we tap into the resources is we have to drill into the ground just like drilling for oil and gas and we have to drill several holes before actually tap into the resource. And each one of those holes is over a million dollars to drill. Once we tap into the resource, we build a conventional power plant on top of that resource. And so again, once it's online, we have a free fuel. We're just tapping into the heat of the earth to run our power plants. But it's very high upfront cost. And so it just to try to get the investments and try to kind of mitigate the risk of the exploration and finding the resource has just been a challenge for our industry. We need more research into, again, being able to find the resource better, better drilling techniques and whatnot. And again, because it's not a very well-known resource, a lot of folks think too that it's a mature resource, although every, I think, resource has benefits from new technologies. We are this forgotten child, but we can contribute a tremendous amount of, again, clean, basal, renewable energy resource to this country. Thank you. Thank you, Yvonne. Thanks for wearing both hats on the panel, renewables and natural gas hat. Next, we're gonna hear from Nanette Lockwood with Ingersoll Rand. Hi, thanks for being here. We really appreciate it. As industry, we are honored to be able to talk to you about some of the technologies that we provide. One of the key things that we wanted to talk about, Ingersoll Rand is best known for our work in buildings. We're leading air conditioning and heating manufacturer, best known for our brand's train. We also handle refrigerant transportation and club car, golf carts, and of course tools. So we're diverse about industrial. We work in countries throughout the world. We have really worked hard to integrate buildings with energy and energy efficiency. So what was really intriguing to us was this slide on energy storage. And this is very interesting because you can really see the changes that are occurring. On the right side of the left chart, you can see the number of projects that's increasing dramatically. And then on the right chart, you can see where you start to see different colors changing. So the light blue is really frequency regulation. That's just the variances between supply and demand. And so up through 2013, that was really the significant portion of energy storage. But when you get into 2014, you start to see the black bar grow dramatically. And that's really all about system capacity. So when you think about system capacity, that means that we have projects that have been announced that are literally going to provide capacity for the utilities. So we're storing energy in order to avoid putting in additional capacity. The plants that you put in for peak demand. Most of the country has very hot summers and most people come home at five o'clock, turn on their air conditioning. Air conditioning is a significant source of demand for the grid. And so this becomes a real issue that we're seeing and our customers have really wanted to do something about this because the rates for peak demand are a lot more expensive than the regular rates for base demand. And so the different types of storage can are, there's several different types. There's batteries, there's hydro. These are the non-hydro types of projects. But one of them is also what we call thermal storage. And there's several different types of thermal storage as well. One of the thermal storage types of technologies is really where a building can actually produce ice from a chilled water system at night. So that during the day, they can use that to cool the building. So what that does is it maximizes the building owner's potential to use these low cost rates at night. And then during the day, they don't have to run that heavy equipment. And so this is technology to spend around for a long time. But until the incentives were there to truly drive the building owner to want to put something like this in until the rates started increasing for peak demand, they didn't get talked about a lot. So these systems are now really going on all over the US, especially in areas where utilities and states are trying to reconfigure how they're distributing and generating power. For example, in New York, where they're actually pulling a nuclear facility offline in 2020. There's been a lot of incentives to drive energy storage. And so these, what we call ice systems have been proliferating throughout New York City to try to make sure that there's enough capacity so that when that system comes off that there's not an issue with supply and demand and that they have consistent availability of electricity. So what it also does is it can save money. And there are examples throughout, but in Fort Pierce there's a school district, St. Lucie. And we were able to upgrade their chillers and put in ice systems in the district and they've basically saved 30 to 40% of their electric bills. And that's about $5 million every year. And they're using that to basically hold on to about 100 jobs. So as a technology provider, we look for ways to answer questions from the customers. Not all customers are interested because oftentimes you have a big building and you're leasing to a bunch of tenants. They basically are paying the electric bill. Why do you care? So without the incentive, sometimes the building owner doesn't have the initiative or the desire to actually do something for the grid. So it's really important that we handle policy and the states are using federal money as well in order to make this happen so that we can prepare for the future because as Yvonne said and Colleen, we're integrating renewables throughout the entire system. And so with renewables comes this change in your peak demand so you're shifting load. And so in order to be reliable and have enough capacity on the grid, you need to look for these energy storage capabilities. So with that I'd like to pass it back over to Lisa. Thank you. Thank you. Thank you. Thank you to the panel, really excellent comments. I know we're hitting the one hour mark for some of you and I wanna get to some questions but there are two quick themes that I wanted to get some reactions from the panel. One was on infrastructure