2. Building Michigan’s “Green and Blue”
Economy
Michigan’s Opportunity to Lead in the
Sustainable Economy of the Future
John Austin, President, Michigan State Board of Education
Brookings Institution Non-Resident Senior Fellow
Director, Michigan Economic Center at Prima Civitas Foundation
THE BROOKINGS INSTITUTION METROPOLITAN POLICY PROGRAM
Michigan Energy Forum
SPARK – Ann Arbor
June 5, 2014
3. GLEI
BROOKING
First, our natural resources and our water
were used to grow and transport the rich
bounty of our region – people flocked here…
4. GLEI
BROOKING
Food, livestock, timber, and rich raw materials were
converted; energy produced, water used and
abused as input to great agro-industrial enterprises
that grew here…We ruled the factory economy!
5. What is our future past Factory Economy? Late Ned Gramlich, University
of Michigan provost and Federal Reserve Board Governor summarized
nicely our hopes and the reality of Michigan’s economic promise when he
said: “The opportunity for the Great Lakes States to thrive economically, as
a center of innovation, and as an environmentally sustainable, clean-green
playground for our nation’s people to live and work is unrivaled.”
6. In a global economy, where top talent, and firms can be
anywhere…Michigan’s communities have to be special
places….a place people choose… to live, work, and do their
business
Today Quality of Life and Place Matter
7. “Green” communities have a higher quality
of life, better economy, residents spend
more time on amenities, and they attract
and keep talent (Bieri, U of M, “Are Green Cities Nice Places to Live?”)
8. GLEI
BROOKING
Why don’t we solve world problems
here? Meet global needs for energy,
water, food, and mobility solutions in
Michigan – huge new markets…
9. Provide leadership in the coming “green” and “blue”
sustainable economies based on smart energy and water
use…
10. GLEI
BROOKING
Become the “silicon valley”of new mobility-need
to link people and goods movement with IT,
develop sustainable integrated systems here…
The Energy We Use The Infrastructure We Build
The Products We Buy The Places We Live and Work In
13. Blue Economy
Water cleaning, monitoring,
conservation technologies
Building retrofits, water
infrastructure repair, turbine
machining, “blue-collar” jobs
“Blueways”,wetland
preservation, waterfront
renewal, water trails
Rain gardens, ‘grey-water
systems: new “Blue” culture
Green Economy
Wind, solar, battery, bio-mass, next
energy technology creation
Building retrofits, turbine
machining, solar panel production,
transit-building: “green collar jobs”
“Greenways”, parks, open-space:
“green” places
Green roofs, recycling, local food:
“green” culture
‘Blue is the New Green’
14. GLEI
BROOKING
We have the assets to lead in the
Blue - Green Economy
Location: Sustainable platform for population and economic growth
Water and green outdoors is a place–definer…“magic”…PURE MICHIGAN
Economic attractor: recreation, tourism, quality of life advantage, outdoors
(green) and water (blue)-based economic development
New “green and blue jobs”:
Water: 1 Million “Blue Economy” jobs already – 4th highest share in nation,
freshwater work is growing $74 trillion global business
Clean Energy: Michigan 12th in nation in green’jobs– 9th in biomass energy
production, 10th and 4th largest wind and solar states
Clean energy market is a $260Billion market, worldwide
Nationally employs 2.7 million and growing – bigger than bio-med
Innovation hub: public-private research and learning centers can grow
here to drive sustainability revolution
18. MOST ENERGY RESOURCES REQUIRE
LARGE QUANTIES OF WATER
Thermal electric
technologies
• Coal
• Natural Gas
• Nuclear
• Biomass
• CSP (Concentrated
Solar Power)
• Geothermal
144 coal plants on Great
Lakes and 38 operating
nuclear plants
• 76 percent of water
withdrawals in GL Region
• 41 percent of water
withdrawals nationally
19. Water Use for Energy Production
Includes upstream water use (coal
mining, hydraulic fracturing for
natural gas) and electric generation.
20. Thermal Electric Generation
More than 90 percent of U.S. power plants
need cooling.
Thermoelectric – use a heat source to
produce steam for generating electricity.
