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Analysis: Experts skeptical of Sanders' $16.3 trillion 'Green New Deal' proposal

Highlights

'Unicorns ... signaling to a progressive base'

Hard to decarbonize last 20-30%

Rejecting nuclear option questioned

Houston — Bernie Sanders on Thursday released a $16.3 trillion "Green New Deal" plan that would, among other things, eliminate fossil fuels from power plants and transportation by 2030. Specific aspects drew power sector observer descriptions ranging from "complete garbage" to "probably not doable."

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The 37-page plan contains the following proposals relevant to the electricity industry:

  • 100% renewable energy for electricity and transportation by 2030.
  • Directly investing $16.3 trillion over 10 years toward these and other climate-related efforts.
  • Grants and trade-in programs to buy electric vehicles for families and businesses, and buses for school districts and transit agencies, plus funding for private businesses to replace shipping trucks.
  • Build regional high-speed rail and expand public transit ridership by 65% by 2030.
  • Expanding four federal Power Marketing Administrations and the Tennessee Valley Authority, plus creating a new federal power authority to serve the Northeast and Midwest.
  • Stop the building of nuclear power plants and declare a moratorium on license renewals.
  • Invest $30 billion for a "StorageShot initiative to decrease power storage costs "dramatically".

"This plan will pay for itself over 15 years," the plan states, in part by "making the fossil fuel industry pay for their pollution, through litigation, fees, and taxes, and eliminating federal fossil fuel subsidies," and from the sale of electricity from the newly expanded federal power authorities.

"Revenues will be collected from 2023-2035, and after 2035 electricity will be virtually free, aside from operations and maintenance costs," the plan states.

The renewable energy section of the plan states, "We will end greed in our energy system."

'COMPLETE GARBAGE': ANALYST

"This plan is complete garbage," said Campbell Faulkner, senior vice president and chief data analyst at OTC Global Holdings, an interdealer commodities broker. "Regardless of your political persuasion, this plan is likely illegal and totally ignorant of the emergent phenomena that drive reduction and efficiency. Total energy consumption per capita has been and will continue to be reduced via natural innovation and pricing mechanisms without centralized planning."

Morris Greenberg, S&P Global Platts Analytics managing director of North American power, said in an email Thursday, "Power would not be free (including recovery of fixed costs) but prices could be zero for many hours given potential periods of surplus wind and solar."

"Making some educated guesses about the assumed evolution of costs, I would say that the total renewable and storage investment numbers look like they would get close to the required capacity (probably not enough storage to get 100% off fossil generation)," Greenberg said. "However, the annual rate of investment would be much higher than we have ever seen to date and there could be shortages of materials and skilled labor as a result."

None of the industry observers who offered comments said achieving 100% renewable power in the electricity and transportation industry by 2030 is possible, either physically or politically.

"While we definitely need to move to a much cleaner electricity and transportation system, 100% renewable electricity + 100% electrification of transportation by 2030 is frankly impossible," said Joshua Rhodes, a University of Texas Energy Institute research associate.

'THE LAST 20-30% IS MUCH HARDER'

"Study after study shows that the grid can get to high levels (70-80%) of renewables, but that last 20-30% is much harder," Rhodes said in an email Thursday. "These types of plans that limit the decarbonization toolbox only make it harder and increase costs."

OTC Global's Faulkner said Sanders' plan "is pure unicorns and virtue signaling to a progressive base."

"Unless we are moving back to whale oil lamps/wood heating along with the removal of HVAC and computing from modern life, there is absolutely no way to eliminate fossil fuels from the generation mix," Faulkner said.

Matt Mooren, a PA Consulting energy markets expert, said the plan is also "probably not doable."

"The proposed national target of 100% renewable energy by 2030 is more aggressive than the most progressive renewable energy states like New York and California, which have lower 2030 targets and longer-dated 100% renewable and carbon-free targets than Senator Sander's plan," Mooren said in an email Thursday.

THE NUCLEAR OPTION

Several industry observers questioned the plan's rejection of nuclear power.

Fred Beach, the UT Energy Institute's assistant director of policy studies, said he had researched a proposal to shift the entire US light-duty vehicle to all electric, with all power emissions free, considering wind, solar and nuclear alternatives.

"Nuclear was the lowest by far," Beach said in an email Thursday. "Having a staunch anti-nuclear position makes achieving near term high levels of decarbonization exorbitantly expensive. Keep nuclear in the mix, and it is not only very affordable but very doable by 2050."

Matthew Cordaro, a former Midcontinent Independent System Operator CEO who now resides in New York, said, "It is quite hard to take this plan seriously" because "he wants to eliminate the largest source of emission-free power -- nuclear energy."

"At the end of the day, Sanders' proposal will mean higher energy costs, impaired reliability, higher taxes and only marginal, if any, reductions in emissions," Cordaro said in an email Thursday. "Sanders pushed for his home state of Vermont to get rid of nuclear and because of that its emissions today are much higher than they were with Vermont Yankee operating."

Mike Jacobs, senior energy analyst at the Union of Concerned Scientists, noted that transitioning from one power source to another requires an engineering review of transmission and distribution connections.

"These have never been fast, meaning that changes to the electricity supply on the scale of a five-fold increase of renewable energy will need longer than 2030," Jacobs said in an email Thursday. "Ultimately, details matter. Keeping old fossil capacity available, but running it very rarely, is a step in the transition."

-- Mark Watson, markham.watson@spglobal.com

-- Edited by Gail Roberts, newsdesk@spglobal.com