Energy Days 2016 Full Report

Summary Report: Penn State Energy Days

May 19-20, 2016

Humanity is facing tremendous challenges, change, and opportunity when it comes to the ways in which we create, understand, and interact with energy in the twenty-first century. Penn State is uniquely positioned to take the lead as society tackles these issues.”
—Penn State President Eric J. Barron, November 2015

Introduction

Clean, abundant, and affordable energy provides a critical foundation for our nation’s prosperity. At Penn State, we believe universities can and should do more to strengthen that foundation, and we can accelerate the trajectory of fundamental discovery and applied innovation through deeper partnerships with government, industry, and civil society. On May 19–20, 2016, Penn State hosted its inaugural “Energy Days” event to seek input and feedback from stakeholders in the energy realm.

In November 2015, President Eric J. Barron outlined a goal to the Penn State Board of Trustees about how Penn State might become the “Energy University.” Over the last year, our University’s leadership has been working to benchmark our capabilities, define our strengths and opportunities, and prepare an ambitious effort to become the higher education leader in energy research, education, and service.

To launch that effort, the Energy Days event was designed to elicit input and engagement from a diverse range of stakeholders. This event included a day and a half of both formal and informal discussions. Approximately 150 people registered for tours of various research facilities, then participated in a poster session and reception featuring ninety posters showcasing student and faculty research about diverse energy topics. This was followed by a keynote talk on Thursday night, a panel discussion on Friday morning, and additional keynote talks during lunch. The event also included a set of break-out sessions to explore the needs of the market and of society and how Penn State might transform itself to meet those needs.

Energy Days attendees included 243 people representing a range of interests, including nearly 100 attendees from the energy industry, government agencies, and non-governmental organizations. In addition, Penn State students, faculty, administrators, and staff from a variety of colleges, departments, and institutes also attended. Expertise ranged from engineering and nuclear physics, to law, policy, and economics.

Findings from this event are summarized in this report, and will provide critical feedback as Penn State seeks to transform itself and partner with others to address current and future energy challenges.

Summary of formal presentations and expert panel

On Thursday, May 19, Provost Nick Jones opened Energy Days with an introduction to Penn State’s Strategic Plan and how the plan articulates Penn State’s vision, mission, values, foundations, and key thematic priorities with energy being a key piece; one of the plan’s foundations is Ensuring a Sustainable Future, while a key thematic priority is Stewarding Our Planet’s Resources. He noted that Penn State will help create comprehensive solutions to a variety of issues, including the development and use of clean and renewable energy sources.

Next Mark Brownstein, Environmental Defense Fund, gave a keynote presentation on how discussions related to energy are framed within the context of climate change and the Paris climate agreement achieved in late 2015. It was noted that the resulting global agreement provides a common goal of stabilizing the earth’s temperature to no more than two degrees Celsius while providing differentiated paths on how to get there. Four key challenges to achieving this goal were presented:

  1. The relationship of fossil fuels to other energy sources and the need to limit how much fossil fuel can actually be used;
  2. The role of natural gas in the energy sector;
  3. The impact of grid modernization; and
  4. The strategic tipping point currently occupied by nuclear power, both in the U.S. and abroad. We have the capabilities and technologies to meet energy demands and meet higher standards of living, including in parts of the world that currently lack reliable energy supplies.

Friday, May 20 opened with a discussion of Penn State’s existing energy-related research portfolio. Vice President for Research Neil Sharkey noted that faculty research and publications are in the top five in several broad categories:

  1. Policy, law, economics and geopolitics;
  2. Fossil fuels;
  3. Renewable energy, including nuclear;
  4. Systems and technology (grid, storage, etc.); and
  5. Environmental impacts.

Penn State would like to continue building on this broad portfolio.  The need for 50 percent more energy by 2040 was also expressed. Energy Days participants were asked to think through what this means, and how to provide clean, safe, affordable, and abundant energy supplies. This introduction was followed by a panel discussion about key challenges for the energy sector.

