The topic that we are looking at is one that is exciting, it has already achieved so much. So what are we talking about? We're talking about how we can have an energy efficient infrastructure that provides for much greater resiliency in our local economies and our local communities that we can do this through looking at district energy, what it is doing in communities and at military bases, hospitals, universities, etc. CHP combined power and microcracks. And we're going to see this morning how all of these technologies play a role, come together in terms of the confluence of them, it really provides enormous opportunities for gaining an efficiency environment and sound business sense. And so I'm very, very excited that we've been working with the International District Energy Association with regard to bringing this group together as well as Senator Franken's office. We do want to mention that we are anticipating that Senator Franken is going to come by about 10 o'clock. He is juggling three to four hearings this morning, so when he comes, we will simply yield the podium to him and then we'll resume when he has to leave. But we feel very, very pleased that he is taking such a huge interest and leadership role in this whole topic. And during our session this morning, we are also going to be hearing about the overall outlook what's involved with these technologies we're going to be seeing and hearing about these studies, looking at different aspects and also looking at what's the implication for policy, what's going on in terms of thinking about both policy needs and what are we learning at a mistake level that perhaps could be replicated and utilized at the national level. Where should we be going so that we truly can breathe the promise of what we have already seen as great and growing success? So to start us off this morning, I want to turn first to Rob Thornton, who is the president and CEO of IDEA, the International District Energy Association. Rob. Thanks very much, Carol. And good morning, everyone. Thank you for joining us. Those of you from congressional staff, thank you for coming over. Those of you who sort of suffered the gauntlet of security, I think exacerbated by sequestration, thank you for making it here with us today. So this is a typical power plant. This is the average day in a typical remote power plant in the U.S. where two-thirds of the fuel is exhausted as heat. Essentially it hasn't changed a whole lot since Eisenhower was in the White House. Now the DOE has recognized this and in the quadrennial review, they've called it out that the average efficiency of a coal-fired central station power plant still is around 32%. And if you look at the coal-fired fleet in the U.S., it averages between 26.5% and 39%. It's still only about a third of the energy that goes into the plant comes out as useful electricity. We think we can do better. Let me just share you a case study. This is a power plant near where I grew up in Somerset, Massachusetts. It's the largest fossil-fired plant in New England, Brayton Point. It's about 1,600 megawatts. It's been operating since I was in kindergarten, 1964. Like most remote central generating stations, it takes the water from the Taunton River and exhausts the heat into the Mount Hope Bay. And it's been doing that since 1964. Nearly 60 years of rejected heat. And it's a lot of heat. Every year, about 37 trillion BTUs are exhausted into the bay. Now, this is really not the right solution. And in fact, it was a cause for the plant having to comply with an EPA water management requirement or thermal pollution requirement. Ultimately, they've made some changes. But every year, it's about $400 million worth of heat they're throwing away into the bay. So recently, the owners of this plant actually decided to comply, and they invested about $570 million in cooling towers. And so now this plant has these spiffy new cooling towers that really dominate the skyline in Fall River. And if you live near this plant, you might have a different view of the impact of this scale. So essentially what they've done is instead of wasting the heat into the bay, they're wasting it into the sky. So continually today, $400 million worth of heat is now still being essentially exhausted. Now, the bad news for this plant is even though the owners have invested over a billion dollars in compliance, both with it's a coal-fired and natural gas plant, even though they've done their stewardship, they've invested in compliance, the plant capacity factor is now well below economic. And it's now for sale. And recently, the owner announced they're taking a $780 million right down on this plant and another. We think there's a better solution. Instead of just exhausting the heat, you can put it in a pipe and sell the heat to heat buildings and communities nearby. Now this is not a new idea. We've been doing it for over 100 years. And in Europe, they're doing it in a profound way. We call it district heating. In Copenhagen, they caught on to this. And they built a network, a thermal transmission network of all of their power plants and they put it into a wholesale network and it supplies heat to 18 communities. And their investment in this pipe in Greater Copenhagen is about as much as that utility invested in those towers. So now Copenhagen or Denmark has this useful form of heat that's displacing emissions. It allows them to sell more gas instead of burning it. It's changed their energy trade balance from a deficit of minus $5 billion a year to a trade surplus of $6 billion a year. Now district energy alone does not account for this. But it's the underpinning. It's the foundational structure in Denmark that has enabled their energy and environmental success. So their power plants, and this plant in Copenhagen, operates at efficiency of not 37 or 32, but over 90% because they sell the heat. This plant is now being converted to be 100% renewable. It started with coal, but now it'll all be biomass. The owners of this plant actually have a very valuable asset, which will have a different future than a plant that only yields a third of its output. Very simple graph, but really what we're talking about now is recovering heat and making it useful, improving the energy efficiency of our electric and our fundamental infrastructure. So district energy combined heat and power we think is a foundational advantage for this country. Simply put, it's a central plant and in the US we have literally hundreds of these systems at a different scale. The capital power plant which provides the heating and cooling to all the buildings on Capitol Hill is a district energy system. This whole campus on the top of the hill is connected to district energy. And so we have smaller scale plants that make heating and cooling in the form of steam or chilled water or hot water, and that's distributed to buildings and they use it for heating and air conditioning. But what's now coming is really mayors want a district energy micro grid. They want to make power as well as heat and cooling. And we're seeing now an interest in local generation, smaller scale, with the sequence of extreme weather and grid issues, resiliency and reliability are becoming more of a driver, and that is our strong suit. So when you have smaller generation units populated closer to the load centers, you actually have higher reliability. And when you have a district energy network and it's connecting tens or hundreds of buildings, now you've created a thermal scale. By providing the heating and cooling to multiple buildings, it creates an economy of scale where you can invest in technologies that really don't pencil on a building-by-building basis like biomass or wood waste. Geothermal has more profound opportunities with a district energy network. But because we're underground, we're hidden from view. And frankly, district energy doesn't really get the headlines or the visibility that we deserve, but there are literally hundreds of systems in the U.S. And what this infrastructure now allows is the flexibility of multiple fuels over time. You can deploy local energy supplies, biomass, or even cold water from the nearby lake to air condition your city or campus. And so we really future-proof cities by having this thermal network. And when you have a thermal use, it makes combined heat and power or cogeneration that much more productive. By aggregating and harnessing the heating needs of dozens of buildings, we really enable cogeneration to work perfectly. All across the U.S., if any of you went to college in this country, I'd be willing to bet that you lived in a dorm that was supplied by district heating. Ubiquitous in our college campuses. And you're going to hear from one of my colleagues from Princeton University shortly. In fact, working with the Department of Energy, we've identified nearly 300 district heating systems that today have tremendous opportunity to plug in cogeneration. They've already got the heating network in place. They can add cogeneration, really dramatically improve their efficiency. And this could represent 11 gigawatts of the 40 gigawatt goal that the administration set forth in August of last year. You'll hear more about that. But the district energy industry is actually low-hanging fruit for application of combined heat and power. Top of the chart now is resiliency. Mayors want more sustainable resources. And local infrastructure in the event of climate, adaptation, and events. I'm going to close with this event. Superstorm Sandy seems like, well, it was six months ago. The biggest storm in history, a convergence of a number of factors. Total estimated economic cost over $71 billion. 21 states were affected by the storm as far west as Michigan. 57,000 utility workers had to restore power. It was an inundation of really dramatic proportions. Parts of the northeast were literally underwater and under siege. But one system in particular in the Bronx, Co-op City, stayed online. They have a 40 megawatt combined heat and power plant. There's 60,000 residents. They provide power, steam, and cooling. Sorry, sir, you're going to have to yield the microphone. So it's my pleasure to introduce our colleague and friend, Senator Al Franken from Minnesota. He's been a really strong proponent of district energy. And let's give Senator Al Franken a nice round of applause. Senator? Very impressive, smooth transition. I want to thank the Environmental and Energy Study Institute for holding this briefing. I'm glad that you're focusing on how we can increase energy efficiency and make our local energy supplies more reliable. Combined heat and power systems have a lot of potential in our economy by capturing heat that would otherwise be wasted. It can be put to use heating homes and buildings, other buildings, generating electricity, and put to use in the manufacturing process. For example, heat generated by electricity production can be captured and used to heat buildings instead of going to waste in St. Paul, Minnesota. For example, a biomass fuel combined heat and power system generates electricity, and the waste heat from the facility provides heat to about 80% of the commercial, residential, and industrial buildings in downtown St. Paul. But despite all of the benefits of combined heat and power, it is underutilized in our economy. The President has a goal of adding 40 gigawatts of new CHP to the current 80 gigawatts by 2020. I applaud President Obama for supporting CHP, but I think we can go further. I think we can double our CHP capacity by 2020. That's why I will soon introduce legislation to incentivize the deployment of these energy saving systems. CHP systems have high upfront costs, but they pay for themselves through energy savings over time. That's why my legislation will include financing mechanisms so that manufacturers and municipalities can access funds to get past these upfront costs. My legislation will also enable communities, businesses, and others to get technical assistance from the Department of Energy on setting up CHP systems so that more consumers can take advantage of these energy savings. I would encourage all of you to reach out to your Senators and ask them to support my legislation. I'm Al Franken. I want to thank Mark Spur for working with my office and for his work with the City