Wood Smoke: Monetizing Health Benefits

1. Wood Smoke: Monetizing Health Benefits Regional Technical Forum August 23, 2013

2. Meeting Agenda • Subcommittee objectives • Objectives for today • Genesis of the problem • Regional Act and Regulatory requirements • Abt Associates presentation • Discussion • Next steps • Adjourn

3. Subcommittee Objectives • Exploring alternative options to quantify the net health impacts of displacing wood heat with electric powered heat. • Different options available to model health impacts of particulate emissions on air quality. • Granularity of results one can expect from this modeling exercise. • Inherent assumptions and uncertainties associated with such modeling • Data required to conduct this analysis.

4. Objectives for Today • Discussion to provide direction for staff to draft a Scope of Work • Make recommendations to RTF on options and methods. • Understand how results from this exercise will be applied • Direction will be gathered from discussion in the subcommittee meeting.

5. Genesis of the Problem • Ductless Heat Pumps (DHP) replace wood heat in some residential homes. • This reduces wood smoke emission … but this also adds load to the grid • Preliminary analysis showed the health benefits from avoided wood smoke to be significant, larger than electric savings • Other EE measures also reduce wood heat (e.g. weatherization)

6. Regional Act Context: Section 3(4) Cost-effectiveness “System cost” is defined to mean “an estimate of all direct costs of a measure or resource over its effective life,” including, “among other factors”: • cost of distribution and transmission to the consumer, if applicable • waste disposal costs • end-of-cycle costs • fuel costs (including projected increases) • such quantifiable environmental costs and benefits as the Administrator determines, on the basis of a methodology developed by the Council as part of the plan are directly attributable to such measure or resource

7. RTF Guidelines • RTF Guidelines describe analysis of costs & benefits • Guideline section 4.5 identify “other non-energy” cost & benefits • General guideline: “included in a measure cost analysis if it can be sufficiently demonstrated to the RTF that the impacts are significant and monetizable.”

8. WA Public Utilities Regulation • RCW 80.52.030(8): “… the definition of cost-effective, which applies to conservation and other resources, relies on system costs that explicitly includes quantifiable environmental costs and benefits.” • System Costs include quantifiable environmental costs and benefits. • The 1980 Northwest Power Act also includes quantifiable environmental costs and benefits in the “system cost” to be included in cost effectiveness calculations. • Staff has not had a chance to understand regulatory requirements of OR, MO, ID

9. ABT Presentation • ABT presentation will contain three options for analysis: • Option 1: Screening Level Analysis (Basic Detail) • 3 months; $20,000 - $40,000 (Abt estimate) • Option 2: EPA RIA- Style Analysis for CAPs (Medium Detail) • 6 – 8 months; $60,000 - $200,000 (Abt estimate) • Option 3: EPA RIA- Style Analysis for CAPs and HAPs (High Detail) • Cost and duration will be more than Option 2

10. Discussion • Scope of this analysis for electric utilities • Feasibility of presented options • Potential bias inherent in each option • Importance of granularity • Consider impacts beyond health? • Other ideas/ considerations?

11. Next Steps • Milestones • Scope of Work • Timing for analysis (Option driven) • Other thoughts?