and I'll ask a question on that in a moment. And then the second is, and you kinda touched on this, Nanette, what's the role of the federal government in terms of the energy sector? So I wanted to get brief, like let's try to keep it real brief in terms of our comments so we can get to some questions. And this gives you some time to get ready if you have questions for the panel. But the first question is infrastructure. And maybe Emily, we can start with you. I mean, there's gonna be a robust conversation in Congress and with the new administration on how to create jobs and prove our economy and upgrade and expand infrastructure. You know, the council's been thinking about this as a coalition quite a bit and we have a paper that you can get off of our website where you can see some of our preliminary thoughts but I mean, I think there's two kind of big picture ideas that we wanna get across. One is energy in and of itself is critical infrastructure. But also, energy powers all other critical infrastructure. So it's essential that we look at it from both directions and it be a center point in the conversation. So now I'm gonna ask the panel to provide a few more comments on the topic again starting with Emily. Great, thanks Lisa. I think first and foremost, you know, in talking about infrastructure, as Lisa said, we need to make sure energy infrastructure is included in that, right? Infrastructure is not just bridges and roads, those are important too. But it's also our transmission and distribution networks. And because we are effectively an infrastructure company, we are of course very interested in any kind of policy around infrastructure. I mean, just to give you an example, last year was the first year we actually interconnected more solar, more residential solar than interconnected gas. So that was pretty remarkable for us. We did the first offshore wind project. We did the Sea to Shore line from Block Island to the first offshore wind project up in Rhode Island. So we are investing a ton in our infrastructure. I think the thing I'd point out that's somewhat unique about utilities is we're not looking for money, right? I mean, we can invest a lot in our infrastructure and that will then be rate based and our customers pay for that because that's how we provide them services. But I think one thing we are really interested in looking at is public-private partnerships and ways to incentivize states to have infrastructure in their region. I think some of the pushback we've gotten from the past is not in my backyard type of mentality and this is for any type of infrastructure. Transmission lines that bring wind in from the Midwest or hydro from Canada or the other parts of the Northeast and also for pipelines. And we need that infrastructure to be able to continue to provide reliable and affordable electricity and energy to our customers. So any kind of infrastructure bill or policy that helps incentivize states to have this infrastructure in their backyard, it creates jobs, it creates really good property tax base for their schools and other things that they want to do in their community. And so that's what we're really looking for when it comes to infrastructure policy. No, I agree pretty much. Okay. Anyone else have a comment? Let me give you one good example of how energy efficiency can lend to upgrading our infrastructure. Lisa said our infrastructure runs on energy. She's right. We've got a project in Hawaii right now. $245 million of private sector investments going in to upgrade the equipment and the lighting at 11 different airports in Hawaii, the harbor and the roads on the lighting. The money is being financed and it's getting paid back through the energy savings. So it doesn't cost the state anything on the investment side. So we're being able to upgrade those critical infrastructures with energy savings. I think when we think about infrastructure too, we've got not only think about roads, bridges and airports, but go beyond that and start thinking about other critical public infrastructure, whether they be hospitals or schools or emergency call centers and localities and things to try to make them more energy efficient and resiliency. Again, we don't need money. We can pay for this through the savings and that's a proven approach and a proven program that I think we need to figure out how to continue to advance and turbo charge those type of thinking and those type of projects out there. First on the federal agreement. Okay. Well, we have some agreement on that from both sides. I'm going to move to the next question as I move this back and it really relates to Nanette. Maybe you want to dive a little more deeply into the role of the federal government in the energy sector, at least from Ingersoll-Rand's point of view and then we can hear from others. I'm just going to get us back to something pretty. Oh, I was going to say. Yeah. It's our slide. No, no, no, no slide for you. Just if you could talk a little bit more about what you were saying. I mean, I think there'll also be a significant and appropriate conversation about how the federal government interplays in the energy sector and at the federal level what its role is because as probably many of you know, a lot of decision-making in the energy sector, particularly the power sector, happens at the state and regional level. So Washington can be involved to some degree but a lot of the decisions happen more locally. So maybe Nanette, you could start. Sure. And I guess I would start with an analogy. I mean, I don't know how many of you really pay attention to road construction but every time someone opens a new lane, it's always full and they start opening another one right two years later. When are we ever going to open it wide enough so we don't have to drive through construction barriers for the next five years? And it's because states really focus on the very near-term issues and near-term problems, right? So the federal government has the opportunity to really allocate funds and really prioritize things for a longer-term horizon as we move the power grid from just supply, supply, supply to totally bi-directional. With all the renewables that are coming in, it's gonna have to be an incredible system and a network