of Grand Marais in northern Minnesota on a district heating project. I also want to thank Ken Smith for his work and the other panelists for coming here to talk about this important issue. Thank you all. Thanks very much, Senator. Thank you very much, Senator Franken. In fact, in St. Paul, in Minneapolis, we have prime examples of how district energy can provide economic environmental benefits, and he's seen it firsthand, and so we really applaud his support. And we're going to reach out to all of you. As his bill is announced, we would hope that you would help us in garnering additional sponsorship support and moving this legislation. It will be fundamental in advancing, I think, and deploying much more of the systems we're talking about. I'm going to conclude with, let me just finish my wrap up here. Moving from Minnesota back to the home of the New York Yankees. So this system stayed on when the rest of the region was dark. If this co-op city, if this were a city, it would be the 11th largest city in the United States, in New York, I'm sorry, 60,000 residents. Because they had combined heat and power on campus, they weathered the storm. And you see this in mission critical operations where you would expect energy reliability as paramount, like cities and towns. NASA Energy in Long Island stayed on the district heating cooling system in Atlantic City, where they supply energy to all the casinos, stayed on. I don't know if they had many players, but the hospital in Danbury, South Oaks Hospital, Hartford Hospital, and this is a little known, the Bergen County wastewater treatment plant had CHP and stayed on. And we often overlook the impact of when those pumps stop running and the sewage gets released into the local environment. It is not only costly, it's very dangerous. And so having combined heat and power at a wastewater treatment plant was a very thoughtful and cost-effective solution. And when we think about energy durability, we need to look at our infrastructure needs more closely. Our next panelist, Ted Borer from Princeton University, they got hit head-on.  And most of the universities that had CHP actually provided area of refuge for their students. College of New Jersey, Fairfield University, Stony Brook, even NYU in Manhattan, stayed online, except for a slight bump throughout the storm. And Princeton University, because they have a very robust district energy combined heat and power facility, really was a shining beacon of what we can deliver in terms of resiliency. And so it's now my pleasure to yield the podium to Ted Borer from Princeton University and he's going to tell you a little bit about their experience there. Thank you. Thanks so much, Rob. And I'm also so glad that you raised the whole issue of wastewater treatment facilities because as we know this is such a piece of critical infrastructure that as we think about the growing incidents of extreme weather events and the vulnerabilities that are created with very, very profound implications in terms of public health if those pumps go down. It really does need to play a role in terms of how we think about planning for our future. So as Rob said, it's so interesting to think about the lessons learned and in terms of what we saw with that dreadful Superstorm Sandy. And so we are very, very glad to have one of those folks here who really went through this and can talk firsthand about his experience. He has experienced Ted Borer who is with Princeton University and is the energy plant manager there, Ted. Thank you so much. I really appreciate that. Talking with a couple of the staff and writer who are here this morning before we started a couple of people said, well, give us the buzzword. What's the takeaway? Really simply ask the question, where's the waste and how can I take advantage of that? I think you'll find that cogeneration, CHP, district energy really answers that. So I'm going to give Princeton University as an example. This is where I work. But you can think of this as a town of 12,000 people. You can think of this as a small community. And as Rob said, honestly, I think you should hire Senator Franken because he does a better job than any of us explaining this stuff. But as he said, this can scale up nationally. This can scale up to entire large cities. And it can actually scale down very small as well. So it's quite scalable. We are a community of 12,000 people during the day. We're skewed because half our business is research. Most people know of us as education, but about half of what we do is research. So we have a little bit higher energy needs than most communities of that size. For those of you who like numbers, you can see we are a fairly energy intense organization for 12,000 people. The equipment that I've got is one gas turbine. It was actually designed for the stealth fighter. It's a very highly responsive gas turbine or jet engine. But instead of using it to move something forward, we use it to turn a generator. I've got a couple of boilers. We use the boilers to recover the heat from the gas turbine or to make steam when the gas turbine is not available. But in combination, the gas turbine and the boiler become our co-generation plant, the combined heat and power. One energy input with two useful energy outputs. The useful energy output is electricity at the generator and heat, which comes out the back end of the gas turbine or the boiler, which we make steam with to heat the campus in the winter. And in the summer, we use that steam to turn steam turbines that turn our chillers to cool the campus. So it's not only highly efficient, but it's also highly utilized through the entire year. Our capacity factor is very high. We also make chilled water just like in the Capital District. We make chilled water to cool the buildings. Very cold water picks up the heat from the buildings, takes it back to the cooling tower and rejects that back to the environment. We have one form of energy storage that is a thermal storage tank. It's about 2.6 million gallons, a little bit larger than this room, maybe 80 feet in diameter and 70 feet high. And that's enough that we can buy electricity when it's very inexpensive at night, cool off all this water and then deliver the value from that electricity when it's very valuable. So we actually have thermal storage and it makes the system very resilient, very responsive and much, much more economically efficient. If you look at the plant as an energy conversion box, we buy all these forms of energy on the left-hand side, electricity, natural gas and liquid fuel, push it through these energy conversion devices and then deliver it to the campus in the form of steam, electricity and chilled water. The co-generation system, as Rob suggested earlier, that top line is about one-third efficient. So if I buy one unit of fuel and put it in the gas turbine or one unit of fuel and put it in the jet engine and run that against the generator with nothing else, I get about one-third of a unit of energy out as useful electricity. And on an airplane, that's what happens. You lose about two-thirds of that energy that you bought, that is the pilot takes one tank of fuel, one-third of that tank of fuel pushes the airplane forward, two-thirds of that tank of fuel on the airplane heats up the sky. It's completely wasted. In our case, we put a boiler on the back end of that gas turbine and we recover half again the energy that comes in. So now instead of a one-third efficient process, I can have between a 60 and an 80% efficient process. So really we can run circles around the central utility that has no thermal customer. If they could retrofit that plant that Rob was talking about and actually port that energy out to the customers nearby, the buildings nearby, that plant too could be 80% efficient instead of rejecting all the heat up to the sky or rejecting the heat to the river. We do have a district energy system on campus, central energy plant in the bottom left, the network of green pipe shows our distribution system and we serve about 180 buildings from one plant. Instead of 180 boilers, I only need three. Instead of people and tools and equipment and emissions and fuel deliveries associated with 180 buildings, I have a few people and a few tools and they're all in one spot and that gives me the opportunity to control the noise and the pollution and make it a much more efficient and much more cost-effective system. This is a one-day period showing the power purchase and the power generation on campus. So you're looking at 24 hours.  Forget it, it's too spastic. The green and the purple are the power that we're buying on two different substations. The blue and the red is the power that we're generating with our cogeneration and our solar energy respectively. We have 5 megawatts worth of solar energy, so it's about a quarter of what the campus power generation has. So in the middle of the night we're making about 7 megawatts with the co-gen. Of course it's dark, we're not making anything with solar. And we're buying a little bit the green and the purple on each of the two substations. As the price of power comes up during the day, we push the throttle forward on the co-gen system, we make a lot more power and the sun comes up when we get a lot of solar energy. And what you see is we're backing off the purchase of power when it's expensive, but we buy a lot when it's inexpensive. So it saves us huge amounts of money. And we're actually good stewards on the grid because we're demanding from the grid when it's least heavily stressed and we're avoiding the demand on the grid when it is most heavily stressed. So it works out for us financially, but it's also a social good. I can also make the argument that we are buying the least polluting power and we're avoiding the purchase of the most polluting power. This is how it nets out over the span of a day. The green line, can you guys see that? I can't tell if that's, yeah, okay. So the green line is how much power we're buying in a 24-hour period. And the red line is the price of power. And we have over the past maybe 20 years through all of our different investments in CHP, district energy, co-generation, thermal storage, we have completely inverted what is the normal pattern of power purchase. Most people buy power in the middle of the day. They buy lots when the price is very high. Most people avoid the purchase of power because they go to sleep and don't use much when power prices are very low. We do just the opposite. We buy a whole whack of power when it's inexpensive. We store it or we use it effectively. And then through all the tools we've invested in, we avoid the purchase of power when it's very expensive. This is the economic dispatch system that we've built with an outside company. And this is an expert guidance system. Basically it tells the plant operators based on the price of power, the price of fuel, the weather, our predictive concepts about what's going to happen. It tells us how to operate the plant most efficiently. I think we'll stop on that there. But this is expert guidance. We could automate it. We choose not to. But this is really where Princeton is furthest ahead. I would suggest then probably any of our peers in the way that we operate. Not the equipment that we've got, but the way that we operate what we've invested in. During Hurricane Sandy, we were the bright spot in the sky through all of New Jersey. So we kept the lights on. We also were a place of refuge. And our steam and our heat stayed on, our steam and our cooling stayed on, so none of the research was interrupted. So we could have lost millions and millions of dollars with the research. But instead, when the utility tripped, we were able to isolate the campus. We were able to run as an island, and we were able to keep everything going and not only shelter the people on campus, but shelter some of the first responders from the local community and feed them. Things that you have to do to be reliable. You need to have a base load generator behind the meter. You need the ability to run separate from the grid. So you need to be able to run your generator separate from the grid, and not all generators are set up that way. You need black start capability, so that is you have to be able to bootstrap yourself. You can't be dependent on the outside grid for that. And you need the ability to shed load. That is, if the campus wants more power than I can generate right now, I need a way to grossly cut off parts of the campus and do a triage, essentially cut off the lesser important things and keep things like our research and the emergency facilities going. Things that make life a whole lot better because they help pay for the system and actually make the life cycle cost much lower than it would be otherwise if you just had emergency backup power. Our combined cycle, or CHP, are permitting your equipment for non-emergency use, so that diesel generator that provides the exit lights and it provides maybe power for the elevators. That's not permitted to run all the time, so I can't save any money with that. 98% of the time, it is cold iron.  