Merging Pathways to Net Zero

In Episode 18 of Power Players by Origis®, Janice Loppe, Director of Sustainability for Origis Energy, discusses the recently released “Valley Pathways Study” with Dr. Charles Sims, Director for the Center for Energy, Transportation and Environmental Policy at the University of Tennessee Baker School of Public Policy and Public Affairs.

 

 

MEET THE PLAYERS

Dr. Charles Sims’ research interests center on environmental and natural resource economics with a specific emphasis on the role of risk and uncertainty in natural resources, environmental, and energy policy. His work has been published in environmental and natural resource economics journals, agricultural economics journals, general interest economics journals, applied ecology journals, and general interest science journals. With an eye toward adding physical and natural science realism to his economic models, Sims often collaborates with ecologists, mathematicians, engineers, foresters, biologists, hydrologists, and computer scientists.

As Director of Sustainability and ESG for Origis Energy, Janice Loppe works across all levels of the company to collect data, assess, and report on sustainability performance relative to company goals and to the performance of peers, as well as provides guidance for a best-in-class sustainability program.

Recently, the Tennessee Valley Authority (TVA) partnered with the Baker School to publish a pathway study to identify strategies for the Tennessee Valley to achieve a net-zero economy. Dr. Sims identified a broad range of stakeholders then led the study. He is now sharing his findings with the broader community.

Cutting Through the Carbon Clutter

For many years, TVA was able to reliably predict the amount of electricity needed in the future by using a fairly simple formula around population growth and industrial demand. Over the past few years, this prediction process has gotten harder. Trends on several fronts have made the process more complex. These include a broad range of electrification actions. Consumers installing solar panels and driving electric vehicles. Public policy changes to building codes in their service territory. Data centers and industrial generation and decarbonization moves. All these add up to complexity when forecasting demand.

TVA realized they needed a model with more nuance, one that considered what was happening outside their own efforts at decarbonization to accurately predict how much clean electricity will be needed in the future and how to meet the overall decarbonization goals.

“Growing up in the Tennessee Valley, we have been accustomed to thinking about decarbonization as being TVA’s responsibility, and we’re waiting on TVA to do it,” said Sims. “But when you think about the other sectors of the economy, it comes down to adoption of different technologies and adoption of different standards. And if we’re not careful and we don’t coordinate those things, we can get ourselves into trouble.”

Sims and team assembled a group of stakeholders to find out what was already happening to reduce carbon emissions in the valley and determine what future steps are necessary and likely to the people who need to implement them.

“The other thing we really wanted to highlight was that there’s several different paths to get to net-zero,” Sims explained. “Each stakeholder group showed up with their own idea of what the preferred path to net-zero carbon emissions would look like, which is natural to do because it’s a complicated problem. And when you’re faced with a complicated problem, you tend to think there’s only one way to solve this problem. But one of the things we wanted to make clear to them is there’s several different ways to get there. Just because I don’t agree with your pathway doesn’t necessarily mean that I’m against a net-zero goal.”

The group next had to settle on a clear definition of “net-zero,” and decided to use what Sims called the simplest definition based in common sense to gain consensus: “we want the carbon being pulled out of the atmosphere to be greater than the carbon that’s going in.”

Possible Paths to Net Zero

The first step was to get carbon accounting as a baseline for future work. Loppe pointed out that alone was a big task, “You had to do a greenhouse gas inventory and you had to do a profile of your emissions. Now, having just done a greenhouse gas inventory with Origis, I know how complicated that process is. And we just did it for a company. You did it for an entire geographic area for the whole Valley.”

The results offered some amount of surprise for many stakeholders, Sims said, “The accounting revealed electricity generation was not the biggest source of greenhouse gas emissions in the Valley, which would not have been true a decade ago. And I think, that was sort of eye-opening for a lot of people that TVA has reduced their greenhouse gas emissions quite a bit over the past decade.”

Transportation is the largest source of emission in the region, which is consistent with national data.

“That’s been a persistently large source of greenhouse gas emissions for a long time. It hasn’t changed very much. We’ve seen improvements in greenhouse gas emissions in some of the other sectors, such as the building and the residential, commercial, and industrial sectors.”

Other findings were that buildings and industry emissions include only non-electricity emissions (such as furnaces and industrial processes) but use nearly 100% of electricity generated in the Valley.

After determining a baseline for carbon emissions, Sims said they looked at various pathways to reduce carbon emissions.

“We found that if we projected into the future with each one of those pathways out to 2050, the biggest emissions reduction came from trying to electrify everything,” said Sims. “And this is consistent with what you hear from a lot of folks is that we want to clean up the electricity generation and then we want to try to electrify everything. The biggest emissions we saw there were certainly in that scenario.”

The Roles of Each Power Player

Sims said, “This led us to start to decide the most obvious no regret strategy was to try to electrify the transportation sector. That electrification got a big reduction in emissions. And it’s the technology that seemed closest to widespread adoption. Maybe not in the next 5 years, but certainly in the next 10 years or so.”

To make widespread adoption of EVs happen, an investment in charging infrastructure will be necessary. Sims says there’s no consensus among policymakers or economists who should pay for that.

“A lot of the things we’re talking about with decarbonization are changes in human behavior, but there’s also lots of investments in big infrastructure as well. And those investments in big infrastructure are hard for local economies to swallow,” said Sims. “Those are usually coming from state governments or federal governments who are funneling dollars for new road projects or new water infrastructure projects and things like this. I think the role of government here is to help fund some of those big infrastructure changes and then leave it to the local governments to decide what is the best way to spend some of that money based on local factors only they really understand and know.”

Conclusion

Loppe and Sims agreed a net-zero economy would require federal, state and local policies as well as personal buy-in from residents and commercial stakeholders. Sims pointed out people would adopt different decarbonization strategies for different reasons. Some would do it to save money and others to improve the planet. But for anything to be effective, there usually needed to be consensus and transparency on the strategy, which is what the Valley Pathways Study provides.

During their conversation, Loppe and Sims discussed the Pathways to Net Zero.

Three key takeaways:

  1. Consistent with national data, the transportation sector is the largest source of emissions in the Tennessee Valley Authority (TVA) seven state region.
  2. Electrifying the transportation sector will get the biggest reductions in greenhouse gas emissions.
  3. Consensus and transparency are the keys to adoption of any new policies, technologies or behaviors.

 

We’d like to thank our Power Players expert guest Dr. Charles Sims and host Janice Loppe, for their insightful conversation.

 

Resources:

https://baker.utk.edu/research-centers/cetep/valley-pathways-study/

https://baker.utk.edu/2024/03/24/valley-pathways-study-preliminary-findings-webinar/

https://www.tva.com/environment/valley-pathways-study