Moderated Panel

Titled “Transforming the Energy System,” the one-hour moderated panel discussion included a diverse range of expertise and perspectives, including the following:

  • Grace Bochenek, Director, National Energy Technology Laboratory
  • Kristina Johnson, CEO and co-founder, CubeHydro
  • Don Moul, Vice President, FirstEnergy
  • Cynthia Pezze, Vice President and Chief Technology Officer, Westinghouse Electric Company
  • Andrew Place, Vice Chairman, Pennsylvania Public Utilities Commission (PUC)

In a discussion, panelists were asked to consider questions related to energy supply, infrastructure, energy use, education, and outreach, and what role a university might have in addressing challenges related to these areas.

A panelist observed that the energy system frees us up to do innovative things to help improve the human condition, and that customers expect to have safe, affordable, and reliable energy. Transformation is happening, ranging from grid innovation, smart metering, energy efficiency, and distributed generation. Challenges include how to use reams of data, meeting customer needs, and managing a flexible grid while also addressing carbon-intensive fuels.

Another panelist said that this was an interesting time for all of us, noting that disruption allows for key innovations to happen. Also noted was that we have 100-year history of using readily available fossil fuels, and that we are now trying to disrupt this. At both the state and national level, fossil fuels supply a significant base. If we want to achieve climate change, however, we need to tackle carbon dioxide, as well as carbon capture and storage. It was stated that this was an exciting time for researchers to engage in a complex, complicated problem set, and that there is a need to understand policy and bring legal aspects into technical programs. Also noted was that communications are critical: the public doesn’t understand where their energy comes from.

The role that nuclear power plays was also discussed, noting that about 11 percent of power produced today is from nuclear. It was observed that there is an energy ecosystem where all sources of energy need to interact in the market place, and a need for more energy in places in the world that don’t yet have “the privilege of having lights turn on.” It was stated that we need to think more about power generation and distribution, with more R&D needed in smart grids; more work is also needed on policy and how the environmental and energy business integrate together.

One panelist raised the question of the sustainability challenge of energy: how can we provide affordable, sustainable, safe energy throughout the system? It was noted that Pennsylvania is an interesting and complicated place, and the regulatory oversight piece is complicated. There is a lot coming through the Public Utility Commission, including renewables, storage, and net metering. It is a challenge to have these work together and balance the needs of different energy sources while mitigating risks, providing energy efficiency and sustainability, and integrating storage into the now two-way grid system. It was also noted that alternative fuels for alternative vehicles are critical, as well as overall energy regulation and policy.

Another panelist stated that we are in a transition from one energy source to another. For example, we are going from personal independent gas-driven systems to shared electric autonomous-learning systems. Likewise, the community or rooftop solar is moving from centralized consumers to de-centralized “pro-sumers.” The aspirational goal to reduce greenhouse-gas emissions by a certain date is a goal set by policy and can be done in five easy pieces:

  1. Conserving energy and increasing energy efficiency;
  2. De-carbonizing the electricity system;
  3. Electrifying light duty fuel;
  4. Fuel switching to biofuel for flight and freight; and
  5. Modernizing the grid.

Universities can help analyze policies and practices for their effects; policy matters, and matters at scales ranging from light bulbs to building codes. There needs to be an honest, open debate: hydropower is difficult, and we can’t do it without nuclear. Universities can analyze how to mitigate the environmental impacts for all energy sources through the whole system.

After noting that policy is an issue that is coming out loud and clear, infrastructure was brought into the discussion. Panelists noted that infrastructure has aged; investment is needed; it is a bipartisan issue; technologies need to evolve much faster, with more of a sense of urgency; resources need to be optimized and integrated (including water, gas, etc.), while providing adequate redundancy to ensure reliability even given extreme events like the polar vortex; the interconnection between gas and electricity, while a regulatory challenge, is important; access to energy is an issue of economic vitality and justice; and we need to modernize what we have. Energy efficiency is also part of the system.