21. Withdrawal vs. Consumption
Water withdrawn - total volume removed
from a water source. Often, a portion is
available to be used again.
Water consumed – removed for use and
not returned to its source.
22. Trade-Offs
Closed-cycle cooling systems consume more
water, up to 70% of water withdrawn due to
evaporation, but they withdraw between 95
and 98 percent less water than once-through
cooling systems.
23.
24.
25. RE and Energy Efficiency
Renewable energy systems like wind
and solar PV don’t rely on
thermoelectric power generation and
consume very little water.
EE - Reducing demand for energy will
reduce demand for water.
26. Integrated Resource Planning (IRP)
• A plan developed by an electric power
provider that defines the short and long term
capacity additions and demand side
management programs that it will undertake
to meet projected energy demands.
• Reflect fuel cost and volatility, the effects on
air and water, national security, climate
change, etc.
27. IRP in Michigan
• Public Act 286 requires an IRP to be prepared
and filed by utilities when filing an application
for a certificate of necessity with the Michigan
Public Service Commission.
• PA 286 developed 2007-2008, passed in 2008.
28. Water Withdrawal Assessment Tool
• PA 188, 189 of 2008 - created framework for
management of water withdrawal and
diversion from the Great Lakes basin.
• Developed 2007-2008, passed in 2008.
29. 2007-2008
• Water Withdrawal Policy Discussion
– Sen. Patty Birkholz
– Bottled water, agriculture
• Energy Discussion
– Sen. Patty Birkholz
– PA 295 of 2008 – renewable energy standard
– PA 286 of 2008 – Integrated Resource
Planning
31. IRP in Arizona
IRP must address:
–load-serving data regarding air emissions,
water consumption, and tons of coal ash
produced
–environmental impacts related to air
emissions, solid waste, and other
environmental factors and reduction of
water consumption
33. Water and Energy Nexus
Nick Schroeck
Director, Transnational Environmental Law Clinic, WSU Law
Executive Director, Great Lakes Environmental Law Center
Photo Credit: Jeff Schmaltz, MODIS Rapid Response Team, NASA/GSFC
36. Water Quantity
• Common Law is inadequate to safeguard
water quantity
• Reasonable Use Doctrine
• Oil and Gas Development
37. Great Lakes Compact
• Background and brief discussion of what the
Compact does and does not require
• 100,000 GPD threshold only applies to
registration and reporting
• 100,000 GPD threshold may be too high
• Compact does not require states to establish
consumptive use thresholds
38. Example of State Implementation: The
Michigan Water Withdrawal Act
• Ensures compliance with Compact’s Decision-
making Standard
• Defines adverse resource impact
• Water Withdrawal Assessment Tool
39. Suggestions to Strengthen the
Compact’s Water Quantity Protections
• Condition approval of withdrawals on
environmental review, not just registration
and reporting
• Consider lowering threshold level
• Set Consumptive Use ceiling
• Increase sanctions for non-compliance
40. http://www.glangler.com/
Integrating Energy and Water
Resources Decision Making in the
Great Lakes Basin
An Examination of Future Power
Generation Scenarios and Water Resource
Impacts
Great Lakes Energy-Water Nexus Initiative
41. Project Goals and Objectives
• Water and Energy = inextricably linked
• http://glc.org/projects/energy/glew/
• Thermoelectric Power Production:
– Great Lakes basin water use
– Aquatic resource impacts and ecological
vulnerabilities in tributary watersheds
– Future power generation scenarios
– Potential policy & regulatory implications
45. Policy Implications
The Great Lakes and St. Lawrence River Basin Water
Resources Compact
• Thresholds for Reporting and Registration:
– Withdrawal: 100,000 GPD
– Consumption: 5 MGD (subject to regional review)
• States may set their own thresholds!
• GLEW Scenarios:
– Result in varying projections of water use and, thus, varying
implications for compliance with Compact guidelines
46. Policy Implications, cont.
• Compact threshold violations vs. vulnerable watersheds
– What’s the connection?