My co-gender plan, on the other hand, is running more than 8,000 hours a year, so that's paying itself back very quickly. Energy storage is a good idea. It makes the whole thing more resilient, more responsive. And I'd say underground utility distribution is also one of the reasons why when the trees fall, the cars hit the poles, the animal contact, we are not subject to those kind of risks. We're able to keep the lights on through our central power plant much more reliably. And rather than showing it now, I would commend you to look at this video. You've got a link to it. Mostly the students like to criticize the administration. It's really a fine day when the students come and interview the administration and the video says, thank you, we were really glad that you had the power plant on. We were glad that we had a place to go. We were actually glad that we weren't at home during this storm. And that was a real honor. That's it. Thank you very much. That's a terrific story, Ted. And I should think that lots of universities and colleges would love to be able to replicate that and have their student bodies come back to them and offer that kind of gratitude for such sound planning. We're now going to turn to Bill DeCroche, who is the CEO for Viola Energy North America to take another look at some case studies of projects that they have done in New England and how this is part of the whole North America system. So good morning. Rob asked me to come and speak today and he talked about what segment I would talk about and I said, absolutely, that's easy. I have to describe a lot more difficult things on many days. I'm here to talk about an urban application for CHP and district energy. So as you can see, my slide is labeled Green Steam, Boston and Cambridge. And I apologize to any people who might have gone to school in Cambridge. It's not in the picture. We could have gone a little wider frame to get Cambridge in there, but it's a solution for both cities. So why do we say Green Steam? When you look at that picture of the downtown of Boston, 14 out of those high rises are heated from the district energy loop and half of that energy is waste heat that otherwise would have gone into the atmosphere or into the Charles River. So 14 out of the 22 tallest buildings in downtown, half of their heating coming from energy that would otherwise have been dumped. Now if you ask somebody in Boston who sits in one of those high rises and their buildings heated, they say, I don't know, whatever. So it's not even recognized. We've had to literally go on this effort to educate that we've got these urban districts that are great mechanisms to deploy combined heat and power and we're doing it today and it's underappreciated. It's under-known. It's under-marketed. Many times we'll talk to a building owner and they'll say, wait a minute, I've got a green product coming into my building so quite a bit of this urban effort to educate people on the benefits of CHP are really telling a story that's been going on for an awful long time but the point is we need to do more of it. So Violia. I run Violia Energy North America, a small part of a much bigger company. It's a French company. We operate in 7, this is a shameless plug obviously for Violia, but we operate in 70 countries with the largest operator in the world, so we operate over 800 systems around the world. It's what we do. It's the core of our energy practice. We also have a water business, a large water business and environmental services. So we're really an environmental company. That's where we look at it. So Violia Environment is the name of the company. So it's in the DNA of our business frankly to come up with these kind of solutions. So back to some ground that's already been covered. District energy, it's an aggregator. So it's a thermal aggregator having individual heating loads for a building. It aggregates for an urban center. It aggregates for a campus. And as Rob said, once you have aggregated you can deploy different technologies. So for example, different types of fuels. You can have a central plant that then distributes energy out to a campus, an urban center, whatever. And it can be fed from oil. It can be fed from gas. It can be fed from biomass. From biogas. Many different sources. The benefits of aggregation and the benefits of multi fuels also play into resiliency. So when you have a plant that is natural gas fired, it's got oil backup. If there's an interruption, on the fuel side you can basically swap over to another fuel. And as the colleagues of mine have previously mentioned very capable of withstanding what otherwise would be interruptions that you experience on the grid, on the conventional grid. So in the U.S. with the largest portfolio of district energy plants, Viola owns 17 of these districts. And again, if you just run down the East Coast so Boston, we don't know New York but if you talk about the district energy system in New York but Boston, New York, Philly, Baltimore did you know that in all of those cities that the majority of that urban core is heated from a district energy system? And did you know in fact that over 50% generally all three of the all four of those major metropolises are heated from waste heat that have otherwise been dumped? Probably didn't know that. So again, just to remind people of these district energy assets in many cases are there and we're underutilizing. So I'm going to get to the point of a way to better utilize not only in these urban cores but every military base pretty much every hospital pretty much every college campus pretty much most industrial sites have a district energy system sitting at their core and it's a bit perverse but as we all know that shale gas is changing the landscape of the energy face of America. There's a bit of a and for good reason a bit of a push towards natural fuels. We need to be mindful of the fact that we don't rush to just burn more natural gas in individual boilers because of their efficiency and the availability of gas. We need to make sure we shift and move that gas into combined heat and power applications because there will be a play in many cases you have a large district energy schemes with combined heat and power but as we push towards natural gas use institutions consider coming off the districts and burning cheap natural gas in their own facility not in a combined heat and power application so the more we can educate people on where these assets are and how they're presently being utilized the better decisions can be made and we're finding that it's the the mayor's sustainability directors of urban environments that are getting the message of the development community the real estate community in the right direction but it takes a lot of catching up with people's understanding so keep it simple right I used to be an engineer I say and now I've been a boss for too long so I have to have these very simple diagrams but again it's worth repeating so in the center you see to get 85 units of useful energy on the right in a combined heat and power plant you have to put in 100 units and we're being conventional and we're being generous at 50% efficiency but that's your combined cycle gas turbine facilities you have to put in 170 units so it's I mean how much more simple can we get I mean it's kind of one of these duh but we're not doing enough of it Rob brought up the example of Denmark while the rest of the world has been trying to figure out how to slow the increase in their carbon emissions they've turned it and they're coming down and it's not due to demand destruction or bad economic environment because actually the GDP has been growing throughout this period but their profile today is back to an early 90s emissions profile so they have turned the table if you will and they're actually reducing their emissions while they grow their economy so a bit of an overview of Boston so you can see that hold on a second here oh now I'm in trouble so the downtown peninsula of Boston he has Cambridge on the other side of the Charles river so these pink shaded areas are where the districts are so you've got a district over in Cambridge actually MIT has its own district right along the river here Harvard has another district over here and we have a district in Boston and then there's another district in the Longwood Medical Area which is Harvard Medical School and it's all its teaching facilities so we've got this big large aggregated load on the district and how can we best utilize these technologies of district energy and combined heat and power so today if you can see right in the middle there here's again Boston's on the right, here's Cambridge you can see the Longfellow Bridge there's a pipe that runs under that bridge today from this plant this combined heat and power plant that's owned by NRG and it exports steam that otherwise would have gone into the river and on the right side of the bridge here you've got Massachusetts General Hospital, MGH a very large medical institution they pretty much get all their heating needs from that pipe and then what they don't use, we buy and we help heat Boston so in the aggregate about half of the heating needs come from Boston, come from a pipe from a plant doesn't sound all that sexy but we'll get to a minute what the impact of that is so again, the type of impact you can have with these projects is extraordinary so since we're not using all of the steam from this plant there's still a lot going into the river both the predecessor to NRG which was Genon owned the plant and they were having some interesting conversations with EPA in the lines of you need to stop polluting the river with your thermal energy just like the cooling tower case down in Brayton Point in southeastern Mass they said get out of the river so we had a solution for them build another pipe so we're running down along the river across the Charles with a second pipe again, not cheap close to $30 million to run this pipe large pipe lots of waste heat recovered and in fact what we'll do is we will then take the present situation of about half the energy heating of Boston come from waste heat recovery to 70% so what does that mean today if you look at, I've got an example of that other district Maytep its cogeneration facility avoids about 160,000 tons of carbon a year the existing pipe coming across the Longfellow Bridge saves another 150,000 tons of carbon a year the new pipe saves another 165,000 tons per year of carbon that's huge now if you slide over to the right to put it in perspective what does that mean its the equivalent of how many football fields you have to cover with solar panels okay not disparaging my brethren over in the solar community but the point being when you add the two pipes together okay the existing and the new one its the equivalent of 600 football fields covered with solar panels from not that difficult thing to do run a pipe from a power plant to a district pretty straight forward stuff the last, the final thing and I know you told me to wrap up a couple of minutes ago so I'm going over sorry about that but on the resiliency note you can see pictures like this repeated over and over again a dark city with a bright spot in it in this year in Boston, actually in Cambridge in Boston, we had a blackout the only part of the city that was lit was Biogen Idex campus why? because there was a cogent plant in the basement Sandy is the tale of two NYU's you saw on the news NYU Langone Medical Center with the evacuations