Panelists were asked to discuss the role of nuclear. It was stated that Westinghouse is building three new plants in China, with a focus on simplicity, modulization, and standardization; the goal is to learn from each modular approach to make plant construction more straightforward and reach a thirty-six-month construction schedule. These plants are light water cooling, but there is a need to change cooling to something like lead or molten salt to take a safe fleet and move it to a new level. People such as Bill Gates are investing in nuclear; it will take big money to look at nuclear differently.

Another panelist stated that nuclear provides a safe, reliable way to address carbon, but the current de-regulated market is not sending price signals to invest in it. Policy decisions have unintended consequences: nuclear has fully loaded fixed costs, and we are paying to keep generating on off-peak follow. Production tax credits have been used to incentivize wind and were used to start the fossil industry; should they be used for nuclear?

One panelist said that a conversation is starting about markets and the PJM (Pennsylvania Jersey Maryland) interconnect footprint; how do we get price signals right and figure out carbon?

An audience member noted that a centralized grid with de-centralized energy production provided a great opportunity for dealing with issues like a polar vortex; Penn State is now offering a new graduate certificate in grid modernization. Panelists noted that distributed generation is changing the energy supply, but there is a need to get net metering right while ensuring stable energy providers; there needs to be a balance between distributed energy and stability. How do we address rate base, socialized costs, resilience? How are these priced into the market? Distributed energy is a challenge, but also an opportunity to think about more modular approach to designing systems.

Finally, panelists were asked about the role universities can play. One panelist stated that they can do policy and research: can you de-carbonize a campus, and cut emissions, and develop a checklist on how to do this in a collaborative sustainable environment? Another panelist noted that education can be out integrating the pieces; rather than educating citizens in a one dimensional view, we need to address issues in their complex, inter-disciplinary interactions: we need three dimensional solutions. A third panelist suggested that collaboration between universities, government, and industry is paramount. A fourth panelist stated that universities offer a unique platform to help educate the general population on energy by using a much more effectual, data based system. Focusing on commercialized technology in partnership with national labs can help break through barriers. In addition, diversity and inclusion are important for STEM fields, and will help with innovation.  Finally, someone said universities can develop future energy leaders who can help serve customers: leaders in policy, engineering and technology who use research and education based on science and fact and outreach to industry to understand its pain points can solve the right problems.

After a break, participants split into break-out sessions (discussed below), followed by lunch and additional keynote speakers.

Lunch time discussions:

President Eric Barron discussed the goal of making Penn State into “Energy University,” noting there is no silver bullet for energy, and we will need a mix of energy sources for a long time to come. Policy is important, perhaps more important than locating new sources of energy. Scaling up energy of any source will have environmental consequences. Understanding the energy sector, and how it connects to food and water, is a complicated space that requires both depth and breadth, as well as inter-disciplinary work. It was noted that Penn State has a powerful foundation to build on: more than seventy different programs, 320 researchers, a land-grant mission, and good connections with industry. Adding this together, we need to focus on crossing siloes going forward, build connections with society, build our ability to cross boundaries, and recruit people into the energy space.

Congressman Glenn Thompson discussed the topic of affordable energy as a critical issue: energy costs, especially for transportation, are among the highest costs after personnel. A number of challenges were cited, including:

  1. Coal mines are shutting down;
  2. There is a lot of over-reaching regulation;
  3. Low gas prices and a warm winter are affecting industry;
  4. Infrastructure is lagging to bring gas to market.

He also stated that universities are essential to moving energy industries into the twenty-first century; a multi-disciplinary approach is needed across a strong spectrum of academic programs and all of Penn State campuses. Energy policy is a key piece, as well as addressing energy’s environmental impact. Domestic energy production provides many benefits, including jobs, economic prosperity, national security, and a way to address food and energy security both here an internationally.