in order to move to efficient use. We all have electronics. We all want solar or something on our rooftops. How are we going to be able to work that and rely on it? I don't know how many of you wanna work at home when you have snow days here but I, for one, would like to make sure my computer's working. I don't get, for eyes or anything else, or blackouts. So it's really important that the feds come in and actually think about these things and help states understand and work together in order to give us the reliable network that we're gonna need because eventually we're looking at buildings as almost a resource, right? The buildings are gonna be able to be bi-directional in energy and communication. So that's something that needs to be looked at at a macro level in addition to the state level. But, so, Calpine, as I said, operates in the deregulated competitive electricity markets. Now that's not all around the country and there are several different markets. So California has its own Texas, PJM area, which is where we are, New York and then New England and then the Midwest has something of a market and so do the Southeast. And so I think one of the things of the realization that the electricity market isn't standard. One size fits all across this country and so federal policies don't necessarily fit for every region of this country or every state in this country and so to be conscious of that fact and that you have experts in each region that are coordinating what's going on in the grid and actually have the true responsibility for what's going on in the grid. States certainly have their say, but there is an interplay between what the states are trying to do and then the impact that they have on the competitive markets. We believe that competition free markets are the best and that they are driving investments in energy efficiency and renewables and bringing the cost down of power across the board and so when you start having some interference in the markets, you know, we feel that it kind of wreaks havoc and does not produce the right outcomes or the best outcomes in each market and so I think there needs to be a kind of a holistic look at, you know, what our energy policies are and ensuring that we are, you know, driving towards the best policy decisions to bring cheap, reliable electricity to everyone. I think another point I'd make is, and I think Yvonne's right, you know, every part of the country is different. We operate obviously in the Northeast. We have RPS requirements, renewable portfolio, standard requirements that we have to meet and so we may be bringing hydropower in from Canada in order to meet those. We may be bringing in, you know, wind or other resources in to meet those and that's at the state level and so creating certainty, whether it's at the federal or the state level is really key for our business, right? I mean, we have to be forward-looking. We have to look at the next 10 years and what do we invest in? What contracts do we sign? What does that world look like for us? And so certainty, above all, is really important and it's been hard to get actually recently but I think the other kind of thing I would look at as from a staffer's point of view is, DOE put out the Quadrennial Energy Review in the last year and they've been kind of putting out pieces of it over the course of the Obama administration and that is just a wealth of great ideas, some of which have already become law but if you're looking for things that can be beneficial to energy markets, the energy sector from the federal level which as Lisa pointed out is very different from what's happening at the state level. I would highly recommend checking that out as a resource because there's a lot of great stuff in there that I think could be supported by industry and could help us keep stable electric prices and gas prices for our customers. Great, thank you. You know, I was just gonna mention quickly DOE. I mean, obviously there's gonna be a look at all federal spending in this session of Congress and I would anticipate that no agency is going to be immune from that look under the hood and that's an appropriate thing. I guess from our standpoint, you may have picked up on it a little bit in some of the comments. While we are assessing the value to American taxpayers of government spending and we're looking at things, now I'm just gonna talk about the Department of Energy, it provides a lot of expertise to states and the regions in many areas that impact the power sector and the transport sector and they can provide resources that states don't have to do planning and to better understand data, similar to things that we're putting out there, but also how to implement best practices from other parts of the country. So when you're thinking about changes to the budget, there's a lot of value in areas, there's certainly room for improvement and there's probably room for reductions in certain areas but the technical and convening power of agencies that can benefit states and regions and in this case with the power sector and the transportation sector is really important and the resources don't exist in any other area. So research, development and deployment support are critical things that the federal government can provide and when they can do it well, it really provides jobs and economic enhancements on the ground so I just wanted to say that. As promised, now we're gonna take some questions from many of you that would like to ask them. I will probably repeat your question because I think if we don't go into the microphone, it won't be part of the recording. I see someone all the way in the back who might have a question and just if you could introduce yourself but let's keep our questions, make them a question and make it real brief. Thank you. I guess from how should consumers look at the price and it's important because if my company's technology my bill shouldn't be more than $40 or $50 now because of the advancement of technology and if my factory is in relation, it shouldn't be in the range of $50, $60 but why would it go, I mean, why would the price of elections that's going to increase maybe like five percent per year? Well, I mean, I don't know if we'd be able to respond to anybody's particular