which you didn't see was the other NYU campus in Lower Manhattan that was lit because it had a cogent in its basement on a district and then finally back in 2001 Maytep which is this plant that feeds all of Harvard Medical Schools six hospitals with an awful lot of beds for people we had a blackout in Boston again the only island that was lit was Maytep so it's a bit of a no brainer from an environmental perspective from a cost perspective and from a resiliency perspective we really need to make sure that we don't have a district that is naked as I say without a CHP attached to it it's existing technology, it's proven we need to do more of it and I will pass on to my next colleague terrifically important stories lessons and I think context in terms of the enormity of the possibilities and the extent of the solutions and where all they can be applied and in addition I think your point about the diversity of fuel sources is also so important because it can so depend upon where you are, what's available and there are so many options that we can take advantage of so we are now going to hear from Ken Smith who is the CEO of Evergreen Energy and he is going to be talking a little bit about policy and some of the policy ideas, recommendations that are coming out of Minnesota and what that can also mean in terms of thinking about this whole important industry and its contributions nationally. Thank you Carol. Good morning. I also want to talk a little bit about why this is so important and so we are going to talk a little bit about the evolving energy system and as Ted said, focus on the waste so we've been talking really if you think about our country focusing on how energy is evolving really since the 70's since we had the energy crisis some of you in this room might remember that some of you the younger folks don't when we changed our mileage our speed limits down to 55 and there was a lot going on and we started focusing on conservation in a great way, it impacted everyone impacted some more than others in our family my dad bought one new car in his lifetime it was a 1972 Ford LTD Fordor it was gorgeous and then we had an energy crisis and he traded in for that yellow pinto we had a family of five and so we had to fight in the back who was going to sit in the hump in the back seat so it impacted everybody in different ways this is what our energy system looked like this is from Lawrence Livermore National Labs you can research this it's on the web and what you have on the left hand side is the inputs, primary energy inputs the epitolium and coal, natural gas and on the in the middle here you have what's where it's used, electricity generation residential, commercial, industrial transportation and then how much is rejected or lost or wasted ok and then you have how much is used well, if you add the numbers to it it was about 50-50 about 50% was used about 50% was rejected back in 1970 before the energy crisis you can see that the efficiency of power plants about 36.7% was going actually being used 63% was being lost in 1970 and that made up about 30% of all the wasted energy in 1970 you can see the balance there from where it was coming from in other areas now this is the flow diagram for 2010 in 1970 was about 68 quads 68 quadrillion BTUs of energy in our economy today it's about 98 quadrillion BTUs of energy so about a 30% growth the picture is prettier you'll see things in there like solar and biomass so there's been some other sources now do you think after 40 years of energy efficiency focus the system is more efficient today than it was in 1970 how many think it's more efficient today how many think it's not you're right it's not so here are the numbers this is the facts 57% lost today after 40 years of focusing on energy efficiency power generation is now 32% so we've actually decreased it as far as the efficiency nearly 50% of the wasted energy in this country is coming from electricity generation nearly 57% 47.7% you can see where we focused a lot on energy efficiency is actually in buildings and buildings went down they were rejecting about 30% of the energy in 1970 and now they're rejecting about 15.6% of the energy but we're focusing on pieces of the system not the whole system and as a result the system is less efficient today if you look back all way to 1950 which is the data available and take the graphs and this is a graph that I did off of that data you can see that this is the rejected energy in the US this is the useful energy we haven't really improved in the 1980s we haven't broke about the 43% mark efficient so we've been wasting around 56-57% of the energy for a very long time it's a lot of money and as Rob mentioned in his the quadrennial report also pointed this out saying that nearly 60% of our primary energy is lost as waste heat something we can use so how does that compare globally so I took the Lawrence Livermore diagrams and picked out the G8 plus emerging and added some other countries in and you can see that Norway is way up here at nearly 60% of the energy is used Brazil is well over 50% China is right about 50-50 got a whole grouping in here in the middle and here's the US dead last one of the reasons why we have to have inexpensive energy is because we waste so much of it it's a drain on our economy in Minnesota we use total energy used is about 1.8 trillion BTUs of energy 1.8 quadrillion, sorry 1800 trillion BTUs of energy on an annual basis about 21 billion dollars a year is what that equates to now in Minnesota we have a lot of resources energy is not one of them we have a lot of wind and we have good solar but we import all of our oil we import all of our natural gas we import all of our coal we import materials for our nuclear reactors and so 21 billion dollars a lot of flow out of our economy to neighboring states and into Canada so if we can use energy more efficiently it benefits our economy we keep more dollars in our local economy well how does Minnesota you think a progressive state like Minnesota we've certainly got to be more efficient we're not we really mirror the US profile about 57.7% is lost you can see our efficiency is right around 32% on power generation so we don't we're about the same well how much energy is that 57% of our rejected energy which is 1000 trillion BTUs every year is wasted as heat in a state that has some winters to it actually the last snow just melted out of my yard last weekend so we have a lot of a lot of need for heat and we have a tremendous amount of wasted energy if we think about where we're focusing our efforts on energy conservation as a country we're focusing a lot of it on buildings let's make buildings more efficient and we should we should use make energy use where it's used more efficient and that certainly helps with the supply and a lot of it's focused down in this area but you can see we're not changing the outcome of the system so with this in mind we've been working on legislation as David said in his remarks focus on the waste and we've been working on legislation in Minnesota which is now ready to go to the floor in both the house and the senate on this session that would encourage the recovery in your reuse of waste heat and so basically it's fuel agnostic don't care what comes from it's technology agnostic it's basically if you recover the waste heat and you use it to reduce electricity if you use it to reduce natural gas the utilities can count that against their goals and in Minnesota we have a program called SIP Conservation Improvement Programs where the utilities invest in reducing natural gas and electricity usage and so those funds can then be used to invest in those projects because they're using waste heat to reduce natural gas electricity seems kind of simple it's a gap in our legislation right now so for example if I prove the efficiency in this industrial building or this process to the extent that I possibly can and I still have waste heat there's really no incentive for that heat to be used across the street to another building that can use it and this legislation would encourage the recovery and reuse of that heat either at that site or beyond that site and the utilities then can invest in it we think it's got a lot of promise we've had we've gone through the committees and we've had zero no votes on this legislation so we're feeling pretty good it's going to get passed in this session thank you be glad to answer any questions that you have on it thanks so much Ken and I must say when you were talking about how needing that we need cheap energy because we waste so much it's the only way therefore we can keep it affordable I was struck also with that statement and the discussion earlier with regard to looking at Copenhagen and Denmark overall because I know in terms of the Danish officials that I've met with over the course of the last 20 years one of the things that they always said was that because energy was always expensive for them and that they were always dependent up on or for so many years certainly in terms of fossil energy dependent upon getting that from other places that it meant that they had to become much more efficient so it really has been a huge driver in their economy so if anybody's also interested in pursuing that further we have done a couple briefings in there was a briefing sort of telling the Danish story and how they've ended up with a really strong economy and at the same time driving their whole carbon profile their use of energy way down that is on EESI's website so I think it's a very very important lesson for us all so now to round out our briefing we are going to be turning to Mark Spurr who is not only the legislative director for the International District Energy Association IDEA but Mark has been involved in terms of working with communities and companies for years in terms of looking at the development of feasibility studies putting together analysis planning in terms of so many projects both in the US as well as overseas Mark thank you Carol we've heard some very convincing discussion about why district energy and combined heat and power are good things but we're in Washington so the question is what can be done policy wise to help these things move along and I think there's probably some ultimate answers in terms of long term policy but we're not close to comprehensive energy or climate policy in this country right now so I think for the time being we need to make some steps in the right direction and I'd like to tell you a little bit about a couple of a couple of bills one that's been introduced and that's a master limited partnerships parody act tell you a little bit about that I think many of you are familiar with it it was introduced a couple weeks ago and then I'll go into the bill that senator franken referred to it's a bill in the making that the senator will be introducing soon the master limited partnerships parody act is I think an elegant bill and you don't hear that term very much applied to legislation but it's elegant in the sense that it takes an existing law that happens to confer advantages to oil and gas businesses and say why shouldn't this also apply renewable energy and efficiency and I that's a darn good question a very common sense thing a master limited partnership is a business entity that's taxed like a partnership and the power of that is that you avoid double taxation because you don't go through a corporate tax and then an individual tax makes the cost of capital lower because you're avoiding taxation and investors therefore don't require a higher return this is also a very liquid type of ownership interest and that makes it very attractive to investors so the bill does as I said a moment ago it says hey we're allowing the fossil fuel industries to use this let's allow renewable energy to use it as well so the types of renewable resources that are described in sections 45 and 48 of the tax code those being the production tax credits and the investment tax credits respectively are qualifying as MLP investments and there are a number of other categories that are also included such as renewable transportation fuels waste heat power and other technologies we believe this is an enormously useful and common sense bill it will not only help develop for example combined power or waste heat recovery