24 30 27 18 27 24
+ 6
+ 3
-6
+ 3
-10
-5
0
5
10
15
20
25
30
35
2007 BAU 2035 NNOLC
2035
OLCP 2035 RPS 2035 CCS 2035
NumberofWatersheds
Change from 2007
Remember: a number
of watersheds straddle
a “tipping point” on the
verge of vulnerability…
…Even withdrawals
below current Compact
thresholds could have
adverse impacts in
these areas
…Registration and
Reporting do not
preclude a user from
withdrawing the
resource
Reference: Natural Resources Defense Council (NRDC), Climate Change, Water, and Risk: Current Water Demands Are Not Sustainable (July 2010), available at http://www.nrdc.org/globalwarming/watersustainability/files/WaterRisk.pdf.
Largest freshwater system on the earth. Bordering 8 states, 2 provinces. Approx. 21% of the world’s freshwater supply. Drinking water for tens of millions of people. 10% of US population, 30% of Canadian population live in the Basin. World class fishery, over 250 species of fish. Manufacturing, tourism, argiculture. Many threatened and endangered species call the Lakes home.
The following slides present an overview of the Great Lakes Energy-Water Nexus Initiative, a 21-month effort led by the Great Lakes Commission. The information has been compiled from several supporting/background documents:
Energy and Water in the Great Lakes (V. Tidwell, B. Moreland, Sandia National Laboratories)
Environmental Rules to Classify Basins for Sensitivity to Future Energy Development (M. Bain, Cornell University)
The Confluence of Power and Water: How Regulation of the Electric Power Grid Affects Water and Other Natural Resources (J. Moore, Environmental Law and Policy Center)
Great Lakes Energy Facility Siting (N. Schroeck, Great Lakes Environmental Law Center)
Based on what we know about the strong linkages between energy and water in the Great Lakes basin, we designed the GLEW project to:
Examine water resource use for power production in the basin
Examine potential aquatic resource impacts and ecological vulnerabilities in tributary watersheds associated with power production
Lay out a series of future power generation scenarios to examine changes in water use and aquatic resource impacts
Examine potential changes in energy policy and power production facility siting associated with a changing Great Lakes power profile
24 watersheds exhibited high vulnerability
21 exhibited moderate vulnerability
57 exhibited low vulnerability
5 watersheds along the St. Lawrence River were excluded from analyses 102 HUC8s were examined for this portion of the project
29 watersheds exhibited high vulnerability
29 exhibited moderate vulnerability
29 exhibited low vulnerability
15 exhibited extremely low vulnerability
Only 15 (14.7%) regions have extremely low threat, meaning that 85.3% of regions have some threat due to thermal loading and coldwater resources
5 watersheds along the St. Lawrence River were excluded from analyses 102 HUC8s were examined for this portion of the project
18 watersheds exhibited very high water quality threat
19 exhibited moderately high threat
19 exhibited moderate threat
43 exhibited low threat
3 exhibited no (extremely low) threat
Great Lakes Compact (2008)
Thresholds provided by Compact:
100,000 GPD (gallons per day) = withdrawal threshold for reporting and registration
Withdrawals over this amount are subject to possible legal action by any aggrieved citizen
5 MGD = consumption threshold (over 90 day period)
Most GL states have passed legislation setting consumptive use thresholds at 2 MGD, with varying consequences for exceeding this amount
GLEW scenarios examined result in varying projections of water uses due to changing thermoelectric demands; potential for varying regulatory implications for power producing facilities pursuant to Compact guidelines
Figure used as reminder of how various scenarios affect watershed vulnerability
Points to keep in mind:
Several watersheds are on the verge of ecological vulnerability
Thus, even water use below the Compact thresholds could adversely impact these areas
The “registration and reporting” required by the Compact do not preclude a user from withdrawing the resource
States should consider requiring prior approval of withdrawals, especially in these vulnerable areas
The GLEW Model can help to, at a minimum, identify where the most vulnerable areas are
Additionally, the Compact requires “cumulative impact assessment,” every five years OR when the basin experiences an increase in water losses greater to 50 MGD (over 90 day period)
The GLEW model can be used to help prevent excessive water use (i.e., to trigger timely assessments!) throughout the basin; can help to highlight where losses are occurring (at HUC8 watershed scale)
