Esty: CT to lead nation’s energy and environment innovation

Dan Esty intends to transform Connecticut’s broken-down, fractured energy policy into a national bellwether for innovation, efficiency and business cooperation, driving the state toward a clean and cheap energy future.

He is ambitious.

As Gov. Dannel P. Malloy’s nominee to run the proposed super-agency Department of Energy and Environmental Protection (DEEP), Esty’s goals match those of the governor. His vast experience and expertise enable him to see and mold all the pieces of a very complex puzzle, and perhaps even realize all of Malloy’s ambitions.

“In the next decade, we will be what California was in the last decade,” Esty said, referring to the West Coast state’s history of strong environmental standards.

Esty is a former advisor to President Barack Obama on energy and the environment; previously served as a senior official in the U.S. Environmental Protection Agency; is an environmental law professor at Yale University; is the director of the Center for Business and the Environment at Yale; and is the director of the Yale Center for Environmental Law and Policy.

He also co-authored a book that argues that companies investing in sustainability and clean energy innovation gain a competitive edge.

To that end, Esty said the new DEEP will create an incentive program for businesses to develop new technologies and approaches in clean energy, energy efficiency and environmental protection. The department will partner with anyone with a good idea, particularly in all fields of clean energy technology.

The goal is to develop cheap and clean power.

“We want Connecticut positioned to be a leader in clean energy innovation, and we believe it can be a cornerstone of our economy,” Esty said. “If Connecticut doesn’t do it, my worry isn’t that the work may go to other states; my real fear is that these opportunities will go off to places like China.”

Malloy’s proposed DEEP takes the Department of Environmental Protection and folds into it the utility oversight of the Department of Public Utility Control. To that, it adds a component to develop a long-term energy strategy for Connecticut and ensure all of the state’s facilities use energy as efficiently as possible.

Esty is Malloy’s nominee for commissioner of the existing DEP, and the confirmation process will play out in the coming weeks. The process to create DEEP will come as the governor’s budget proposal works through the General Assembly, and Esty will be the nominee for the new department if it is approved.

Kevin Hennessy, energy lobbyist and staff attorney for the Connecticut Business & Industry Association, said the state’s biggest problem with energy policy is the authority is spread out over multiple departments and issues are handled without regard for the larger picture. Connecticut needs an agency in control of all energy policies able to examine all the issues and take a holistic approach to long-term needs.

“They have a top-notch person in Dan Esty to run the department,” Hennessy said. “His credentials are second-to-none.”

Esty said the first task of the new DEEP is to address all concerns regarding power generation, demand, pricing, renewable energy goals, emissions, environment and energy efficiency to develop a long-term energy policy in a coherent and systematic way that puts Connecticut on track to lead the nation in innovation and environmental protection.

In the state’s Renewable Portfolio Standards that calls for 20 percent of Connecticut’s power generation to come from Class I renewables, Esty said to expect some tweaks.

Hydroelectric is a clean energy source, he said. The state RPS considers hydroelectric a renewable resource, but only in a very limited capacity for a few megawatts. Esty said Connecticut needs to consider it as a greenhouse gas-free source of power, but with the tradeoff that too much hydroelectric can be destructive to nature.

Nuclear power has to be part of the state’s clean energy future, Esty said. It is a cheap source of energy that is also free of greenhouse gas emissions. Connecticut’s largest source of electricity generation comes from the nuclear Millstone Power Station in Waterford.

Because such a large portion of the state’s baseload electricity comes from nuclear, Esty wonders why electricity prices aren’t significantly lower, instead of Connecticut having the second highest rates in the nation.

The problem starts with the Federal Energy Regulatory Commission, and the way it allows ISO New England to set wholesale electricity prices for the region through its Uniform Clearing Price model, Esty said. The model says all power generators should be paid the price given to the highest cost power generator, even if all the other generators produce power at significantly reduced costs.

Connecticut’s voice might only be a small one in the fight against FERC; but that won’t stop Esty from battling to get more favorable pricing.

“I’m not going to accept it as a given,” he said.

More reasonable energy pricing based on Connecticut environmental goals is one way the state will become more business friendly under the new DEEP, Esty said.

While the state’s environmental concerns and natural beauty must be preserved, the agency recognizes the need to meet business halfway on many of its issues. Esty said both sides are willing to be reasonable.

“One of the things we are looking forward to is having a more collaborative DEP,” said Eric Brown, CBIA associate counsel and environmental lobbyist.

While partnering business toward technological innovation, the DEEP will apply similar innovative techniques to how the department is structured and deals with businesses for permitting and regulation.

“Some permit processes are relatively routine, and they should be treated as such,” Esty said. “Others are more complex and need to be addresses with better care.”

Connecticut has a slumping economy, $3.2 billion state budget deficit and a collage of different initiatives posing as energy policy. The challenge is enormous, but so is the opportunity, Esty said.

In Washington, there’s no agenda for energy, greenhouse gas emissions or environmental protection, Esty said. In other states, infighting between branches of government and political parties prevents constructive planning.

The legislative and executive branches in Connecticut — as well as the Republicans and Democrats — are taking on the tough energy issues with a spirit of cooperation, Esty said. In developing a progressive energy policy, Connecticut will emerge as a state and national leader on the all-important issues of the future.