but it also will cover the distribution of that energy such as the pipe that bill was talking about earlier we strongly urge support for this bill now I would like to tell you a little bit about the local energy supply and resiliency act this is the bill in draft form right now it also is addressing what is a crucial barrier to making these kinds of systems happen and that's cost to capital reference to the fact that hey that pipe was kind of expensive and I'll tell you that the wonderful things that have been done at Princeton and in St. Paul were also fairly capital intensive but they allow us in the long term to reduce costs, reduce environmental harm and reduce use of fossil fuels so the master limited partnerships parity act will help very much on the equity side of things but there's a huge opportunity in the many universities that are out there or colleges or hospital complexes or communities who would like to put in this kind of infrastructure who need access to low cost capital so that's the basic idea the fundamental core of the bill is a revolving loan fund and I'll tell you more about that in a moment and I think it's clear from the prior presentations what we're talking about, why do we want to do this we want to reduce fossil fuel use we want to increase energy resiliency and reliability we want to increase the environment benefit the environment by reducing emissions and keep energy dollars in the local community instead of sending it off to Montana or Saudi Arabia or wherever we've seen various types of graphs like this or pictures like this this is my favorite because it's kind of cute and cartoony but the basic idea is there's a lot of energy right in our own backyards that we could tap to meet our needs Senator Franken mentioned Grand Marais, Minnesota that's a town in northern Minnesota that is developing a biomass district heating system and I got involved in that project about a year ago and when I went to visit the public utilities commission I said, well, you know, why are you interested in this? Thinking I'd hear gee, we want to get off the fossil fuel price roller coaster we want to reduce greenhouse gases we want to keep energy dollars in our community he said something that surprised me he said, well, fire forest products industry in northern Minnesota is way down because of shifts in international markets for forestry products and there are a lot of parts of the woods that are falling in on themselves and are becoming in the terms of the foresters, this is a new term I bet you've never heard this, decadent forests and they're over the age they're falling down and they're becoming fire hazards these folks have actually been burning some of this excess fuel in pits just to reduce fire hazard so their idea was why don't we use it for energy instead there are lots of opportunities to do multiple benefits we've talked a lot about waste heat this is a much simpler version of the Lawrence Livermore chart that Ken showed I've boiled it down and let me just step away from the mic so whereas looking at all of the waste I kind of took out transportation there's energy going into transportation a lot of it is waste but I think in the near term it's going to be very hard to tap that so I'm going to set that to the side but when you simply look at the power sector and the residential and industrial sectors 36% of our national activities is waste heat, mostly in power plants 27% of the power plants in the balanced waste heat from buildings or industries and so it's about half and half, half of it is used and half of it is not that's a huge opportunity the bill that Senator Franken is working on has three main parts one part is to help communities and universities and others identify opportunities to use waste heat and renewable energy evaluate those opportunities address barriers to the development of those systems, do the engineering because it takes a certain amount of effort to tee these things up for financing this would be open at this point in the draft legislation would be open in both public and private entities the core of the bill is to establish a revolving fund because we need a source of low cost capital to implement these systems and the idea would be that the fund would be established with appropriations would revolve so that loan repayments would go back into the fund for 10 years and then the idea is after 10 years those loan repayments go back into the treasury for deficit reduction so long term we really repay the treasury for the money used but we need a low cost source of funds and the proposal is to make the financing available at the interest rate of US treasury bonds of comparable maturity and then we would also like to in the bill reauthorize a program that was authorized in ESA in 2007 that has now the authorizations lapsed but it would establish an inventory of waste heat in the United States so that we know where the BTUs are and get an opportunity and facilitate the ability to tap that energy to be useful instead of wasted this is a very packed chart but bear with me for just a second what I wanted to illustrate was the impact cost of capital on price and profitability I'm using the example of a final mass of the key system compared to natural gas this blue line here this blue dashed line is cost per million BTU of heat so this is after boiler efficiency based on US EIA's average commercial gas cost the green line is the cost per million BTU of biomass it's a capital intensive affair so it very much depends on what the average cost of capital is when you go to a private entity and say you want to build this thing they're going to look at caps of nets and equity and their average cost of capital might be somewhere close to 10% but you see that makes biomass pretty expensive if you go out and do it on an industrial revenue bottom it's a pretty wide range here because it depends a lot on the risk conditions in particular and that helps bring the cost down so if you go to GO's general obligation box that a local government might implement you start getting close to really making things go but here's the range that we're talking about for the target with treasuries which will give you a comfortable margin to really give projects a push this is the fundamental concept of this thing is that we need to have a firm low cost capital and with that I thank you I would just mention to that EESI has done a fact sheet with regard to MLPs master limited partnerships it's available on our website this is bipartisan legislation it's been introduced on both sides of the hill and so let's open it up for your questions or comments in our remaining could you identify yourself please Hi good morning I'm Brandon Mitchell with the office of the deputy mayor here in Washington and I've actually spoken with Rob and Mark one of the projects that I'm assigned to is the Walter Reed redevelopment which will in time become a three million square foot mixed use mixed income project all the utilities have to come out and the utility infrastructure has been there since Teddy Roosevelt was in the White House and one of the things that we're looking at is a CCHP system with a PV array one of the biggest challenges we're facing is the degree to which we can get local utility cooperation on standby fees interconnection fees other technical support the ownership of distribution and so what I've learned from my colleagues around the country is that the CCHP and the CCHP savings get whittled away when you interconnect the local utilities and so I'd like to know from the panel what your experiences have been and how folks you've worked with have been able to overcome those challenges so just make sure your mics are on sure I'll jump in our experience is the same as yours the utilities will chew away the three big challenges of backup rates interconnection standards and franchise rules and for those who aren't familiar with this battle interconnection standards is when you try to attach to the grid with a generator if the grid wasn't built to accept distributed generation it costs a bundle to do it so the utility will look where you connect to the grid and say well now there's grounding problems because of your generator so I have to change the service to all the other buildings on that network feed and they add that to your build to connect the second issue is backup rates so in other words you put in a 10 megawatt plant and it's going to have to come offline for maintenance it periodically may trip offline so you'll still stay connected to the grid for backup and the utility will come in some utilities charge nothing others will charge you 70% and other creative ways of charging you so even though you put in the 10 megawatt plant you're still paying for it as if you didn't have it or some big chunk of it to the utility and there's lots of reasons for this I mean it's the whole history of how the grid was built how utilities make their money but it is a challenge and then the final one is franchise rights so particularly in deregulated states where the utilities basically when they had to sell off all their generation and they just became transmission and distribution the grand bargain was okay we'll part with generation oh by the way we get to recover that to stranded asset deals but we get exclusive franchise rights in our territory so we're the only ones who can run wires in the streets, that's it so what happens as a developer whether it's an institution or a third party developer you look at your campus and you say I got to build a CHP and I got to optimize it so I can make it pencil I have to pick up enough of the thermal load to balance that with the electric load and make this thing work so that it's worth investing in so there's a return and what happens is you have to cross the street to pick up the other half of your campus or cross two streets to pick up your campus and you can't because as soon as you do a big part of your savings when you come off the grid is you don't have to pay for the utilities wires anymore their transmission and distribution because you're doing it yourself you're making your electricity you're distributing it around your site but what happens is when you have to cross the street okay you got to use our wires so you can run your wires but they become theirs or they put them in for you and you still have to pay the TND so it's a shame because we can see the benefits are it's a duh I mean you look at it and say 50% versus 85% but it's the same battle now it's we're winning in some places you know you have to kind of pick our battles and we see what utilities are being more progressive some are progressive some are not they're in the middle paying lip service you know for them it's a challenge because the best load is what these energy dense fields campuses industrial sites office towers so for them they look at it and say wait a minute how do I make money now all I am is TND and you take this Swiss cheese bites out of their franchise and they have stock holders like everybody else so it really becomes a policy issue otherwise you try to force the utilities there but you know they've been fighting this battle for a long time and they're pretty good at it and for obvious reasons so it needs to be a policy initiative where they're held harmless and you fly up to 100,000 feet rather than a 10,000 foot view and look at how the grid is serving the society on an economic and an environmental benefit level so long winded answer to having the same fight as you but the barriers are coming down in some states are leading the way on it final comment it's not just at a state level it's at the PUC levels public utility commissions so it's not just legislation it's ultimately legislation but then it's how does the PUC interpret it so it's an interesting battle more and more opportunities to get things done right? did you have a quick comment because I think probably this deserves a much longer conversation with people afterwards just a real quick comment in New Jersey at Princeton we suffer the same kind of issues but there's one very nice piece of legislation that went through that really helps us out and that is in New Jersey if you have a thermal distribution system and you're generating power so my co-generation plant I'm actually allowed