latest-news-headlines Market Intelligence /marketintelligence/en/news-insights/latest-news-headlines/eei-to-push-for-methane-measuring-electric-vehicle-incentives-in-2020-56988580 content esgSubNav
Log in to other products

 /


Looking for more?

Contact Us
In This List

EEI to push for methane measuring, electric vehicle incentives in 2020

Blog

Essential Energy Insights - March 2021

Blog

what is the impact of the eu sustainable finance disclosure regulation sfdr

PODCAST

Episode 8: What the SolarWinds compromise means for information security

Blog

Infographic Q4 20 US Power Forecast


EEI to push for methane measuring, electric vehicle incentives in 2020

In its annual presentation to Wall Street, Edison Electric Institute leaders outlined plans to measure methane emissions by natural gas suppliers, lobby hard for electric vehicle tax incentives and execute its strategy to slash emissions by its electric utility member companies 80% by 2050.

During the briefing, held at the University Club of New York Feb. 5, EEI President Thomas Kuhn characterized the past 10 years as a journey toward a grid that is not only cleaner but "smarter and stronger."

As he did in 2019, Kuhn reminded attendees that electric utilities represent 5% of U.S. GDP. "I always say we're the first 5% because without electricity you really haven't got much of a GDP," he quipped.

Kuhn noted the shift to renewables and energy efficiency has helped investor-owned utilities reshape their image. "If we really look at where we were ten years ago, the utilities were looked upon as the problem for CO2 emissions," said Kuhn. "Now we're looked upon as the solution, not only for our industry but for other sectors of the economy as well."

In 2018, EEI's investor-owned utility members achieved a 37% reduction in carbon from 2005 levels, according to EEI's presentation at the event. The 2020 figure is likely to be around 40%, according to Brian Wolff, executive vice president for public policy and external affairs at EEI. By 2050, EEI expects its members to have cut carbon 50% by 2030 and 80% by 2050.

"That's constantly moving," Wolff assured attendees. "Companies are constantly changing and moving that up a bit as they balance out their fuel mix [and] as they balance out their investments."

"The progress we've seen is amazing, new commitments almost every week from our member companies," said Kuhn.

Projections for capital expenditure by EEI companies were shown to have reached a peak in 2019, at $135.6 billion, with 2020's projected CapEx at $128.1 billion. By 2021, CapEx is expected to decline to $118 billion.

"The EEI Index gained 25.8 percent in 2019 and has produced a positive total return in 15 of the last 17 years," EEI said in its prepared remarks, noting that the industry produced returns greater than 10% in 12 of those years and including five years with returns exceeding 20%.

A major shift in the industry began in 2009, according to Wolff, who called the year a "particularly pivotal moment."

"If you all recall, not only did we have a new president that was inaugurated, we also had a Democratic House and a Democratic Senate," said Wolff. "We really came to the table [and] ushered to the table our entire industry to be able to talk about our clean energy vision."

In the 2010s, $900 billion was invested in renewables in the U.S., with renewables now accounting for 58% of new projects, according to Wolff.

"We're typically a long-term planning industry, so I was always very interested to see what an accelerated energy transformation would look like," said Wolff, who has observed a dramatic ramp-up in greening the U.S. energy space over the past five to six years.

Meanwhile, innovations in smart grid, micro grid and battery storage technologies are also driving U.S. decarbonization, while electric vehicles and their charging stations have entered the mainstream.

"It's no longer a prospect, it's reality," said Kuhn of electric cars. "You have a situation right now where there are 1.5 million cars on the road, where major companies' fleets are turning to electric."

"it is vital that we advance public policies that support the substantial investments companies are making," EEI said in its statement, citing its support for the EV tax credit. EEI plans to continue lobbying the U.S. Congress for the EV tax credit, while also lobbying lawmakers for regulations that "support investments in EV infrastructure and other approaches to grow the electric transportation market, such as education, incentives, and managed charging."

"Our industry is the only industry with an ESG sustainability template that's used industry wide," added Richard McMahon, senior vice president for energy and supply finance at EEI. "Lately we've brought [the American Gas Association] into our industry effort and it's really, really, I think, a huge positive for the industry."

The "natural gas sustainability initiative" is designed to provide EEI members and their natural gas suppliers with a "standard methodology to report methane emissions across the value chain," according to prepared remarks published by EEI the day of the event. The new framework will initially focus on methane emissions, with plans of incorporating additional ESG measures over time

EEI expects to make progress on its targets regardless of which party prevails in the 2020 elections.

"Wednesday Nov. 4 will dawn with the same strategic focus and vision that we had the night before," said Kuhn. "It's not going to change."