bill but maybe Colleen could just, we didn't talk a little bit about the differentiation between wholesale price declines and retail price declines and what goes into retail prices and maybe just, we have it in the fact book broken out by region so you can see on the wholesale level where your region or state's power prices have been and then you can also see what the retail consumer pricing has been and I'll let Colleen talk a little bit about that for you. Sure, thanks Lisa and thanks for the question. I'll start off by just reiterating what's been said before me which is that every state is different and so in some states you have a set retail rate that doesn't really change throughout the year except it changes, of course, your overall bill changes on your consumption. There are other states like New York which Emily could talk to where your actual, the cost of your power, the rate of your power changes from month to month based on how much it costs your utility to purchase that power. So for example, I live in New York, I have ConEd, my bill changes from month to month based on what the cost of power in that wholesale market was and that's usually more expensive in the winter because as Emily mentioned, there is a shortage of natural gas pipeline capacity in New York and New England so there's constraints and natural gas prices in that area tend to be higher in winter because you're trying to use natural gas for heating and power at the same time. So that can all happen. In the fact book, we do look at retail prices and wholesale power prices over time and we have taken out inflation here in order to provide a better apples to apples comparison and if you look across the US on average, retail rates are 7% below 2008 levels which was the peak and they fell 2.2% year on year from 2015 to 2016. So by and large, these cost savings are getting passed along to consumers. There, it may not be as noticeable a change as what, as some of the graphs I showed you looking at solar and wind costs because your electric bill is more than just the cost of power generation, it's the cost of maintaining and improving the distribution lines, the transmission lines so there's more that goes into that bill. Yeah, so Colleen just made my job really easy and basically answered the question. So I believe, I don't live in Maryland but I believe it like DC, it is also in a deregulated market which means it's a competitive marketplace which means that PEPCO is providing, when they send you a bill, your bill is made up of several components, one of which is the commodity which in the winter tends to be higher because oftentimes it's natural gas and there's greater demand for natural gas in the winter and so prices tend to go up a little bit at that point in time and then the other part of it is the transmission and distribution costs of getting you that commodity and because probably like national grade, PEPCO is upgrading lines and transmission lines, distribution network pipelines, things like that, that all goes into your bill and then there are other things that, other programs that utilities pay for that benefit customers and that cost also gets wrapped into the bill so I will say I look at my electric bill occasionally and sometimes I feel like you need a PhD to understand your electric bill, it can be quite confusing but there are several components that go into it and could explain why your bill may have gone up recently. Great, so I see two questions here. We'll start here and here and then, so we're gonna take three questions before we break because I wanna give people at least a few minutes before two and we're gonna close to come up and talk to the panel before you have to scoot out so we'll take these three questions. If I could ask you to do it real quick, in fact what I think I might do is take two to start so just if you could offer your question and then we'll go to the other person who had a question, thank you. So the first question was about interminancy issues related to renewables and how maybe other technologies like storage can help, the second question, we'll just, if you could raise your second question now and then the panel can, yes, go ahead, just stand up and, yes, thank you. Great, so there was a question about natural gas industries from a representative from California related to the range of emissions related to natural gas. So why don't we start with the interminancy renewables question first and let's try to keep our responses brief. Anyone wanna dive into that? Yeah, just briefly, if you look at the slide on the storage capacity or the energy storage, there it is, okay. So you can kind of see up there you've got a green where it says system renewables integration and that's basically, it kind of fluctuates but there is an energy storage component that is necessary in order to integrate renewables and renewables are interesting because they basically reshape the demand curves and so it's not your traditional demand curve anymore. In California they have what's known as this duck curve which basically takes on a whole different shape than they had before because the renewables can provide power at different times than the typical. So from a technology perspective there's lots of different ways to do that from an energy storage and I know, Mark you were. From an energy storage side we're seeing our customers get a much increased interest in battery storage particularly if they're installing renewable energy to provide the backup for the interminancy as well as frequency regulation and load leveling type of things. So when you combine storage and that's where we're starting, as I said starting to see a real growth in the demand and the interest for storage on site behind the meter if you will for battery storage I think you'll see that in the coming years a lot of growth in that area. To address that question. I just wanted to add real quick that demand response can also be a solution here for helping to integrate and shift load. So a great example would be my friend's dad has a pool and the utility said this is a form of demand response hey if we pay you $30 a month can we occasionally turn off your pool filter for 15 minutes at a time. So what they're doing is when they