to wheel around the block and back into my other substation because I'm serving my thermal customers with electricity so there's some legislation that actually helps us out a great deal does that make sense in what we're talking about? in New Jersey is leading the charge on that as far as that type of legislation so there are examples out there that are really quite helpful to us and just the final point Brandon welcome to the club we're happy to have you you're not alone, you know this is the age-old challenge if there were a symbol for district energy CHP it would be Sisyphus I'm familiar with the Greek god push the boulder up the hill we have gotten some boulders over and we'd be happy to help you I think the DOE clean energy application centers can weigh in there are some resources precedent policy initiatives etc but I think it does take a village and an industry and we really would be happy to help you identify but also maybe find some solutions because that's a wonderful site yes this is, I'm Bill Dickinson I'm a private consultant this has been fascinating but the issue I think this gentleman hit upon and that I'm curious about is when we talk about district energies or energy districts are these governmental are they not for profit are they special authorities or is there a combination all of the above and how are they governed and what authorities do they have do they I'll start they range from privately owned subsidiaries of utilities they're governed often by a franchise within the community they serve so under the jurisdiction of the local city municipality laws they adhere to all the codes and requirements of the region they comply with all state their emissions et cetera so they're very much a regulated operating entity district heating systems that are legacy that go back to when the investor utility was selling heat as well as power those steam systems often operate under tariff and often are regulated by the public utility commission in their state so they're subject to review and rate case et cetera but a lot of the district cooling systems in the US that have been built are not regulated so they're very likely to compete you know if you're a building owner you can choose to connect to this network of chilled water or you can put in your own chillers and often it's a long term arrangement of contract very transparent very well managed by informed entities and so it's really a contractual arrangement often 20 25 years but the ownership ranges from private to public private to institution and all of the above so it's really quite a range anyone care to add Ken? in St. Paul we have 501c3 non-profits and we're regulated by the city and we have a franchise so as Rob said it really is it's a spectrum and it really depends on the company's local market in some cases state law of our 17 networks 2 are regulated from a tariff perspective cost perspective the rest are just free market you have to compete and so we have to be competitive on a delivered energy basis we have to offer value we don't really have a tailwind of regulatory support you know we really lack a lot of incentives that support the growth of some of our sister industries and so you know I think ultimately we've survived and thrived because we're competitive and provide value to our customers for instance it's just an asset that the university owns we bought it we built it because we think it's the best and most cost effective way of doing our business okay okay here first and then we'll come to that this question is for Mark or the entire PNL this is Hannah Northy from Greenwire has Senator Frank and I saw that he introduced legislation in the past to incentivize combined heat and power can you give us a little legislative history what's happened to those measures and is this bill that he's going to introduce facing any challenges is there an appetite for this on Capitol Hill? Good questions several years ago the senator introduced a bill that would have done a number of things including expand the availability of production tax credits for certain types of renewable thermal energy that bill was introduced on a bipartisan basis in the senate also had a house companion in the shuffle of a lot of other issues it did not advance when we discussed more recently another legislative effort to help in this area we told the senator that we thought that tax credits were first of all not useful to a broad array of sectors because you're leaving out non-tax paying entities and experience seems to indicate that not even among private sector tax paying entities there's a limited amount of tax appetite that a lot of companies can't actually make use of tax credits because of the tax situation so that's what brought us to this idea of a revolving fund which is going to lift a range of boats and I think a much more useful way we're having discussions regarding the support on the hill it hasn't been introduced yet it's coming soon we're having some initial discussions we'd like to see it introduced with a republican co-sponsor so we're working on that does that help? and I would just add so in addition to I think beyond capitol hill we're finding the voice of mayors and sustainability directors and cities that really want more reliable resilient infrastructure they see this as an effective vehicle to get there our institutions that have really want to deploy combined heat and power so they want to see a vehicle that can enable that and we work very closely with the department of energy in the clean energy application centers as well as the EPA, the CHP partnership so those two agencies have really been very engaged in trying to deploy and increase the market share for CHP and district energy so I think we need to do a better job on the hill and sparking awareness among staff like you, what this could do but out there people are looking for this and want mechanisms to get there and the industry is growing but this would I think accelerate our penetration at a time where it's really quite needed I think just to further the point on cities so cities are coming around to this so any eco zones or new development areas in cities when you talk smart cities, typically at the core of one of those there's going to be a CCHP plant at least at the beginning of the design process and so cities are getting it, the real state community is starting to get it as well why because people are willing to pay for it one so people want to know the energy usage of the building they're going to rent or live in or build their stuff in and cities again like Mayor Bloomberg so New York is doing it, Philly is doing it, other cities are going to fall soon is every building is going to have a label you're going to have a mile per gallon if you will on a building it's going to tell you what the energy usage is that's getting the attention of the real estate industry you know if you've got a dog of a building, good luck trying to fill it your occupancy rates are going to change and part of the solution for that is going to be if you can get credit in other words if you're on a district that's powered by CHP and we can rationalize the fact that your footprint is different because of it your label gets better and it's making sure that it's understood as these new mechanisms come into play in the cities that are trying to lead the charge to make sure we get credit for the fact that we are an efficient solution as well and then just a final point if I could add you know we're really we're trying to also reorient the thinking the ying and yang on this is that you know if you look at the charts we just expose you all to you know we're wasting all of this energy I mean we're literally throwing it away and we don't have to do that this is not the next this is not you know where we are is my grandfather's grid and what we're offering is your children's future and it's very simple to put pipe in the ground and make these systems work but we need your help we need you to talk to your members and make them aware that man we have a solution and it works and here's what it's called district energy, combined heat and power and micro grids so you know we're here hoping to proselytize and get you to join our army and help us help you know Brandon because we think it makes common sense sometimes an entity not often traded in Capitol Hill you know and historically it's the sad thing is as we invented it here the first big district energy systems in the world were all in the US so the oldest systems on the planet are in our big urban cores yet we kind of forgot about it where other countries now have taken it and run with it many districts and CCHPs in China they get it all their cities are going to be fed from these so we need to kind of remember what we learned a long time ago back to the future in every sense and one last point the Capitol power plant that supplies as I mentioned earlier all the heating cooling all the buildings the Capitol is in fact investing in combined heat and power is installing cogeneration I think it's like 15 megawatts you'll be hearing more about that we're making some progress we think there's much more opportunity but you know we have a lot to be proud of really a lot more ground to gain I think you had another question over here we have a few questions that's okay there were a couple questions back here okay so let's go there first and then we'll come over to you Deborah Jacobson GW Law School some innovative financing approaches have taken hold at the state level including PACE property assessed clean energy as well as on-bill financing and in the interim before any new legislation passes I'm wondering if these offer some opportunities to overcome these high upfront capital costs well what we're seeing is take a class of institutions like hospitals hospitals they all want to add a CHP plant frankly to their district through the economics perversely cheap gas isn't helping because remember this is an efficiency play so you're more efficient than the grid so you're going to be if you're 20 points more efficient you have to multiply that by the cost of the fuel to find out how many dollars you save so cheaper gas has made the payback periods longer so that is a bit of a challenge so these projects that are a bit on the bubble now because of cost then you look at financing what can that do for you but then there's still a lot to do and the uncertainty of can you get the project to go the way you penciled it and when you're facing the barriers from the utilities it's questionable many times even if you can get the cheap cost of capital which should help but the barriers still have some people on the fence so again the further we can get it down the more likely it will be to tip the seesaw and the projects go forward and the barrier issues still need to be solved as well Mark? I just want to try to answer your question directly I think the PACE type approach is a terrific approach I think it would be hard to fit it into these kinds of situations because with PACE you're taking advantage of an ongoing utility billing arrangement there's not a really good analog to apply it to these kinds of systems so I think as a mechanism it would be hard to adapt that concept to this but I'm hoping a broad idea is there but that's my initial reaction just one so in its current form PACE was really like a utility centered mechanism to fund efficiency or renewable improvements so the vehicle is really the local utility now it could be in the next iteration you could have sort of a PACE mechanism to fund a new district energy investment sort of a mechanism but I think the capital scale the penetration rate the coverage issues it probably isn't as Mark said the most effective vehicle to germinate a big capital intensive project at the outset many of these projects take a mosaic of solutions to put together many things come to the table and so it might be a part of it but it's not going to be the magic bullet okay we had a couple other questions going back here Hi there I'm Annie Downs with AC tripling we've talked a lot about state and federal policy options and I wanted you to expand a bit on municipal governments and if there are any best practices for policies that they can implement to encourage district energy with CHP this is a topic near