William Hederman, Jr., Counselor to the Director and Senior Advisor to the Secretary of the U.S. Department of Energy (DOE), closed out the formal remarks. He said that this was a terrific conference and he was honored to be part of the discussion.  The challenge of energy is great, and so is the opportunity. The goal for the quadrennial energy review is to move to evidence based decision making, and enhance the analytic rigor of federal energy policy making. Policy objectives integrate policy with technology by focusing on economic competitiveness; energy security; and environmental responsibility. The overall energy review is broken into two installments, each on a four year cycle. Quadrennial Energy Review (QER) 1 is examining the areas of strength and threats for transmission, storage and distribution infrastructure. QER 1.2 is taking a comprehensive look at the electricity system. The analysis for both is using serious analysis and serious policy attention:

  1. Where are we now,
  2. Where are we headed,
  3. Where are the gaps,
  4. How do we address them,
  5. What are the recommendations, and
  6. How do we build consensus among twenty different agencies?

This review will provide a catalog for the technologies the federal government thinks is important. He noted that Penn State’s current capabilities and areas of research provide a good parallel with national level efforts to look at affordability and sustainability, and ensuring investments while providing just and reasonable rates. Pennsylvania is re-emerging as a leader in energy: this is where tricky debates about energy are taking place, including on issues relating to urban and rural populations; jobs; shale/coal. It was noted that if we can find ways to work this out in our communities, it will help the country as well. This includes attention to implementation, additional research and development, and policy stability.  Finally, education about energy at the local level is needed:

  1. How can we explain the cost of producing energy (both economic and environmental);
  2. What are the benefits and values of heat, comfort, mobility, electricity; and
  3. How do we take personal responsibility and choices with our energy use so we don’t heat or cool the whole neighborhood?
Summary of Breakout Sessions

During the morning session, participants broke into smaller groups for discussion on particular themes:

  1. Impacts of changing energy trends on market needs and R and D strategies(natural gas and renewables, mergers and IPOs, evolving regulations, global instability)
  2. Addressing the challenges of critical and coupled energy infrastructure(pipelines and grid, evolving financial models, reliability and uncertainty)
  3. Needs and opportunities for “smart grid” and energy security(distributed and intermittent supply, demand management, software and security)
  4. Energy and climate in the context of the Paris COP21 agreement(global market impacts, carbon negative strategies)
  5. Decision making in the context of regulatory or market uncertainty(quantifying risk, implementing new financial models)
  6. Best practices for moving technology to market / transformation through big data, sensors and measurement(scale-up and demonstration / smart systems, real-time adaptive management)
  7. Innovative strategies for university – industry collaborations (breaking down IP barriers, life-long education, human capital development and talent recruiting)
  8. Adapting energy systems to new modes of mobility(autonomous vehicles, low-carbon aviation, electrification)
  9. Disruptive tech at the materials-energy interface(batteries, 3D printing, smart fabrics, sensors)

Each group reviewed the “Energy University” purpose statement, then discussed challenges related their particular theme; potential opportunities to address those challenges; and what they might do if they had funding to address the challenges.  After lunch, the groups reconvened to refine their list of potential opportunities or strategies and to develop a summary slide with potential strategies.

In addition, someone took notes in each group to provide more details of each discussion. The summary slide is included in Appendix A, while a summary of overall findings is below.

Finding #1:

There is a critical need for public and stakeholder engagement, education, and outreach

  • No one can solve this alone, and technology alone is not enough; we must find opportunities for productive discourse at all levels (personal to global)
    • Need to establish a tiered model from entry level engagement through multi-dimensional partnerships
    • Helpful to focus on aligning goals, expectations for each partner: communicate and build trust, especially with policy makers
    • Deliberative discussions in communities are needed to create a broad Pennsylvania energy and development focus
    • Local governments may be key in meeting international targets—how do we engage?
    • How do we meet communities where they are, including in Appalachia where the jobs have been from coal mining?
    • Collaborative partnerships between scientists and policy makers needed (example is UC Davis’s STEPS program to bring industry, policy-makers, and academia together).
    • Outreach is critical; opportunities from using WPSU/public media; addressing issues in classroom; demonstrations at the University level
  • We need to increase the impact and reach of public education on issues of energy technologies, usage, and impacts on the public
    • There is a public disconnect with the current energy system and transition
    • The value of public conversation re: the energy space is a challenge, as is the group awareness of the role of energy portfolios in society and the timeline for transformation
    • Need to raise basic energy literacy across the board (from kids to customers to regulators)
    • We need education to improve decision-making at the regulatory and customer level
    • Public engagement and education with a quantitative basis is needed

