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REAL-TIME FORECASTING FOR

RENEWABLE ENERGY DEVELOPMENT

HEARING

BEFORE THE

SUBCOMMITTEE ON ENERGY AND 

ENVIRONMENT 

COMMITTEE ON SCIENCE AND 

TECHNOLOGY 

HOUSE OF REPRESENTATIVES

ONE HUNDRED ELEVENTH CONGRESS

SECOND SESSION

JUNE 16, 2010

Serial No. 111–100

Printed for the use of the Committee on Science and Technology

(

Available via the World Wide Web: http://www.science.house.gov 
(II)

COMMITTEE ON SCIENCE AND TECHNOLOGY 

HON. BART GORDON, Tennessee, Chair 

JERRY F. COSTELLO, Illinois 

EDDIE BERNICE JOHNSON, Texas 

LYNN C. WOOLSEY, California 

DAVID WU, Oregon 

BRIAN BAIRD, Washington 

BRAD MILLER, North Carolina 

DANIEL LIPINSKI, Illinois 

GABRIELLE GIFFORDS, Arizona 

DONNA F. EDWARDS, Maryland 

MARCIA L. FUDGE, Ohio 

BEN R. LUJA ́ N, New Mexico 

PAUL D. TONKO, New York 

STEVEN R. ROTHMAN, New Jersey 

JIM MATHESON, Utah 

LINCOLN DAVIS, Tennessee 

BEN CHANDLER, Kentucky 

RUSS CARNAHAN, Missouri 

BARON P. HILL, Indiana 

HARRY E. MITCHELL, Arizona 

CHARLES A. WILSON, Ohio 

KATHLEEN DAHLKEMPER, Pennsylvania 

ALAN GRAYSON, Florida 

SUZANNE M. KOSMAS, Florida 

GARY C. PETERS, Michigan 

JOHN GARAMENDI, California 

VACANCY 

RALPH M. HALL, Texas 

F. JAMES SENSENBRENNER JR., 

Wisconsin 

LAMAR S. SMITH, Texas 

DANA ROHRABACHER, California 

ROSCOE G. BARTLETT, Maryland 

VERNON J. EHLERS, Michigan 

FRANK D. LUCAS, Oklahoma 

JUDY BIGGERT, Illinois 

W. TODD AKIN, Missouri 

RANDY NEUGEBAUER, Texas 

BOB INGLIS, South Carolina 

MICHAEL T. MCCAUL, Texas 

MARIO DIAZ-BALART, Florida 

BRIAN P. BILBRAY, California 

ADRIAN SMITH, Nebraska 

PAUL C. BROUN, Georgia 

PETE OLSON, Texas 

SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

HON. BRIAN BAIRD, Washington, Chair 

JERRY F. COSTELLO, Illinois 

EDDIE BERNICE JOHNSON, Texas 

LYNN C. WOOLSEY, California 

DANIEL LIPINSKI, Illinois 

GABRIELLE GIFFORDS, Arizona 

DONNA F. EDWARDS, Maryland 

BEN R. LUJA ́ N, New Mexico 

PAUL D. TONKO, New York 

JIM MATHESON, Utah 

LINCOLN DAVIS, Tennessee 

BEN CHANDLER, Kentucky 

JOHN GARAMENDI, California 

BART GORDON, Tennessee 

BOB INGLIS, South Carolina 

ROSCOE G. BARTLETT, Maryland 

VERNON J. EHLERS, Michigan 

JUDY BIGGERT, Illinois 

W. TODD AKIN, Missouri 

RANDY NEUGEBAUER, Texas 

MARIO DIAZ-BALART, Florida 

RALPH M. HALL, Texas 

CHRIS KING Democratic Staff Director 

SHIMERE WILLIAMS Democratic Professional Staff Member 

ADAM ROSENBERG Democratic Professional Staff Member 

JETTA WONG Democratic Professional Staff Member 

ANNE COOPER Democratic Professional Staff Member 

ROB WALTHER Democratic Professional Staff Member 

DAN BYERS Republican Professional Staff Member 

TARA ROTHSCHILD Republican Professional Staff Member 

JANE WISE Research Assistant 

ALEX MATTHEWS Research Assistant 
(III)

C O N T E N T S 

June 16, 2010

Page 

Witness List ............................................................................................................. 2

Hearing Charter ...................................................................................................... 3

Opening Statements

Statement by Representative Paul D. Tonko, Acting Chairman, Subcommittee 

on Energy and Environment, Committee on Science and Technology, U.S. 

House of Representatives .................................................................................... 7

Written Statement by Representative Brian Baird, Chairman, Subcommittee on Energy and Environment, Committee on Science and 

Technology, U.S. House of Representatives ................................................ 7

Statement by Representative Randy Neugebauer, Subcommittee on Energy 

and Environment, Committee on Science and Technology, U.S. House of 

Representatives .................................................................................................... 8

Written Statement ............................................................................................ 9

Witnesses:

Ms. Jamie Simler, Director, Office of Energy Policy and Innovation, Federal 

Energy Regulatory Commission 

Oral Statement ................................................................................................. 10

Written Statement ............................................................................................ 12

Biography .......................................................................................................... 14

Dr. Alexander MacDonald, Deputy Assistant Administrator, Laboratories and 

Cooperative Institutes, Office of Oceanic and Atmospheric Research, National Oceanic and Atmospheric Administration 

Oral Statement ................................................................................................. 15

Written Statement ............................................................................................ 16

Biography .......................................................................................................... 27

Dr. David Mooney, Director, Electricity, Resources, and Building System Integration Center, National Renewable Energy Laboratory 

Oral Statement ................................................................................................. 27

Written Statement ............................................................................................ 29

Biography .......................................................................................................... 34

Dr. Pascal Storck, Vice President, 3TIER 

Oral Statement ................................................................................................. 34

Written Statement ............................................................................................ 36

Biography .......................................................................................................... 41

Mr. Grant Rosenblum, Manager of Renewable Integration, California Independent System Operator 

Oral Statement ................................................................................................. 41

Written Statement ............................................................................................ 42

Biography .......................................................................................................... 48

Dr. Robert Michaels, Senior Fellow, Institute for Energy Research 

Oral Statement ................................................................................................. 48

Written Statement ............................................................................................ 49

Biography .......................................................................................................... 54

Discussion 

Potential Economic Savings ................................................................................ 55

Potential Burdens on Energy Resources and Transmission ............................. 56
Page

IV

Allocating Costs for Renewables ......................................................................... 57

Wind Power Impacts on Pollutants and Emissions .......................................... 58

Roles for the Federal Government and Private Industry ................................. 58

Wind Power .......................................................................................................... 59

More on Private Industry .................................................................................... 60

Storage and the Limited Availability of Fossil Fuels ........................................ 60

More on the Need for Renewables ...................................................................... 61

Power Plant Siting ............................................................................................... 62

Information Gathering and Sharing ................................................................... 64

Potential Savings Versus Instrumentation and Data Gathering Costs .......... 65

Adapting Energy Demand to Intermittent Sources .......................................... 66

Potential for Job Creation ................................................................................... 67

Closing .................................................................................................................. 69

Appendix 1: Answers to Post-Hearing Questions

Ms. Jamie Simler, Director, Office of Energy Policy and Innovation, Federal 

Energy Regulatory Commission .......................................................................... 72

Dr. Alexander MacDonald, Deputy Assistant Administrator, Laboratories and 

Cooperative Institutes, Office of Oceanic and Atmospheric Research, National Oceanic and Atmospheric Administration ............................................... 73

Dr. David Mooney, Director, Electricity, Resources, and Building System Integration Center, National Renewable Energy Laboratory ................................. 74

Dr. Pascal Storck, Vice President, 3TIER ............................................................. 77

Appendix 2: Additional Material for the Record

NREL Response to the Report Study of the Effects on Employment of Public 

Aid to Renewable Energy Sources from King Juan Carlos University 

(Spain) ................................................................................................................... 80

Supplemental Testimony of Dr. Robert Michaels, Senior Fellow, Institute 

for Energy Research, dated June 28, 2010 ........................................................ 89

The Institute for Energy Research: The NREL’s Flawed White Paper on 

the Spanish Green Jobs Study ............................................................................ 93
(1)

REAL-TIME FORECASTING FOR RENEWABLE 

ENERGY DEVELOPMENT 

WEDNESDAY, JUNE 16, 2010

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

COMMITTEE ON SCIENCE AND TECHNOLOGY

Washington, DC.

The Subcommittee met, pursuant to call, at 10:02 a.m., in Room 

2318 of the Rayburn House Office Building, Hon. Brian Baird 

[Chairman of the Subcommittee] presiding.
2
3

HEARING CHARTER

COMMITTEE ON SCIENCE AND TECHNOLOGY

SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

U.S. HOUSE OF REPRESENTATIVES 

Real-Time Forecasting for

Renewable Energy Development 

WEDNESDAY, JUNE 16, 2010

10:00 A.M.–12:00 P.M.

2318 RAYBURN HOUSE OFFICE BUILDING

Purpose 

On Wednesday, June 16, 2010 the Subcommittee on Energy and Environment of 

the House Committee on Science & Technology will hold a hearing entitled ‘‘RealTime Forecasting for Renewable Energy Development.’’

The Subcommittee will receive testimony on the roles that various Federal agencies as well as the private sector play in providing forecasting data and services relevant to expanding the availability of reliable, renewable power, and the extent to 

which these efforts are coordinated. The hearing will also explore any research, development, demonstration, and monitoring needs that are not currently being adequately addressed.

Witnesses

• Ms. Jamie Simler is the Director of the Office of Energy Policy and Innovation at the Federal Energy Regulatory Commission. Ms. Simler will testify on 

FERC’s recent activities to survey the issues surrounding the utilization of 

intermittent renewable energy sources on the electric grid, as well as viable 

technical and policy options to address these issues.

• Dr. Alexander MacDonald is the Deputy Assistant Administrator for Laboratories and Cooperative Institutes in the National Oceanic and Atmospheric 

Administration’s (NOAA’s) Office of Oceanic and Atmospheric Research. Dr. 

MacDonald will describe the data, information, and services currently provided by NOAA in support of renewable energy, and how these capabilities 

could be further developed to better serve the needs of renewable energy developers and consumers.

• Dr. David Mooney is the Director of the Electricity, Resources, and Building 

Systems Integration Center at the National Renewable Energy Laboratory 

(NREL) in Golden, Colorado. Dr. Mooney will testify on NREL’s activities 

with other Federal agencies as well as the private sector to identify and address issues with grid integration of renewable energy resources.

• Dr. Pascal Storck is the Vice President of 3TIER. Dr. Storck will provide 

testimony on the role that private renewable power forecasters play relative 

to and in collaboration with services offered by the public sector.

• Mr. Grant Rosenblum is Manager of Renewable Integration for the California Independent System Operator (California ISO). Mr. Rosenblum will 

testify on his experience in balancing intermittent renewable power with 

baseload power sources, and on ways to ensure the reliability of a transmission system with significant renewable energy components.

• Dr. Robert Michaels is a Senior Fellow of the Institute for Energy Research. Dr. Michaels will testify on economic and other challenges associated 

with renewable energy sources.

Background 

A significant barrier to the widespread adoption of many forms of renewable energy, including wind, solar, and marine and hydrokinetic power (MHK), is that 

these sources are intermittent. Electric grid managers address this intermittency by 

adjusting the delivery of other sources of power based on expected changes in renewable power output. These expected changes are called power production fore-
4

1 ‘‘Baseload’’ power refers to power that can be delivered continuously. Examples include coal, 

nuclear, natural gas, and power delivered from energy storage systems such as batteries, fuel 

cells, and compressed air energy storage (CAES). 2 Examples include the National Renewable Energy Laboratory’s Western Wind and Solar 

Grid Integration Study published in May 2010 and the Department of Energy’s 2008 report entitled 20% Wind Energy by 2030. 3 Including researching, monitoring, and predicting ocean currents, tides, water levels, ocean 

circulation, and temperature. 

casts. Such forecasts must take into account changing weather conditions in conjunction with the land’s topography near a renewable energy device, along with the 

device’s expected technical performance. The larger the uncertainty in these forecasts, the more baseload 1 power must be kept in reserve or stored to ensure the 

reliability of electricity to consumers, thus ultimately increasing the total cost of 

electricity generation. Several recent reports 2 have determined that improving the 

accuracy and frequency of these forecasts can have a major impact on the economic 

viability of renewable energy resources. 

Wind, Solar and Marine and Hydrokinetic Power Forecasting Needs 

Current observational networks in the United States are relatively sparse and 

widely spaced, and are therefore not well-suited to forecast wind energy generation. 

These networks emphasize data collection at a height of 10 m or less above the surface compared to today’s typical wind turbine hub height of roughly 80 m. This 

makes it difficult to detect and forecast weather events such as large wind speeds 

over short time periods. The American Wind Energy Association’s (AWEA’s) detailed 

Action Plan to 20% Wind Energy by 2030, which is a follow-up to DOE’s wind energy 

report, also notes that there is ‘‘currently a disconnect between wind forecasters and 

grid operators regarding what wind forecasting information is most useful for system operators.’’ The plan recommends greater cooperation between these groups and 

enhanced system operator training, as well as a significant effort to integrate wind 

forecasting tools into energy management system applications. In addition, collaborative field and computational modeling research is considered necessary in strategic areas of the country to better detect and forecast complex flow regimes that 

lead to unexpected turbine outages, long-term turbine performance issues, and wind 

forecasting errors. 

Forecasting needs for marine and hydrokinetic energy projects are similar to 

wind. High-resolution wind data, enhanced frequency in which data is collected, and 

increased local observation sites near potential MHK projects can improve long- and 

short-term power forecasts. Wave energy technologies also benefit from accurate 

ocean surface wind simulations. Although tidal and current energy are more predictable than wave energy, DOE’s National Marine Renewable Energy Centers are currently developing numerical models to simulate the mechanics of flow around single 

turbines and full arrays with the goal of significantly improving their reliability and 

power forecasts. Finally, meteorological data focused on the surface boundary layer 

of the water, combined with the already collected astronomical tidal forecasts conducted by the National Oceanic and Atmospheric Administration’s (NOAA) National 

Ocean Service, can assist in providing more accurate tidal power forecasts. 

Solar power forecasting is heavily dependent on satellite data, much of which has 

a resolution that is a factor of 10 or more too course to meet the real-time needs 

of grid managers. The power output of utility-scale concentrating solar power systems also depends on the level of direct, as opposed to diffuse, sunlight incident on 

the systems’ components, which in turn is dependent on the concentration of 

aerosols as well as cloud cover in the local atmosphere. This compounds the monitoring and modeling requirements to achieve an accurate forecast.

Public and Private Sector Roles in Renewables Forecasting 

NOAA’s capability to understand and predict changes in the Earth’s environment 

enables the agency to support renewable energy at multiple scales. NOAA’s weather 

forecasts support energy demand predictions today, and these forecasts are expected 

to be critical as sources which depend on real-time meteorological conditions such 

as solar, wind, and MHK power increase in importance. At the most basic level, 

most renewable energy sources depend on the atmospheric and oceanic data that 

NOAA provides. NOAA furthers the development and integration of renewable energy sources through models, analysis tools, and by providing reliable weather, 

hydrological 3, climatic, and ecological data and forecasts. To accomplish this, NOAA 

employs a diverse array of data collection tools and leverages internal and external 

partnerships. NOAA utilizes an integrated system of Earth observing networks supplied by such tools as remote sensing and satellite imagery and a surface network 
5

of weather radars, upper air balloons, ocean buoys, ships, aircraft, and seafloor observations to enhance observation networks, improve weather forecasts, and incorporate climatic changes into long term resource forecasts for the energy industry 

and utilities. For example, the Earth System Research Laboratory (ESRL) and the 

National Weather Service (NWS) work to improve the sensing, characterization, and 

prediction of weather elements in the Planetary Boundary Layer (PBL) through advances in research and implementation of the next generation operational weather 

forecast model (called the Weather Research and Forecasting computer model, or 

more commonly WRF). NOAA leverages research capacities across the agency, as 

well as partnerships with other Federal agencies and national laboratories, cooperative institutes, universities, and international research organizations. 

The National Center for Atmospheric Research (NCAR), sponsored by the National Science Foundation (NSF), conducts collaborative research in atmospheric 

and Earth system science, encompassing meteorology, climate science, atmospheric 

chemistry, solar-terrestrial interactions, and environmental and societal impacts. 

Since 2009, a priority of NCAR has been to develop its capacity to support a transition to renewable energy sources through its breadth of atmospheric science knowledge, experience with technology transfer, and access to university researchers. For 

example, NCAR entered into a partnership with DOE’s National Renewable Energy 

Laboratory (NREL) and a regional utility company, Xcel Energy, to develop sophisticated, localized wind forecasts for operational use. These products aim to inform the 

siting of new wind turbine farms, to better integrate wind-generated electricity into 

the power grid, and to make critical decisions about powering down traditional 

power plants when sufficient winds are predicted. In addition, NCAR incorporates 

observations of current atmospheric conditions from a variety of sources, including 

NOAA models and meteorological data, satellites, aircraft, weather radars, groundbased weather stations, and sensors on the wind turbines into three powerful 

NCAR-based tools: WRF (referenced above); the Real-Time Four-Dimensional Data 

Assimilation System (RTFDDA); and the Dynamic Integrated Forecast System 

(DICast). 

NREL has published several studies on the regional integration of intermittent 

renewables into the electric grid over the last several years. The laboratory currently works with private renewable technology developers and forecasters to test 

and supply relevant data on the effect that varying atmospheric conditions can have 

on particular types of renewable energy systems. NREL also works with NOAA and 

other relevant agencies to map and update its assessment of renewable energy resources throughout the United States, and it carries out modeling and simulation 

research activities to better inform the siting and operation of a variety of renewable 

energy projects. In addition to these ongoing efforts, on June 1st DOE announced 

funding for up to $6 million over two years to improve short-term (0–6 hour) wind 

energy forecasting—$2 million of which will be provided to NOAA this year to fund 

its technical support of the selected projects and $1 million will be awarded to one 

or two competitively selected teams. DOE anticipates providing an additional $3 

million in fiscal year 2011 to NOAA and the recipient team(s) for completing the 

project. 

Private sector companies, often called Forecasting Service Providers (FSP), have 

been in the business of producing site and technology specific renewable power forecasting products for over a decade. These companies are generally third-party vendors which provide confidential forecasting products. The power forecasting products 

are usually based on three main inputs. The first input is the foundational numerical weather prediction (NWP) models using NOAA, NASA and NCAR meteorological and atmospheric data. The second input is site specific observations collected 

from meteorological (or ‘‘met’’) towers and other on-site observation devices. Finally 

this information is combined with technical specs based on the energy output of the 

specific renewable technologies (i.e. a certain kind of wind turbine or solar panel). 

Then using advanced computational techniques, simulations and local scale specific 

models a power forecasting product is created. 

Renewable energy project developers, financiers, energy generators, utilities, and 

electricity balancing authorities use power forecasts. Generally there are two kinds 

of products, one is used for long-term planning to build and site new renewable 

projects and the other is short-term (day-ahead or hour-ahead time frames) for optimization of renewable energy integration onto the grid. The long-term forecast helps 

assess the amount of energy a specific location may be capable of producing using 

a certain technology. This information helps determine characteristics of a project 

such as what technology to install and how large an installation should be. The 

short-term power forecasts are used for efficient scheduling of generation resources. 

This is important to energy generators as well as to balancing authorities such a 

Regional Transmission Organizations (RTO) and Independent Systems Operators 
6

(ISO) which are charged with managing the flow of electric power on the grid. Accurate power forecast products help generators maximize profits by making their resources more reliable for scheduling as well as better at precisely predicting their 

energy output. Increased accuracy may reduce fines, penalties, and eventually the 

amount of reserve energy required to back-up or firm-up the same quantity of renewable resource. This is important to RTOs and ISOs because it reduces the risk 

of over or under loading the power grid, which can damage the grid and possibly 

lead to catastrophic blackouts.

FERC Notice of Inquiry on Variable Energy Resources 

To gain further information on these issues, the Federal Energy Regulatory Commission (FERC) issued a Notice of Inquiry (NOI) in January on ‘‘the extent to which 

barriers may exist that impede the reliable and efficient integration of variable energy resources (VERs) into the electric grid, and whether reforms are needed to 

eliminate those barriers.’’ The NOI goes on to state that:

‘‘[i]n order to meet the challenges posed by the integration of increasing numbers of VERs, ensure that jurisdictional rates are just and reasonable, eliminate 

impediments to open access transmission service for all resources, facilitate the 

efficient development of infrastructure, and ensure that the reliability of the 

grid is maintained, the Commission seeks to explore whether reforms are necessary to ensure that wholesale electricity tariffs are just, reasonable and not 

unduly discriminatory.’’

To date, FERC has received responses to this NOI from over 100 parties, including relevant government agencies and laboratories, electric utilities, RTOs, ISOs, 

and private forecasting companies.
7

Mr. TONKO. [Presiding] This hearing will now come to order. 

Good morning, and welcome to today’s hearing on real-time forecasting for renewable energy development. 

The United States has tremendous potential to expand our use 

of renewable energy resources. According to a study by the Pacific 

Northwest National Laboratory, the accessible wind potential in 

just 12 states could power the entire country over twice. Lawrence 

Berkeley National Lab has also shown that if we took one percent 

of the total United States land area and covered just a quarter of 

it with currently available solar panels, we could meet all of our 

energy needs. In addition, the Electric Power Research Institute 

has found that we could more than double our electricity generation from waterpower just by harnessing our nation’s ample marine 

and hydrokinetic energy resources. 

But as we have often pointed out in this Committee, and it is a 

stunning observation, the wind doesn’t always blow and the sun 

doesn’t always shine. Now, the intermittency of these sources could 

eventually be addressed through the widespread adoption of energy 

storage technologies such as batteries, fuel cells and compressed air 

energy storage systems, and this Committee has passed significant 

legislation to accelerate the advancement of each of these options. 

Right now, electric grid managers throughout the country are 

doing their best to integrate and balance several gigawatts of wind 

with baseload power options on an hour-by-hour and even minuteby-minute basis. To ensure a steady flow of electricity to their consumers, these managers rely on forecasts of power production, 

which take into account weather information provided by NOAA as 

well as energy technology research carried out by DOE or the private sector. 

Recent studies led by the National Renewable Energy Laboratory 

have shown that improving the accuracy and frequencies of these 

forecasts can have a major impact on the economic viability of renewable energy resources. I look forward to learning more from 

this excellent panel of witnesses on how we should best be addressing this important issue. 

[The prepared statement of Chairman Baird follows:]

PREPARED STATEMENT OF CHAIRMAN BRIAN BAIRD

The United States has tremendous potential to expand our use of renewable energy resources. According to a study by the Pacific Northwest National Laboratory, 

the accessible wind potential in just 12 states could power the entire country twice 

over. Lawrence Berkeley National Lab has also shown that if we took one percent 

of the total U.S. land area and covered just a quarter of it with currently available 

solar panels, we could meet all of our energy needs. In addition, the Electric Power 

Research Institute has found that we could more than double our electricity generation from water power just by harnessing our nation’s ample marine and 

hydrokinetic energy resources. 

But as we’ve often pointed out in this Committee—and it is a stunning observation—the wind doesn’t always blow and the sun doesn’t always shine. Now; the 

intermittency of these sources could eventually be addressed through the widespread adoption of energy storage technologies such as batteries, fuel cells, and compressed air energy storage systems, and this Committee has passed significant legislation to accelerate the advancement of each of these options. 

Right now, electric grid managers throughout the country are doing their best to 

integrate and balance several gigawatts of wind with baseload power options on an 

hour-by-hour and even minute-by-minute basis. To ensure a steady flow of electricity to their consumers, these managers rely on forecasts of power production, 
8

which take into account weather information provided by NOAA as well as energy 

technology research carried out by DOE or the private sector. 

Recent studies led by the National Renewable Energy Laboratory have shown 

that improving the accuracy and frequency of these forecasts can have a major impact on the economic viability of renewable energy resources. I look forward to 

learning more from this excellent panel of witnesses on how we should best be addressing this important issue. With that I yield to our distinguished Ranking Member, Mr. Inglis.

Mr. TONKO. With that, I yield to our distinguished Ranking 

Member, Mr. Neugebauer, for his comments. 

Mr. NEUGEBAUER. Thank you, Mr. Chairman. 

I appreciate you holding this hearing and bringing together the 

subject matter experts on not only energy, of course, but also the 

views of the national labs, the Federal regulator, and economists, 

as well as forecasting from the private sector. 

At its most fundamental level, renewable power is about harnessing energy from the environment in some fashion. In that 

sense, being able to forecast the availability of those environmental 

sources, wind, solar, water, for example, at any one time is critical 

to knowing when and how much energy will be generated. 

