Energy policy in Delaware

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Energy policy in Delaware
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Quick Facts
Energy Department Division of Energy and Climate[1]
State Population 900,000
Per Capita Income $41,940
Energy Consumption
Total Energy Consumption 272 trillion BTU[2][3]
Per Capita Energy Consumption 299 million BTU
Energy Spending
Total Energy Spending $3,957 million
Per Capita Energy Spending $4,357
Price of Residential Natural Gas $20.77 per thousand cubic foot
Price of Electricity 14.04 cents per kWh
See also
Energy on the ballot
Statewide fracking on the ballot
Local fracking on the ballot
Policypedia
Policypedia Energy Final 2-01.jpg
Energy Policy Project
Energy policy in the United States
Energy use in the United States
Energy policy in Delaware
Energy terms and definitions
Energy policy in Delaware depends on geography, natural energy resources, how electricity is generated, how much energy consumers use, politics and the influence of groups such as environmental and industry organizations. Decisions by policymakers, such as state and local governments, utilities and regulatory agencies, affect all citizens economically and environmentally, and are generally geared toward providing reliable, affordable energy. The cost of energy affects not only home heating and electricity bills, and thus disposable income, but also economic growth, including jobs, investment and the cost of doing business in the state.

How energy is produced and consumed also has an impact on the environment and pollution. Energy policy in Delaware, and many other states, focuses on providing for the increasing demand for energy, decreasing emissions by increasing energy efficiency and the use of renewable energy. As the infrastructure for producing and delivering renewable energy sources is not as advanced as it is for energy generation from traditional sources, these policies often require subsidies to make the produced energy affordable, and their effects are difficult to measure.[4]

Energy policy involves tradeoffs between providing an affordable, consistent energy supply on the one hand, and limiting pollution and protecting the environment, on the other. How states attempt to balance these two differs between states, and often boils down to costs to consumers versus costs to the environment. This article provides general energy information about the state as the context within which energy policy is made, as well as information about major legislation and public and private groups that play a role in setting energy policy in the state.

See also: Energy policy in the United States for more information on energy policy.

Energy overview

State facts

Below are quick facts about Delaware's energy climate.

Delaware

In Delaware

  • each resident uses one-third more energy than the national average.
  • total energy consumption is among the lowest in the nation.
  • natural gas is the main source of energy used in home heating.
  • the state imports most of its consumed traditional energy resources.
  • industry is the largest energy-consuming sector in the state.[5]

Available energy resources

Delaware has no traditional energy resources such as oil, coal or natural gas. Because of the state’s access to Wilmington Port it ships oil and coal. This lack of traditional energy resources means Delaware is a net energy importer, bringing in all the coal, natural gas and petroleum consumed in the state.[5]

Delaware has renewable energy resources that contributed a small portion of the energy for electricity in 2011 according to the U.S. Energy Information Administration (EIA). The state generates its primary renewable energy from biomass including landfill gas. Delaware is also currently developing commercial offshore wind resources. In 2010 the first utility-scale wind turbine was installed.[5]

Consumption and prices

Energy consumption in Delaware
DE energy consumption chart.png

Legend[6]
     Transportation       Residential     Industrial       Commercial
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As shown in the pie chart in 2011, 30 percent of Delaware's energy use was for industrial, one-fifth for residential, 23 percent for transportation and the remaining for commercial. Most of the energy used in the state is in the form of natural gas (used primarily for the electric power sector), followed by electricity and petroleum.[5]

Gasoline, used in transportation, accounts for the majority of the petroleum consumed in the state. Per capita petroleum consumption is one of the lowest in the nation.[5] Generally the price of gasoline in the state tracks closely to the national average.[7] Delaware has an excise tax on all gasoline of 23 cents per gallon, ranking it the 31st highest gas tax in the nation.[8]

Comparisons tables

The table below compares Delaware's consumption and spending for energy, as well as prices for gas and electricity, and carbon emissions to those of Rhode Island, which has similar population, resources and consumption needs because of climate and geography. These two states are very similarly placed in the low-rank on population, overall consumption and overall spending. Also given are the U.S. averages and the state rankings. All rankings are from highest to lowest, so, for example:

  • Delaware's rank of 48th in carbon emissions means that carbon emissions are slightly higher in Delaware than in Rhode Island, which has a ranking of 49th.
  • Likewise, per capita income in Delaware is higher than the national average, and lower than in Rhode Island, which at 15th ranks nine places ahead Delaware ranking of 24th in per capita income.
  • Per capita energy consumption in Delaware (at 30th) is somewhat higher than in Rhode Island (at 51st).
  • Per capita energy spending in Delaware is significantly higher because it ranks 28th to Rhode Island's ranking of 46th. This is somewhat surprising because natural gas prices are only slightly higher in Delaware, at sixth compared to 12th in Rhode Island.
  • Electricity prices are slightly higher in Rhode Island, which was ranked at ninth, compared to Delaware at 14th.
Consumption and Expenditures Comparisons Summary
Type DelawareRhode IslandU.S. Figures
FigureU.S. Rank*FigureU.S. Rank*Totals
Population0.9 million451.1 million43313.9 million
Per Capita Income Average$41,94024$44,99015$42,693
Total Consumption272 trillion BTU48184 trillion BTU4997,301 quadrillion BTU
Per Capita Energy Consumption299 million BTU30175 million BTU51312 million BTU
Total Spending on Energy$3,957 million48$3.818 million49$1,394,088 million
Per Capita Spending on Energy$4,35728$3,63446$4,474
Price of Residential Natural Gas, dollar per thousand cubic feet$20.776$14.9412$12.48
Price of Electricity, cents per kWh14.041414.55912.31
Total Carbon Dioxide Emissions, million metric tons (2010)11.74811495,631
*Rank is from highest to lowest.

The price of electricity in Delaware is 24 percent higher than the national average. This may result from the fact that 60 percent of electricity in Delaware comes from coal, which is becoming more expensive because of carbon dioxide emissions. The state also has a renewable portfolio standard (RPS), and some studies argue that "renewable electricity mandates are a very expensive way to reduce carbon dioxide emissions."[5][9][10]

See also: State Energy Rankings to compare all 50 states
Consumption of energy for heating homes in Delaware
Source Delaware 2011 U.S. average 2011
Natural gas 40.3% 49.5%
Fuel oil 15.9% 6.5%
Electricity 31.4% 35.4%
Liquid Petroleum Gases (LPG) 10.4% 5%
Other/none 2.1% 3.6%

Production and transmission

Delaware produced 3.8 BTU of energy in 2011. Almost all of that came from what the EIA classifies as ‘other’ renewable energies.[11]

Energy production by type in Delaware, 2011
Type Amount Generated
(trillion BTU)
% of State % of USA
Other 3.8 100% 0.05%

All of Delaware's energy production came from renewable energy resources in 2011, according to the EIA. The state generates its primary renewable energy from biomass including landfill gas. In 2010 the first electricity-utility scale wind turbine began developing commercial offshore wind.[5]

Natural gas is supplied through interstate pipelines, mainly Columbia Gas Transmission Corp. and Eastern Shore Natural Gas Co. from Pennsylvania. A small amount is also imported from Maryland. The port of Wilmington, which is part of the Delaware River, receives Delaware's imported resources. Delaware has one of the only two operating petroleum refineries on the East Coast. Coal is mainly shipped by rail from Kentucky, Virginia, West Virginia and small amounts from Ohio and Pennsylvania.[5]

Where electricity comes from in Delaware [12]
Type Amount generated (MWh) % of state** % of U.S.**
Natural gas-fired 493,000 74.47% 0.05%
Coal-fired 150,000 22.66% 0.01%
Other renewables 11,000 1.66% 0.01%
Total net electricity generation 662,000 100% 0.02%
**Note: Because the U.S. Energy Information Administration (EIA) does not include all of a state's energy production in these figures, the EIA totals do not equal 100 percent. Instead, we have generated our own percentages.

The Delaware Public Service Commission (PSC) regulates one electric utility and two natural gas utilities along with utilities for cable, wastewater, and water. The PSC does not regulate propane or fuel oil utilities, and has no say over rates they charge. For natural gas utilities, Delaware only regulates transmission to customers while the Federal Energy Regulatory Commission (FERC) regulates interstate transmission.[13] Natural gas used in electricity generation is shipped into Delaware through the Port of Wilmington. The electric transmission system in Delaware is regulated by FERC. PJM Interconnection LLC (PJM) is the transmission organization for the state.[14]

Energy policy

Policy Issues

The price of electricity in Delaware is 24 percent higher than the national average. This may result from the fact that 60 percent of electricity in Delaware comes from coal, which is becoming more expensive because of increasing regulation due to its carbon dioxide emissions.[15][16]