have too much load they're just temporarily shutting him off for 15 minutes and then turning it back on again. So it's another way of sort of managing those imbalances on the grid and as a consumer he pretty much likes it because he doesn't even notice and he gets money. I have to put a quick plug into again the combined cycle natural gas plants or peaking plants that can turn on very quickly. You have wind a lot of situations and particularly we've noticed this in Texas that it just dies it just falls off and you need something a resource that can quickly turn on to start to meet that need and right now the one that's filling it is natural gas. And just a quick comment on that. We've seen an evolution and we're not in adolescence on this conversation we're just still at the beginning. What will create these technologies being readily available is a market signal that comes from the regulatory framework. So if we provide a value for those services and they're often called ancillary services then the marketplace will deliver those technologies and they might be storage, they might be CHP, they might be any number of technologies we can't even think of right now. But if there is not a clear path for investment and a clear way to monetize the value of those services we won't have it. And there is a federal government role not just education for the state and regions but also through FERC, the Federal Energy Regulatory Commission they sometimes weigh in on those kinds of issues where they have jurisdiction. So that's another area where federal government policy can be helpful in making sure that those technologies can be delivered cost effectively for customers. So I wanna get to the natural gas question and then this gentleman had a question. So yeah. So great question on methane. So one of the ways that we're helping to reduce our methane emissions is by replacing our old distribution gas pipeline. Up in the Northeast we have some of the oldest infrastructure in the country. There are parts of the Northeast, I'm not gonna name any names, where we are using wood as pipe to continue to provide commodity through parts of the country. So obviously we need some upgrades which is why your electric and gas bill may also see some increase. But just to give you a sense, we spend about $190 million annually to replace old leak prone pipe. There's a lot of cast iron pipe in our part of the country and so we're replacing that with plastic which is much more efficient and also helps reduce methane leaks. So that's one way we're attacking that problem. Any other comments? No, we're not a producer. We believe that those issues need to be addressed and we are working with others in the industry to talk about the best means to address them. Right, so I saw, if you could just do them in sequence to your question and then did you have a question you wanted to ask? Yeah. Elizabeth, please. Do you wanna come up? No, I don't think anyone will hear you unless we have it on the mic. So we're gonna take one last comment here. So on the question before, thank you for coming on up and please introduce yourself. Thanks. Oh no, come over here. Okay. Blinded by the light. Sorry folks. Just to respond to a question about intermittency particularly in the West in California where we have the duct curve. My firm represents the Sacramento Municipal Utility District, one of the sponsors of the fact book. One of the ways that SMUD is managing the intermittency problem is through joining the energy and balance market which is a voluntary system in the West that helps match up load to that renewable overage in key areas. So it so far is working well. It's relatively easy to sell renewables into the market and match them where they're needed. So it's a good solution for the West and it's important that it stay voluntary which allows each of the utilities to bid in or bid out as needed. So this kind of solution is another option to a more formalized market that might take place in the East. Thank you. Good to have you. Okay, thank you. I've been very patient. What is your question? I'll try to repeat it. I'm talking about utilities view themselves. Yeah. Can I repeat the question? Sure, so the question was about electric vehicle charging units and how utilities view that as an opportunity and some of the partnerships and whatnot that we're working on. So I wish I had my stats because we just announced a big program in Massachusetts where I think we're installing and don't quote me on this. I wanna say 15,000 electric vehicle chargers over the next five, 10 years. I can't remember the exact number. But we see that as a huge opportunity going forward. It's a great opportunity. I mean, talking about kind of demand response and other types of things, providing opportunities on the grid, other advantages to creating a more synchronized grid. And so we've been working closely with our trade association, the Edison Electric Institute. This is a huge priority for them and the electrical vehicle drive association and others across the country to figure out ways that we can be a part of the solution of advancing electric vehicle technology and using that as a real tool for us as well to help create more customers, frankly, to use some of the great electric resources we have up in the Northeast. Okay, well, I'd like to try to close on time and I wanna thank everybody for coming. I really wanna thank, wait, don't get up yet, ESI as our partner in this event. And I'd like to take a moment for all the staff from the business council and ESI that work and lead our federal education and advocacy initiatives to stand up so we can introduce you. I can start with the, yes, and they get applause. Yeah. I'm gonna introduce Ruth McCormick. She's the director of state and federal affairs for the business council. She probably sees many of you in your offices. And Carol, do you wanna introduce Amory or others? Right, so Amory LaPorte right here. If you have questions from the ESI front, yes. And he gets applause too. And I'd like to thank the caucus for the House and the Senate caucuses for letting us work together. And it's gonna be a big year on energy and they're excellent resources. So thank you all for coming and enjoy the rest of your Friday.