Because of its rich oil and gas resources, there has long been an 

impression that Texas is behind the times when it comes to pursuing renewable energy. To the contrary, though, Texas is firmly 

established as the country’s leader when it comes to wind energy—

almost 10,000 megawatts of installed capacity, more than double 

any other state. And I am sure many members have heard by now, 

because I never miss the opportunity to remind folks, that the 

highest concentration in wind energy in America is produced in my 

Congressional district. 

Despite many years, even decades, of growth in subsidies and 

vast resources targeted toward research and development, renewable energy sources remain significantly more expensive than conventional counterparts: coal, gas and nuclear. 

Yet still today, wind generation costs are averaging over $150 

per megawatt-hour and solar over $250 per megawatt-hour compared to conventional costs of approximately $100 per megawatthour, to the frustration of many. 

Nonetheless, the last decade has seen significant integration of 

renewable energy into the electric grid fueled by many of the subsidies as well as state-level renewable portfolio standard mandates. 

This growth has resulted in new and increasing challenges for both 

the industry and government, in particular because renewable energy sources such as wind and solar provide only intermittent contributions to the grid. They result in an increased reliability concerns, as they ultimately must be backed by baseload power from 

conventional resources. 

The additional burden on baseload power supply to ensure overall grid reliability adds to the cost of delivering electricity. A key 

question that must be answered is: whom shall pay for this cost, 

the renewable energy companies that are being assisted, or the 

baseload providers that are doing the assisting? Regardless of the 

answer to the key question, there are potential reduced reliability 

concerns associated with integration of renewable energy with better weather forecasting and the incorporation of real-time information. As noted in today’s testimony, improving forecasting accuracy 
9

by even just one or two percent can lead to millions of dollars in 

savings and can alleviate reliability concerns. 

It seems the key to these improvements lies with NOAA, which 

has the responsibility for providing weather and water forecasts 

and developing computer models that are then used by the private 

sector to develop forecasting products for electricity suppliers. To 

this end, we need to make sure NOAA has the authority to pursue 

these activities through support of appropriately focused research 

and development and renewables-focused weather forecasting service. 

I thank the witnesses for appearing before the Subcommittee 

today and I look forward to the testimony. Thank you, Mr. Chairman. 

[The prepared statement of Mr. Neugebauer follows:]

PREPARED STATEMENT OF REPRESENTATIVE RANDY NEUGEBAUER

Thank you Mr. Chairman, I appreciate you holding this hearing and bringing together subject matter experts on not only energy of course, but also the views of 

the national labs, the Federal regulator, an economists as well a forecasting provider from the private sector. 

At its most fundamental level, renewable power is about harnessing energy from 

the environment in some fashion. In that sense, being able to forecast the availability of those environmental sources—wind, solar, or water for example—at any 

one time is critical to knowing when and how much energy will be generated. 

Because of its rich oil and gas resources, there has long been an impression that 

Texas is ‘‘behind the times’’ when it comes to pursuing renewable energy. To the 

contrary, though, Texas is firmly established as the country’s leader when it comes 

to wind energy, with almost 10,000 Megawatts of installed capacity, more than double any other State. 

And I’m sure members by now have heard it, but I never miss the opportunity 

to remind folks that the highest concentration of wind energy in America is produced in my district. 

Despite many years—even decades—of growth in subsidies and vast resources targeted towards research & development—renewable energy sources remain significantly more expensive than conventional counterparts (coal, gas, nuclear). Yet still today, wind generation costs are averaging over $150 per megawatt/hour and solar over $250 per megawatt/hour, compared to conventional costs of approximately $100 per mw/hour, to the frustration of many. 

Nonetheless, the last decade has seen significant integration of renewable energy 

onto the electric grid, fueled by many of these subsidies as well as State-level Renewable Portfolio Standard mandates. 

This growth has resulted in new and increasing challenges for both industry and 

government. In particular, because renewable energy sources such as wind and solar 

provide only intermittent contributions to the grid, they result in an increase of reliability concerns and as they ultimately must be backed by baseload power from conventional sources. 

The additional burden on baseload power supply to ensure overall grid reliability 

adds to the cost of delivering electricity. A key question that must be answered is 

who should pay for this cost—the renewable energy companies that are being assisted, or the baseload power providers that are doing the assisting. 

Regardless of the answer to that key question, there is potential to reduce reliability concerns associated with integration of renewable energy with better weather 

forecasting and the incorporation of real-time information. As noted in today’s testimony, improving forecasting accuracy by even just one or two percent can lead to 

millions of dollars in savings and alleviate reliability concerns. 

It seems the key to these improvements lies with NOAA, which has responsibility 

for providing weather and water forecasts and developing computer models that are 

then used by the private sector to develop forecasting products for electricity suppliers. To this end, we need to make sure NOAA has authority to pursue these activities through support for appropriately focused R&D and renewables-focused 

weather forecasting services. 

I thank the witnesses for appearing before the subcommittee today, and I look forward to the testimony and discussion. 

Thank you Mr. Chairman.
10

Mr. TONKO. Thank you, Mr. Neugebauer, and certainly with the 

increased pressure being felt by many to encourage alternate supplies of energy, I think today’s witnesses will enable us to create 

that more effective, more efficient outcome out there, especially as 

we look at the situation in the Gulf today and the need to, I think, 

strengthen our entire comprehensive energy strategy. 

With all that being said, it is my pleasure to introduce our first 

panel of witnesses at this time. We begin with Ms. Jamie Simler, 

who is the Director of the Office of Energy Policy and Innovation 

for the Federal Energy Regulatory Commission, or FERC. Seated 

next to Ms. Simler is Dr. Alexander MacDonald, who is the Deputy 

Assistant Administrator of Laboratories and Cooperative Institutes 

within the Office of Oceanic and Atmospheric Research at NOAA. 

Then Dr. David Mooney, who is the Director of the Electricity, Resources and Building Systems Integration Center for the National 

Renewable Energy Laboratory. Then we have Dr. Pascal Storck, 

who is the Vice President of 3TIER, and Mr. Grant Rosenblum, 

who is the Manager of Renewable Integration at the California 

Independent System Operator. And then finally, Dr. Robert Michaels, who is a Senior Fellow for the Institute for Energy Research. We welcome each and every one of you to the panel and 

look forward to hearing your testimony. 

As our witnesses should know, you will have five minutes for 

your spoken testimony. Your written testimony will be included in 

the record for the hearing, and when you have completed your spoken testimony, we will begin with questions. Each Member will 

have five minutes to question the witnesses. 

Ms. Simler, you would begin, please. 

STATEMENTS OF JAMIE SIMLER, DIRECTOR, OFFICE OF ENERGY POLICY AND INNOVATION, FEDERAL ENERGY REGULATORY COMMISSION 

Ms. SIMLER. Good morning, Mr. Tonko, Mr. Neugebauer, and 

members of the Subcommittee. Thank you for the opportunity to 

appear before you today. My name is Jamie Simler and I am the 

Director of the Office of Energy Policy Innovation of the Federal 

Energy Regulatory Commission. I appear before you as a staff witness. My testimony does not necessarily represent the views of the 

Commission or any individual Commissioner. My testimony will 

cover the motivations of the Commission’s January 21st Notice of 

Inquiry on the Integration of Variable Energy Resources and a 

summary of some of the more relevant responses to the forecasting 

issues in that notice. 

The Commission regulates transmission and sales for resale of 

electric energy in interstate commerce. Its primary responsibility is 

to assure that the rates, terms and conditions of transmission service and wholesale power transactions are just and reasonable and 

not unduly discriminatory or preferential. As part of its ongoing responsibilities, the Commission issues public notices to solicit information on emerging issues that may affect jurisdictional rates and 

terms of service. 

The Notice of Inquiry on the Integration of Variable Energy Resources sought comment on the extent to which barriers may exist 

that impede the reliable and efficient integration of variable energy 
11

resources into the electric grid and whether reforms are needed to 

eliminate those barriers. The Notice noted that while variable energy resources have many desirable characteristics, including low 

marginal energy costs and reduced greenhouse gas emissions as 

compared to conventional fossil fueled generation, they also present 

unique challenges. For example, because variable energy resources 

cannot store or control their fuel source, they have limited ability 

to control their production of electricity. 

With regard to forecasting, the Commission sought comment on 

several issues. These include the current practices used to forecast 

power production from variable energy resources, and whether 

those practices would be adequate as the number of these resources 

increases. The Notice also sought information on whether additional data, tools and reporting requirements are necessary to accommodate state-of-the-art forecasting. A related question is 

whether safeguards need to be in place to ensure that commercially 

sensitive data remain protected. 

As to the issue of current forecasting practices, commenters note 

the importance of understanding two aspects of variable energy 

forecasting, specifically, national weather forecasts and power production forecasts. National weather forecasts span large geographic 

regions and are developed by NOAA and associated government 

agencies. Power production forecasts are designed to predict the energy output of individual facilities. They build on the national forecasts by incorporating additional, site-specific information, such as 

local atmospheric phenomena and specific generator equipment, to 

then develop a more detailed forecast of the anticipated power output of a given facility. These power production forecasts are generally developed by commercial forecast service providers and are 

specifically tailored to the needs of their clients, which could be a 

variable resource owner, a local utility, or a regional transmission 

organization. Some commenters note that existing national weather 

forecasts are optimized for predicting temperature and precipitation and that additional data, models, and computing capabilities 

are needed to generate more detailed weather forecasts suited to 

the challenges of predicting the output of variable energy resources. 

A number of commenters also encouraged the development of 

rapid-update national weather models that utilize data obtained 

and shared from variable energy resources. Many commenters indicate that such improvements to the underlying national weather 

forecasts could provide significant improvements to the ability of 

those in industry to predict the output of variable energy resources. 

Additionally, because different market participants are often simultaneously engaged in predicting the output of the same variable 

energy resources, the notice included questions about whether the 

Commission should encourage centralized or decentralized forecasting protocols. Centralized forecasts are power production forecasts developed for system operators. The system operators use 

these forecasts and generator unit commitment process to ensure 

sufficient generation is online to meet load. Decentralized forecasts, 

on the other hand, are developed for individual variable energy resources and are used by them so that they can schedule their energy production. 
12

Comments indicate that there is likely a role for both centralized 

and decentralized forecasts. The accuracy of these power production forecasts is ultimately affected by the data inputs that are 

used. Because different data sets are available to different market 

participants, some forecasts may include less than ideal information. The notice, therefore, sought comment on this, and the commenters provided information on what type of additional information may be needed. Some commenters also discussed the confidentiality of commercially sensitive data, and they suggested that meteorological data collected from individual generators could be reported to a centralized repository such as NOAA. 

In summary, the Commission’s Notice of Inquiry on the Integration of Variable Energy Resources brought forth a wealth of information on the topic of forecasting, much of which the Commission 

staff is still digesting. The full record, which is available through 

the Commission’s document retention system, will be used by staff 

in making recommendations to the Commission for next steps. 

Thank you. 

[The prepared statement of Ms. Simler follows:]

PREPARED STATEMENT OF JAMIE SIMLER

Introduction 

Mr. Chairman and Members of the Subcommittee, thank you for the opportunity 

to appear before you today. My name is Jamie Simler, and I am the Director of the 

Office of Energy Policy and Innovation of the Federal Energy Regulatory Commission (FERC or Commission). I appear before you as a staff witness; my testimony 

does not necessarily represent the views of the Commission or any individual Commissioner. My testimony will cover the requested area of the Commission’s Notice 

of Inquiry on Variable Energy Resources and filed comments of interest.

Background 

The Commission regulates transmission and sales for resale of electric energy in 

interstate commerce to assure the rates, terms and conditions of transmission service and wholesale power transactions are just and reasonable and not unduly discriminatory or preferential. 

The existing wholesale electricity supply function relies on the coordinated operation of transmission and generation resources. There exist two models to accomplish this. In some parts of the country Regional Transmission Organizations 

(RTOs) and Independent System Operators (ISOs) coordinate the transmission and 

generation resources from a number of utilities and provide service to load serving 

entities through organized wholesale markets. In this model, the RTO/ISO uses dayahead and real-time markets to assess the demand for electricity and to commit and 

dispatch generation and transmission resources to meet that demand. In other parts 

of the country (primarily western and southern regions), individual utilities use 

their own generation and transmission resources and may enter into bilateral arrangements with third-party generators and transmission providers to ensure that 

they have sufficient generation available to serve load reliably. 

At all times, regardless of the model used to provide electric service, system operators must maintain a balance between the amount of energy put on the grid and 

the amount of energy being taken off of the grid. Complicating this task is the fact 

that there is a significant degree of variability in the moment by moment operation 

of the grid. For example, the demand for electricity (known as load) changes on a 

constant basis, and generation resources must be dispatched to meet this demand. 

Additionally, outages can occur whenever generation or transmission resources unexpectedly trip offline. 

System operators have developed a set of tools that allow them to both plan for 

and react to these variations. In the case of load variability, system operators have 

significant experience in developing load forecasts, which rely on statistical analysis, 

temperature forecasts, and historical load patterns, to estimate the amount of load 

at any point on the grid in any given time period. These load forecasts are then incorporated into unit commitment and scheduling processes, in which system operators determine the generation and transmission resources needed to serve the an-
13

ticipated load. Conventional generation resources, under normal conditions, are 

scheduled assuming precision in power production. However, variable energy resources cannot be scheduled with the same precision as conventional generation resources, so accurate power production forecasts play a more important role in allowing system operators to make accurate before-the-fact determinations of power production. 

By their nature, load and power production forecasts are not perfect, and conditions such as weather can deviate from those forecasted. Accordingly, system operators have developed a variety of remedial actions that can be employed in real-time 

to maintain the balance between generation and demand for electricity and to react 

to unforeseen circumstances. For example, system operators deploy operating reserves, which are generation (or demand response) resources that stand ready to 

quickly increase or decrease power production or consumption as needed. Reserves 

are also available to accommodate what are called contingency events, such as the 

forced generation or transmission outages mentioned above. By forecasting anticipated conditions and having the tools in place to react to events as they happen, 

system operators maintain a balance in what is a constantly changing electric system. 

As greater numbers of variable energy resources come online, system operators 

are increasingly faced with additional challenges. Variable energy resources have a 

limited ability to control their output. They can also experience significant increases 

or decreases in the amount of power they produce when a weather system moves 

through the area.

Notice of Inquiry 

To gain a better understanding of the impact of increasing numbers of variable 

energy resources on the electric grid, the Commission issued a Notice of Inquiry 

(Notice) in January of this year. The stated purpose of the Notice was to seek comment on the extent to which barriers may exist that impede the reliable and efficient integration of variable energy resources into the electric grid and whether reforms are needed to eliminate those barriers. The Commission explained that it is 

taking a fresh look at existing policies and practices in light of the changing characteristics of the nation’s generation portfolio. To that end, the Notice posed a number 

of questions on a wide range of subjects. Many of these questions explore ways in 

which existing operational practices or market rules may have the effect of imposing 

unnecessary costs or burdens on both variable energy resources and the transmission systems in which they are located. Thus, the Notice included a number of 

questions related to scheduling practices, unit commitment protocols, and reserve 

requirements. 

Most relevant to the subject of today’s hearing, the Notice included inquiries into 

existing power production forecasting techniques and data provision requirements. 

Among other things, the Notice posed questions about current practices used to forecast power production from variable energy resources, and whether those practices 

would be adequate as the number of these resources increases. The Notice also 

sought information on whether additional data, tools, and reporting requirements 

are necessary to accommodate state-of-the-art forecasting techniques, and whether 

safeguards need to be in place to ensure that commercially-sensitive data remain 

protected. 

Commission staff is currently in the process of reviewing comments from more 

than 130 parties, and we are evaluating what future action may be appropriate. A 

consistent theme in many of these comments is that improved forecasts will play 

a critical role in facilitating the integration of variable energy resources into the 

grid. A few examples are provided.

National Weather and Power Production Forecasts 

Several commenters noted the importance of understanding two aspects of variable energy forecasting: national weather forecasts and power production forecasts. 

National weather forecasts span comparatively large geographic regions and are developed by NOAA and associated government agencies. These national weather forecasts form the foundation for power production forecasts. Power production forecasts 

are designed specifically to predict the energy output of individual wind and solar 

facilities. They go beyond the national weather forecasts and incorporate additional 

site-specific information—such as terrain features, local atmospheric phenomena, 

and specific generator equipment—to develop a more detailed forecast of the anticipated power output of a given facility. These power production forecasts are generally developed by commercial forecast service providers and are specifically tai-
14

lored to the needs of their clients, which could be a variable energy resource, a local 

utility, or an RTO or ISO. 

Some of these commenters indicated that existing national weather forecasts are 

optimized for predicting temperature and precipitation, and that additional data, 

models, and computing capabilities are needed to generate more detailed weather 

forecasts that are suited to the challenges associated with predicting the output of 

variable energy resources. A number of commenters encouraged the development of 

rapid-update national weather models that utilize data obtained and shared from 

variable energy resources. Many commenters indicated that such improvements to 

the underlying weather forecasts, developed by government agencies like NOAA, 

could provide significant improvements to the ability of those in the industry to predict the output of variable energy resources in both the day-ahead and real-time 

operational time frames.

Different Uses of Power Production Forecasts 

Additionally, because different market participants are often simultaneously engaged in predicting the output of the same variable energy resources, the Notice of 

Inquiry included questions about whether the Commission should encourage the development of either centralized or decentralized forecasting protocols. ‘‘Centralized’’ 

forecasts are power production forecasts developed for system operators. These forecasts are used in the generator unit commitment process to ensure that sufficient 

generation is scheduled to meet anticipated load. ‘‘Decentralized’’ forecasts are developed for individual variable energy resources and are used to create energy production schedules and offering strategies. 

Comments indicated that there is likely a role for both decentralized and centralized power production forecasts. Commenters noted that different market participants use power production forecasts in different ways. Variable energy resource operators need accurate power production forecasts to submit bids to system operators 

that they are capable of meeting in real-time. By submitting bids they can meet in 

real-time, these resource operators mitigate their exposure to penalties as well as 

requirements to buy energy in spot markets to make up for any imbalances. System 

operators, on the other hand, need accurate power production forecasts to determine 

an appropriate commitment schedule for generation resources in advance of the operating hour and to deploy reserves as conditions change in real-time. 

While different market participants use power production forecasts to different 

ends, the accuracy of these forecasts is ultimately affected by the data inputs that 

are used. Because different data sets are available to different market participants, 

some forecasts may include less-than-ideal information. The Notice therefore sought 

comments on whether there is a need for data reporting requirements among market participants. A number of commenters indicated that additional data reporting 

among market participants is needed. They provided various lists of the types of 

data and the frequency with which data are reported to support advances in power 

production forecasting capabilities. Commenters generally pointed to the need for 

additional meteorological, operational, and specifically generator outage and de-rate 

data in developing state-of-the-art forecasts. Some commenters, concerned about the 

confidentiality of commercially sensitive data, suggested that meteorological data 

collected from individual generators could be reported to a centralized repository 

such as NOAA because NOAA has no economic stake in the electric industry.

Conclusion 

The Commission received over 2,800 pages of comments to its Notice of Inquiry; 

and Commission staff is in the process of analyzing how power production forecasts 

are used in existing electric markets and how potential regulatory reforms may 

achieve the Commission’s goals of ensuring just and reasonable rates and result in 

benefits to market participants. Upon completing its analysis, the Commission staff 

will make recommendations to the Commission on possible courses of action on 

these issues. Thank you again for the opportunity to testify today. I would be happy 

to answer any questions you may have.

BIOGRAPHY FOR JAMIE SIMLER

Jamie L. Simler is Director of the Office of Energy Policy and Innovation at the 

Federal Energy Regulatory Commission. 

Prior to heading the Office of Energy Policy and Innovation, Ms. Simler served 

from 2005 to 2009 as Deputy Director of FERC’s Office of Energy Market Regulation. Ms. Simler has held several other positions at the Commission, including Director of the Western Division of the Office of Markets, Tariffs and Rates and Advi-
15

sor to Commissioner Nora Mead Brownell. Before joining FERC in 1997, she was 

employed in private industry, working for the Interstate Natural Gas Association 

of America, Panhandle Eastern Pipeline Corporation and the Potomac Electric 

Power Company. 

Ms. Simler earned a Bachelor of Science in Petroleum and Natural Gas Engineering from the Pennsylvania State University and a Masters in Business Administration from the George Washington University.

Mr. TONKO. Thank you, Ms. Simler. 

Dr. MacDonald, please. 

STATEMENTS OF ALEXANDER MACDONALD, DEPUTY ASSISTANT ADMINISTRATOR, LABORATORIES AND COOPERATIVE 

INSTITUTES, OFFICE OF OCEANIC AND ATMOSPHERIC RESEARCH, NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION 

Dr. MACDONALD. Good morning, Mr. Chairman, Mr. Tonko, Congressman Neugebauer and other Members of the Subcommittee. I 

am Alexander MacDonald, Deputy Assistant Administrator of 

NOAA’s Office of Oceanic and Atmospheric Research. Thank you 

for the opportunity to testify today. 

The ongoing Deepwater Horizon spill in the Gulf of Mexico reminds us that there are indeed risks of producing and delivering 

energy. These events also emphasize the need as a Nation to look 

for new cleaner forms of energy. As we explore possibilities for new 

power sources, it is exciting to contemplate creating clean and renewable energy from the sun, wind and ocean. Today I will describe NOAA’s current support of the renewable energy sector and 

how NOAA’s data forecasts and information play a critical role in 

maximizing the potential benefits from renewable energy. 

NOAA’s current contributions to renewable energy include siting 

operation and support of management from our mission-driven and 

focused efforts. NOAA provides weather, water and climate forecasts and information over a full range of time and geographical 

scales. It accomplishes this through remote sensing and imagery 

from satellites, surface networks, weather radars, upper air balloons, ocean buoys, ships, aircraft, and subsurface ocean observations. It uses sophisticated weather and climate models running on 

supercomputers to make forecasts such as those that accurately 

predicted the East Coast snowstorms this past winter. NOAA also 

has expertise to effectively evaluate the impacts of coastal and 

ocean energy projects, thereby protecting our natural resources of 

our coastal communities that our national economy relies on. 

With respect to hydropower, NOAA provides regular forecasts of 

precipitation, hydrologic forecasts of snow melt and runoff, as well 

as monthly precipitation outlooks. At the cutting edge of precipitation forecasting, NOAA’s hydrometeorology test bed is researching 

how to forecast the most intense precipitation events. 

In each of these instances, NOAA works in a partnership with 

other Federal agencies like the Departments of Energy and Interior, FAA, NASA and others. NOAA also works closely with the private sector and recognizes the contributions that private weather 

and climate service enterprise will continue to make in the Nation’s 

renewable energy capabilities. NOAA understands that cooperation—and not competition with the private sector, academic, and 

research entities—best serves the public interest, and best meets 
16

the varied needs of individuals, organizations, and economic entities. 

In light of the tremendous information that NOAA currently provides the renewable energy industry, the needs of the industry are 

relatively new compared to the evolution of NOAA’s other products 

and services, and the pace of industry expansion is driving us toward developing new capabilities. The solar and wind energy sectors have generally highlighted that they require improved observations, global models, predictions across a range of time scales, 

and high-resolution forecasts to support the improved operational 

weather forecasts needed for their industry. Wind, for example, is 

typically not measured at the levels where wind turbines operate, 

over 300 feet above the ground. The lack of observations at these 

heights leads to inaccurate forecasts which are important for us to 

remedy. These inaccuracies drive added wind integration costs. 

With respect to solar energy, there are relatively few high-quality, continuous, ground-based observations with which to evaluate 

current and future solar potential, and even fewer measurements 

of direct solar beam, which is essential for concentrating solar systems. 

These are good examples of the new and emerging requirements 

from the renewable energy sector that NOAA must address. We are 

collaborating with DOE and the private sector on a planned 12 

month field demonstration project to improve the efficiency of wind 

energy through enhanced modeling and forecasting. We are working with the private sector and would like to play the role of honest 

broker, which would allow us to collect data that would help improve the information we have. 

Last night, President Obama framed the challenge of renewing 

America’s energy system as similar to the challenges America faced 

in its industrial expansion in World War II and putting a man on 

the moon. In the future, the renewable energy sector will need observations, forecasts, and analysis in order to better integrate 

weather-driven renewable energy. NOAA has the experience and 

mission expertise to work in partnership to address these needs. 

This Nation can create a reliable, efficient energy system depending significantly on weather-driven renewable resources. The 

United States is big enough that if the wind is not blowing or if 

it is cloudy in one part of the country, it is most likely blowing and 

sunny in another part. Improved forecasts along with improvements in our national power transmission and storage would allow 

us to meet President Obama’s challenge. 

Thank you for the opportunity to testify today. 