Finding #2:

  • Public policy and decision making are important
  • Policy affects grid investment and operations
  • Need decision process to monetize/assess grid services, externalities, attributes (e.g. base/peak load, resiliency, security)
  • There is a need for technology neutral, evidence-based energy policy development (with public education, feedback, adaptation with sustainability goals)
  • Penn State could create an energy policy institute
  • Engineering policy and environmental nexus/decision making
  • Independent analysis, opportunity for dialogue
  • Consortium of energy/domain with Pennsylvania focus- include an Energy Roadmap
  • Challenge of leveling the playing field among fossil fuel uses and next generation applications
  • There is a disconnect and lack of interdisciplinary design between designer and decision makers of the wholesale energy markets
  • The continuity of cash flow and the lack of consistent regulatory framework = risk
  • Regulations don’t support development of green technology
  • Amortization schedule may be too long, especially if utilities are trying to recoup sunk costs
  • Regulators move slowly longer term plan requirements may be too prescriptive

Finding #3:

There are many challenges, and therefore opportunities for research:

  • Pathway to change: From sound science and technology solutions to practical demonstration and to evidence based policy
    • Research to drive public policy in an informed direction in polarized space
    • Challenge for research to industry pathways- need context based knowledge and breadth (connectivity between the lab and the real world)
    • Need to find way to bridge academic and industrial gap
    • Parties have different objectives, may be difficult to reconcile
  • Rate of change
    • Efficient acceleration of innovation, speed of execution: how?
    • Are we moving too far, too fast? How do we replace 85% fossil fuel use? What does this do to affordable, reliable abundant sources of energy? What about people who do not yet have reliable food, water, electricity?
  • Use strategic system and lifecycle analysis (cradle to grave) to determine appropriate business value and environmental importance, then figure out how to communicate to policy makers
    • Systems thinking/integration and tradeoff analysis
    • Challenge: appropriate market valuation of energy and its impacts, particularly in transportation sector (consumer drives key choices)
    • Understand and compare multiple attributes of energy sources (cost, emissions, risk), especially for renewables and nuclear
    • Integrated production research
  • Manufacturing research:
    • Establish center/institute around disruptive and sustainable manufacturing (manufacture up to TRL 5 demonstration)
    • Establish strategic leadership in advance manufacturing and materials; identify high reward energy applications
    • Engage production facilities in the field and seek value adding processes
  • Impact of carbon/energy:
    • Disconnect between a headlong approach to carbon without an economic evaluation
    • Potential for carbon sequestration (ensuring no leakage)
    • Paris Agreement to reduce CO2 emissions—implementation possible?
    • Environmental impacts of energy production (land use, water, air quality, other)
  • Access to energy, community resilience
    • Some areas have no energy at all (places in China, India, S. Africa)
    • How do we ensure access to safe, reliable, affordable energy for all (not just wealthy families, but for poor families who can’t invest in efficiency)?
    • How do we ensure community resilience?
    • Financial implications of ensuring resilient systems (no one would pay for back-up power until the next Sandy hit)
  • Energy security/resilience
    • Security aspects of H-REEs: non-diversified at present, supply chain challenges
    • Threats to critical infrastructure (cybersecurity, physical attack)
    • Interconnectivity of power grid—subject to key notes being taken out
    • Mega events over large region = big impact.
  • Energy grid/networks/infrastructure:
    • Need deep/granular integrate of sensing, simulation/prediction, visualization, optimization of distributed grid assets
    • Need to study distributive generation, bidirectional flow
    • Method to predict and respond to volatility in energy market
    • Managing distributive generation (non-centralized generation) is tricky (impact of market forces, accounting, regulatory challenges at state/federal level)
    • Better coordination between gas and electric networks—interdependence
    • Potential to co-locate infrastructures (pipelines, highways)
    • Grid resilience critical
  • Transportation
    • Consumer choice impacts overall energy use
      • Challenge: public opinion/public action lags science by ~ 10 years
      • Good science, technology solutions imperative for driving change (lifecycle costs with technologies needed to replace fossil fuels)
  • Potential areas of innovation/opportunity:
    • Smart electrification: integration of electrification into vehicles
    • Vehicle automation and fleet operations
    • Integrated heat and power cycles
    • CO2 capture and usage in vehicles
    • Biofuels
    • Internet of things: energy management requires data to optimize
    • Aviation
  • Behavior change
    • Separation of technology/culture: what leads to a decision/change in behavior?
  • Learn from other’s experience
    • International experience with carbon-shifting in planning, impacts, and nuclear
    • Siemens’ global commitment to go carbon-neutral by 2030

