Wih few exceptions, scant attention has been given to integrating energy and environmental goals and strategies. U.S. energy and environmental laws are written with little sensitivity to these intersections. For example, the Clean Air Act does not provide clear guidance or means of crediting renewable energy developers with the environmental benefit of their actions. (REPP will pursue this subject in future research projects.) EPA and the Department of Energy operate largely independently of one another.

The few instances in which energy and air pollution objectives have been merged provide a starting point for more ambitious thinking. The acid rain program, adopted in the Clean Air Act Amendments of 1990, allows utilities to achieve required reductions in SO_x emissions through investments in energy efficiency and renewable energy. Reductions greater than required result in tradeable credits, which have a market value. However, most utilities have found it easiest to comply by importing low sulfur coals and other strategies that avoid the need for new technology. The Energy Policy Act of 1992 provides economic incentives for use of non-petroleum fuels, although without regard to relative differences in their environmental benefits and without eliminating tax differences which continue to favor gasoline over better alternatives.⁵³

A serious approach to linking energy and environmental goals would require more radical changes in the regulatory system. For example, increased reliance on pollution taxes would reflect more accurately the environmental costs of pollution and, at the same time, create an economic incentive to avoid generating emissions. Proposals for such major changes in environmental regulation are increasingly being proposed from diverse quarters, partly in reaction to the ill-considered and unsuccessful attack on pollution control laws in the previous Congress. While much hard thinking remains, the prospect of making renewable energy an integral part of achieving our environmental goals may be near.

The potential to use renewable energy technologies much more effectively to meet air quality goals is illustrated by a 1993 report of the Center for Global Change (CGC) to the South Coast Air Quality Management District (SCAQMD).⁵⁴ The District is responsible for meeting air pollution standards in Southern California, the region that faces the most severe air quality problems in the United States. While the region is not ideally suited for all renewables technologies, certain applications could be highly effective in reducing southern California's air emissions.

PHOTOVOLTAICS AND EMISSIONS REDUCTIONS The environmental benefits of photovoltaic systems were tested in 1993 and 1994 in a cooperative project involving EPA and 11 electric utilities nationwide [Arizona Public Service, Atlantic City Electric, City of Austin Municipal Utility, New England Electric System, New York Power Authority, New York State Electric and Gas, Northeast Utilities (CT, MA, NH), Northern States Power (MI, MN, ND, SD, WI), Pacific Gas and Electric (CA), Southern California Edison, and Wisconsin Public Service]. The measured performance of sixteen PV systems was combined with emission rate and load data from the participating utilities to determine potential emission reductions. The results showed that the emissions offset varied enormously as a function of the utility fuel mix and generating equipment, by a factor of three for CO2, four for SOx, thirty for particulates, and more than eighty for NOx. Variations in the solar resource proved to be much less important. Another interesting result is that a simulation of emission offsets showed a reduction of about 25% in emissions when storage systems were added to the PV systems. This is because more of the displaced power was from off-peak periods when most utilities use cleaner and more efficient powerplants. Source: Edward Kern and Daniel Greenberg, Demonstration of the Environmental and Demand-side Management Benefits of Grid-connected Photovoltaic Power Systems (Cincinnati: U.S. EPA, National Risk Management Research Laboratory, Nov. 1996, EPA/600/SR-96/130). See also Edward Kern and Anne Polansky, "How Many Rooftop PV Systems Does it Take to Save the Earth?" Solar Industry Journal 4 (Fourth Quarter 1993), 18-27.

The CGC study suggested a three-pronged strategy to reduce emissions of two problem pollutants- NO_x and reactive organic gases-by 85 percent and 53 percent respectively, relative to currently projected emissions in 2010. The proposed strategy involves the following elements: (1) increasing the renewables fraction in electricity generation by utilities acquiring new renewable resources, retiring old fossil capacity, and using PVs for peak load-shaving and other high value applications; (2) replacing fossil fuel combustion and other processes through electric vehicles, heat pump water heaters, and improved industrial processes; and (3) using cost-effective solar technologies for water heating in homes and office buildings, for swimming pools, and in low temperature applications.

While far from definitive, the study illustrates how an examination of air pollution sources by region can identify numerous opportunities for using renewable energy technologies to reduce emissions. The study also found that the higher the cost of other options for meeting air quality goals, the stronger the case for renewables. Finally, the study shows that the time frame for air quality planning in many regions-up to 2010 in Southern California-is more than sufficient to allow for the transition to increasingly cost-effective renewable energy technologies.

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