[The prepared statement of Dr. MacDonald follows:]

PREPARED STATEMENT OF ALEXANDER MACDONALD

INTRODUCTION 

Good morning Chairman Baird, Ranking Member Inglis, and other Members of 

the Subcommittee. I am Alexander E. MacDonald, Deputy Assistant Administrator 

for Laboratories and Cooperative Institutes in the Office of Oceanic and Atmospheric Research at the National Oceanic and Atmospheric Administration (NOAA), 

in the Department of Commerce. Thank you for inviting me to discuss NOAA’s 

science and research that has the potential to support the increased use and efficiency of renewable energy. 

The Nation’s renewable energy sources—solar, wind, and water—are largely driven by weather and dependent on climate. This fundamental connection of renewable 
17

1 U.S. Energy Information Administration, Annual Energy Review 2008, Report No. DOE/

EIA–0384 (2008). http://www.eia.doe.gov/emeu/aer/overview.html

energy to the atmosphere and oceans is at the core of NOAA’s participation in today’s hearing and explains our key role in developing renewable energy. 

The U.S. energy sector is a $1 trillion-per-year enterprise 1 central to our Nation’s 

economy. The Obama Administration has called for the expansion of our Nation’s 

capacity to provide energy from renewable sources to help reduce our dependence 

on fossil fuels, increase our energy security, build the green jobs and economy of 

the future, and reduce greenhouse gas emissions. While numerous climate assessments completed by United States and international climate science bodies agree on 

the long-term impacts of greenhouse gases, the Deepwater Horizon/BP oil spill is a 

reminder of the potential catastrophic, short-term, and acute environmental impacts 

of a fossil fuel-based energy system. NOAA’s scientific data, forecasts, and information can play a critical role in maximizing the potential benefits from all forms of 

renewable energy, and minimizing the environmental impacts of marine renewable 

energy. 

Today, I will describe NOAA’s current support of the renewable energy industry 

and the essential role of NOAA data, information, and services in sound renewable 

energy planning. Some of the challenges to increased use of renewable energy have 

the potential to be addressed by further developing NOAA’s weather, climate, and 

ecological observations and predictions. While renewable energy sources offer a positive option, they are not necessarily environmentally benign. Therefore, I will also 

summarize NOAA’s role in ensuring that renewable energy projects are developed 

consistent with NOAA’s mission to conserve and manage coastal and marine resources to meet our Nation’s economic, social, and environmental needs.

NOAA’s CURRENT CONTRIBUTIONS TO RENEWABLE ENERGY 

NOAA provides weather, water, and climate forecasts and information over a full 

range of temporal and geographical scales. NOAA accomplishes this through remote 

sensing and imagery from satellites, surface networks of weather radars and observing systems, upper air balloons, ocean buoys, ships, aircraft, and seafloor observations. NOAA’s network of integrated Earth observing systems monitor changes in 

ocean, land, air, and space that are critical to siting decisions by the energy sector. 

NOAA provides the marine renewable energy industry with relevant ecological data 

to facilitate siting decisions and construction and operational requirements to minimize and mitigate adverse effects on living marine resources and ecosystems. NOAA 

also works to ensure that siting decisions and operations do not adversely impact 

other key NOAA missions, such as wind power facility impacts on weather radar 

installations. 

NOAA’s contributions to energy facility siting, operation, and management are 

based on a wide range of legal authorities, including energy-specific authorities, as 

well as authorities related to conservation, management, observation, and forecasting (see Appendix A for a list of authorities). In addition, although licensing authority for most energy projects resides with other Federal agencies, NOAA does 

have authority for licensing ocean thermal energy conversion (OTEC) facilities. 

Overall, NOAA plays an active and important role in the siting and management 

of energy facilities through legal authorities that direct NOAA to:

• Collect data on sensitive species and habitats, topography, tides and currents, 

and meteorological conditions. This data, along with information about protected areas and human use patterns, provides the basis for siting decisions.

• Evaluate potential environmental impacts of energy facilities on coastal and 

marine resources and recommend mitigation measures to minimize those impacts.

• Assess and predict the impact of oil spills and hazardous substance releases 

on natural resources, identify response strategies, and implement restoration.

• Forecast weather conditions. Based on the forecasts, energy facilities can adjust their operations to optimize energy production or minimize the negative 

impacts from inclement weather.

• Provide scientific expertise and technical and management assistance to Federal agencies, states, the energy industry, and other stakeholders.

• Determine energy-related content of state Coastal Management Plans, mediate Coastal Zone Management Act (CZMA) energy-related disputes and decide 

appeals of state CZMA objections to energy projects to the Secretary of Commerce.
18

While many of the authorities are NOAA-specific, NOAA implements some of the 

authorities in cooperation with other Federal agencies. The Federal agencies with 

energy-related authorities include Federal Energy Regulatory Commission, Department of Transportation, Maritime Administration, United States Coast Guard, Department of Energy (DOE), Department of the Interior (DOI), and Environmental 

Protection Agency. In an effort to focus on key authorities related to energy facility 

siting and management, this testimony does not cover the full scope of NOAA’s legal 

authorities. Many other important authorities support the extensive work that 

NOAA does related to energy issues. For example, legal authorities related to climate are not listed in this testimony, but NOAA’s climate change efforts provide 

valuable contributions to the advancement of renewable energy. 

Additionally, in providing mission-relevant information and services in support of 

renewable energy development, NOAA works in partnership with and draws upon 

the data and information of other Federal agencies in this area, including but not 

limited to the DOI, DOE, the National Aeronautics and Space Administration, and 

the National Science Foundation. For example, NOAA and the Department of Energy’s National Renewable Energy Laboratory together signed a Letter of Intent to 

allow the exchange of scientific resources, personnel, and technical knowledge to 

support the improvement or development of atmospheric and ocean sciences, instrumentation, climate modeling, and renewable energy. Furthermore, NOAA and 

DOE’s Office of Energy Efficiency and Renewable Energy are exploring a Memorandum of Understanding to collaborate to achieve the necessary advancements in 

short-term environmental forecasts and long-term resource projections for the integration of renewable energy into the Nation’s energy system. 

NOAA also works closely with the private sector, and recognizes the contributions 

the private weather and climate service enterprise can make toward the Nation’s 

renewable energy capabilities. NOAA’s role in providing forecast data and information for the renewable energy industry will be guided by the 2006 NOAA Policy on 

Partnerships in the Provision of Environmental Information, based on the National 

Research Council’s 2003 report, ‘‘Fair Weather, Effective Partnerships in Weather 

and Climate Services.’’ The Nation benefits from government information disseminated both by Federal agencies and by diverse nonFederal parties, including commercial and not-for-profit entities. NOAA recognizes that cooperation, not competition, with private sector, academic, and research entities best serves the public interest and best meets the varied needs of specific individuals, organizations, and 

economic entities. NOAA will take advantage of existing capabilities and services of 

commercial and academic sectors to support efficient performance of NOAA’s mission and avoid duplication and competition.

Observations and Forecasts for Operation of Renewable Energy Systems 

NOAA’s observations and forecasts are used by the renewable energy industry to 

efficiently operate its systems and plan for future sites. NOAA’s historical climate 

records provide essential information required to optimize the siting of wind farms 

and solar energy plants. Not only are historical records essential to optimize the location of new production facilities, but accurate weather predictions are critical to 

renewable energy operations because they provide the information needed to ensure 

balance between electric supply and demand. For example, in order to increase operating efficiency, renewable energy operators must know how much energy a particular wind farm or solar energy farm will generate. Likewise, forecasts can help 

energy grid operators predict how much renewable energy will be available to distribute to the energy grid and inform the decision whether to supplement renewable 

energy with other generation sources, such as coal or natural gas plants. The more 

accurate the forecasts NOAA can provide, the more efficient the energy industry can 

become. 

NOAA’s predictions form the core of capability that is used by a thriving commercial weather industry to support the weather information needs of the Nation. In 

general, as NOAA’s predictions have improved, the size and value of the commercial 

weather providing sector has grown commensurately, as it should for the improved 

renewable energy predictions discussed below.

Current Wind Observations 

NOAA’s wind observation capability includes surface measurements as well as 

measurements from aircraft, ships, satellites, Doppler radar, wind profilers, and 

radiosondes—instruments lifted through the atmosphere by weather balloons which 

provide wind data up to about 10 miles high. All of these data are critical for 

NOAA’s success in forecasts and warnings, but wind is not typically measured at 

levels critical for wind turbine operators, about 100 meters above the ground. Also, 
19

none of these data sources provide information at the density that is needed by the 

wind industry. Even fewer observations are available offshore, and these data are 

critical for any offshore wind farms that are being planned. 

While the observations at the 100 meter level are not available, NOAA’s sophisticated computer simulations of the atmosphere can model and predict winds at 100 

meters and some of these data are now becoming available to the private sector. 

However, these models were not designed to provide the information at the temporal 

and spatial resolution needed by the wind industry.

Current Wind Forecasts 

The wind energy industry uses standard NOAA weather forecasts. These forecasts 

were developed to improve surface meteorological predictions and aviation needs. 

They have been extremely successful in addressing these goals but the weather 

models underlying these forecasts were never designed and optimized to provide the 

temporal or spatial resolution or the accuracy needed by the wind industry.

Solar Observations and Forecasts 

NOAA’s Surface Radiation network is a network of seven state-of-the-art Continental United States (CONUS) surface sites that measure diffuse, direct, and total 

solar radiation as well as surface reflectivity. NOAA also measures solar radiation 

at eight global monitoring sites. NOAA’s Climate Reference Network measures total 

incoming solar radiation at about 140 sites in the CONUS and additional sites outside CONUS. These data provide a record of radiation coverage for CONUS. 

NOAA has developed techniques to forecast solar radiation, and currently provides a forecast for ultra-violet (UV) radiation, which is used by the Environmental 

Protection Agency to warn the public of health risks. This product has the capability 

to be extended to address the radiation wavelengths relevant to solar renewable energy.

Precipitation Observations and Forecasts to Support Hydropower 

NOAA’s monthly and seasonal temperature and precipitation outlooks provide information for water management. In particular, NOAA hydrologic forecasts of seasonal snow melt and runoff are important to manage water flow feeding hydro-generation plants. Further, the National Integrated Drought Information System 

(NIDIS), a multi-agency effort which NOAA leads, provides information and early 

warnings of droughts while NOAA’s Hydrometeorological Test Bed (HMT), a demonstration project, provides water information across a wide range of time and space 

scales with a focus on high precipitation events. HMT and NIDIS thus provide extensive expertise on water resources, helping the Nation design a future renewable 

energy system that maximizes our country’s vast natural resources, while preserving water allocations to support our country’s many needs.

Ocean and Coastal Observations and Forecasts to Support Ocean Thermal Energy 

Conversion and Marine Hydrokinetic Energy 

Under the Ocean Thermal Energy Conversion Act (OTECA), NOAA has the responsibility for administering a consolidated licensing program for authorizing ocean 

thermal energy conversion (OTEC) facilities. OTEC is a technology which uses the 

differences between the temperature of deep, cold ocean water and warm ocean surface waters to produce electricity much like a heat pump. Although the technology 

has been proven to work, it has not been developed yet at a commercial scale. A 

substantial effort is underway by industry and the Navy to develop a commercialscale OTEC facility with the most likely site being offshore of Hawai’i. Last November, NOAA brought together leading engineers in the offshore technology field to assess the feasibility of developing an OTEC technology at a commercial scale. The 

findings of that workshop are scheduled to be released this summer. Later this 

month, NOAA is holding a workshop in Hawai’i on the assessment of potential impacts from an OTEC facility. Both workshops are in preparation for a rulemaking 

for the licensing of OTEC facilities. 

Marine hydrokinetic energy uses the energy of waves, tides, and currents in rivers 

and oceans to produce electricity. While these systems do not yet provide power to 

the electrical grid in the United States, a few tidal systems operate in other parts 

of the globe. 

NOAA’s observations and forecasts of the oceans, waves, tides, and rivers provide 

data critical for the development of OTEC and marine hydrokinetic energy. The U.S. 

Integrated Ocean Observing System (IOOS) generates and disseminates continuous 

data, information, models, and services on coastal waters, ecosystems, Great Lakes 

and oceans. NOAA is an integral partner in IOOS.
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Observations and Forecasts to Support Biomass Energy 

NOAA provides forecasts of precipitation, cloud cover, temperature, winds, and 

water flow that are important to biomass production. As these resources are developed, NOAA will work to improve forecasts of precipitation and temperature, which 

are critical factors in determining variation in U.S. biomass supply.

Predictions of Climate Variability and Change to Inform Siting of Renewable Energy 

Systems 

Continued expansion of the Nation’s renewable power capacity will require considerable infrastructure investments, whether in facilities or the grid that will be necessary to efficiently provide Americans with the power they need. To optimally plan 

tomorrow’s energy system, the Nation needs information to understand how the influences of climate and climate change, including natural variability and large-scale 

climate-drivers, such as El Nino, may affect renewable energy resources such as 

wind, solar, and water in the future. In the same way, information about the location and likely intensity of weather- and climate-driven energy demand is needed 

by the industry, such as projections of climate and climate change effects on degree 

heating and cooling days. NOAA observation data, including wind, temperature, 

cloud cover, solar radiation, and climate variability and change predictions are critical pieces of information for forecasting the future availability and location of renewable sources of energy and the likely future demand for energy in the different 

regions of the nation. These forecasts in turn inform industry and public sector investment decisions about the best locations to build facilities like wind farms or 

solar energy platforms, as well as grid design. 

For example, utilities need information about the likelihood of future increases in 

degree heating days to ensure ample power generation and distribution to meet cooling needs. In the same way, developers of coastal wind and hydropower need predictions of sea-level rise and the likelihood of increase in severe coastal storms to 

site, engineer, and design those facilities to withstand future conditions. And lastly, 

hydropower developers require information about the future timing and availability 

of water to adequately design reservoir and power storage capability and dam operation. 

However, it is important to note that the optimal location for renewable energy 

production may not be the optimal location for social or environmental reasons. For 

example, an optimal energy production site may be in the heart of a prime fishing 

ground, in an important endangered species migratory corridor, or in a location that 

interferes with our Nation’s important radar assets. Not only can NOAA assist by 

providing relevant information on these other factors to optimize site selection, but 

it also has regulatory and oversight obligations that are addressed below.

Evaluating the Environmental Impacts of Coastal and Ocean Renewable Energy 

NOAA is also a regulatory agency with responsibilities under the National Environmental Policy Act, the Endangered Species Act, the Marine Mammal Protection 

Act, the Magnuson-Stevens Fishery Conservation and Management Act, and the National Marine Sanctuaries Act. NOAA ensures that coastal and ocean energy 

projects are conducted in compliance with these authorities. NOAA provides information on health, abundance, distribution, and ecological requirements of living marine resources to ensure industry and other regulatory agencies, such and the U.S. 

Army Corps of Engineers, Federal Energy Regulatory Commission, and Minerals 

Management Service have information to meet their obligations under these environmental statutes. NOAA also works with industry and other regulatory agencies 

to ensure that projects they fund or permit are reviewed and authorized consistent 

with the relevant environmental statutes. 

In regard to providing ecological data relevant to environmental permitting or review of coastal and ocean renewable energy, NOAA conducts investigations of the 

status of various fish stocks that support commercial and recreational fisheries, 

threatened and endangered species, and marine mammal stocks. It also conducts 

ecosystem assessments that help define the ecological relations in the ecosystems 

of which these species are a part and upon which they depend. This information is 

critical to making sound siting decisions and accurately identifying effects of energy 

projects. NOAA’s regulatory role can also facilitate the development of mitigation 

measures that will minimize environmental impacts; thereby potentially resolving 

conflicts with competing users of a location. NOAA’s investment in studying and understanding our coastal and marine ecosystems is essential to the development of 

an environmentally sound renewable energy industry.
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Avoidance of Radar Interference from Wind Energy 

NOAA and other Federal agencies evaluate industry requests for turbine siting 

to minimize potential interference of turbines on our Nation’s network of radars. 

NOAA is working with the Departments of Defense, Homeland Security and Transportation to develop software to model potential wind turbine impacts on radars in 

advance of turbine installation to better support the evaluation of industry siting 

requests. Turbines, when sited close to weather radars, can cause false returns that 

can disrupt forecaster situational awareness and weather radar algorithms. For example, a study has shown that when turbines are located within about 18 km (10 

nm) of NOAA/NWS Doppler weather radars, the interference can cause tornado and 

severe thunderstorm detection algorithms to malfunction. NOAA is working with 

the academic community to develop radar software that mitigates the turbine interference in the weather radar’s returned signal. The interference with air surveillance radars can be significantly different.

MEETING THE DATA AND INFORMATION NEEDS OF AN EXPANDING 

RENEWABLE ENERGY SECTOR 

NOAA’s observations, forecasts, and analyses are at the core of integrating weather-driven renewable energy in an efficient manner. NOAA has worked with the renewable energy industry, other Federal agencies, and academic partners to understand current and future observation and forecast needs to support renewable energy. For example, the wind energy sector identified its need for improved observations, global forecast models, predictions across a range of time scales, and high-resolution forecast models to support an improved operational weather forecast. In 

multiple public meetings, private sector weather service vendors, wind farm operators, utilities, and power balancing authorities have requested that NOAA provide 

these improved services. A strong collaboration with Federal partners and the industry would result in improved siting of renewable energy facilities, more accurate 

weather forecasting to support efficient operations, and an opportunity for growth 

in the renewable energy sector. In the end, advancements in observations and forecasts that help address the emerging needs of the renewable energy sector contribute to the broader national interest in reducing our dependence on foreign fuels, 

increasing our energy security, building the green jobs and economy of the future, 

and reducing greenhouse gas emissions. 

In addition to the need for improved forecasts and observations from NOAA, the 

need for coastal and marine spatial planning (CMSP) in the U.S. is critical to the 

development of renewable energy resources. CMSP is a comprehensive, adaptive, integrated, ecosystem-based, and transparent spatial planning process, based on 

sound science, for analyzing current and anticipated uses of ocean, coastal, and 

Great Lakes areas. As the Nation’s primary ocean agency, NOAA will continue to 

play a leadership role in advancing the implementation of CMSP throughout U.S. 

waters for purposes that include the development of renewable energy. To this end, 

NOAA brings a unique mix of: diverse legal authorities for place-based ocean stewardship; robust and cutting-edge scientific and technical expertise to understand 

and observe ocean and coastal ecosystems and their uses; effective ocean management programs with decades of expertise in spatial planning and meaningful stakeholder engagement; and long-standing partnerships with coastal states, regional 

ocean governance organizations, tribes, and other Federal agencies who share a 

common interest in sustainable, healthy oceans. 

CMSP’s comprehensive approach to planning the full range of human uses in the 

ocean provides many opportunities, and indeed imperatives, for substantive collaboration between Federal agencies, the private sector, and stakeholders on matters 

such as the siting and development of renewable energy sources. For these and 

other current and emerging ocean uses, private interests will play a key role in providing spatial data and insight into the requirements, plans and implications of 

siting decisions that maximize benefit while minimizing conflicts and impacts.

Onshore and Offshore Wind Energy: Forecasts and Observations 

Since NOAA’s current weather forecasts were not developed to support the wind 

energy industry specifically, and because there are limited observations that are 

publicly available where wind turbines reside, NOAA’s forecasts do not provide information at temporal scales that the wind industry requires. Further, because the 

amount of wind energy produced depends on wind speed cubed, even small differences in projected wind speed can yield large differences in the predicted wind 

energy produced. Although such differences are addressed and overcome on a daily 

basis in the E.S. and everywhere wind provides electricity, power production based 

upon an intermittent resource adds additional elements of complexity when man-
22

aging power production and delivery. For example, the Bonneville Power Administration imposed wind integration charges (WIC) of $5.85/MWh on wind producers 

due to scheduling discrepancies and the cost to maintain power reserves in the 

event that wind generation falls short of forecasts. The national electric system has 

evolved to support more temporally consistent energy sources like coal, nuclear, and 

natural gas, so integrating wind energy has presented some difficulties to system 

operators. NOAA can partner with the renewable energy industry to improve our 

understanding and predictions of wind energy and work together to provide better 

forecasts. 

An additional challenge for wind energy forecasting is in the identification and 

prediction of so-called ‘‘ramp events.’’ A ramp event is any large and sudden change 

in wind speed or direction that can significantly alter wind energy generation. 

NOAA’s weather models were not developed to identify these features in such small 

scales and pose challenges to wind farm operators across the Nation. Power balancing authorities and system operators often ‘‘curtail’’ wind energy production 

when wind farms produce significantly different amounts of energy than what was 

expected, at least partly based on NOAA’s wind forecasts. Better observations, forecast models, and wind forecasts (especially the timing and amplitude of ramp 

events) are a key to improving the ability to align electricity production from wind 

and other sources to meet demand most efficiently. 

NOAA has the scientific expertise to partner with industry and help it to improve 

the understanding of atmospheric processes in the lower part of the atmosphere 

(called the boundary layer) where wind turbines reside and affect the operation, performance, and longevity of wind turbines. Finding out what is actually occurring in 

the boundary layer would entail the development of wind-energy demonstration 

projects, which would be research sites to study the lower part of the atmosphere. 

Based on NOAA’s experience deploying atmospheric research demonstration 

projects, an array of industry-supported projects to advance an understanding of 

wind to support wind energy would: (1) collect observations of the boundary layer 

for studies of phenomena that affect wind resources; (2) provide data sets for weather-forecast model development and verification; (3) determine the most effective sensors for assimilation into weather-forecast models; (4) identify optimal sensors for 

a national observational network supporting wind energy. Off-shore turbine-height 

winds could be measured using buoy-based boundary layer profiling systems. Measurements of thermal-atmospheric eddies would support offshore wind energy. New 

observations that would inform the conditions that an offshore turbine tower will 

face include measurements of the vertical distribution of temperature in the ambient water, as well as of currents and waves. 

These observations would advance the understanding of low-level winds and turbulence, which would allow the provision of forecasts of winds with greater accuracy 

in space and time. These observations also would help NOAA provide guidance to 

the developing national Network of Networks (NoN), called for by a recent National 

Research Council report, to ensure that the needs of the renewable energy industry 

are considered as this NoN is developed. With these observations, the wind energy 

industry would have the potential to meet its needs and contribute towards a national reference data set that would be managed by NOAA for the renewable energy 

industry that contains historical, real-time, and even projected/modeled data (discussed below), all of which have been subject to quality-control measures. 

NOAA is currently collaborating with DOE to improve the efficiency of wind energy through improved models and forecasts on a small, regional scale. The area 

will be selected based on responses to a Funding Opportunity Announcement released earlier this month. A valuable part of this collaboration with DOE and the 

private sector is the request that the private sector (wind farm operators and balancing authorities) share proprietary atmospheric observations that they already 

collect. NOAA would act as an ‘‘honest broker’’ by keeping these data private and 

protected, but using them in our weather models to make our forecasts more accurate. 

NOAA has fulfilled this ‘‘honest broker’’ role before in other sectors. A valuable 

example is seen within the airline industry, when during the 1990s airlines began 

to send their proprietary weather data from aircraft to NOAA to assimilate and provide improved forecasts for aviation. NOAA has improved its model forecasts, including those for aviation, significantly over the last 15 years. The improvements 

resulted from more observations, at all atmospheric levels, to better define the current 3-dimensional weather conditions; more frequent observations to allow models 

to be initialized more frequently; faster computers allowing higher spatial resolution 

in the models; and better understanding of weather phenomena. Over the last 15 

years, the errors for 6-hr wind forecasts, used for air traffic management, have been 

reduced by 50 percent over the United States. These improvements also benefited 
23

many other NOAA programs which depend on better predictions (e.g., thunderstorms).

Solar Energy: Forecasts and Observations 

NOAA’s potential contributions to expanding solar energy could include building 

upon existing meteorological and climatological observation networks, such as the 

Historical Climate Network. The most difficult challenge in solar energy forecasting 

is providing precise cloud-coverage measurements. NOAA has the scientific expertise to design and deploy solar demonstration projects to make detailed and comprehensive measurements of cloud parameters and aerosols using remote-sensing 

instrumentation. Such research would allow an evaluation of weather forecast models by comparing their model output to the observations from demonstration 

projects. After pinpointing where inaccuracies arise in the models, the forecasts of 

clouds and aerosols could be improved. 

To respond to industry identified needs, NOAA in partnership with other Federal 

agency and private sector partners could lend the scientific expertise necessary for 

the development of a national solar radiation and aerosol network. NOAA experience would contribute to the creation and maintenance of a national reference database of historical, real-time, and projected solar data. NOAA also has expertise in 

assimilating satellite solar radiation data to generate the best analysis fields for 

forecasting solar energy at various times scales, as well as for developing advanced 

methods for quickly and accurately computing net solar radiation under various 

weather conditions.

