Presentation to thePresentation to the

St. Louis Regional Chamber and St. Louis Regional Chamber and Growth Association (RCGA)Growth Association (RCGA)

Energy and Environmental CouncilEnergy and Environmental Council

by Commissioner Kevin Gunnby Commissioner Kevin GunnMissouri Public Service CommissionMissouri Public Service Commission

SEPTEMBER 15, 2009SEPTEMBER 15, 2009

DisclaimerDisclaimerThe opinions expressed here are mine, and The opinions expressed here are mine, and mine alone, and are not those of the mine alone, and are not those of the Commission, any Commissioner (other than Commission, any Commissioner (other than myself) or any member of the Staff of the myself) or any member of the Staff of the Commission. Commission.

Further, nothing in this presentation should be Further, nothing in this presentation should be attributed to any case or matter before the attributed to any case or matter before the Commission, to any member of the Staff of the Commission, to any member of the Staff of the Commission, other Commissioners or the Commission, other Commissioners or the Commission.Commission.

Commissioner Kevin GunnCommissioner Kevin Gunn

Lawyer in private practiceLawyer in private practice

Chief of Staff for Rep. Richard GephardtChief of Staff for Rep. Richard Gephardt

Missouri Public Service CommissionerMissouri Public Service Commissioner

2009 Eisenhower Fellow2009 Eisenhower Fellow

NARUC Board of DirectorsNARUC Board of Directors

NARUC Water CommitteeNARUC Water Committee

Climate ChangeClimate Change

What are the assumptions for this What are the assumptions for this presentation?presentation?

Climate change is real Climate change is real

The effects of climate change will do The effects of climate change will do substantial harm to the global environment substantial harm to the global environment and global economyand global economy

STERN REPORT: SUMMARY

450 PPM•Severe impacts on marginal Sahel region, Africa•Small mountain glaciers disappear worldwide•Coral reef ecosystems extensively and eventually irreversibly damaged

550PPM•Failing crop yields in many developing regions•Significant changes in water availability•Possible onset of collapse of part or all of the Amazonian Rain forest•Many species face extinction (20-50% in one study)•Rising intensity of storms, fires, droughts floods and heat waves•Possible increasing natural methane releases (positive feedback loop) •Weakening of the Atlantic thermal Haline Circulation•Onset of irreversible melting of the Greenlands ice sheets

•Conclusion: Aim to stabilize at 450ppm not 550ppm atm CO2

Still a Skeptic?Still a Skeptic?

Take a Risk Management Approach:Take a Risk Management Approach:

What are the consequences of What are the consequences of believers or skeptics being believers or skeptics being wrongwrong??

Transformational ImpactsTransformational Impacts

The transformation to a carbon restricted The transformation to a carbon restricted environment does have impacts:environment does have impacts: Cap and Trade will raise electricity ratesCap and Trade will raise electricity rates Renewable Portfolio Standards will change Renewable Portfolio Standards will change

generation and may increase costgeneration and may increase cost Transmission costs will riseTransmission costs will rise Jobs will be lostJobs will be lost

MitigationMitigation

Growth of “Green Jobs” (not necessarily a Growth of “Green Jobs” (not necessarily a 1 for 1 proposition)1 for 1 proposition)

Rise in Wind/Solar/Biomass GenerationRise in Wind/Solar/Biomass Generation

Greater concentration on Demand Side Greater concentration on Demand Side rather than Supply Siderather than Supply Side

Efficiency as a fuelEfficiency as a fuel

Renewable Potential in MissouriRenewable Potential in Missouri

Efficiency Efficiency

SolarSolar

WindWind

BiomassBiomass

HydroHydro

EfficiencyEfficiency

SB 376 allows cost recovery by UtilitiesSB 376 allows cost recovery by Utilities

Spend pennies to save dollarsSpend pennies to save dollars

Cheapest for utilities and ratepayersCheapest for utilities and ratepayers

Incorporates both low-tech (insulation) and Incorporates both low-tech (insulation) and high-tech (Smart Grid)high-tech (Smart Grid)

SolarSolar

Required by Missouri’s Renewable Required by Missouri’s Renewable Portfolio StandardPortfolio Standard

There is some Solar PV potentialThere is some Solar PV potential

Technology is getting more efficient every Technology is getting more efficient every dayday

Wind PotentialWind Potential

Missouri’s potential is in the Northwest Missouri’s potential is in the Northwest cornercorner

Some reports say that Missouri has about Some reports say that Missouri has about 5,960 megawatts of potential wind 5,960 megawatts of potential wind capacitycapacity

National Renewable Energy Laboratory Innovation for Our Energy Future

Missouri’s greatest renewable potential?Missouri’s greatest renewable potential?

BIOMASSBIOMASSCrop residue Crop residue

Switch grassSwitch grass Timber harvest residueTimber harvest residue

Methane from Biologic SourcesMethane from Biologic Sources

Landfill methaneLandfill methane Demonstration projects in Jefferson City and St. Louis Demonstration projects in Jefferson City and St. Louis

CountyCounty 6.9 trillion BTU potential6.9 trillion BTU potential

Demonstration Demonstration ProjectsProjects

Landfill GasLandfill Gas

HydroHydro

Small turbines in Mississippi Lock and Small turbines in Mississippi Lock and Dam systemDam system

Low flow turbinesLow flow turbines

Creative turbine designCreative turbine design

What about Nuclear?What about Nuclear?

Only renewable currently able to meet Only renewable currently able to meet baseload generationbaseload generation

New nuclear incredibly capital intensive New nuclear incredibly capital intensive (new plant cost estimates of $6-11(new plant cost estimates of $6-11BBillion)illion)

Opposition seems to have transformed Opposition seems to have transformed from environmental to economicfrom environmental to economic

What are the next steps?What are the next steps?

Utilities need to encourage efficiency to mitigate Utilities need to encourage efficiency to mitigate impact of carbon restrictions (SB 376)impact of carbon restrictions (SB 376)

Missouri needs to take advantage of natural Missouri needs to take advantage of natural renewable potentialrenewable potential

Economic development strategies such as tax Economic development strategies such as tax credit programs should focus on renewable credit programs should focus on renewable generation as high potential projectsgeneration as high potential projects

There is still time to mix old world manufacturing There is still time to mix old world manufacturing economy with new world green economyeconomy with new world green economy

Thank you!Thank you!

Questions?Questions?