See also: Fracking in Delaware

Energy policy is made, executed and influenced by many organizations, both public and private, and is codified in the laws and regulations of the state. Delaware has been relatively progressive regarding energy efficiency and renewable energy use. Delaware enacted a Renewable Portfolio Standard (RPS) in 2005 and expanded it in 2010. The standard requires electricity suppliers to buy 25 percent of the electricity they sell within the state from renewable sources by the year 2025-2026.[5]

Delaware ranked 22nd on the Energy Efficiency Scorecard produced by the American Council for an Energy-Efficient Economy.[17] There are differing estimates about the economic impact of these mandates in terms of costs that may affect prices and jobs, as well as the impact on the environment and pollution. Thus, for example, there are many new studies of what is called the "rebound effect" which refers to the fact that "some of the theoretically estimated gains in energy efficiency will be eroded as consumers consume additional goods and services."[18][19]

Major legislation

  • The Energy Efficiency Resource Standard Act (2009) targets energy consumption and peak demand. This energy efficiency program seeks to decrease energy consumption and imposes regulations to reduce natural gas and electricity use. The act mandates a 15 percent decrease in electricity use, a 15 percent decrease in peak electricity demand, and a 10 percent decrease in natural gas use by 2015. Delaware utilities must consider cost-effective demand-side management and demand response strategies for dealing with their increasing energy demand.[20]
  • Delaware Senate Bill 18 (2007) known as Substitute Number 1, created a nonprofit corporation called Sustainable Energy Utility. An Oversight Board and the State Energy Coordinator along with the Department of Natural Resources and Environmental Control direct the Utility. It was created to deliver renewable energy services to customers and to coordinate programs that deliver understandable energy efficiency. Demand-side management plans are required from electric utilities.[21]
  • The Electric Utility Retail Customer Supply Act (2006) was inspired by cost-effectiveness. This act requires electricity providers to turn in documents with 10-year integrated resources plans. Included in the document, long-term supply contracts should be described, along with provisions for demand-side resources and renewable energy.[22]
  • Delaware Energy Act (2003) is a plan developed by the Governor's Energy Advisory Council. Workgroups were created to review resources and current policies and to suggest improvements to the Governor's Energy Advisory Council for the state's future energy targets, policies, and goals. The workgroups' goals include reducing energy use, the environmental footprint of energy used by Delawareans, and transportation energy use. The groups also work on ensuring efficient and effective energy transmission and distribution systems and supporting and growing Delaware's clean energy businesses.[23]
  • Delaware Law HB 10 (1999) gave permission to the Delaware Public Service Commission (PSC) to create environmental disclosure requirements and consumer protection standards for green power marketing. All electric suppliers must disclose to the PSC aggregate proportions of fuel resource blends for the electricity supplied to buyers. Electric suppliers must also provide their fuel resource blends to retail electricity buyers yearly by bill inserts and by customer request. Documents must include the total number of retail electric customers in each class, the net amount of electricity supplied to each customer class, and the fuel blends by percentage.[24]

Government agencies and committees

Policypedia
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State energy policy

Energy policy terms

Fracking in the U.S.

Energy use in the U.S.

Energy policy in the U.S.


See also
Local fracking on the ballot

Statewide fracking on the ballot

  • The Delaware Public Service Commission (PSC), an independent regulatory agency has been regulating Delaware public utilities since 1949, including those that are municipally-owned. Types of utilities regulated include electric, natural gas, water, wastewater, cable and telecommunications. Most of these must obtain PSC approval before they set new rates, issue stocks or bonds, or undertake major construction projects such as water wells, power plants or transmission lines. The PSC is composed of five part-time commissioners who decide cases brought to the PSC for changes in utility operations, rates and for construction projects. Commissioners are appointed by the governor and confirmed by the state senate for staggered six-year terms. The commissioners’ office is under the direction of a full-time staff.[27]
  • The Division of Clean Energy and Climate represents the Delaware State Energy Office. The division is in charge of optimizing energy efficiency, educating the public on energy issues, promoting renewable energy sources, and improving and protecting the environment. Projects and programs supported through the office will help to achieve the goals of the Division of Clean Energy and Climate. Partnerships with the Energy Office and the Home Builders Association of Delaware helps to implement the state's energy goals and offers rebates for newly constructed homes that qualify under the National Green Building System and Leadership in Energy Environmental Design (LEED).[28][29]