Ocean Thermal Energy Conversion (OTEC) and Marine Hydrokinetic Energy 

As a source of renewable energy, OTEC has the potential to make a significant 

energy contribution in the locations where it is suitable. Islands that are currently 

almost entirely reliant on imported fossil fuel could take strides for self-sufficiency 

if the commercial development of OTEC proves feasible. However, while NOAA is 

working to develop a clear regulatory pathway for OTEC development, that pathway 

needs to include an assessment of the impacts, risks and mitigation requirements 

for OTEC facilities particularly in regards to the enormous volumes of water that 

will be required. Additional research will be needed to understand the environmental impacts of OTEC. This will provide greater regulatory certainty and confidence levels for OTEC developers, their financial backers and the public. 

Marine hydrokinetic technologies currently depend on extensive testing of prototype devices on a pilot scale to guide technology design for eventual commercialization. Commercial scale projects will most likely have to compete with existing ocean 

user groups, but NOAA’s potential contributions include resolving conflict by working with others under the Ocean Policy Task Force’s Coast and Marine Spatial Planning Framework to develop regional coastal and marine spatial plans. Those plans, 

representing the best technological and spatial knowledge, should build on traditional mandates and agency roles. 

Additional science, research and monitoring of coastal and ocean resources are 

needed to effectively inform siting of new renewable coastal and ocean energy 

projects. New observations of the vertical distribution of currents and of temperature in rivers and coastal areas, and of the living resources using those habitats, 

would also be needed for future siting and operations of marine hydrokinetic facilities. NOAA is well poised to provide this information by enhancing its current data 

gathering operations. In addition, NOAA requires comprehensive benthic habitat 

maps to fill gaps in current habitat characterization data that is needed to conduct 

essential fish habitat consultations.

Biomass/Biofuels 

Improved and more geographically precise weather and climate forecasts of precipitation, cloud cover, temperature, winds, and water flow are needed for biomass/

biofuel agriculture; improved vegetation index products; information about environmental impacts of land-use changes on coastal and ocean areas; and measurements 

and predictions of the distribution of atmospheric gases produced by biofuel production.

Climate Services for Renewable Energy 

NOAA has a world-class scientific leadership in documenting and understanding 

climate variability and change, and in improving model forecasts of what the future 

climate will look like under different greenhouse gas emission scenarios. NOAA’s capabilities and expertise in this discipline offer major contributions to the sound 

planning of a domestic renewable energy system by providing key climate services 
24

and information. NOAA also has the technical capability to provide the long-term 

data sets, the climatology, re-analyses (model-facilitated descriptions of past climate 

conditions), and projections into the future of wind and other renewable energy 

sources needed to support the private sector’s decisions on selecting optimal locations for renewable energy facilities. 

NOAA has the technical capability to conduct studies of how natural variability 

and anthropogenic climate change may affect renewable resources (wind, solar, 

water, marine hydrokinetic) in the future. The renewable energy industry has identified requirements for seasonal, annual, and longer-term predictions of renewable 

sources, as well as information about how renewable energy resources co-vary across 

time and space. NOAA’s scientific expertise in weather and climate offer significant 

contributions to studies that would be necessary to optimize an electricity system 

based on weather-driven renewable energy, and address the advantages of increasing the diversity of energy sources, both in type and spatial location. 

Little is known about the possible inadvertent impacts of deploying large numbers 

of renewable energy systems on the natural environment, across a range of time 

scales, including changes to local and regional climate. For example, wind farms 

could have the potential to cause small downwind changes in soil moisture or the 

number of frost days. NOAA could address these potential problems with targeted 

analyses in conjunction with academic and industry partners. 

Providing meteorological observations, analyses, and forecasts is at the core of 

NOAA’s mission. These needed products and services would fit appropriately within 

a NOAA Climate Service. Providing the atmospheric and oceanic research and services required for increased use of renewable energy is arguably one of the most effective ways that NOAA can support mitigation of climate change.

CONCLUSION 

More detailed observations from the atmosphere, land, and ocean will feed into 

improved computer model forecasts for weather, water, and climate. This is at the 

core of NOAA’s mission and it is well-positioned to partner with the private sector 

and support its efforts. These improvements offer substantial benefit not only for 

the renewable energy enterprise, but for the Nation as a whole. Thank you for inviting me to discuss NOAA’s important current and potential roles in supporting this 

growing sector of our economy.
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BIOGRAPHY FOR ALEXANDER MACDONALD

Dr. Alexander E. (Sandy) MacDonald was named the first Director of the Earth 

System Research Laboratory and first Deputy Assistant Administrator for NOAA 

Research Laboratories and Cooperative Institutes on July 27, 2006. Dr. MacDonald 

served as Acting Director for the Earth System Research Laboratory and Director 

of the ESRL Global Systems Division during the consolidation of the Boulder Laboratories into the Earth System Research Laboratory in 2006. Prior to the consolidation, Dr. MacDonald led the Forecast Systems Laboratory. 

Dr. MacDonald was the Director of the Program for Regional Observing and Forecasting Services (PROFS) from 1983 to 1988. From 1980–1982, he was Chief of 

PROFS’ Exploratory Development Group and from 1975–1980 he was a Techniques 

Improvement Meteorologist in the Scientific Services Division, Western Region, National Weather Service in Salt Lake City, UT. He was an Air Force Officer while 

a member of the U.S. Air Force from 1967–1971.

Mr. TONKO. Thank you, Dr. MacDonald. 

And we move to Dr. Mooney, please. 

STATEMENTS OF DAVID MOONEY, DIRECTOR, ELECTRICITY, 

RESOURCES, AND BUILDING SYSTEM INTEGRATION CENTER, NATIONAL RENEWABLE ENERGY LABORATORY 

Dr. MOONEY. Good morning, Mr. Chairman, Members of the Subcommittee. I appreciate the opportunity to appear before you today 

to discuss wind and solar resource forecasting. My name is David 

Mooney. I am the Director of the Electricity, Resources and Building Systems Integration Center at the National Renewable Energy 

Laboratory. NREL is the U.S. Department of Energy’s primary laboratory for research and development in renewable and efficiency 

technologies. 

I would like to emphasize three main points in my testimony 

today. First, high-accuracy, high-resolution wind and solar forecasts are critical for enabling reliable and cost-effective, large-scale 

deployment of wind and solar power generation. Second, while current state-of-the-art forecasts are very valuable to systems operators, there is considerable room for improvement. And third, there 
28

are important roles for both the public and the private sector in 

furthering forecasting technology. 

As we all appreciate, forecasts are needed because we are unable 

to control the weather that is a source of uncertainty in wind and 

solar generating power plant outputs. The inability to dispatch 

wind and solar then becomes a significant integration challenge to 

systems operators in high-penetration scenarios. Therefore, reduction of uncertainty in renewable power plant output that can be 

achieved through forecasting is critical, and it serves two functions. 

First, forecasts allow the power system to be operated more reliably 

under high wind and solar generation deployment. Second, higherresolution forecasts with enhanced accuracy significantly reduce 

the cost of integrating large amounts of renewable generation into 

the existing power system. 

Renewable resource forecasts for utility operations have two 

main components. First is the prediction of the wind speed or the 

solar intensity at different times in the future, and second is the 

conversion of that data to power plant output. The first component 

has historically been the government’s role. NOAA, through the 

National Weather Service, provides weather forecasts from which 

wind speed and solar intensity forecasts can be estimated. 

Industry’s role is to convert those weather forecasts into predicted power plant outputs that are then packaged into customized 

products for systems operators to plan their generation mix. Currently, for a single wind power plant, energy production forecast 

error varies from about 10 to 15 percent for hour-ahead forecasts 

and as much as 25 to 30 percent for day-ahead forecasts. At these 

accuracy rates, though, forecasts are very valuable. An example is 

shown in NREL’s western wind and solar integration study which 

found that, for 27 percent wind and solar penetration across the 

14-state western interconnection, the use of state-of-the-art dayahead wind and solar forecasts in systems operations compared to 

not using any forecast at all would save $5 billion per year, which 

is about 14 percent of total operations costs, so a significant savings. 

Even considering this impact, though, many improvements can 

be made to today’s forecasts. To that end, the public sector should 

undertake simultaneous improvement on three fronts. First, there 

is a need to further develop weather prediction models that focus 

on the physical phenomena that impact wind speeds and solar intensity. This involves improved understanding and representation 

of the atmospheric conditions that impact those quantities. Second, 

there is a need to better observe those phenomena that are needed 

as inputs to the weather prediction models, and third, there is a 

need to operate these models at higher temporal and spatial resolution. 

The public and private sectors currently work together very constructively. Private sector entities provide tailored renewable forecasts to systems operators using inputs to their models from the 

public sector. Given the substantial cost of conducting fundamental 

research in the areas of atmospheric physics, modeling, and observation, the acquisition and assimilation of that data from the observations and then running very computationally intensive models at 

high resolutions over vast geographic areas, the public sector is 
29

likely best positioned to undertake these challenges that are of 

common benefit to all private sector forecasting industry members. 

It is anticipated that the higher-quality data resulting from better 

understanding and modeling of fundamental atmospheric conditions will ultimately result in better forecasts that will enable more 

reliable and cost-effective wind and solar integration in support of 

our national objectives. 

To make progress in this critical area on a time scale that supports our energy goals, both the government and the private sector 

have essential roles, and we are eager to support and actively participate in the advancement of this vital field. 

I appreciate the opportunity to testify this morning and I will be 

happy to take questions. 

[The prepared statement of Dr. Mooney follows:]

PREPARED STATEMENT OF DAVID MOONEY

Mr. Chairman, thank you for this opportunity to discuss important issues related 

to forecasting wind and solar resources, which are becoming increasingly vital to the 

nation’s energy future. I am the director of the Electricity, Resource and Building 

Systems Integration Center at the National Renewable Energy Laboratory (NREL) 

in Golden, Colorado. NREL is the U.S. Department of Energy’s primary laboratory 

for research and development of renewable energy and energy efficiency technologies. I am honored to be here, and to speak with you today.

Why is forecasting of renewables needed? 

In many cases, renewable power generation technologies have operating characteristics that are unique when compared to the conventional generation technologies 

that utilities are accustomed to operating. Principal among these is that the generation of wind and solar plants (that do not include storage) cannot be controlled and 

depend on resource conditions to determine their output. While there are many 

techniques available to address the variability and uncertainly of the resources such 

as fast-response conventional generators and demand response, high resolution resource forecasting is recognized as a critical tool in allowing for the economic and 

reliable integration of variable generators. 

Wind and solar renewable resources are inherently variable and uncertain—that 

is we cannot perfectly forecast what the weather will be like every hour of the day 

a day ahead. Because this adds to the inherent uncertainty in the load that utilities 

already manage, it can potentially become a significant issue for utility system operations at large wind and solar energy penetrations. In order to reliably and costeffectively integrate large amounts of wind and solar power generation into the 

power system, accurate forecasts are critical. It is expected that the development of 

more accurate forecasts, for wind and solar power, at higher temporal and spatial 

resolution along with the adoption of those forecasts in utility operations will ensure 

that we can deploy wind and solar generation technologies in quantities that support our national goals of reduced greenhouse gas emissions and increased energy 

security. 

The development and adoption of renewable resource forecasts reduce the uncertainty of renewable power plant output and serve two critical functions:

1) Forecasts allow the power system to be operated more reliably under high 

renewable generation deployment, and

2) Higher-resolution forecasts with enhanced accuracy significantly reduce the 

cost of integrating large amounts of renewable generation into the existing 

power system.

With both wind and solar, uncertainty has a greater impact than variability. If 

wind or solar power is over-forecast, a utility will likely experience higher costs due 

to using unplanned quick response conventional generation and possibly higher 

spot-priced fuel. If wind or solar power is under forecast, the utility may have excess 

electricity and need to sell at depressed market rates, or in extreme situations curtail ‘‘free fuel’’ wind and solar. 

While today’s state-of-the-art forecasts are proving to be very valuable in renewable generation adoption, there remains considerable room for improvement, and 
30

1Keith Parks, ‘‘Value to Real-Time Operations’’, UWIG Spring Forecasting Workshop, Phoenix, AZ, Feb 18–19, 2009

there are important roles in advancing this technology that both the public and private sectors can play. 

Currently as wind turbines extend to 250 feet and higher and utility scale solar 

power plants are being developed, forecasters are challenged to predict with needed 

precision the electrical output from wind and solar plants for each season, day, hour 

and fraction of an hour ahead. 

This challenge should be distinguished from another challenge, that of determining optimal sites for deploying turbines and solar plants to maximize production. 

Resource measurement and characterization is based on historic data and aids in 

locating plants to maximize their power output over time. Resource forecasting predicts resource availability in the future and aids in the integration and operation 

of the plants once they are constructed.

What is the state of the art of renewable resource forecasting today? 

Forecasts of suitable quality for adoption in utility operations have two main components. First is the prediction of wind speed or solar intensity at different times 

in the future, and second is the conversion of that data to power plant output. Historically, the government has played the biggest role in providing generalized 

weather forecasts from which wind speed and solar intensity forecasts can be estimated, while it has been industry’s role to convert those wind speed and solar intensity forecasts into predicted power outputs that individual utilities or systems operators can utilize to plan the mix of their power plant dispatch needed to meet demand. 

The starting point for a state-of-the-art weather forecast today is provided by the 

National Weather Service (NWS), which is part of the National Oceanic and Atmospheric Administration (NOAA). These relatively coarse temporal and spatial resolution weather forecasts are produced using weather prediction models. These weather 

prediction models assimilate observations from ground and airborne instruments, as 

well as satellites for more accurate initialization of the weather models. Currently 

these weather prediction models and the observations they use are focused on 

weather prediction impacting life and property, but not necessarily on renewable 

power generation issues. 

Although not of ideal temporal or spatial resolution, the private sector uses these 

NWS forecasts for the initialization of their proprietary models to provide tailored 

power prediction forecasts for utility and systems operators. To assist the industry 

in providing more accurate power production forecasts, it is critical that observational networks and the resulting weather forecasts provided by the NWS be of 

higher quality and accuracy, and that they be aimed at the unique requirements 

of renewable energy prediction in addition to the current focus of weather prediction 

impacting life and property. 

Currently, for a single wind power plant, energy production forecast error varies 

from 10–15 percent for hour-ahead timescales, to 25–30 percent for day-ahead timeframes. This forecasting error diminishes when multiple plants (and their associated 

forecasts) across an entire region are considered. The table below summarizes these 

state-of-the-art forecast errors for both energy forecasts and capacity forecasts.

Improvements in the error level of forecasts would benefit utilities immensely. 

Xcel Energy, for example, has released analysis that shows every percentage point 

improvement in accuracy saves Xcel Energy $1.2 million through a reduction in required spinning reserves 1. 
31

2GE Energy. May 2010. Western Wind and Solar Integration Study, NREL Report No. SR–

550–47434, www.nrel.gov/wind/systemsintegration/pdfs/2010/wwsis¥final¥report.pdf 3 New York State Energy Research and Development Authority. March 2005. ‘‘The Effects of 

Integrating Wind Power on Transmission System Planning, Reliability, and Operations,’’ 

www.nvserda.org/publications/wind¥integration¥report.pdf 4 California Energy Commission. July 2007. Intermittency Analysis Project Study. ‘‘Appendix 

B—Impact of Intermittent Generation on Operation of California Power Grid,’’ 

www.energy.ca.gov/2007publications/CEC-500-2007-081/CEC-500-2007-081-APB.PDF 5GE Energy. March 2008. Attachment A: Analysis of Wind Generation Impact on ERCOT Ancillary Services Requirements. Prepared for Electric Reliability Council of Texas. Schenectady, 

NY: GE Energy. http://www.ercot.com/content/news/presentations/2008/Wind¥Generation

¥Impact¥on¥Ancillary¥Services¥-¥GE¥Study.zip

Additionally, NREL’s Western Wind and Solar Integration Study 2 (WWSIS) found 

that use of day-ahead wind and solar forecasts in operations, compared to not using 

a forecast at all, would save $5 billion per year across the 14-state, two-Canadianprovince Western Electricity Coordinating Council. This savings was at a 27% wind 

and solar penetration across the region. Further, the WWSIS showed that if the 

forecast were perfect, those savings would increase by 10% or about $500M/year. 

Studies 345 of the California Independent System Operator, the New York Independent System Operator and the Electricity Reliability Council of Texas systems 

also show significant costs savings when a forecast is used in power system operations and further incremental savings for a perfect forecast (i.e. a forecast with 

zero uncertainty). 

The table below shows the impact on costs savings for these three system operators when no wind forecast is used, compared to implementing a state-of-the-art and 

a perfect forecast.

It should be noted that there is approximately 30 times more wind generation installed in the USA than solar energy generation, making the demands on wind forecasting more critical than those for solar forecasting. The state-of-the-art for forecasting is therefore more advanced for wind than it is for solar. Additionally, development in capabilities for forecasting wind and solar resources differs because of differences in how these resources behave and how we measure and model them.

How can solar and wind forecasts be improved? 

While wind and solar forecasts have been reasonably successful for small levels 

of deployment, it is becoming increasingly clear that higher accuracy levels need to 

be achieved to enable higher penetrations of renewable power generation on the 

grid. 

While forecast error averaged over a year and across a wide region may not be 

too large, specific hours throughout the year can have significant forecast error. In 
32

the Western Wind and Solar Integration Study, these extreme over or under forecasts could be up to half of the installed capacity. It is these extreme events that 

create difficulties for system operators in maintaining system reliability. Improved 

forecasting to reduce the severity and number of these extreme events would be 

very helpful. 

Among the most important reasons for wind forecast error is the lack of measurements in the Planetary Boundary Layer (PBL) as well as inherent uncertainties in 

modeling the atmospheric physics within the PBL. The resulting forecast uncertainty is also evident in the forecasting of ramp events—periods of rapid change in 

wind-farm production. Because ramp events drastically increase or decrease the 

wind energy available in a short span of time, an accurate ramp forecast is important for utility dispatchers who must address load balancing on a sub-hourly basis. 

The quantification of forecast errors for ramp events provides valuable information 

for improving wind forecast methods. This topic is not sufficiently understood or developed. 

The errors in solar forecasting are primarily the result of forecasting errors in 

how clouds form and dissipate at different layers in the atmosphere. This involves 

complex physical processes, and better understanding and representation of these 

processes will lead to better solar forecasting. Because solar forecasting is not a priority of weather forecasting models, research and more accurate implementation of 

these processes in the weather prediction models do not typically get priority. Shortterm solar forecasting capabilities can most probably be done using geostationary 

satellite imagery, but that methodology is not yet fully developed. 

To improve forecasting of both wind and solar resources that will enable more accurate corresponding power production modeling, there is need for the public sector 

to provide more extensive measurements and improved weather models resulting in 

better resource forecasts for utilization by the sophisticated power production models used by the private sector. The provision of better resource forecast inputs will 

need simultaneous improvement on three fronts. 

First, there is a need to develop weather prediction models that are tailored to 

producing accurate forecasts of wind speeds and solar intensity. This involves improved understanding and representation of the atmospheric conditions that impact 

their variability. As an example, cloud formation and dissipation need to be better 

characterized to improve solar forecast. Similarly the understanding of the dynamics 

of the wind in the lower levels of the earth’s atmosphere (the PBL) needs to be improved for better wind prediction. 

Second, there is a need to better observe the physical phenomena that are needed 

as inputs to the weather prediction models. Lack of proper observations to feed an 

improved prediction model will most likely result in a bottleneck to improved forecasts. Examples of observation tools and techniques needed are wind profiles from 

Light Detection and Ranging (LIDAR) and Sonic Detection and Ranging (SODAR) 

instruments. Also useful will be a significant increase in the number of sites where 

solar observations are taken by NOAA, which maintains only seven sites today. 

Third, there is a need to operate these models at higher temporal and spatial resolution using enhanced observations as inputs. Higher temporal resolution provides 

information about variability that is missed when model output is only available at 

3 or 6 hourly intervals. Also higher spatial resolution results in the capture of 

small-scale physical processes and the impacts of terrain that are missed when the 

spatial grid is coarse. 

It should be noted that, even at today’s lower resolutions, computers with highend computational capabilities (teraflop range) are employed because of the 

computationally intensive nature of the model runs and the huge volume of observations from various sources they assimilate. To operate these models at higher resolutions over all of the U.S. would require the latest generation of supercomputers, 

which is another important capability and resource that is likely most appropriate 

for the government to provide. 

It is expected that renewables-focused, higher quality wind and solar forecasts 

that are also available at higher temporal and spatial resolutions will result in a 

better forecasts of power output. These renewables-tailored forecasts could be provided by the NWS and available to all forecasting industry members. This is potentially an important role for government to play in accelerating the deployment and 

integration of wind and solar power production technologies.

What are Potential Roles of the Private and Public Sectors? 

The synergistic relationship between the private and public sectors in forecasting 

of renewables is evident from how forecasting is currently done. Private sector entities provide tailored renewable forecasts to systems operators using inputs to their 
33

models from the public sector, while augmenting them with proprietary observations, mesoscale models, and statistical techniques. 

Specifically, NOAA currently provides wind speed and cloud cover (from which 

solar resources can be derived) forecast products by running their operational 

weather prediction models. Given the enormous cost of

a) Conducting fundamental research in the areas of atmospheric physics, modeling, and observation;

b) Acquisition of observations over potentially thousands of sites that are input 

to the models;

c) Assimilating the observations for model initialization, and;

d) Running computationally intensive models at high resolutions over vast geographic areas;

the public sector is best positioned to undertake these issues that are of common 

benefit to all private sector forecasting industry members. NREL and the U.S. DOE 

have historically played an important role as an interface between the weather data 

and the forecasting industry. NREL and DOE have researchers with the domain expertise to understand how (and which) weather conditions impact the renewable 

generation technologies. DOE and NREL work to help NOAA better understand 

which resource characteristics impact technology performance, as well as support 

the industry in understanding how resource characteristics impact technology output. 

Ultimately better, more renewable-tailored models run by NOAA will provide better initial conditions for the private sector to run their proprietary models for more 

time- and place-specific power-production forecast products. It is anticipated that 

these renewable-tailored, higher quality data resulting from better understanding 

and modeling of fundamental atmospheric conditions affecting wind and solar will 

ultimately result in better hour- and day-ahead power forecasts that will enable the 

integration of renewable generating technologies on a scale that will support our national objectives. 

Another key government role is the role that DOE and its subcontractors have 

previously played in translating the needs of utilities to the forecasting industry and 

vice versa. For example, forecasters and the meteorological community previously 

used mean absolute error or root mean square error as a metric for their work. 

However, as understanding has improved, utilities have decreased emphasis on the 

average forecast error and focus more on whether forecasts correctly capture ramps, 

which directly and significantly impact operations and reliability. Through DOE’s 

work, state-of-the-art forecasting has evolved to try to more accurately capture ramp 

forecasting.

Summary 

High temporal and spatial wind and solar resource forecasting is critical for the 

deployment of large-scale renewable power generation technologies. High quality 

forecasting will enable integration of these technologies at lower costs, while maintaining the reliability of the power system. 

While state-of-the-art forecasting is already beneficial to wind integration, there 

is substantial room for valuable improvement in fundamental weather observations 

and models. Additionally, solar resource forecasting is in its infancy, and there are 

extensive requirements for the development of the fundamental science to improve 

the state-of-the-art for solar forecasting. 

To make progress in this critical area on a time-scale that supports national objectives, both the government and the private sector have vital roles. 

The government can improve fundamental weather forecasting techniques to include more accurate and timely forecasts tailored for wind and solar technologies. 

The government can provide the data required by industry power conversion models 

so that highly accurate power-production forecasts can be generated. More accurate 

power production forecasts will be crucial in maintaining the reliability of the power 

system and in improving the economics of wind solar power plants deployed at scale. 

Mr. Chairman, thank you again for this opportunity to share our perspective on 

this important topic. I will be happy to address any questions you may have.
34

BIOGRAPHY FOR DAVID MOONEY

Dave is currently working at the National Renewable Energy Laboratory leading 

efforts to identify and address technical issues associated with the large-scale deployment and integration of renewable and efficiency technologies into the existing 

energy infrastructure. In this capacity, he leads 125 researchers conducting $65M 

in R&D annually. Dave is a 23-year veteran of the renewable energy industry. 

From 2007 to 2008 he was assigned by NREL to support the DOE’s office of the 

Assistant Secretary for Efficiency and Renewables. On the assignment he conducted 

analysis of EERE’s technology portfolio to quantify energy, environmental, and economic benefits and served as technical counsel to the Deputy Assistant Secretaries. 

Principal among his activities at DOE was the development of a technology-based 

analysis for quantifying greenhouse gas reduction potentials for the EERE technology portfolio, which were used in international climate negotiations. 

During his tenure at NREL Dave has worked as a physicist researching photovoltaic materials, as a project manager, and as Assistant to the Director implementing laboratory strategy. 

Dave has also worked as the director of business development for a U.S. PV company where he was responsible for launching manufacturing and systems businesses, business planning, and raising investment capital.

Mr. TONKO. Thank you, Dr. Mooney. 