and dear to my heart we've we've done a lot of work along these lines and I think there are a range of things that local governments can do one very important fundamental thing is that local governments should do everything within their power and political parameters to encourage or require new building development to have what we call hydronic heating and cooling systems in other words they're actually making hot water and chilled water within the building and circulating into space within the building in order to provide heating and cooling a hydronic system is easily convertible to district energy other types of systems where for example you're just running electrical wire to the building space and they're using electric resistance heating in the space for heating that's not convertible to district energy so that's a very very fundamental thing I also think that local governments can encourage developers to think about district energy if they actually have a kind of a framework or a vision for district energy and have done some of the groundwork that we're hoping the frankenbills technical assistance program can help with so that they've done the groundwork to say well gee we've got this area this redevelopment area this looks like a good low density is what we worry about as engineers and so we're kind of keeping an eye on this area as a potential opportunity for district energy I think doing some of that community energy planning where they might for example also look at well are there local power plants who are kicking off waste heat or is there a server farm out here the ironic thing about air conditioning is that what are you doing you're getting rid of heat as has been discussed usually that just goes into the air or into water and of course server farms are huge heat generators so there are a lot of opportunities I think that kind of planning can be very helpful the other thing I would encourage is that and you're seeing that as the municipalities can require or certainly encourage doing a life cycle cost analysis rather than a first cost and then you're getting the total cost analysis and that certainly helps towards having a fair evaluation of the benefits that you get from district energy there's some fundamentals and particularly in new development real estate group is looking at first cost that's traditionally how they've looked at it and then they approach the community that's going to help them build the building the AE community they want to build plants they don't just want to connect to a district so the permitting organizations once they force the look they've got to legislate what the solution is but force the look at the alternatives the look at district energy the look at combined heat and power and then let it compete on its own two feet and in many cases we win once we get the look I want to echo that this is exactly the approach that Princeton takes we look at the life cycle cost of all of these energy opportunities the one thing that I'd add is that you use the lowest grade energy possible that is if you can use warm water as opposed to very hot water if you can use hot water as opposed to steam you're enabling a lot of different technologies by doing that so if we put heating or cooling coils in the floor slab of this room we might be able to use solar hot water we might be able to use ground source heat pumps and we could easily connect to district energy so it allows much more flexibility than if you design with very high thermal energy demands or extreme temperatures so that's one of the things that we're we're working towards and that allows much more flexibility for the building many years down the road so that's what I would suggest the municipality should do just as our little community is still at the university and a final point last year IDA released the community energy development guide it's really the book on how to think about mapping your community and evaluate district energy combined heat and power so that's available for free on our website community energy development guide and you can make that if you have municipalities that are curious this is really the non-technical guide to getting there and then secondly working with the DOE clean energy application centers we've developed a screening tool that can help them do a quick economic analysis red yellow green just doesn't make economic sense yellow it has some potential might need some tweaking but green there really is a terrific opportunity here and it bears further investment so we've created some tools that we think would be useful for communities to advance their energy mapping and their strategy great well we're out of time I know that there are a couple questions but hopefully you can go ahead and ask our panel I did want to mention we will also provide a link on our website to the community energy development guide the presentations and video will be up on EESI's website and because this issue is so important in terms of as you have heard there's so many opportunities we were planning to do kind of a little mini series and hope to do a lot more in this and so stay tuned on May 22nd we'll be taking another look at the whole role of CHP and what it can mean in terms of our economy so that will be the afternoon of May 22nd so hope we will see you here and there's lots of so we don't want to see any waste food that's right so it's particle waste this is with all heat generated please grab some orange juice and grab some day dishes and thank you all for coming and thank you very much for coming


Okay very good morning to you. It is Tuesday the 2nd of June. Hope you're doing well My name is Anthony Chung. I'm the head of market analysis here at Amplify Trading Just a quick mention of our website AmplifyTrading.com There will be you will be presented with a few different options depending on whether you are a trader Wanting to learn to trade or a student if you go on the trader page though This is what you'll see and if I just scroll down you can see information about the team and different programs that we run But of all the programs that we run there's something we have called Amplify Now Which is our on-demand learning portal which we launched at the beginning of the year If you now click that start now button essentially the way that we design this is that we have Put this is the e-learning portal You just enroll and then you can access three videos from the team absolutely free So no harm in doing so Just even if you wanted to check out that content without doing anything else other than that But if you did like what you see then basically you can pay for an upgrade and get access to the full program Which it really is the the full kind of foundation for everything you need to know to analyze and trade financial markets at least to Start your journey on the right footing So check that out. Just go on the AmplifyTraining.com forward slash traders page and you'll be able to access that But let's look at the charts in more detail for this morning and we've got a relatively quiet open Kind of similar to yesterday in some respects in terms of the equity movement And we've had a little dip an overnight and then we've recovered as we've gone into the late Asia session And as Europe has come into the market Kind of similar to the gap down We had with some of the initial protests from the weekend only to be reversed when Europe came in kind of similar type news themes as Well occurring with widespread Protests across nationwide America last night once again I'll go into that in a moment in a little bit more detail But for now, let's just have a quick look across the charts So equity index futures kind of flat in the u.s. Dax up about 30 albeit off its best levels Gold below its pivot level and you can see here just in terms of some of the near-term price activity It has been the pivot a interesting point of technical Interest added some support in the overnight Asia Pacific session a couple of times had a failed break there Momentarily when it did then eventually break through at around 5 30 am London time It broke down came back up to retest that level before then the extension on the pushdown So a nice classic on the on the pivot there in terms of the movement In fixed income with we're basically flat WTI crude futures holding up and There's a couple of things to be aware of there nothing major really but all in all Stabilization at a thirty five dollar handle Saudi Arabia Favouring keeping the current curbs in place Which are set to start easing from July They want to keep it in place for an extra one to three months according to a delegate and of course yesterday We're hearing some talk about them bringing forward next week's OPEC meeting to this week on Thursday I haven't really had any confirmation or not whether that's going to take place And obviously the whole deal is contingent on Russia agreeing with Saudi Arabia Which has obviously been a fairly contentious relationship in the past But it's looking like perhaps that that might take place in the markets Taking heed from that and giving some underlying support to crude prices despite some of the natural demand Uncertainty emanating from the escalation in the US China trade war at the moment In the FX markets the dollar is pretty flat There's a little been a little bit of movement since the European participants came in initially a little bit of a dip in the dollar then a recovery But net net the Dixie is unchanged that price movement kind of reflected in the euro this morning And cables currently really unchanged But holding on to a lot of the games that were seen after a decent day in the markets yesterday for the British pound let's get in then to some of the stories and starting off then with what has been happening in America because You know from a financial markets point of view You must understand that you know my my job here is to talk about markets It's not to talk so much about politics as you've probably come to ascertain the two are somewhat Incorporate one another to a certain respect just given Donald Trump in the White House, but otherwise as well the government's integral part of trying to counteract the economic consequence of the pandemic but things like the reasoning behind this kind of the underlying Racial connotations of this later Sun rest again I will leave to the sidelines, but markets at this point are Not really that faced by what's going on That's not to downplay the importance of the issue, but markets don't really have Sympathy for these types of issues at least mechanically from how they function That's not unless and one thing I'll talk about that it increases the rate of potential transmission of the virus Which then given that kind of compounding rate of growth that it can have If then you know one person catches it and that our rate goes above one and then one goes to two Two goes for and so on and so forth Then certainly this would have big ramifications for the economic recovery potential For the United States of America, which would be absolutely key for the global economy So we're going to talk about that a little bit, but let me just give you an overall an overview of what's happening So last night it kind of came to a bit of a head given the fact that Donald Trump was doing a few things that I guess the opposing political view have some serious questions about given that he Authorized the use of tear gas on peaceful protesters nearby I believe he was in in Washington and he wanted them removed So he teared gas them walked across basically the hill and then went to a church for a photo Opportunity is what some of the press is suggesting but irrespective of that What has been happening? Well, Trump the main point was that he threatened to deploy the US military To end riots riots and lawlessness across the country This of course is all coming after George Floyd that on our black man was killed by the hands of the Minneapolis police What's seven days ago now? Trump he said that state officials he labeled them as basically weak and asked them to toughen their response to Demonstration so again, it's kind of quite a traditional tactic from Trump Similar to how he's dealt with the virus. He's kind of using the The state-level authorities as kind of the the scapegoats to