Major organizations

  • The University of Delaware Energy Institute is prepared to assist in addressing Delaware's energy problems through a variety of areas of study including science, engineering, public policy and business aspects related to energy issues. For almost 40 years the university informed Delaware's energy sectors including photovoltaics, fuel production, fuel-efficient vehicles, energy efficiency and conservation, policies relating to energy and the environment, fuel cell technology and science, wind power and energy storage. The Institute serves as an organization supported by energy research, education and outreach in applying current energy discoveries.[31]
  • The Delaware Technology Park (DTP) is a non-profit research park. The technology park works with energy companies to provide information technology, renewable energy and advanced materials. More than 75 companies have been housed under DTP and more than 16,000 new jobs have been created since its opening in 1992. The success of DTP was made possible with the help from the University of Delaware, the private sector, and partnership modeling. The park was recognized in 2005 as the Outstanding Research/Science Park of the Year and as a model research park for regional economic development initiatives for the U.S. Council on Competitiveness.[32]
  • Green Delaware is an organization that believes in progressing towards improving environmental and public health issues in the state and in neighboring states. Green Delaware was founded in 1995. The group promotes policies that support good health, biodiversity preservation, and long term sustainability. To achieve these goals, the group directs change through basic human relationships built on peace, justice, and democratic forms of government.[33]

In the news

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See also

External links

References

  1. Division of Energy & Climate, "About Us," accessed March 5, 2014
  2. These figures come from the U.S. Energy Information Administration's State Profiles and Energy Estimates, Delaware Overview. Statistics for population and per capita income are for the year 2012; consumption and spending estimates are for 2011; and prices are for October 2013. Updated pricing information is available on the state's EIA profile. Prices will be updated on this page biannually.
  3. U.S. Energy Information Administration, "Delaware Overview," accessed February 5, 2014
  4. Delaware Division of Energy and Climate, "Delaware Energy Plan 2009-2014," March 26, 2009, accessed March 5, 2014
  5. 5.0 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 5.9 U.S. Energy Information Administration, "Delaware State Energy Profile," December 18, 2013
  6. This chart depicts the state's energy consumption as reported by the EIA for 2011. Click the image to enlarge.
  7. To compare current gasoline prices in Delaware to the U.S averages, go to GasBuddy.com
  8. Tax Foundation, "State Gasoline Tax Rates, 2009-2013," March 21, 2013
  9. Institute for Energy Research, "The Status of Renewable Electricity Mandates in the States," accessed March 16, 2014
  10. U.S. Energy Information Administration, "Rhode Island State Energy Profile," December 18, 2013
  11. U.S. Energy Information Administration, “State Energy Data System, Production,” accessed February 18, 2014
  12. These figures come from the EIA State Profiles and Energy Estimates U.S. Energy Information Administration, "Delaware Overview," accessed March 8, 2014
  13. State of Delaware, "PSC Regulated Utilities," accessed March 15, 2014
  14. State of Delaware, "Electric Regulation in Delaware," accessed March 8, 2014
  15. Institute for Energy Research, "The Status of Renewable Electricity Mandates in the States," accessed March 16, 2014
  16. Institute for Energy Research, "Delaware Energy Facts," accessed March 7, 2014
  17. For a full explanation of how the ACEEE calculates this ranking see the executive summary of their report here [1]
  18. International Risk Governance Council, "The Rebound Effect: Implications of Consumer Behavior for Robust Energy Policies," accessed March 3, 2014
  19. Scientific American, "How Bad Is the Rebound from Energy Efficiency Efforts?," May 21, 2013
  20. American Council for an Energy-Efficient Economy, "Delaware," accessed March 7, 2014
  21. American Council for an Energy-Efficient Economy, "Delaware," accessed March 7, 2014
  22. American Council for an Energy-Efficient Economy, "Delaware," accessed March 7, 2014
  23. State of Delaware, "Delaware Energy Plan" accessed March 7, 2014
  24. Database of State Incentives for Renewables & Efficiency, "Fuel Mix Disclosure," December 17, 2012
  25. State of Delaware, "Senate Energy & Transit Committee," accessed March 8, 2014
  26. State of Delaware, House Energy Committee, accessed March 8, 2014
  27. Delaware Public Service Commission, "About Us," accessed March 8, 2014
  28. National Association of State Energy Officials, "Delaware," accessed March 8, 2014
  29. State of Delaware, "Delaware Division of Energy & Climate," accessed March 8, 2014
  30. Delaware Department of Natural Resources & Environmental Control, "Divisions," accessed August 15, 2011
  31. University of Delaware, "Energy Institute," accessed March 7, 2014
  32. Delaware Technology Park, "About," accessed March 7, 2014
  33. Green Delaware, "About Green Delaware," accessed March 7, 2014