Dr. Storck, please. 

STATEMENTS OF PASCAL STORCK, VICE PRESIDENT, 3TIER 

Dr. STORCK. Good morning, Chairman Tonko and the other Members of the Subcommittee. I appreciate the opportunity to be here 

today to testify on the issue of public and private roles and research needs in renewable energy forecasting. 

Electricity generation from renewable sources such as wind and 

solar comes with the disadvantage that the output is variable and 

fluctuates as the weather does. As renewable energy generation 

has come to supply an increasing amount of the electricity consumed in our country, it has become clear that forecasting renewable energy output hours and days in advance is key to the costeffective integration of this variable energy source. 

The first point that I would like to make is that small- and medium-sized private businesses in the United States have assumed 

a leadership role in providing energy forecasting services. Our sector is vibrant, competitive and maturing and is creating high-paying technical jobs and exports. Our company, 3TIER, and our competitors routinely provide accurate forecasts of renewable energy 

output hours and days in advance to project owners, system opera-
35

tors, utility companies, and power marketers. Our company alone 

provides wind energy forecasts for over 12,000 megawatts of installed capacity representing over 100 individual projects and serving over 40 unique clients. 3TIER employs a staff of 60 in the production and delivery of these forecasts and other services for the 

renewable energy industry. To seize the opportunity of the global 

market, we have established offices in India, Latin America, and 

the Pacific rim for the export of our energy forecasting services. 

As the renewable energy industry has grown, so has the experience level of the private sector in providing these forecasts. Our 

company was founded in 1999, and we have played an integral role 

in the improvement of forecast accuracy as we invest in our forecast systems to meet the demands of our clients. In fact, recent 

work overseen by NREL has demonstrated that the current state 

of the art technology provides 80 percent of the value of a perfect 

forecast. In short, the private sector renewable energy forecasting 

community is strong and well positioned to meet the demands of 

our clients worldwide both today and into the future. 

The second point that I would like to make is that the government does have an important and fundamental role in supporting 

the private sector in our task of creating more accurate renewable 

energy forecasts. 3TIER and our competitors rely on accurate government weather forecasts as inputs to our more specialized energy 

forecast systems on both a regional and global scale. The government operates a reliable national network of routine surface and 

upper air weather observations. It also develops and operates sophisticated computer weather forecast models that ingest these 

data and produce weather forecasts. Improve the quality of these 

forecasts by improving the observational inputs, the models themselves, and the systems that create the forecasts, and the private 

sector will improve the quality of the renewable energy forecasts. 

Improving the accuracy of the Nation’s fundamental weather forecasts is an enormous challenge. This charge falls squarely on the 

Department of Commerce where NOAA is uniquely positioned to 

accomplish these improvements through its Office of Atmospheric 

Research and other divisions. Doing so will not only improve the 

quality of renewable energy forecasts applied by the private sector, 

but will also aid the National Weather Service in its primary mission of protecting life and property. It will also provide benefits to 

transportation, agriculture and other economic sectors, ensuring 

that investments made here are not solely for the benefit of one industry. 

The last point that I would like to make is that the roles of the 

government and the private sector in renewable energy forecasting 

need to be clearly defined. Fundamental research and infrastructure investments are required to improve the Nation’s weather 

forecasts, but these should not be confused with applied research 

and product development for specific industries and end users. The 

public sector can and should provide the best possible scientific 

foundation upon which the private sector can do what it does best: 

drive innovation and deliver services nimbly and competitively to 

our customers. Confusion in these roles blurs the line between 

business and government, creates a distorted marketplace, and ultimately increases the tax burden while squeezing out the very 
36

companies that are effectively serving these markets. To be clear, 

it is essential that the Federal agencies provide fundamental research, data collection, and accurate foundational weather forecasts 

without then inserting themselves into the marketplace as an alternative to the private sector, thereby undermining a vibrant industry of small businesses like ours. In these times of strong renewable energy industry growth and Federal stimulus program 

funding, there is an opportunity, if not an obligation, for the public 

sector to work aggressively toward complementing the private sector’s capabilities. Working together will allow American companies 

to continue to lead the world’s clean energy revolution, but for 

these companies to lead, we need to make sure that they don’t find 

that their biggest competitor is their own government, both at 

home and abroad. 

Thank you for allowing me the opportunity to testify today and 

I look forward to any questions you may have. 

[The prepared statement of Dr. Storck follows:]

PREPARED STATEMENT OF PASCAL STORCK

Good Morning, Chairman Baird, Ranking Member Inglis and the rest of the committee. I appreciate the opportunity to be here today to testify on the issue of public 

and private roles and research needs in renewable energy forecasting. 

Electricity generation from renewable sources such as wind and solar comes with 

the disadvantage that the output is variable and fluctuates as the weather does. As 

renewable energy generation has come to supply an increasing amount of the electricity consumed in our country, with some regions (such as Texas/ERCOT) seeing 

20% or more of hourly electricity demand satisfied solely by wind, the challenges 

of integrating this energy into our power system have been documented, studied and 

debated. One common theme that has emerged is that forecasting renewable energy 

output hours and days in advance is key to the cost-effective integration of this variable energy source. 

The central importance of renewable energy forecasting has led to the establishment and growth of a vibrant and competitive private sector to provide these forecasts. Our company, 3TIER, and our competitors routinely provide accurate forecasts of renewable energy output, hours and days in advance, to project owner/operators, system operators, utility companies, and power marketers. Our company 

alone provides wind energy forecasts for over 13,000 MW of installed capacity and 

employs 60 staff in the production and delivery of these forecasts and other services 

for the renewable energy industry. As the renewable energy industry has grown, so 

has the experience level of the private sector in providing these forecasts. Forecast 

accuracy has improved significantly over the past several years as we invest in our 

forecast systems to meet the demands of our clients. In fact, recent work overseen 

by our colleagues at NREL has demonstrated that the current state-of-the art provides 80% of the value of a perfect forecast. In short, the private sector renewable 

energy forecasting community is strong and well-positioned to meet the demands of 

our clients, both today and into the future. 

As I mentioned earlier, renewable energy output fluctuates as the weather does. 

This simple fact makes accurate weather forecasts a fundamental requirement of an 

accurate renewable energy forecast. 3TIER, as well as our competitors, rely on government weather forecasts on both the regional and global scale as inputs to our 

energy forecast systems. These government issued forecasts in turn rely on global 

and local observational networks as well as computer models that have been developed, implemented, and refined by countless individuals spanning government operational forecasting centers, our research universities, our national labs, and the private sector as well. Herein lies the best opportunity for collaboration between the 

private sector, government and academia. Improve the quality of the weather forecasts, by improving the observational inputs, the models themselves, and the systems that create the forecasts, and we will improve the quality of the renewable energy forecasts that the private sector can provide. Improvement of the accuracy of 

the nation’s fundamental weather forecasts is an enormous challenge and one that 

our Federal agencies are uniquely positioned to achieve. Doing so will not only improve the quality of renewable energy forecasts supplied by the private sector, but 

will benefit transportation, agriculture and the other sectors that are affected by the 
37

weather, ensuring that investments made are not solely for the benefit of one industry. 

In these times of strong renewable energy industry growth and Federal stimulus 

program funding, there is the opportunity—if not the obligation—for the public sector to work aggressively towards complementing the private sector’s capabilities to 

provide the greatest benefits to the renewable energy industry’s requirements for accurate energy forecasts. If this opportunity is not well planned and coordinated, 

there is the risk that federally-funded efforts could be redundant and in competition 

with services already provided by the private sector. Working together, we can ensure a robust and second-to-none U.S.-based weather forecasting infrastructure as 

well as a competitive renewable energy forecasting industry that enables the realization of the nation’s full renewable energy potential. 

Thank you for allowing me the opportunity to testify today and I look forward to 

any questions you may have.

Additional Material (see attached: Joint Statement on the Role of Government-Affiliated Renewable Energy Forecasting Activities Relative to the Private Sector, prepared by Bruce Bailey, Mark Ahlstrom and Pascal Storck on June 3, 2009)
38
39
40
41

BIOGRAPHY FOR PASCAL STORCK

Pascal Storck serves as the Vice President of 3TIER and has been with the company since its beginning. During his tenure at 3TIER, Dr. Storck has played an integral role in the development and commercialization of all of the company’s products and services. Dr. Storck is an internationally recognized expert on the topics 

of renewable energy forecasting and assessment and frequently presents at leading 

industry conferences. Dr. Storck received a bachelor degree in Civil and Environmental Engineering from Cornell University, a Masters in Civil Engineering 

through the University of Illinois-Urbana Champaign and a Ph.D. in Civil and Environmental Engineering through the University of Washington.

Mr. TONKO. Thank you, Dr. Storck. 

Mr. Rosenblum, please. 

STATEMENTS OF GRANT ROSENBLUM, MANAGER OF RENEWABLE INTEGRATION, CALIFORNIA INDEPENDENT SYSTEM 

OPERATOR 

Mr. ROSENBLUM. Thank you. Good morning, Congressman Tonko 

and Members of the Subcommittee. I appreciate the opportunity to 

discuss the important function entity forecasting will play in our 

ability to successfully integrate increasing levels of variable renewable resources into the power system. 

As a representative of a transmission system operator, my perspective is that of a consumer of forecasting services, and, in particular, one that has the responsibility for keeping the lights on for 

approximately 30 million Californians, and doing so in a manner 

as economically efficient as possible. 

To provide a brief but hopefully unnecessary context to my comments, a fundamental but not exclusive requirement for keeping 

lights on is maintaining a constant and precise balance between 

electric supply and demand. Wind and solar resources add to the 

operator’s balancing challenge by increasing the system’s aggregate 

volatility, given their inherent variability and output and uncertainty as to the timing and magnitude of the fluctuations. Accordingly, the central issue operators confront with additional renewable resources is whether sufficient backup resources can be committed and maneuvered up or down fast enough to compensate for 

changes in variable renewable resource output. 

While more flexible conventional resources such as pump storage, 

modern combustion turbines, and innovative technologies, including on- and offsite storage and demand response, will likely play 

a major role in managing renewable resource variability in the future, improvements in forecasting also offer potentially substantial 

and, importantly, more expeditious assistance in achieving continued grid reliability, market efficiency, and greenhouse gas reductions. 

Based on this perspective, the California ISO offers three conclusions and recommendations. First, forecasting improvements appear to significantly reduce resource requirements for integrating 

renewable resources. A preliminary ISO analysis of a 33 percent 

RPS scenario consistent with current California policy direction indicates that if we were able to cut by nearly one-half our current 

forecasting error rates of approximately 15 percent in the day 

ahead and ten percent in the hour ahead, we could reduce the 

quantity of capacity that must be available for dispatch in our realtime energy market by approximately 25 to 35 percent, or nearly 
42

2,000 megawatts. While the ISO has not completed its analysis of 

the potential cost savings on its system of this improvement, increases in forecasting accuracy will necessarily lead to more efficient and, therefore, less costly resource utilization. 

Second, improvements in forecasting appear to rest in significant 

part on improvements by the Federal Government in the quality 

and quantity of data provided to the electricity industry and its private sector forecast partners. In particular, it is the Federal Government improvement in the underlying physics-based atmospheric 

models that form the baseline input for most resource forecasters 

that should be focused upon. As part of a recent RFP for forecasting services by the ISO, the ISO observed a high degree of correlation among the forecast errors committed by the participating 

private forecast service providers. This suggests that those Federal 

agencies responsible for developing numerical weather prediction 

models should tune their efforts by focusing on areas with concentrations of high renewable resources. In addition, it should be 

noted that the Federal Energy Regulatory Commission should be 

commended and should continue its efforts to address many of the 

root causes of poor data quality received from the generating facilities themselves. This includes improvement in the rules and requirements regarding reporting of meteorological data, equipment 

outage, and other critical factors. 

Third, it should be emphasized that a transmission system operator must not only have accurate prediction of average production 

over a specified period, but it must also anticipate the speed, magnitude, and timing of changes over different operating periods. 

Therefore, forecasting improvement efforts must focus on increasing our ability to predict wind and solar ramp events and the underlying weather conditions that cause such events. 

Thank you for this opportunity to come before you, and I welcome questions. Thank you. 

[The prepared statement of Mr. Rosenblum follows:]

PREPARED STATEMENT OF GRANT ROSENBLUM

Mr. Chairman and Members of the Subcommittee, it is an honor to be here and 

I appreciate the opportunity to discuss the critical function energy forecasting will 

play in successfully integrating to the power system increasing levels of variable renewable resources. This hearing seeks to examine the roles the Federal agencies 

and the private sector play, and should play, in providing renewable resource forecasting as well as to explore means to enhance the efficacy of forecasting research, 

development, and monitoring. I intend to touch upon these topics from the perspective of a consumer of forecasts, which through its status as an independent transmission system operator, is responsible for ‘‘keeping the lights on’’ for approximately 

30 million Californians and for doing so in as economically efficient manner as possible. 

As I will elaborate further; my conclusions and recommendations are:

• Forecasting improvements are essential for maintaining reliable grid operation and market efficiency if we are to continue on a course of increasing 

reliance on renewable generation

• For a transmission system operator, forecasting improvement efforts should 

focus on increasing our ability to predict ramp events or abnormal weather 

conditions

• Improving forecasting requires collaboration between government and the private sector with the Federal Energy Regulatory Commission, National Weather Service, and the National Oceanographic and Atmospheric Administration, 

among potentially others, assisting to enhance the quality and quantity of 
43

1 Regulation is generating capacity under automatic generation control that is dispatched on 

a four-second basis to continuously balance instantaneous deviations between supply and demand that occur within the five-minute periods between each economic dispatch of energy 

through the ISO’s real-time market software applications. The market dispatch of energy is 

often referred to as ‘‘load-following.’’ It is the dispatch of energy in the real-time market to address longer-term imbalances that are not addressed by regulation.

data available to, and, in the case of electricity generators, provided by, the 

private sector, which can perform the specific forecasting services

Æ FERC should continue its efforts to ensure adequate meteorological, production and other data is provided to those transmission operators that 

utilize a central forecasting structure or that reasonable and appropriate 

incentives exist for generation scheduling entities to provide accurate 

forecasts in those regions that may rely on decentralized forecasting.

Æ Those Federal agencies responsible for developing numerical weather 

prediction models should tune their efforts to focus on relevant weather 

patterns for areas with concentrations of renewable resources.

Brief Description of the California ISO 

The California ISO is a non-profit, public benefit corporation regulated as a public 

utility by the Federal Regulatory Energy Commission. As an independent system 

operator (ISO), the California ISO impartially manages the flow of electricity across 

25,398 circuit miles of high-voltage transmission lines that make up the bulk of 

California’s power grid. While utilities still own the transmission lines, the California ISO acts as a ‘‘traffic controller,’’ offering open access and maximizing the use 

of the transmission system and administering wholesale power markets. One of the 

most important responsibilities of any ISO is to maintain reliable bulk power system operations in real-time. We do this by, among other things, providing reliability 

services including outage coordination, generation scheduling, voltage management, 

ancillary services, and load forecasting. As noted, the California ISO, like other 

ISOs, coordinates competitive wholesale power markets in which energy providers 

submit supply offers and purchasers submit demand bids. A market clearing price 

balances supply and demand, selecting least-cost supplies until demand is met.

The Impact of Increasing Variable Energy Resources on Grid and Market 

Operations and the Benefits of Improved Forecasting 

Power system operation requires the constant balancing of supply and demand to 

comply with mandatory reliability standards. Accordingly, all power systems historically have been designed to manage a certain degree of demand volatility and supply unpredictability. The inherent variability and uncertainty of wind and solar generator output present challenges to grid operators by increasing the system’s aggregate volatility. Variability refers to the fact that, in the absence of supplemental 

storage capability, the output from wind and solar resources changes according to 

fluctuations in its primary fuel source. Uncertainty refers to the greater unpredictability in the magnitude and timing of the production variations in comparison to 

more traditional generator technologies. In short, the central issue operators confront with additional renewable resources is ensuring there are sufficient other resources available for timely commitment that have the ability to be maneuvered up 

or down fast enough to compensate for the expected and actual changes in output 

from variable renewable resources. 

How a particular power system manages the increase in volatility due to renewable resources will depend on a myriad of factors, including the quantity of installed 

renewable capacity, the technological and geographic diversity of the renewable capacity, and the flexibility attributes of other available resources to call upon to alter 

their output. Despite potential differences, virtually all regions with an independent 

system operator administer a day-ahead market for energy and ancillary services 

and a reliability commitment process to ensure sufficient resources are available the 

next day to meet anticipated demand and satisfy other reliability criteria. Since all 

power systems are highly dynamic from moment to moment, the day-ahead system 

set-up will necessarily require refinement as the operating time becomes closer. This 

refinement is accomplished, as a general matter, through the procurement of ‘‘regulation’’ ancillary services, short-term supply commitment and real-time market redispatch of energy every five minutes from committed resources through sophisticated optimization software.1 Thus, added variability and uncertainty from renewable resources generally results in: 

• Less efficient unit commitment both in the day-ahead and real-time periods
44

2 ‘‘Western Wind and Solar Integration Study’’ (May 2010) at http://www.uwig.org/

wwsis¥final¥report.pdf. 

• Unanticipated and higher system ramps in the upwards and downwards direction

• Increased load/renewable resource following requirements

• Increased regulation requirements

• Increased frequency and magnitude of minimum generation or over-generation events.

Each of these impacts will likely impose costs on the system. Inaccurate unit commitment triggers additional costs because either an underestimate of the renewable 

output results in the unnecessary commitment of alternative resources or an overestimate of the renewable output requires the commitment of a faster starting, often 

less efficient, unit closer to real time. The increase in ramping and load following 

capabilities requires the system operator to have capacity available to convert the 

capacity to energy as needed to maintain the balance between supply and load. This 

may lead to the commitment or reservation of less efficient units than would otherwise be required to ensure the balance of more predictable and stable net load. In 

addition, load-following may require the dispatched resources to move from their 

most efficient operating point to a less efficient operating point. 

Reliability problems can also occur when an erroneous forecast either underestimates or overestimates the amount of load-following or regulation service that must 

be available. For example, in the case of an underestimate, if the system operator 

is required to commit additional capacity at minimum load to be ready to make up 

for a shortfall in supply due to an inaccurate prediction of expected renewable output, that commitment will increase the possibility of there being too much generation on the system during low load periods, when wind power tends to be produced 

at its highest level. The operational and market consequences of over-generation include, but are not limited to, acceleration in system frequency, violation of control 

performance standards established by NERC, and an increase in excess energy flows 

to neighboring balancing authority areas as inadvertent energy, which can cause 

control performance problems for the receiving balancing authority areas. In the 

case of an overestimate, insufficient load-following capacity can result in a need to 

convert resources reserved for contingencies to energy in order to satisfy load requirements or, at worst, an inability to serve load. 

Accurate forecasting will mitigate many of these potential inefficiencies of increased reliance on renewable resources. Better wind power forecasts in the dayahead unit commitment process minimize the potential to over- or under-commit 

other generation resources to meet forecast load when renewable generation, which 

is generally not required to offer into the day-ahead market, shows up in the realtime. The real-time forecasts are, or will be, used to update short-term unit commitment decisions to ensure sufficient maneuverability or ramping capability exists to 

manage changes in renewable output as well as part of the real-time security-constrained economic dispatch program to ensure the most efficient resources are 

moved to provide the necessary system balancing. 

There have been several studies that I am aware of, but there are probably others 

that I am not aware of, that have attempted to quantify the benefits of more accurate forecasts. Links to a few studies are provided. An example of one effort was 

conducted by Richard Piwko of GE Energy. Using a production simulation program 

for the Texas system, GE Energy evaluated three levels of wind energy—5,000 MW, 

10,000 MW and 15,000 MW—and found there to be an annual savings of $20 million, $180 million and $510 million, respectively, from moving from no forecast to 

a state of the art forecast. A similar result was reported as part of the Western 

Wind and Solar Integration Study prepared by GE Energy for the National Renewable Energy Laboratory.2

The California ISO is conducting, but has not yet completed, its own quantification of the financial impact of improved forecasting on its system. However it has 

completed the first part of its analysis, which focused on the potential reduction in 

regulation and load following needs. The results are as follows:
45

Consequently, while I cannot provide an estimate of the savings to the California 

market from improved forecasting accuracy, it is likely to be material based on the 

reduction in services that otherwise must be acquired by the California ISO to manage increased renewable resources. The California ISO would be happy to submit 

the results of its ongoing study efforts as they become available.

Transmission System Operators Need the Focus of Forecasting Science to 

Shift to Prediction of Significant ‘‘Ramp Events’’

Until recently, renewable power production forecasting focused mainly on predicting the average power production for a series of upcoming time intervals. This 

focus reflects the need of market participants to minimize the potential economic 

impacts of energy imbalances over the corresponding time period. The quality of 

these forecasts is usually measured with metrics such as mean absolute error (MAE) 

or root mean square error (RMSE). Currently, this is the type of forecast produced 

by private forecasting service AWS Truepower, as the California ISO’s centralized 

forecast provider, for use in California ISO market applications. For this type of 

forecast, the California ISO is observing an aggregate day ahead forecast error of 

less than 15%, calculated as the root mean square error (RMSE). This level of forecast error represents a substantial improvement over past California ISO experience 

with day-ahead forecasts. The aggregate hour-ahead forecast errors was reduced to 

less than 10% RMSE, which represents a 20% improvement in forecast accuracy 

over the CAISO’s prior hour ahead forecast methodology. This forecast improvement 

was based on changes to the algorithm used to manipulate NWS forecasts, not an 

improvement to the base NWS forecast. 

As noted, these more deterministic forecasts were largely developed to meet the 

needs of market participants, not transmission system operators. Transmission system operators are more sensitive to the need for a forecast product that provides 

an advanced warning of situations with a high probability of a large change in wind 

or solar production over a relatively short period of time. Unexpected large wind or 

solar ramps can have a large impact on the transmission operators’ ability to keep 

power systems within their operating range and avoid catastrophic events. Because 

small errors in forecasting the timing of a ramp event produce large power errors, 

approaches that focus only on minimizing power error over an hour are not appropriate for ramp forecasting. 

The severity of renewable resource ramping events is highly dependent on both 

the weather causing the ramp and geographic diversity of renewable resources within the ISO. For example, wind generators shut down when wind speeds exceed safe 

operating limits. As a result, a big storm front with high wind gusts can first result 

in a substantial spike in output, followed by the loss of hundreds of megawatts energy from wind generation over a short period of 10 to 20 minutes. Also, wind shear 

conditions at a wind facility may result in the units going from zero to full output 

within a few minutes when the wind shear condition changes and the wind hits the 

turbines instead of passing above the units. While solar power may not fluctuate 

as regularly as wind, most solar generation technologies will suffer significant variation in output due to transient cloud cover or other atmospheric conditions, such 

as ambient moisture or aerosols. The following provides a graphic example of the 

changes in solar production.
46

Several ISOs, including California ISO, NYISO, and ERGOT, are pursuing the development of ramp prediction forecasts through relationships with private forecast 

service providers. The California ISO is working with AWS Truepower to implement 

a ramp forecast tool that includes both a probabilistic ramp rate forecast and a deterministic ramp event forecast with probabilistic confidence bounds. It is contemplated that when complete and tested, the probabilistic ramp rate forecast will 

be a primary driver of grid management decision-making, including incorporation 

into market systems. Given the nascent status of ramp forecasting, there is considerable opportunity for public/private collaboration in enhancing data inputs and 

methodologies, as I will discuss next. An example of a graphic representation of the 

proposed ramp tool for the California ISO is provided for your review in Table 4.

This view gives a grid operator a graphical forecast page that displays a probabilistic ramp rate forecast. The ramp rate thresholds in MW, the time window over 

which the ramp rate is defined (15, 60 and 180 minutes in the above example) and 

the number and composition of the regional aggregates is customized for the operator.
47

Regardless of the Nature of the Forecast, Improvements Hinge on Increased Quality and Quantity of Weather Data 

The California ISO obtains its forecasts through AWS Truepower and therefore 

is most familiar with its methods and needs. Other private forecasters may have 

a different set of methods, but all seem to agree on the need for high quality input 

data. Based on our knowledge of the process, the forecast service provider develops 

the forecast using 

ensemble forecasts techniques that rely on input from regional-scale and globalscale numerical weather predictions models, statistical models and plant output 

models. For these prediction models to improve, more strategically located and high 

quality data inputs are necessary and for simplicity, I will focus on data from the 

renewable resources and the needs of numerical weather prediction models (NWP) 

that are largely within the purview of the NWS and NOAA. 

Data from the renewable facility is critical for statistical and plant output models. 

ISOs generally require renewable resources to provide a range of real-time meteorological data, such as wind speed/direction, barometric pressure, humidity and ambient temperature as well as current MW output, along with physical data such as 

location and hub heights to forecast providers. FERC should be commended for facilitating the collection of such data and their continued investigation of data needs 

through its recent Notice of Inquiry. 