blame in this instance, whereas he comes down with quite a heavy kind of hand Two people have been killed and unrest in the Chicago sub suburb last night four police officers have been shot in St. Louis So there's lots of different things that are going on New York City They've imposed a late-night curfew as of yesterday that curfew them being Doors closed and from 11 p.m. Until 5 a.m That didn't stop though bands of protests that were happening as a rallying in Times Square in Brooklyn yesterday that marched for several hours Protesters were also marching through Manhattan and Brooklyn irrespective of that curfew last night So one of the main things here that I'm looking at and I was talking to some of the traders about late yesterday was Just having a bit of a recap really of what's going on with COVID-19 if you remember when we were Kind of in early March, I guess this was probably the only screen that I used to be sharing in these briefings however, it's very rarely that actually bring it up and a big point of that is that You know for one a lot of this has been priced in and to we've got over the peak in areas like America And we're now on the downward trajectory and so this is leading to the reopening But what I'm more interested now is as economies do start to reopen then well then What point do we potentially start to see the emergence of a Secondary wave now people have always thought that that will be the case because inherently then given the Nature of the virus that's very hard sometimes to identify because not all people show symptoms It might mean that people do effectively go back to crowded places into the workplace and Inadvertently start to reshare the virus and then of course it can spread very quickly like what we saw in South Korea I think that one individual went to three nightclubs and it was thousands of people that potentially could have been impacted so here then is a bit of an update of what's going on in the US at the moment and One of the things that's looking at is here and this obviously makes it a little bit more clear It's certainly as has always been the case from the beginning New York Rhode Island, Connecticut, New Jersey these types of areas have seen the heaviest number of deaths in regards to the coronavirus situation in the US But one thing I was having a look at last night was well, I was just quite surprised by just the the number of Protests that have been happening in America nationwide at the moment and George Floyd's death in police custody has sparked more than 250 protests across the country and as you can see here each red dot obviously you know, this is not a Scientific kind of map with with respective numbers and those those gatherings will vary in size dramatically, but the point I'm saying is that The last thing that probably you would want from a World Health Organization point of view So from a health authority is for people to be gathering in mass congregations protesting Which is obviously not not conducive for social distancing. So for me, although this virus obviously takes time to Appear in its symptoms, you know, it could be too late by that point One evening of mass gathering then when these people disband and go their own way could easily grow very quickly. So I'm very interested to track those numbers now going forward The protests obviously if they continue today would be going into what the 7th day so The period of the next week I think could be quite interesting to see the trajectory of those US numbers If you break these down, of course poor African-American households with high Incidents of pre-existing conditions. So things like heart disease diabetes asthma. These are all exacerbated by poverty Poor nutrition lack of access to medical care. These are all things that typically are more Probably reflective of the ethnic minorities in America Therefore, those have been more susceptible and have had higher rates of deaths Comparative to their white counterparts for example. So given the nature of these the the racial underlying of these these protests, I think it's going to be potentially a risk for markets not now, but these numbers if they do Expand quite quickly on the virus. So again, just what I'm saying. I guess vigilance for tracking these numbers going forward I think markets have become Relatively sanguine about the whole information or the whole situation at the moment And we continue to kind of rally in the equity market. No, I'm not saying that this is going to be the one Silver bullet that's going to call the end of it but I do think that this The secondary wave risk was already there and now that's been somewhat Exassivated by this this situation Okay, moving on other headlines This isn't new Merkel talking about more stimulus. The only reason I'm bringing it up again because this did come out last week is That today is the day they're going to be talking So German Chancellor Merkel is going to seek to broker compromise today on a second stimulus package after they unveiled the initial one in March Merkel will host officials from ruling coalition of her Christian Democratic led block and the social Democrats in Berlin at 2 p.m. Local Times around 1 p.m. In London possible measures range from debt relief for struggling municipalities to cash bonuses to stimulate car sales I think it's cash for clunkers It's how it's referred to the US and aid for families with with children the finance minister also wants to extend a state wage support program So as what we've seen before in markets generally Every time the government kind of steps up their fiscal Kind of offering to the market generally is more well received than not But as I said, I think that this is already priced in because the initial headlines for this were coming out last week The only thing we're looking out here then is potentially disappointment If Mark or if Merkel's excuse me can't come to a compromise between the the CDU and the social Democrats will then if they if they like we had with the European assets Sensitivity to the inability initially for the EU block to come to some sort of coordinated action Perhaps that could have some sensitivity in a similar fashion if Merkel can't piece together some kind of deal and compromise Markets expect now the range is around 50 to 100 billion euros that we're looking at for for fiscal stimulus in the secondary package The other thing we've had overnight is the RBA. I'm not going to spend much time talking about this hasn't really moved the currency Basically maintain both their cash rate of three year yield target at 0.25 percent. It's all very much as expected One of the interesting things if anything Was a comment that possible depth of downturn will be less than earlier expected So if anything perhaps a little bit upbeat with that commentary So the RBA holding fire on signs of early recovery So the Aussie just holding on to some of the gains that were seen from yesterday's session On Brexit a few things to be aware of UK is expected to indicate its willingness to compromise on fisheries and trade rules if the European Union agrees to back off from its Maximilist demands related to regulatory alignment and fishing access according to the Times Newspaper now that is a little of a sign of perhaps a concession of sorts because Definitely on the fisheries and trade rules there were the two things if you're remembering yesterday's briefing from the weekend press Providing a bit of a stumbling block for further progression in these talks, which recommenced today between Britain and all UK and Europe My thoughts on that have not changed. I do not think that the negotiations Between the kind of the Brexit negotiators is going to change this week But one thing is is that Prime Minister is going to be meeting Boris Johnson with the president of the European Commission said to be This month so after this week, but obviously ahead of the deadline at the end of the month still looking to Looking to get a deal of some sort over the line or at least Heading in the right direction in order for the UK government for Boris Johnson's point of view not to request any further extension beyond the The current transition at the end of the year And then looking at the counter for today This is actually pretty quiet mean RBA aside There's not really a great deal coming out on the on the docket today from a from an economic data point of view a couple of mortgage related numbers Perhaps just for those interested if you if you own a property or looking to buy or sell at the moment The latest nationwide house price data for May Came in month a month at minus one point seven percent a little bit weaker than expected But I don't think that's surprising a nationwide house price data doesn't really move the pound But that just pointing that out because you've got mortgage approvals lending coming out this are later this morning Again, not a market mover and then going into the afternoon no major 130s from the states You've got the ISM your index But again, that's not really going to be a market mover mover either And then the API inventories for any crude trade is not coming out until much later in the evening Speaker-wise not too much from the docket certainly nothing from a central bank perspective And then form a fixed income side of things Some supply coming out the UK to be aware of if you're looking at the UK guilt market But that's that's pretty much it for me So yeah pretty quiet open this morning, but given the lack of calendar events Perhaps then today could be a much more technical lead day on the charts cross-asset Perhaps still keeping an eye on on Trump this situation with the flare-up with the The demonstrations in America and Trump's threat now to deploy the US military Certainly need keeping an eye on at this point markets seemingly still brushing that aside somewhat But I think if we start tipping over into that view that I've been talking about about the repercussion that could have on the pandemic rates of recovery With the and the virus numbers that could be something to to keep an eye on And then also just keeping an eye out as well for anything on the the US China trade front However, I was saying this to some of the guys yesterday. I would imagine that Trump will be wholeheartedly looking to try to address the George Floyd situation rather than talking about China and trade wars um, you know in terms of his political Hierarchy of needs if you want to call it that it's certainly much more about the demonstrations at this point So perhaps that could lessen the need or lessen the probability of a kind of A china related comment that could spook the market at this point Which might mean that trends generally can are going to be continuing today And a more technical oriented session, but we shall see all right guys. That's it from me Have a good session ahead and I'll catch you later


Russia carried out 465 chemical attacks on Ukraine since the full-scale invasion. From the beginning of the full-scale invasion, Russian terrorists have used chemical weapons 465 times to attack Ukraine according to the support force command of Ukraine. The defence forces have recorded 465 cases of the use of ammunition by the Russian Federation equipped with poisonous chemical substances. Of these, 81 cases occurred in December of the current year alone, the statement says. At the same time, the command notes that the dynamics of the use of such weapons by the occupiers are increasing. For example, on a single day, December the 19th, the Russians carried out 8 attacks using chemical substances. Most often, the enemy uses grenades such as K-51, RGR, and the handheld gas-grenade Drofa PM, which are dropped from drones. However, improvised explosive devices equipped with irritants are used. Artillery shelling with chemically hazardous substances is also carried out. For instance, on December the 14th, the use of a new type of special gas-grenade, RGVO, with an unknown chemical substance was discovered. It is noted that 28 cases of the use of dangerous chemical substances have been documented and sent for investigation as part of the criminal proceedings by the groups of radiation, chemical and biological reconnaissance from the military units of the support force command, together with security service of Ukraine.