Finding #4:

Incentive/funding mechanisms are necessary parts of the discussion:

  • Energy funding/rate structures:
    • Achieving carbon reduction goals will require significant, sustained investment (but politics change, limits exist to funding)
    • How can we change the electric-distribution rate structure to incentivize renewable energy penetration?
    • Assess the value of strategic market opportunities for energy resources and utilization
    • Communicate to capital markets niche spaces
    • Find local action opportunities, combining shale and other assets, e.g., unused coal plants.
    • Taxes with rebate structures for encouraging redevelopment, investment
    • Disconnects exist between incentives: utility firms care about investors; regulators care about consumers but not about investors.
    • Penalties/subsidies not equitable across various sources
    • Financing is a challenge, esp. given amortization schedules
  • Research funding and innovation development:
    • Need novel incentives to motivate transdisciplinary energy/climate systems research
    • Funding for R&D and the expense of execution is an issue
    • Help develop start ups to innovate, test ideas (challenge to deploy at scale)
  • Need for broader portfolio of funding sources
    • Embrace industry-led funded research (expand the dialogue on this)
    • X-prize type challenge—include crowd sourcing
  • Need to address misalignment of incentives.
    • Why will future be different from the past?

Finding #5:

Penn State is well positioned to address energy issues and be “Energy University”

  • Penn State can/should leverage its land grant mission to promote energy/climate literacy at all levels, across the globe
    • Create energy academy for elected officials, moms, and everyone
    • Figure out how to get people to engage in the energy issues (meters in dorm rooms?)
    • Learn by doing, use the University as a platform to balance of environment and economics
      • Help students learn through hands on learning (Navy Yard as an example)
    • Can help translate global climate agreement to actionable steps at all scales
    • Create multi-disciplinary course(s) that include broad range of students/focus (energy is about psychology, engineering, economics, law, etc.)
      • “you need engineers who can talk to people, and business people who can relate to engineers and everything in between.”
      • “Complexity is our biggest problem. Silo experts cannot handle—stewarding evolution takes interdisciplinary approach.”
    • Create programs to address workforce needs (e.g., grid modernization)
    • Regular energy days at Commonwealth Campuses (not just University Park campus)
    • Develop energy extension (based on Ag extension idea)
    • Attend industry conferences (Public Utilities Benchmark Conference)
  • Strengthen long-term collaboration between Penn State and the Energy Industry, both domestically and internationally
    • Need for holistic education, spanning engineering, policy, economics, business, communications plus shadowing true field experts
    • Challenge of conflicting priorities/expectations (e.g., proprietary nature and non-disclosure agreements may preclude academic publications)
      • Create opportunities for direct engagement
      • Established more structured ways for industry to interface w/ university
      • Develop facultyà industry exchange program
    • Need to integrate research and industry needs- how do we cross this divide?
    • Incubator focused on energy/infrastructure- energy service demonstration hub with multidisciplinary teams
  • Expand the living lab concept for utilizing Penn State assets for academic enhancement, industry partnerships, and student engagement
    • Demonstration site for new and potentially revolutionary technologies: the university can absorb a level of risk in pilot testing that a business cannot, and each pilot exercise has both research and education components
    • Brand the University as an energy innovator (replace Linebacker U with Energy U)
  • Penn State can take a key role in informing grid policy decisions through analysis and facilitation (e.g., tariff structure, market decisions, etc.)