In general, the California ISO has observed data issues in three areas and has 

taken remedial action in each with FERC’s support. Forecasts rely on high quality 

data made available in a timely manner to the forecast providers for use within 

their models. In 2008 and 2009, the California ISO conducted a one year head to 

head forecast service provided competition. The central objective of the competition 

was to ensure the California ISO was receiving the most accurate forecast possible. 

During the competition there were several instances when data quality was an issue 

and forecast quality suffered as a result. Improving telemetry data and reliability 

from wind sites has been an ongoing focus of the California ISO to improve forecasting performance. 

In early 2008, AWS Truepower provided California ISO with data detailing the 

relationship between poor data quality from renewable resources and the degradation of energy forecast accuracy. The study showed forecast errors ranged between 

11% to over 15% MAE due to data availability and data quality issues. Based on 

the finding of the report, California ISO engineers investigated the root cause of 

poor quality data. The California ISO found three basic causes for errant data. 

Those causes are:

• Unreported Outages

• Communications Failure

• Equipment Failure

The CAISO recommended and has implemented the following:

• Outage/Availability Reporting—The Scheduling Coordinator is responsible 

and must report all data anomalies and outages to the CAISO. These anomalies include MW availability and all telemetry problems with the site.

• Independent Power Supply—electrical interruption of telemetry equipment 

causes errant data which must be eliminated and therefore an independent 

power supply should be mandatory. All telemetry equipment must have a 

backup power source that is independent of the primary power source for the 

station (e.g., station power, battery or solar panel). The backup power source 

must provide power until primary power is restored.

• Data Redundancy—Receiving anemometer data from multiple sites within the 

wind or solar park will add two important components to the meteorological 

data streams. Those components are redundancy of data from the site along 

with a more representative collection of data from the site to develop an energy forecast.

Barriers to obtaining high quality data (i.e. more sensors per wind project or area 

and higher sampling frequency) are mostly driven by economics and relate to installation and maintenance of sensor equipment, but FERC has done a commendable 

job of weighing the benefits to system operation against the potential hardship for 

smaller renewable projects. 

NWS and NOAA provide the numerical weather prediction models that are currently used by forecast service providers, but tuned to providing temperature and 

rain forecasts for the entire United States. These models form the baseline inputs 

to the forecasters’ wind and solar predictions. At the 2010 UWIG Wind Forecasting 

Workshop in Albuquerque, New Mexico, a representative from NOAA delivered a 
48

presentation outlining the need and a plan for NOAA to improve renewable energy 

forecasts. One of the most important points made was the need for ‘‘interaction between NOAA, DOE, NREL, other government, energy industry [and] other private 

sectors.’’ The California ISO firmly believes NOAA should follow up on the promise 

and is willing to be an active participant with NOAA and other balancing authorities. In this regard, the California ISO understands that much of the improvement 

is likely to come from strategically located three dimensional atmospheric sensors 

to cover the ’boundary layer’’ or at or above wind turbine hub height, For California’s Tehachapi wind area, initial guidance on observation targeting has been accomplished through work supported by the Department of Energy’s Lawrence Livermore National Laboratory under the WindSENSE project. This work should come 

to completion. To the extent there is a sense that those areas utilizing the power 

in specific renewable regions should fund the infrastructure for better forecasting, 

the California ISO suggests that it may be appropriate for the FERC to establish 

mechanisms to require utilities to construct, and recover the costs of, any necessary 

observation equipment. 

Thank you. That concludes my testimony.

BIOGRAPHY FOR GRANT ROSENBLUM

Grant is the Manager for the California ISO’s renewable resource integration efforts. The position was created in August 2008 to oversee a multi-disciplinary team 

of engineers and economists who have been directed to ensure the California ISO 

can integrate increasing levels of variable renewable generation in a manner consistent with market efficiency and grid reliability. This encompasses evaluating electric system infrastructure needs and necessary modifications to California ISO markets and operating practices. 

Prior to assuming the position of Manager, Renewables Integration, Grant spent 

four years as an attorney for the California ISO, addressing a broad range of regulatory matters, including generator interconnection, transmission planning and market reform. Grant came to the California ISO from the Electricity Oversight Board, 

where he represented the State in litigation before FERC on the enforceability of 

long-term power purchase agreements entered into during the height of the 2000–

2001 energy crisis. Grant also has eight years of experience in private practice in 

the area of environmental and commercial litigation. He received his JD from University of California, Hastings College of the Law, and his undergraduate degree 

from Pomona College.

Mr. TONKO. Thank you, Mr. Rosenblum. 

Dr. Michaels, please. 

STATEMENTS OF ROBERT MICHAELS, SENIOR FELLOW, 

INSTITUTE FOR ENERGY RESEARCH 

Dr. MICHAELS. Thank you. I am honored to be here. 

Given the recent record of economists and forecasting about everything, one might wonder why I am here. The answer is fairly 

straightforward. This is a committee on both science and technology. Science is about forecasting atmospheric motions, but the 

technology that matters for us is the technology of wind power, and 

they are interrelated in economic terms. 

Renewables now contribute approximately three and a half percent of the Nation’s electrical energy. A few years ago, they were 

doing about two percent. Essentially, all of that growth in renewables has been due to the growth of wind power. If you are committed to renewables given the technologies that are on the horizon, you are committed to wind. Wind is going to be the dominant 

renewable probably for the foreseeable future. If so, then what this 

Committee must do as it evaluates the funding of this improved 

forecasting is to ask itself what is going to be the future role of 

wind. Is it going to be worth the public investment, given wind’s 

track record and given wind’s likely prospects? Wind now is a very 

special source of energy—essentially the only renewable that is 
49

really easy to build now—but it still lives on subsidies. It lives on 

renewable energy mandates. It lives on the production tax credits. 

We know that. We have got lots of statistical records of that. There 

may be rationales for some of these subsidies. In my testimony, I 

say I don’t find them very convincing, but that is another story. 

The question that matters to us is that we are accumulating evidence on the viability of wind and we are accumulating a lot of 

practical questions about whether we should rethink its future or 

not. We know, for instance, that now states even with renewable 

mandates are having trouble building transmission, having trouble 

siting such plants. We are understanding now that the way they 

interact with the rest of the electrical system has very interesting 

consequences, sometimes adverse consequences for carbon emissions and emissions of criteria pollutants. We have a lot of evidence 

to still accumulate and a lot to learn. The practical questions are, 

then, how are you going to interface this? You must be in the process of making your decision today. You are implicitly saying something about the future desirability and the future evolution of wind 

power in this country. You have a tremendous number of developments taking place that are changing everything we know about 

the energy picture. You now have a revolution in the natural gas 

industry, which may well guarantee us clean, economical energy 

independence with it. If that is so, then again, we may rethink 

wind. There are questions mounting about climate policy and what 

exactly will happen if climate policy changes in either direction. 

So we have a set of questions which are really the kinds of questions economists ask. They are questions that, off a word from elementary economics, they are ‘‘marginal questions.’’ What is going 

to be the value of what you do? What will be the value of funding 

this work, supporting this work, given the current state of the wind 

industry and given its many possible futures? And when you make 

a decision here, you are implicitly saying something about what 

you believe the future of the wind industry is going to be. The 

question would be, what if all wind construction stopped today? 

What would you be doing? Would this be funding that was worth 

engaging in, or wouldn’t it be? That is the question that this Committee must decide; I can’t. 

What you are doing is a simultaneous determination of how to 

handle the forecasting models and support them and the future 

role of wind. That role is going to need, I think, to be rethought 

in light of the accumulating evidence. But in any case, it’s critical 

that we think about it in connection with what is before this Committee today. Thank you. 

[The prepared statement of Dr. Michaels follows:]

PREPARED STATEMENT OF ROBERT MICHAELS

I. Introduction 

My name is Robert J. Michaels. I am Professor of Economics at California State 

University, Fullerton and an independent consultant. I hold an A.B. Degree from 

the University of Chicago and a Ph.D. from the University of California, Los Angeles, both in economics. My past employment as an economist includes the Institute 

for Defense Analysis and affiliations with consulting firms. I am also Senior Fellow 

at the Institute for Energy Research and Adjunct Scholar at the Cato Institute. I 

attach a biography to this testimony. The findings and opinions I am presenting 

today are entirely mine, and they are not the official views of any of my professional 

or consulting affiliations. 
50

1GE Energy, Western Wind and Solar Integration Study, May 2010. 2 All figures are from various documents of the U.S. Department of Energy’s Energy Information Administration. A set of graphics and data are available upon request from the author. 

For over 20 years I have performed research on regulation and the emergence of 

markets in the electricity and gas industries. My findings have been presented in 

peer-reviewed journals, law reviews, and industry publications and meetings. I am 

Co-Editor of the peer-reviewed journal Contemporary Economic Policy, an official 

publication of Western Economic Association International with a circulation of 

2,500. I am also author of Transactions and Strategies: Economics for Management

(Cengage Learning, 2009), an applied text for MBA students and advanced undergraduates. My consulting clients have included state utility regulators, electric utilities, independent power producers and marketers, natural gas producers, large energy consumers, public interest groups and governments. My services have at times 

entailed expert testimony, which I have presented at the Federal Energy Regulatory 

Commission, public utility commissions in California, Illinois, Mississippi and 

Vermont, the California Energy Commission, and in two previous appearances before other House committees.

II. Background on renewables

A. Purpose of testimony 

The Committee today explores questions pertinent to the fuller integration of renewable generation into regional power grids. The achievement of important energy 

and environmental policy goals may require additional research within this Committee’s jurisdiction to support new technologies and operating practices that may be 

necessary if grids are to operate efficiently and reliably. I intend that my testimony 

provide the Committee with guidance on factors that it should consider when evaluating the research that others are presenting today, and its relevance for future policy. The most important such research is contained in a study completed last month 

by General Electric Energy for the National Renewable Energy Laboratory (NREL).1

Its authors claim that new technologies and changed operating practices could enable some regions (in particular, the area covered by WestConnect, an association 

of transmission-owning utilities that cover parts of seven western states) to obtain 

as much as 35 percent of their power from wind (30 percent) and solar (5 percent) 

generators. Reliability considerations currently put considerably lower limits on the 

power that grid operators can safely obtain from such sources. Most of the witnesses 

on today’s panel are probably strong supporters of increasing renewable resources 

and integrating them more strongly into existing grids. I hope that my testimony 

will bring some balance to the discussion, and perhaps strike a cautionary note. At 

the outset I wish to make clear that I do not object in principle to Federal support 

of research in this or other areas. There may well be cases in which such support 

is economically warranted. My testimony will instead put the recent rush toward 

renewables into perspective, and conclude that recent experience in the U.S. and 

elsewhere requires rethinking their role in our electrical future. 

B. Generation: history and choices 

The desirability of integrating wind and solar resources on a large scale depends 

on both the costs of new infrastructure and the costs of the resources themselves. 

Those of renewables continue to disappoint the long-held expectations of their advocates. Instead of passing market tests that would indicate their worth, wind and 

solar continue to live on subsidies and state-level requirements that require utilities 

to procure increasing percentages of their power from renewables. In 2009, 44.6 percent of the nation’s power was generated from coal, 23.2 percent from natural gas, 

20.0 percent from nuclear, and 3.6 percent from renewables, generally defined as 

including biomass and waste conversion, geothermal, wind and solar sources.2 Until 

very recently, their percentage contribution to the nation’s power supply was even 

less important. In 1990 they produced 2.0 percent of it, and 2.2 percent in 2005, 

before beginning their recent growth to 3.6 percent in 2009. The reasons for the 

change are important. In 1990, 95 percent of renewable power came from biomass, 

waste burning and geothermal sources. These were viable power sources because, 

then as now, their unsubsidized costs made them competitive against fossil fuel generation in some markets. These resources had the added virtue of dispatchability—

they could be run when they could lower the system’s costs and left idle when they 

could not. Their fuel could be stored in anticipation of when their power would be 

most useful. 
51

3 U.S. Department of Energy, Energy Efficiency and Renewable Energy (DOE/EERE), GPRA07 

Wind Technologies Program Documentation (2007), App. E at E–6. http://

www1.eere.energy.gov/ba/pdfs/39684¥app¥E.pdf 4 AWEA Small Wind Turbine Global Market Study, Year Ending 2009, 4. http://

www.awea.org/smallwind/pdf/2010¥AWEA¥Small¥Wind¥Turbine¥Global¥Market¥

Study.pdf

For the next 20 years, biomass, waste and geothermal power remained viable but 

their outputs did not grow. In 1992 they produced 70.5 gigawatt hours (gwh or million kilowatt-hours) of power, and in 2009 their output was about the same, 69.5 

gwh. The growth of solar power has been surprisingly modest. In 1993 it produced 

0.45 gwh, which by 2009 had grown to 0.81 gwh (below the 2008 figure). This was 

0.6 percent of all renewable power in 2009, and one-fiftieth of one percent of all U.S. 

power. The growth in renewables since 2000 has been almost entirely in wind, to 

the point that by 2009 it accounted for over half of all renewable generation. 

Intermittent power is expensive power, and official expectations are that it will 

remain so. The accompanying figure shows the U.S. Energy Information Administration’s projections of the levelized cost per megawatt-hour output of the most common electrical technologies. They apply to plants expected on-line in 2016, and are 

expressed in 2008 dollars. The four most costly sources are, by rank, solar photovoltaic ($396/mwh), solar thermal ($256), offshore wind ($191) and onshore wind 

($149). Compared with a conventional (not an advanced) combined-cycle gas plant 

($83/mwh) the cheapest intermittent source is 80 percent more expensive. Nor are 

intermittent resources necessarily good investments if a carbon tax or cap-and-trade 

system is on the horizon. Adding carbon capture and sequestration (CCS) technology 

(whose cost is still quite uncertain but is likely to fall) to a combined cycle gas plant 

still leaves it 32 percent less expensive per mwh than the cheapest wind plant. At 

prices for carbon predicted by many models, the wind plant still loses. Note also 

that biomass and geothermal are expected to remain competitive with gas on a cost 

basis. 

Subsidies explain investment in wind generation. Although the 20 percent production tax credit on wind energy is now (probably) permanent, earlier in this decade 

it was on-again off-again. In 2000 (off) 67 MW of wind capacity were built, rising 

to 1,697 MW in 2001 (on). Between 2002 (off) and 2003 (on) the figures are 446 and 

1,687 MW; and between 2004 (off) and 2005 (on) they are 389 and 2431 MW.3 Many 

other factors influence investment, but total investment in years with the tax credit 

was 544 percent greater than in years without it. There is no evidence that the costs 

of wind turbines have fallen sufficiently since 2005 to invalidate this relationship. 

The American Wind Energy Association (AWEA) is aware of the importance of subsidies. As recently as last week (June 8) it explained a recent upswing in installations of small wind turbines as due to the 2009 American Recovery and Reinvestment Act (ARRA), which expanded the Federal Investment Tax Credit (ITC) for 

small wind turbines to 30 percent. 

‘‘The ITC was perhaps the most important factor in last year’s growth . . . [it] 

helped consumers purchase small wind systems during a recession when other 

financing mechanisms were hardest to obtain. The enactment of the ITC [was] 

the industry’s top priority . . .’’ 4

The issue of subsidies is a sensitive one, with problems that hinge on what a subsidy is, etc. About the most comprehensive study of U.S. energy subsidies is a 2007 

document by the U.S. Energy Information Administration. The document is unique 

in that its authors took the pains to examine how they applied to fuel actually used 

to produce electricity, which is the issue before this Committee. Thus a subsidy to 

the oil and gas industry, for example from some particular tax rule, is only relevant 

to the extent that it affects the oil and gas used to generate electricity. Specializing 

to fuels used in electricity, the attached graph presents the basics. Per megawatthour of power it produces, wind receives a subsidy of $23.37 and solar receives a 

dollar more. Wind gets 53 times more funds per mwh than coal, and 93 times more 

than gas and oil. 

Note that these facts do not by themselves say much about the desirability of 

these transfers. Since renewables are a relatively newer industry than fuels, there 

might be an economic rationale for subsidies that fund basic research in them that 

if successful could render them truly competitive. A subsidy that simply discounted 

prices to purchasers of renewables or reduces their taxes would be harder to rationalize. According to the Energy Information Administration, ‘‘tax expenditures’’ (i.e. 

reductions) to the coal industry (including those for coal not used to produce power) 

were $264 million in 2007, while R&D subsidies (possibly necessary if we are to 
52

5Federal Financial Interventions and Subsidies in Energy Markets 2007 (2008), 105. http:/

/www.eia.doe.gov/oiaf/servicerpt/subsidy2/pdf/subsidy08.pdf 6 Robert J. Michaels, ‘‘Run of the Mill, or Maybe Not,’’ New Power Executive, July 28, 2006, 

2. The calculation used unpublished operating data from the California Independent System Operator. 7Lawrence Risman and Joan Ward, ‘‘Winds of Change Freshen Resource Adequacy,’’ Public 

Utilities Fortnightly, May 2007, 14–18 at 18; and ERCOT, Transmission Issues Associated with 

Renewable Energy in Texas, Informal White Paper for the Texas Legislature, Mar. 28, 2005 at 

7. http://www.ercot.com/news/presentations/2006/RenewablesTransmissi.pdf

8Peter Hartley, Some Preliminary Comments on Wind Generation in ERCOT, presentation 

graphics, Rice University, n.d. http://www.rice.edu/energy/research/carbonsolutions/

Hartley%20Presentation%20Aug09Workshop-SECURE.pdf 9 Bentek Energy, How Less Became More: Wind, Power and Unintended Consequences in the 

Colorado Energy Market (April 10, 2010). 10Massachusetts utilities have largely complied with their state’s RPS by obtaining generation 

credits from biomass plants in Maine (which has no RPS), and difficulties in siting the Cape 

have ‘‘clean coal’’) were $522 million.5 Tax expenditures for renewables were $724 

million, primarily the production tax credit for wind, while the R&D that might 

make them truly competitive was only $108 million. 

III. U.S. renewables, present and future 

As the U.S. and other nations accumulate experience with wind generation, its 

virtues and its shortcomings are becoming evident. Small amounts of wind power 

are easily integrated into existing grids because a sudden calm is operationally no 

different from a small outage. Wind, however, blows the most when it is not needed, 

and increasing grid sizes and wind resource concentrations will not completely resolve the basic problems of intermittency. In 2006, California had 2,323 MW of wind 

capacity and was operating under record loads in early summer. Wind’s average onpeak contribution (scattered over the diverse northern and southern climates) was 

256 MW.6 For system planning purposes, ERCOT, the Texas grid operator, currently sets a wind turbine’s ‘‘effective capacity’’ at 8.7 percent of its nominal 

amount.7 The costs of more wind will include that of transmission that links it with 

consuming areas, which will usually operate at only a fraction of its capacity. When 

it is fully loaded, however, however, markets supplied by wind behave oddly. Texas’ 

wind capacity is mostly far from load centers, and its power is priced by market 

bidding. As they compete for access to the constrained transmission lines, prices are 

bid to lower levels. In Texas, however, those prices are quite frequently becoming 

negative, 14 percent of all hours in 2008.8 This growing problem is indicative of both 

a need for transmission and strong evidence on the effects of subsidies. Wind generators will pay to put power into the grid because subsidies are high enough that 

they retain a small profit after making that payment. 

Some might view negative prices in Texas as curiosities, or as an embarrassing 

consequence of an otherwise desirable subsidy system. Newer research has found 

that increasing the scale of wind operations sometimes produces a strikingly perverse outcome. Gas marketer Bentek Energy examined a seeming paradox in Texas 

and Colorado: Large increases in wind power production were responsible for decreases in the output of coal-burning generators, but emission of pollutants from 

those plants had had actually increased, and CO2 emissions were unchanged.9 Operating data showed how wind’s variability meant that coal units had to make many 

quick output adjustments, and that those adjustments were responsible for the 

added pollution. Bentek’s controversial conclusion was that the total load in the 

area could have been produced with lower total emissions had the wind units never 

existed. 

Another possible problem for wind’s expansion stems from the country’s dual regulatory system for power. State regulators have the lion’s share of authority over 

permits for and siting of generation and transmission that move power between 

states. An increasing number of them are unwilling or politically unable to ensure 

that construction of renewable generation and transmission will take place. Local 

intervenors who formerly blocked the construction of conventional generation and 

transmission are becoming adept at doing the same for renewables. Utilities in a 

growing number of states are becoming unable to comply with their own ‘‘renewable 

portfolio standard’’ (RPS) requirements. Once lauded for its progressive policies, 

California now exemplifies how to obstruct them. A 2002 law required its large utilities to obtain 20 percent of their energy from renewables by 2010. All of its utilities 

are currently out of compliance, and now expect to meet the standard by 2014 or 

later. In 2008, California got a smaller percentage of its power from renewables 

than it did in 2001. Other states are encountering similar problems, and these will 

become more stringent as compliance levels increase.10 Through all of the questions 
53

Wind project have become national news. Many other states have maintained compliance in the 

same way. Maryland’s utilities have done so with small hydro projects in Pennsylvania, but the 

start of that state’s RPS will eliminate this alternative. Arizona is 25 percent compliant with 

its RPS, Nevada 35 percent, and similar records are appearing elsewhere. 11See any recent volume of the Energy Information Administration’s Annual Energy Outlook. 

I and others have criticized the model elsewhere, but the text is a consensus finding that does 

not depend on details of its assumptions. 12Gabriel Calzada Alvarez, Study of the Effects on Employment of Public Aid to Renewable 

Energy Sources, Universidad Rey Juan Carlos, March 2009. Calzada’s non-peer reviewed study 

concluded that since 2000 each ‘‘green job’’ created in Spain cost Ö571,000, with subsidies of over 

Ö1 million for each wind industry job. 

13 Eric Lantz and Suzanne Tegen, NREL Response to the Report Study of the Effects on Employment of Public Aid to Renewable Energy Sources from King Juan Carlos University (Spain), 

White Paper NREL/TP-6A2-46261 (Aug. 2009).

about renewable investment, the U.S. Department of Energy’s National Energy 

Modeling System has demonstrated that for at least the next several decades the 

preponderance of new generation will continue to be in fossil-fuel plants.11

IV. Operations and economics

A. Operational realities 

Any possible increase in U.S. commitment to wind power should be viewed in 

light of recent European experience, and it should be viewed in both economic and 

political terms. Denmark’s vaunted ability to obtain 20 percent of its electricity from 

wind helps make its power costs the highest in Europe, and they can use only about 

half of that output. The country can maintain its mix of power sources only thanks 

to geography. It owns a small part of a large, centrally dispatched grid that covers 

Scandinavia, whose power sources are mostly hydroelectric and nuclear, and whose 

systems always have capacity to handle imports from or exports to Denmark, whose 

wind facilities are a minor part of the regional total. Denmark is relevant here not 

only for its economics, but for the underlying politics. The WestConnect region is 

only a fraction of a considerably larger grid that covers the western U.S. The bulk 

of the nation’s hydroelectric capacity is in the Pacific Northwest, and is equivalent 

to approximately 22 nuclear powerplants. The ability to redirect some of this power 

out of that region appears to be of great importance if NREL’s plan is to be feasible. 

As practical politics, the Pacific Northwest has long fought tenaciously to keep as 

much cheap hydropower as possible for its own use, and governments in that region 

appear unlikely to cede control over it to facilitate NREL’s scenario.

B. Economic realities 

America’s economic performance over the past two years gives little encouragement to those who believe that government spending can generate substantial and 

sustained increases in employment. But even if one believes in the efficacy of a 

stimulus package renewables are probably a poor choice for the creation of job slots. 

Most jobs in that industry are in the production and construction of durable equipment and installations, with relatively few long-term operating positions. Wind advocates and critics have produced many studies on the stimulus approach, but there 

is a fundamental flaw in one of the most widely-used models that favor job creation. 

As an example of a critical study, a recent one from Spain purports to show that 

governmental support for renewables actually destroys jobs rather than creating 

them, because renewables have surprisingly high capital requirements per worker. 

If so, investing elsewhere will create more employment slots, although not necessarily better-paying ones.12 For uncertain reasons, NREL subsequently took the 

initiative in critiquing this study, documenting how its ‘‘JEDI’’ computer model 

showed that that pro-renewables policies in fact created new employment.13

Calzada’s study is open to criticism, but ironically NREL’s model cannot possibly be 

the tool to make those critiques. NREL admits that JEDI is constructed in a way 

that renders job destruction mathematically impossible, i.e. it preordains a pro-renewables finding of job creation regardless of the data being analyzed. 

V. Summary and Conclusions 

The value of funding the changes that the Committee is considering depends critically on an assumption that requires far more thorough examination than it has 

thus far received—that wind power will be an economic choice for the nation’s electrical future. Almost all of the evidence points in the opposite direction. There are 

two types of renewable resources: ones like biomass, waste and geothermal generators that have long occupied a small niche in markets where they have long stood 
54

14Proved U.S. gas reserves rose from 4.74 trillion cubic meters in 1999 to 6.93 million in 2008. 

BP Statistical Review of World Energy, June 2010, 22. 

on their own. The other resources, primarily wind, have yet to pass market tests 

and instead thrive because of subsidies and regulatory requirements that utilities 

purchase their output. Official data show clearly that the costs of electricity from 

wind and solar units are well above those of every fossil fuel, and are expected to 

remain high. We have seen wind’s sensitivity to subsidies in the pattern of investments with and without its production tax credit, and in the statements of its trade 

association about the importance of those subsidies. Further, claims that all energy 

sources are subsidized can be quite misleading. Looking at fuel actually consumed 

in power production, a megawatt-hour of wind power receives 90 times the subsidy 

of one produced from natural gas. Most of wind’s subsidy takes the form of tax 

breaks for producers rather than direct allocations of funds for research. 

Other problems are still matters for research, but as they arise they suggest that 

government think twice before it continues to rush electricity into heavier dependence on wind power. Wind’s useful contributions to capacity are weather dependent, 

and wind often produces the least when it is the most needed. Integrating wind into 

regional markets will require substantial transmission investments, and preliminary results of work on wind power’s actual impact on fossil fuel emissions are not 

encouraging. Regional political factors and electrical geography may further render 

some planned operational changes difficult or impossible to implement. Finally, as 

an engine of ‘‘job creation,’’ wind power is probably a poor choice. 

It is always hazardous for a non-expert (or for that matter an expert) to predict 

policy trends. Unfortunately, this Committee will have little choice but to do so 

when considering the GE/NREL study. Public opinion is in flux, but absent national 

carbon control and/or renewables requirements, the value of implementing its recommendations will fall precipitously. Markets are also changing in ways that bring 

up further questions. Over the past few years wind power has grown strongly, largely fueled by subsidies and regulatory requirements. Over that same period a revolution in fossil fuels has taken place, but without such subsidies or regulations. The 

technologies to access natural gas in shales, tight sands and coal seams have come 

of age. They can now reach hitherto unimagined volumes located all around the Nation at current prices, and with what most agree are minor environmental impacts. 

The nation’s gas reserves are massively increasing, and the history of oil and other 

minerals strongly suggests that early estimates of reserves will turn out to have 

been far too low.14 America can probably look forward to literally centuries of its 

own clean, safe, competitively produced, and truly secure fuel. Looking forward also 

means looking backward. Abundant gas means less need for power from coal and 

uranium, and from uneconomic renewables as well. Gas-fired generation is cost-effective, fuel-efficient, environmentally acceptable almost everywhere, and already an 

integral part of almost every utility’s power supply. The future belongs to the efficient, and it is time to abandon the mistaken belief that efficiency and renewable 

are synonyms. 

I thank the Committee for the opportunity to present these views, and welcome 

any questions or comments.

BIOGRAPHY FOR ROBERT MICHAELS

Robert J. Michaels is Professor of Economics at California State University, Fullerton and an independent consultant to the electricity and natural gas industries. 

He holds an A.B. from the University of Chicago and a Ph.D. from the University 

of California, Los Angeles, both in economics. His past positions include Staff Economist at the Institute for Defense Analyses and affiliate of various consulting firms. 

He is Senior advisor to the Institute for Energy Research and Adjunct Scholar at 

the Cato Institute. 

His research on regulation and competition in electricity and gas has appeared 

in peer-reviewed journals, law reviews, and industry publications. He is also CoEditor of the peer-reviewed journal Contemporary Economic Policy. He has advised 

state regulatory agencies, electric utilities, independent power producers and marketers, consumers and producers of natural gas, public interest groups, and governments on aspects of regulation and competition. He has provided expert testimony 

at, among other venues, the Federal Energy Regulatory Commission, the California 

Public Utilities Commission, the Illinois Commerce Commission, the Vermont Public 

Service Board, and in two prior appearances before committees of the U.S. House 

of Representatives.
55

DISCUSSION

Chairman BAIRD. Thank you, Dr. Michaels. I thank all the witnesses. I am glad to be able to join the hearing at this point. I will 

recognize myself for five minutes. 

Ms. WOOLSEY. Mr. Chairman, could I ask a favor of you? 

Chairman BAIRD. Of course. 

Ms. WOOLSEY. We are the Energy and Environment Subcommittee. Can we save some energy by turning down the air conditioning in this room? It is freezing. 

Chairman BAIRD. If we can’t, I will loan you my jacket, but I 

agree with you——

Ms. WOOLSEY. Well, no, I mean——

Chairman BAIRD. No, I agree with you entirely. Let us have staff 

try to work on it. 

Mr. HALL. I am about to burn up. 

Ms. WOOLSEY. That is your problem. 

Chairman BAIRD. Wait. There is a solution. May I borrow your 

jacket? Then I will give it to her. 

Ms. WOOLSEY. That is not the point. The point is, we are wasting 

energy. 

Chairman BAIRD. I agree with you. Thanks, Ms. Woolsey. I appreciate your observation. I share that. We cool this place down to 

outrageous levels. 

POTENTIAL ECONOMIC SAVINGS

So, in the Pacific Northwest, we have a great deal of potential 

hydropower. We are putting in an awful lot of wind, and one of the 

things that people at Bonneville, and I know some of you have testified about this issue in general, talked about was the challenge 

of integrating the grid, and I know that has been much of your testimony. If I missed it, forgive me. What are the estimated savings 

if we can more precisely tell a concentrated solar plant or a wind 

farm to expect this amount of wind, which should lead to X amount 

of output? In our region, that might mean you have to put less energy through the turbine or lower the—you know, or you could 

maybe use your baseline somewhere else, et cetera? How much do 

we save if we can make better predictions of this? 

Dr. MOONEY. Mr. Chairman, we have recently completed a study 

called the Western Wind and Solar Integration study, the National 

Renewable Energy Laboratory, that is, and we showed as one example, and there are a number of studies that I cite in my written 

testimony that give specific quantifications of those savings, but, 

just as an example, in the Western Wind and Solar Integration 

Study, we compared for 27 percent wind and solar penetration in 

the 14-state western interconnection region. We compared operating that system with no forecasting compared to state-of-the-art 

forecasting, and then compared that to perfect forecasting. Going 

from no forecasting to state-of-the-art forecasting, there was a savings of approximately $5 billion annually, which is about 14 percent of the total operations cost. The savings going from state-ofthe-art to perfect is somewhat incremental, an additional roughly 

ten percent savings, but still a significant sum of money of about 

$500 million. 
56

Chairman BAIRD. That is a tremendous amount, and it would 

seem that it also allows your baseload to maybe be channeled into 

different other possible uses. Especially as you get smart grids up, 

and maybe certain industries with high demands, they would run 

their high-demand operations during periods of abundance on the 

renewable side to take advantage of excess baseload. 

Any others wishing to comment on that? Mr. Rosenblum. 

Mr. ROSENBLUM. Yes, I would. Thank you, Mr. Chairman. We 

are currently engaged in a 33 percent RPS analysis within the 

California ISO. The first part of our study has tried to quantify 

what the benefits would be for different portfolios of renewable resources, and part of the sensitivities that we ran were what happens if we were able to reduce the level of error that we are currently experiencing with wind. We extrapolated for solar to the experience in Germany, which has much more solar PV penetration 

than we do, and reduced those approximately in half. What we 

found was that, under those scenarios, we would essentially reduce 

the amount of capacity that we would need in a real-time environment by approximately 2,000 megawatts or more in the spring and 

summer months, and that equates to the commitment of multiple 

combined cycle turbines. So we think that we would see a significant—we haven’t translated that to dollars, and we are doing so—

but we think that will translate to significant operational and cost 

savings to consumers. 

POTENTIAL BURDENS ON ENERGY RESOURCES AND

TRANSMISSION

Chairman BAIRD. Now, this issue of more precise predicting, you 

know, I grew up in farm country, and I remember if it was time 

to bring in the hay, gosh, you would watch to the hour whether the 

rain forecast was coming, because if it was going to rain you 

couldn’t bring in the hay, and if it was going to rain, we would 

work round the clock to get it in and get it into the barn before 

it got wet, if we could. So now we are applying the same kind of 

fairly precise microforecasting but to the energy sector. 

Ms. Simler, in your discussion, you state in your written testimony that existing operational practices or market rules have the 

effect of imposing unnecessary costs or burdens on both variable 

energy resources and transmission. Can you elaborate on that a little bit? 

Ms. SIMLER. I can try. We don’t have any quantitative studies. 

We rely on studies that others have done. But the idea there is 

similar to what was—what you have heard so far. It is that, if we 

can have better forecasting that would allow better forecasting for 

better predictions, you would free up other resources to provide energy. You wouldn’t have to have as many resources committed for 

reserves. 

Chairman BAIRD. I appreciate that, and I may be drilling down 

too much, and we can get to it later if we want because I am almost out of time. But you mentioned specifically market rules. Are 

there market rules that particularly come to mind that may be 

somehow in conflict with the issues we are discussing here? 

Ms. SIMLER. That is part of what the Notice of Inquiry was supposed to do was to explore what the market rules—if there are 
57

market rules, and if there are, then the Commission can take action to remedy them. 

Chairman BAIRD. I see. So you are not saying you have an answer to that; you are trying to say this is a question we need to 

ask. 

Ms. SIMLER. Right. 

Chairman BAIRD. Okay. Good. 

With that, I recognize my friend Mr. Hall. 

ALLOCATING COSTS FOR RENEWABLES

Mr. HALL. Thank you. I may touch a little in your question, Mr. 

Chairman, from Dr. Michaels, but first I want to ask Ms. Simler: 

your testimony noted the need for baseload electricity suppliers to 

back up renewables when the wind doesn’t blow or the sun doesn’t 

shine or you don’t have some of the benefits that you would expect 

and anticipate, and by the way, I read the other day where some 

of the women out in west Texas were objecting to T. Boone Pickens’ 

towers because it was blowing their hair. I don’t know how serious 

that is, but something happened to it. Some of them think it is cold 

when the weather and temperature is normal, you know. I am 

picking a fight I can’t possibly win. 

But, obviously, the unpredictable nature of weather presents 

some kind of a burden and adds cost to the baseload supplier support, and these costs are going to increase as we add more renewables to the grid. I guess my question is, how significant are these 

costs? I think you have touched on it, and will FERC make that 

determination as to who ought to pay for them and could you give 

us some kind of an idea as to the responses to your Notice of Inquiry about this issue? 

Ms. SIMLER. Yes. To the extent that variable resources impose 

additional costs on the grid due to having to have other generations 

standing ready to provide reserves, and, as I said, that generation 

standing ready to provide reserves can be reduced with better forecasting. But to the extent that that occurs, customers will have to 

pay a portion, a share of that. At the end of the day, customers 

pay. And the Federal Energy Regulatory Commission, to the extent 

that those are part of the wholesale rates, would decide which customers pay. 

Mr. HALL. Well, let me ask Dr. Michaels, you referenced DOE 

electricity cost data in your testimony and noted that renewables 

are significantly more expensive than conventional sources on a 

levelized basis. I guess, Dr. Michaels, my question would be, do you 

expect this to change the future as more renewables are added to 

the electricity mix as a result maybe of subsidies or mandates or 

some other unknown or undetected aid? Are subsidies driving technology advances, and, in the current economic environment, how 

much is too much to provide in subsidies or renewables? 

Dr. MICHAELS. I think the way to look at it is, if that is so, what 

is the form that the subsidies are taking? Because, for wind in particular, the subsidies are in the form of production tax credit, basically just a cash flow in the industry. It is not a subsidy for research. Wind is progressing. Wind has progressed, but at this 

point, we know that the rate of productivity increase is slowing 

down, and that is somewhat taking place all over the world. It is 
58

an international industry. There is still improvement, but it is a 

much slower improvement than before. Beyond that, I can’t extrapolate. 

Mr. HALL. Any others want to make any suggestion along that 

line? 

WIND POWER IMPACTS ON POLLUTANTS AND EMISSIONS

I will ask Dr. Michaels. You note in your testimony that in Texas 

and Colorado, it has been found that large increases in wind power 

production resulted in increases in pollutant emissions and unchanged CO2 emissions because the baseload electricity required to 

support the wind power operations forced coal generators to make 

unusually quick adjustments that increased pollution. Has this 

problem been studied more in depth to determine its significance, 

if any, and its impact? 

Dr. MICHAELS. At this point, this is the only study that is outstanding and it is a study that came as a fairly complete surprise 

to the entire industry. It may well be that Texas and Colorado have 

some degree of uniqueness, because they are more dependent on 

cycling coal units than many other parts of the country, so how it 

generalizes is not clear and whether its quantitative importance 

will be the same again we don’t know. I am putting it forward as 

another question that you should think of, though, if you are intending to encourage the further development of wind. 

Mr. HALL. I am just going to ask how much, or are such quick 

adjustments necessary? 

Dr. MICHAELS. They have to—these are the people who are the 

experts in it but the basic answer is, its because wind is intermittent. For small problems, it is no different from the outage of an 

ordinary electrical generator. 

Mr. HALL. I think my time is up. Thank you. 

Chairman BAIRD. Thank you, Mr. Hall. 

Ms. Woolsey. 

ROLES FOR THE FEDERAL GOVERNMENT AND PRIVATE

INDUSTRY

Ms. WOOLSEY. Thank you, Mr. Chairman. 

Who would ever have anticipated that the NOAA Weather Service would become part of our daily news and entertainment cycle 

in the United States of America? I mean, I have a friend who 

would rather watch the weather station than any of the other television stations, and we also know that people follow storms like a 

sporting event. I mean, this is really something that we have accomplished through NOAA—knowing ahead of time what could be 

coming. Sometimes it doesn’t come, but forecasting is really something. There is an economic benefit to the media for bringing viewers and readers because of NOAA’s product, I mean, so what a 

service that is. But we want to improve on this. That is what we 

are talking about today. So we want to meet the President’s goals, 

many of us, and we want to save the $5 billion a year—at least—

that has been reported. So, I mean, why aren’t we already doing 

this, and what do we really need to do? That is my question. I 

mean, each one of you has said we can, we must, you know, and 
59

we should. What will be the Federal Government’s role? What will 

be private industry’s role? 

Dr. Storck, you talked on that, so let us hear from the others. 

You did get to that slightly, but I want to know what you think 

our role is and what private industry’s role is. Do you have a 

thought on that, Ms. Simler? 

Ms. SIMLER. I will let others speak to that. 

Ms. WOOLSEY. Okay. Thank you. 

Dr. MacDonald? 

Dr. MACDONALD. Thank you. NOAA is always trying to improve 

its weather forecasts, and most people do recognize they have gotten a lot better, and I appreciate your comments about—I actually 

do have friends whose favorite channel is The Weather Channel. 

That is because I am in weather. 

Ms. WOOLSEY. Well, they need to get a life. 

Dr. MACDONALD. We are improving our forecasts. They partly 

improved because we understand the weather better and because, 

as computers get faster, our models get better. But there are some 

unusual things about renewables. For example, you really care 

about the winds, you know, fairly high above the ground, about 300 

feet is where the power is. We used to kind of say partly cloudy, 

but partly cloudy is not good enough when you can have clouds sort 

of go over an entire city and change the amount of photovoltaic energy available. So what we want to do is improve our networks and 

improve our models really going specifically after those things 

needed for renewable energy. We need a way to do that. It is at 

a higher resolution and it is observing using things like we have—

things like SODARs—that actually can measure the winds 100 meters above the ground. So we have some great ideas to go after it 

and we are going to keep working on it. 

Ms. WOOLSEY. So, okay, you have the ideas. Do you have the 

technology and do you have the equipment, or are we depending on 

private industry to provide this? 

Dr. MACDONALD. Well, I see us as depending on private industry 

for some of the new technology. I mentioned some of these new 

wind measuring tools. It is going to require, I think, some investments to improve our systems, but, in any case, we are going to 

be working on it because improved weather helps everything. It 

helps aviation. It helps renewable energy. But there are some specific things for renewable energy that we really do need. 

WIND POWER

Ms. WOOLSEY. Dr. Michaels, you hate wind. Poor wind. But isn’t 

wind just part of the solution? I mean, it is not the whole thing. 

Dr. MICHAELS. The Nation is undergoing yet another energy 

transition of the same sort that it has made in the past from wood 

to coal to oil to electricity, and it may well be a transition that has 

a greater role for wind. I do not hate any particular source of energy, and I also do not hate efficiency. But it is important to think 

about what wind’s role really is because some facts are coming to 

light, and its role in the system is, I think, in need of a little more 

rethinking. That is my major point. 
60

MORE ON PRIVATE INDUSTRY

Ms. WOOLSEY. Dr. Storck, what do you think will be private industry’s role in this? We just have 10 seconds. 

Dr. STORCK. Private industry’s role is fairly clear, as I see. Private industry relies on the forecasts that NOAA creates. We take 

those forecasts, forecasts of the weather, and we make them very 

specific and relevant to a wind farm. Regardless of how many computers and scientists NOAA employs, it can never get into the details of every particular wind farm in the United States. And, remember, we export our technologies globally, as well. So we need 

NOAA to produce better weather forecasts and we can take it from 

there. 

Ms. WOOLSEY. Thank you, Mr. Chairman. 

Chairman BAIRD. Thank you, Ms. Woolsey. 

I wouldn’t expect the panelists to be aware of this, but the gentleman now about to ask questions is probably the leading authority in the Congress on some of this because he is virtually off the 

grid, if not entirely off the grid, and has been doing renewable energy in his home walking the talk for many, many years. So with 

that, I am pleased to recognize Dr. Bartlett. 

STORAGE AND THE LIMITED AVAILABILITY OF FOSSIL FUELS

Mr. BARTLETT. Thank you very much. You know, in thinking 

about these alternative energies, we need to think about them in 

a different context. The context in which we ordinarily consider 

them is the present context where about half of our electricity 

comes from coal, and if you are comparing these renewables with 

fossil fuels, they aren’t going to look very good because the quantity 

and quality of energy in fossil fuels is just unsurpassed. Where else 

can you find that quantity and quality of energy? 

The general statement is that we have 250 years of coal at current use rates. Be careful with that phrase ‘‘current use rates’’, because an increase of just two percent doubles in 35 years, gets four 

times bigger in 70 years, eight times bigger in 105 years, 16 times 

bigger in 140 years. I hope we will still be here as a country 140 

years from now. The National Academy of Sciences says that we 

probably have 100 years of coal at current use rates, but even if 

we have the 250 years and you increase its use only two percent, 

and we will increase its use more than that as we have to turn to 

coal for gas and liquids, but even if you increase it only two percent, the 250 years now drops to 85 years. That is the power of 

compound interest, which Albert Einstein says was the most powerful force in the universe, and now if you take some of the energy 

from that coal to produce a gas or a liquid, now it shrinks to 50 

years, and there is an inevitability that few people understand, and 

that is that you will share it with the world out of necessity because if we are getting oil from coal, then the Saudi oil goes to 

somebody else, so in reality, you have no choice but to share it with 

the world. What that means is that 50 years now shrinks to 12.5 

years. So if you make two assumptions, one is that the use of coal 

will increase just two percent, and the other is, the inevitability 

that you will share it with the world, we have 12.5 years of coal 

left. 
61

So the context in which we need to be thinking about these alternative energies is a world in which we do not have the abundance 

of fossil fuels that we have today. Then they start to look a whole 

lot different, don’t they? But we have huge problems with the intermittent production of energy by wind and by sun, and so we need 

hugely increased focus today on storage, do we not? Because you 

can get all the energy that you need from solar, you can get all the 

energy you need from wind but, boy, is it sporadic. And we have 

grossly inadequate ways of storing it today. Where are we in this 

balance between looking at the renewables and looking at ways of 

storing the energy? Because don’t you think that the utility of 

these renewables in the future will be largely dependent on our 

ability to quickly store and release the energy we get from them? 

Dr. STORCK. Congressman Bartlett, can I first address that? I 

think one of the first things before we engage wholly in the idea 

of storage, which I do think is important, is we need to look at 

other market structure improvements such as larger geographic 

areas in which we transact energy because I think that may be a 

more a direct way to increase the flexibility of resources that we 

utilize to balance the variability——

Mr. BARTLETT. You really can’t——

Dr. STORCK. —that you were talking about. 

Mr. BARTLETT. —stretch this stuff too far, can you? Unlike oil, 

you put a gallon in here and a thousand miles away a gallon comes 

out. You put electrons in a wire at this end, and a thousand miles 

away nothing may come out as a result of line loss. Aren’t there 

some limitations to equalizing, to normalizing the production if you 

just include the whole country? 

Dr. STORCK. Well, I would say that is something we need to 

study, but one of the things that we have observed is that the 

broader the geographic area that you can use to balance, there 

probably are benefits and we need to look at transmission associated with that. You are correct. 

Dr. MOONEY. Congressman Bartlett, I think you raise a very important point, and just as wind or any single technology is not the 

solution, in addition to forecasting there are many things that we 

can do to address the variability of wind and solar generating 

plants. Storage, I think, is certainly one, and will likely be a part 

of the solution. As was discussed here earlier, there are market 

structures that could be changed to make integration easier. There 

are operational techniques that can be implemented, for example, 

looking at wider geographic areas for integrating renewable generating technologies, and that is on top of potential efficiency and demand response technologies and techniques. So there is a whole 

portfolio if we look at this as an entire system that will help to address that variability. 

Mr. BARTLETT. Thank you. I yield back. 

Chairman BAIRD. Thank you, Dr. Bartlett. 

Dr. Ehlers. 

MORE ON THE NEED FOR RENEWABLES

Mr. EHLERS. Thank you, Mr. Chairman, and I apologize for the 

delay in being here. I have two committee meetings going on simultaneously. 
62

On the storage issue, of course Michigan, my state, has more experience than most with the pump storage facility that consumers 

power put in, and which has worked remarkably well outside of 

killing a lot of fish initially, but they have managed to put up a 

net that is good enough to keep the fish from getting in and it has 

worked rather well. Every night the otherwise idle plants are sending electricity up there and pumping water, I think, about 200 feet 

up the hill into a lake and during the day let it flow down. The 

same turbines turn the other way and produce electricity. Unfortunately, that is a geographic scarcity to have a situation like that, 

but nevertheless, they have proved it works and so that can be a 

model, and I worry. Mr. Bartlett and I are much in the same vein 

on this issue. We very much support the renewable industry in 

whatever form it manages to survive. That is a very good direction 

to go, but that is only part of it. I really don’t like that term ‘‘renewable’’ because it is not renewable. I mean, sunlight is always 

there, but it is not really renewable. Not much we can do about it. 

But, at any rate, all those alternative forms of energy—which I 

think, is probably a better way of saying it—are essential for us. 

We have to use them, we have to develop them, we have to make 

them work well, and here, as in so many cases including automobiles, the biggest stumbling block is having a good method of 

storage, and particularly in homes. My fond dream is that eventually every home in America will have solar shingles at not much 

greater cost than ordinary shingles. That makes solar power very 

economically feasible. But again, where do you store it? Buying batteries can be expensive and erratic, but nevertheless, that appears 

to be the best thing at this point, and I would be delighted if someone can develop really good batteries or better methods of storage 

than we are used to having. 

So that is not a question, Mr. Chairman. It is more an editorial, 

but I really appreciate what you are doing and what you are working on. It is absolutely essential, I think. As the spill in the gulf 

is pointing out, we have problems with every source of energy, and 

energy by its very nature creates some of its own problems because 

you need ways of containing it, preserving it, shipping it and so 

forth. So thank you for what you are doing, and I yield back at this 

point. 

Chairman BAIRD. Thank you, Dr. Ehlers. 

Mr. Rohrabacher. 

POWER PLANT SITING

Mr. ROHRABACHER. Thank you very much, Mr. Chairman, and as 

a preface to what I am about to say is that of course again for the 

record state that I think that the global warming CO2 theory is 

nonsense and those of us who have found ourselves in combat on 

this, quote, global warming issue realize that there is more to the 

energy argument and the energy issue than simply trying to say 

that we are not going to put more CO2 in the air, which I might 

add as we all know, over the Earth’s history there has been many 

times more CO2 in the air at wonderful times in the world’s history. 

But beside that, back to energy, and that is, those of us who have 

that disagreement don’t disagree that we need to be developing our 
63

energy resources to the maximum degree so that America can benefit both economically and in terms of our national security. With 

that, I have been very active in supporting various alternative energy sources rather than just oil and gas, and I happen to have 

bought on to the theory that we should be moving towards electrifying America, that we should be looking at electric energy as a 

source of transportation, et cetera. 

With that said, I have also been dismayed that quite often those 

people who are supposedly dedicated for the global warming theory 

or whatever motivates them to producing clean electricity that in 

California at least they seem to be putting up roadblocks, and I 

think this is true in other places as well, to actually putting in 

place solar energy installations, and I have a bill, H.R. 964, which 

would facilitate the development and the building of solar installations in the desert, and what apparently we have now is 205 or at 

least over 200 applications at the Bureau of Land Management 

that have been sitting there for years for people who would like to 

build solar plants in the middle of the desert but can’t get the Bureau of Land Management to give them a permit to build. Now, 

something is wrong there. Something is wrong with that equation 

and I would like to ask the panel, what is going on here? I mean, 

are we committed to it to the point that lizards and insects and 

their habitat is more important than developing the energy or can 

we say that yes, developing electric solar power in the desert is 

worth eliminating the habitat for a small number of insects and lizards, who can then scurry someplace else, I might add. So I would 

like to ask the panel that. What about siting of solar plants and 

other alternative plants, I might add? 

Dr. MICHAELS. The issue of siting these plants is being very interesting in California for a lot more reasons than just that. Among 

other things, even if they get sited, nobody is going to be able to 

build transmission to them. The question——

Mr. ROHRABACHER. I will have to tell you that I am personally 

involved with several sitings that the transmission lines go right 

through and it is right there, so I would like to say that yes, that 

is true. We don’t have any electric lines or any way to get it onto 

the grid in many of these but in many of them they do have access 

to the grid and access to transmission lines. Go ahead. Sorry. 

Dr. MICHAELS. But if this is the case, this is the question that 

has always had to be looked at. We have only relatively recently 

in our history become aware that much of what we do does have 

consequences for the environment. The real question is always a 

rule of reason. How do you value the environmental amenities, the 

value of species biodiversity against the value of the power? Is 

there in fact an easier way to get it, a cheaper way to get it, a 

cleaner way to get it? Those are the questions about the relationship of markets and regulation. The question of how the solar units 

are getting built, how they are being financed, are they getting 

some sort of subsidies, tax breaks, questions like those. You have 

got to look at all those aspects of them. It may well be that these 

are intrinsically uneconomic and you wouldn’t want them in the 

desert were it not for certain special treatment that they get. 

Mr. ROSENBLUM. As a transmission planning entity, we do see 

that there is a definite chicken-and-the-egg problem in California. 
64

Do we build the transmission and have them come to it, or do we 

wait for siting to take its course and then build the transmission 

out there? We are trying to be proactive, but also take into consideration the environmental limitations that are occurring. So it is a 

difficult process, as you point out. 

Mr. ROHRABACHER. Would any of you be supportive of legislation 

that said on its very face building a solar plant is positive towards 

the environment and thus they should be—their grant process with 

BLM should be facilitated? Would anyone support that on the 

panel? Okay. Thank you. 

Chairman BAIRD. Shall we let the record show that there was 

no——

Mr. ROHRABACHER. Show there was no great response to that 

question. 

INFORMATION GATHERING AND SHARING

Chairman BAIRD. I don’t know if we want a lengthy second 

round, but there is a topic that I don’t think has been addressed 

and I just want to raise it with my colleagues’ indulgence. It has 

to do with, Dr. Storck, your model is a private entity providing 

forecasting or predicting—I am not sure of the proper term—information for the purpose of renewable energy entities, I think predominantly wind, as I understand it. Two main questions come to 

mind. One, we have heard a little bit about the economic benefits 

that could be achieved if we had more precise forecasting. I want 

to learn what we need to do to get that achieved, what has to be 

added to the system or done better from what we already do. But 

secondly, this interface, you know. There are some really bright 

folks out there doing little iPhone apps for free, but they need public access to information, and the question I would have is, do we 

really need a Federal investment in certain information-gathering 

infrastructure that then becomes open source so that then private 

entities can use it? What do we need to do to make this better and 

how do the private enterprises work with government agencies? 

Dr. STORCK. Thank you. I will start with that question. First, to 

capture the value of renewable energy forecasts, you do need a 

stem that can allow you to extract that value. You need a market. 

Continuing with your analogy of sort of making hay, if I tell you 

that it is going to rain in another hour and you know that perfectly, what you really need is someone to help you make hay. You 

don’t need to know that it is going to rain within the next hour. 

That is just a piece of information. So it is what you do with the 

information. So markets and systems allow renewable energy to be 

moved from one location to the next and they allow that value to 

be captured. In the NREL study that was referred to, the fundamental assumption with looking at the value of forecasts is that 

markets behaved rationally and that you were able to move power 

from one area to the next. It didn’t consider things like $100 per 

megawatt hour in balance penalty. That would be what I would 

call an irrational market. 

Secondly, to your issue of observations and open source, it is a 

very important point. To really predict wind energy on an hourahead basis, we need more than just a weather forecast. We need 

access to those observations that ring the wind farms and perhaps 
65

that our clients at the wind farms have installed themselves. So 

providing these observations that NOAA might put in and not just 

feeding those observations into their supercomputing models but 

making those observations available to the renewable energy industry and not just wind. We heard the last two Congressmen talk 

about solar. We need to think beyond just wind here because once 

we do get to your vision of shingles as PV panels, we are going to 

be having a hearing about solar forecasting and cloud tracking. 

Thank you. 

Chairman BAIRD. Dr. MacDonald? 

Dr. MACDONALD. Chairman Baird, I think NOAA and the private 

commercial sector have really grown in our ability to work together. There was a report called the Fair Weather report done 

back in 2003. NOAA worked on policies, and I agree with Dr. 

Storck that NOAA should put out the best possible forecasts but 

the private commercial sector can work with the very specific needs 

of something like the renewable energy industry to tailor the forecasts that they need, so I think there is an excellent cooperation 

and it says that, as we improve NOAA’s observing networks and 

NOAA’s computing and forecasting, we improve everything. We improve aviation. We improve public forecasts like the blizzard forecasts this winter. So it is something where I liked your words ‘‘open 

source.’’ We operate, we sort of get the best forecast, make it available. And the better our forecasts get, the more companies like Dr. 

Storck’s company make money. 

Chairman BAIRD. Let me ask a slightly different variation of 

that. So forecast is some degree distant from raw data. Is the raw 

data open source as well? 

Dr. MACDONALD. It is, right. We make it all available, and nowadays on the Internet, it is quite easy. There is one distinction on 

that, and that is, sometimes there are proprietary data. For example, one wind farm and one company may say, I don’t want my 

neighboring one to have it, and we have proposed that NOAA be 

kind of the honest broker, where we would get the data and have 

it, but we would use it to improve the forecast. 

POTENTIAL SAVINGS VERSUS INSTRUMENTATION AND DATA

GATHERING COSTS

Chairman BAIRD. The other question then would be, and I don’t 

know that we have time to answer it here, but we have heard estimates in the billions of dollars of savings through increased productivity and efficiency. I am wondering what the cost would be to 

realize those billions of dollars in terms of new instrumentation, 

available data. 

Dr. Storck, you allude to a few new subsets of information-gathering technologies and if there are others who want to speak to 

that? 

Dr. STORCK. Real quick. The billions of dollars of savings is what 

is realized with the current state-of-the-art forecasts that are available to the industry today. That is a very important point to make. 

We have come a long way and we already provide tremendous 

value to the industry. The incremental improvements on a dayahead forecast time horizon, which is what the NREL study looked 

at, was another $500 million for the wind energy industry. That is 
66

significant money, but I wouldn’t spend $500 million just to get 

there. 

Chairman BAIRD. Okay. So you feel with existing technologies 

and data used more effectively, we can already realize substantial 

savings, and that is your business model? 

Dr. STORCK. Yes, and the fundamental question we have in integration is forecasting wind energy changes in the next hour to next 

five minutes. and that is going to require thinking a little bit outside the box of just supercomputers and weather forecast models 

and really getting into the details of more advanced weather observation systems. The question becomes who pays for that. Is that 

the owner/operator of the wind farm or is that the taxpayer? 

Chairman BAIRD. I will give my colleagues, if there any colleague 

dying for a second round? Dr. Bartlett. 

ADAPTING ENERGY DEMAND TO INTERMITTENT SOURCES

Mr. BARTLETT. Of course, an alternative to storage is simply to 

try to match an intermittent production of electricity with an intermittent use of electricity, and there are many uses that we have 

for electricity that could be inherently intermittent. When your air 

conditioner comes on, whether it was five minutes ago or five minutes from now, it makes little difference in how cool your house is 

going to be, and there are many manufacturing processes where 

you simply could stockpile some material when you had energy 

available and use it when the energy is not available. Of course, 

there are always going to be some inefficiencies in doing that but 

there are also inefficiencies in storing it if you have a constant load 

and an intermittent production. 

To what extent are we investing in these kinds of studies so that 

we can create a more flexible load to match an intermittent production? 

Dr. MICHAELS. You already have the growth of an industry which 

essentially makes—what they call the product themselves—is virtual power plants. There are companies like one called EnerNOC, 

which essentially signs up people and tells them that they are 

going to control their loads in exchange for certain rewards in order 

to help the power system cope with its operating problems. So 

these industries already exist and they apparently are able to 

make a profit off it and the question is possibly how to grow them. 

Ms. SIMLER. I would like to comment on that, if I may. The Federal Energy Regulatory Commission has due to Congress this 

month, I think by June 19th, a national action plan on demand response, and Dr. Michaels just referred to with EnerNOC, they are 

providers of demand response and demand response can complement the variability of wind energy resources. So FERC last 

June did a study on the assessment of the potential of demand response in the country and, like I said, the report should be going 

to Congress on the action plan which talks about support for states 

and others about how to achieve the potential identified in that assessment. Thank you. 

Mr. BARTLETT. Yes, sir. 

Dr. STORCK. Yes, and also just recently DOE has made hundreds 

of millions of dollars of funding available for what is called smart 

grid demonstration projects. We are a member of one of those 
67

projects in the Pacific Northwest, and the idea is to look at demand 

response and basically information services that support the electric grid to match supply, particularly from renewables, and in the 

Pacific Northwest, we have got a lot of wind and it is all in one 

spot. So when the wind is blowing, we really want something on 

the power system to consume that resource, and these are largescale, five-year-duration demonstration projects that are currently 

getting underway, so there is a lot of interest there, and funding. 

Mr. ROSENBLUM. The ISO has recently submitted to FERC a 

modification to its ancillary service market requirements to try to 

facilitate the participation of demand in those markets. 

Mr. BARTLETT. As a small example of what one might do, if you 

have a well-insulated hot water tank in your home and you are 

heating it electrically, it will make little difference when you heat 

that water. It could all be heated at two a.m. in the morning, for 

instance, and last you for the whole day if it were large enough and 

well enough insulated. So there are enormous opportunities out 

there for varying the load, and I suspect that that may be simpler 

and cheaper than storage in many cases, and I am glad that we 

are pursuing this with some vigor apparently. Thank you all very 

much for your answers and yield back. 

Chairman BAIRD. Dr. Bartlett, I think that is an excellent line 

of questioning. One of the issues we discovered in the Northwest 

and I think elsewhere is for communities, when you try to look at 

conservation, there is a risk that they lose their access to load. 

When they start using less, then they are entitled to less in the future. So one of the issues we have to deal with with FERC and 

other management entities is to make sure that demand management doesn’t cost you guaranteed access, because that is a disincentive that is built in to some of our current agreements. 

Ms. Woolsey. 

POTENTIAL FOR JOB CREATION

Ms. WOOLSEY. Thank you, Mr. Chairman. 

Dr. Mooney, we talked about saving money and increasing energy. We haven’t talked about renewable energy creating and investing in more jobs in this country. Has your lab taken that on 

as one of your measurements? 

Dr. MOONEY. We do have a group at the Laboratory that is called 

the Strategic Energy Analysis Center. That center has a focus, 

among other things, of looking at the economic and job impacts of 

various renewable energy and efficiency deployment scenarios. So 

we do that, and I am happy to get you additional information on 

what we do there. But——

Ms. WOOLSEY. Mostly I would like to know what they have concluded. 

Dr. MOONEY. Well, generally, I will say without being able to 

quote specific numbers is that there is an economic benefit, job creation benefit, to renewable energy and energy efficiency development, manufacturing and deployment in the United States. 

Ms. WOOLSEY. And would anybody else like to comment on that? 

Dr. MICHAELS. Yes. 

Ms. WOOLSEY. Dr. Michaels. 
68

Dr. MICHAELS. The record is decidedly mixed on whether there 

really is such. There have been studies in the United States, studies abroad. The problem that you have in the United States in particular is the type of computer modeling that they engage in. There 

was a study in Spain. It is a controversial study but they found out 

that renewable energy was actually a destroyer of jobs because it 

had such high capital requirements per worker relative to other potential sources of stimulus. The NREL did a study to refute this 

study, and they used the standard model, and in the process it 

came out, NREL’s model created jobs. NREL’s model mathematically must create jobs. It has to give them the answer that they 

want. In other words, I don’t think that much of this has really 

been studied to the degree that it should, so I am concerned about 

that. 

Ms. WOOLSEY. Would anybody else like to respond to that? I 

mean, do you buy this that going into the new energy-saving technologies in this country, we are not going to have more jobs? 

Dr. STORCK. Well, I could offer a small example. Renewable energy has created 60 very high-paying jobs in Seattle, and a lot of 

the people that we employ are atmospheric scientists and they remark to me, you know, it sure is nice to have an alternative to go 

to other than to work at NOAA. No offense to NOAA. Because, 

without the private sector having a role, that was their option. It 

was either academia or it was to go work for the government, and 

now they can roll up their sleeves and they can do something useful supporting renewable energy in this country. We are just one 

country. Multiply that by all the companies that are out there and, 

yes, renewable energy creates jobs. 

Ms. WOOLSEY. Thank you, Mr. Chairman. 

Chairman BAIRD. Dr. Ehlers, do you have any additional comments? 

Mr. EHLERS. Not at this time, Mr. Chairman. 

Chairman BAIRD. Dr. Mooney, my staff tells me it looks like you 

wanted to respond to that last one, and with that, then we will finish up. 

Dr. MOONEY. I just wanted to offer to the Subcommittee that I 

am happy to make available to the Subcommittee our response to 

the Spanish jobs report, and I will make that available to you if 

you would like. 

Ms. WOOLSEY. Thank you very much. 

Dr. MOONEY. Our intention, though, let me just conclude by saying, our intention in any type of study like that is to objectively 

look at the issues and provide honest information as best as we can 

determine it. We don’t set out in those studies with a predetermined agenda. 

Ms. WOOLSEY. So Mr. Chairman, would it be appropriate at this 

time to ask when we receive it to have that information entered 

into the record? 

Chairman BAIRD. I think it certainly would, and Dr. Mooney, we 

would welcome that, especially if you have a response to the assertions of Dr. Michaels, and Dr. Michaels, feel free to add your explanation for the assertion that the NREL model produces—you know, 

is guaranteed to appear that it produces jobs, so we would be 

happy to look at both of those analyses. 
69

1Dr. Mooney and Dr. Michaels submitted supplemental testimony regarding modeling procedures at the National Renewable Energy Lab (NREL). See Appendix. 

Dr. MICHAELS. The Institute for Energy Research has authored 

a study about the Spanish study and the NREL response to it, and 

we will be happy to give it you.1

Chairman BAIRD. We would appreciate that. 

CLOSING

Before we bring the hearing to a close, I want to thank our panel 

of witnesses for testifying before the Committee today, and I thank 

my colleagues for very important and informative questions as 

well. The record will remain open for 2 weeks for additional statements from the members and for answers such as we have just discussed to any of the follow-up questions the Committee may ask 

the witnesses. 

With that, the witnesses are excused with our gratitude, and the 

hearing stands adjourned. 

[Whereupon, at 11:27 a.m., the Subcommittee was adjourned.] 

(71)

Appendix 1: 

ANSWERS TO POST-HEARING QUESTIONS
72

ANSWERS TO POST-HEARING QUESTIONS

Responses by Ms. Jamie Simler, Director, Office of Energy Policy and Innovation, 

Federal Energy Regulatory Commission

Question submitted by Representative Ralph M. Hall

Q1. Dr. Michaels noted in his testimony that, in Texas and Colorado, it has been 

found that large increases in wind power production resulted in increases in pollutant emissions, and unchanged CO2 emissions, because the baseload electricity 

required to support the wind power operations forced coal generators to make 

unusually quick adjustments that increased pollution.

Please provide FERC’s reaction to this concern. Given that integration of renewables onto the grid is a top priority for FERC, will the Commission be examining this issue in further detail to determine its significance and consider potential policy changes related to it?

A1. As I explained in my testimony, with respect to electricity, the Commission regulates transmission and sales for resale of electric energy in interstate commerce 

to assure the rates, terms and conditions of transmission service and wholesale 

power transactions are just and reasonable and not unduly discriminatory or preferential. In the study noted by Dr. Michaels, there were claims of increased pollutant emissions resulting from the practice of cycling coal fired generation in lieu of 

reducing wind power generation. The Commission does not have the statutory authority to address power plant emissions and has not sponsored such a study. 

The Commission’s economic regulatory focus with respect to the integration of renewable resources centers on the variability of these resources, and how that variability is addressed by the rates, terms and conditions of transmission service and 

wholesale energy markets. The Commission seeks to ensure that all power supplies 

have comparable access to the grid. 

As I mentioned in my prepared testimony, the Commission is currently engaged 

in an effort to examine the extent to which barriers may exist that impede the reliable and efficient integration of variable energy resources into the electric grid, and 

whether reforms are needed to eliminate those barriers. Several areas of this inquiry are focused on electric utilities’ ability to deal with the variability and 

intermittency of wind power production. These include information and data exchanges between wind generators and interconnected transmission operators, wind 

power production forecasts, and unit commitment procedures. Reforms in these 

practices should enhance the ability of the electric power system to efficiently integrate wind power resources. For instance, the Commission noted in the Integrating 

Variable Energy Resources Notice of Inquiry that improvements in transmission 

scheduling procedures may offer the potential for greater efficiency in dispatching 

all energy resources if the degree of variability can be reduced, better anticipated, 

and/or planned for more precisely.
73

ANSWERS TO POST-HEARING QUESTIONS

Responses by Dr. Alexander MacDonald, Deputy Assistant Administrator, Laboratories and Cooperative Institutes, Office of Oceanic and Atmospheric Research, 

National Oceanic and Atmospheric Administration

Question submitted by Representative Ralph M. Hall

Q1. In his testimony, NREL noted that the Department of Energy (through NREL) 

acts as a sort of ‘‘middleman’’ in supporting renewable-related weather forecasting. Specifically, the testimony states that DOE serves ‘‘as an interface’’ between NOAA and the forecasting industry.Does NOAA need an ‘‘interface’’ to 

communicate effectively with the forecasting industry? What is the unique value 

added by this ‘‘interface’’ step, and does NOAA need it to communicate effectively 

with the forecasting industry? If so, would NOAA be capable of carrying out this 

activity if directed to do so?

A1. NOAA has been working directly with the weather forecasting industry since 

the industry began in the middle of the 20th century. NOAA communicates directly 

with the private forecasting industry to understand their requirements and provide 

observations; weather, water, and climate forecasts; and other forecast information 

that is used to respond to the renewable energy community’s needs. NOAA also provides historical climate information (e.g., long-term yearly averages of climate variables such as solar radiation, wind speed, etc.) that is used for siting new renewable 

energy facilities. 

When working with private weather forecast providers to respond to the information needs of specific sectors—e.g., renewable energy, emergency management, agriculture, and aviation—relevant Federal agencies such as the Departments of Energy 

(DOE), Homeland Security, and Agriculture and the Federal Aviation Administration are key partners and play an important role in bringing their knowledge and 

experience to the discussion. In the renewable energy arena, DOE and NOAA have 

formed a productive collaborative relationship to identify strategic efforts that 

NOAA could undertake to improve its products to better address industry needs. 

NOAA is working directly with the renewable energy community, as well as in collaboration with DOE, to understand the needs and to develop programs and capabilities to provide the needed information for the renewable energy industry. 

NOAA does not, however, provide specific forecasts for any private companies or 

industries—but all can use NOAA’s information as a starting point to produce more 

tailored, higher resolution, and industry-specific forecasts. In working with the private weather forecasting industry, NOAA follows its Policy on Partnerships in the 

Provision of Environmental Information (http://www.noaa.gov/partnershippolicy/). 

Adherence to this policy enables a healthy and productive public-private enterprise 

relationship. The NOAA policy was developed in response to the Fair Weather Report: Effective Partnership in Weather and Climate Services (National Research 

Council of the National Academies of Science, National Academies Press, 2003), 

which examined the roles of the private sector, the academic community, and the 

Federal sector in the provision of weather and climate services. 

NOAA believes public sector prediction models and observation networks can be 

improved to meet the needs of the renewable energy industry. As the information 

and forecasts provided by NOAA continue to improve, forecasts developed by private 

industry will also improve. The renewable energy industry is growing rapidly, and 

its needs and requirements continue to be developed and refined.
74

ANSWERS TO POST-HEARING QUESTIONS

Responses by Dr. David Mooney, Director, Electricity, Resources, and Building System Integration Center, National Renewable Energy Laboratory

Questions submitted by Representative Ralph M. Hall

Q1. 3Tier appended to its hearing testimony a statement expressing ‘‘concerns over 

the emergence of ‘‘new’’ government wind forecasting research and product development that replicates what commercial providers have been doing operationally 

for years.’’ NREL activities appear to be at least partially at issue with respect 

to this concern, please provide NREL’s response and reaction to the 3Tier, et al 

statement. What steps does NREL take to ensure its activities do not interfere 

with those of the commercial sector?

A1. Commercial wind power forecast providers rely on government agency weather 

forecasts and public weather data to develop their specific operational products, so 

there is an inherent Federal role. The issue raised in the appended statement, a 

letter dated 6–6–09, points to a concern regarding public funded research that contains elements of applied, operational wind power forecasting. NREL is committed 

to participating in the advancement of forecasting in order to most cost effectively 

integrate wind generation in the nation’s electric systems. The DOE Wind Program 

funds our activities in this area, as well as the efforts of other Federal labs and industry led collaborations. NREL has played a positive role in resolving differences 

by facilitating exchange of information and ensuring any research results funded by 

DOE are publicly available and can benefit future private sector commercial endeavors. As discussed in the response to question 2, the Utility Wind Integration Group 

(UWIG) has been key in this coordination. 

NREL fully agrees with the three priorities outlined in the 6–3–09 statement: Enhancing Publicly-Available Weather Data Networks, Research into Problem Flow 

Regimes, and Improvements in NWP models. The DOE Wind Program has recognized the research issues as well, and recently issued a competitive funding opportunity titled ‘‘Enhancing Short Term Wind Energy Forecasting for Improved Utility 

Operations’’, funding opportunity announcement number DE–FOA–0000343. This 

opportunity is specifically targeted at fostering collaboration with the National Oceanic and Atmospheric Administration (NOAA), the private forecasting industry, and 

utility grid operators. DOE has increased its interactions with NOAA, and supports 

expansion of the NOAA mission to include weather driven renewable energy issues, 

including forecasting. 

NREL believes these recent efforts are fully in line with private sector priorities 

and the private sector’s views on appropriate roles based on collaborations with the 

American Meteorological Society, UWIG, NOAA, the National Center for Atmospheric Research (NCAR), the Office of the Federal Coordinator for Meteorological 

Services, and others. This work, and likely related future collaborations, will advance understanding of wind forecasting, enhancing the commercial sector’s products, and ultimately benefiting the public by facilitating integration of renewable 

power generation into electric systems.

Q2. You note in your testimony that the Department of Energy, through your laboratory, acts as a sort of ‘‘middleman’’ in supporting renewable-related weather forecasting. Specifically, you state that DOE serves ‘‘as an interface’’ between NOAA 

and the forecasting industry, and that DOE plays a role in ‘‘translating the 

needs of utilities to the forecasting industry and vice versa.’’

Please describe in further detail what these interface and translational activities 

entail and why they are necessary, What is the unique value added by DOE/

NREL that cannot be fulfilled directly by NOAA and the forecasting industry, 

or by utilities and the forecasting industry?

A2. DOE/NREL has played, and continues to play a critical role in bringing relevant forecasting stakeholders together to help them understand the technical 

issues associated with renewable resource forecasting, translating this information 

into power plant output, and the potential of renewable plant generation. 

The main forum for this interaction is led by the Utility Wind Integration Group 

(UWIG) and UWIG’s partnership with DOE/NREL. Twice yearly, UWIG meetings 

bring utilities and the forecasting industry together to discuss forecasting needs and 

develop deeper understanding of how forecasting products should be tailored. For 

example, DOE/NREL/UWIG sponsored a workshop in 2008 (http://www.uwig.org/

Update/uwigupdateMarch08.htm) to bring the government meteorology research 

community together with the forecasting industry to discuss how existing weather 
75

models could be improved to address wind and solar power forecasting. In June of 

2010, UWIG sponsored a workshop (http://www.uwig.org/abpwindforework.html) 

that brought together the utilities and wind data modelers to discuss needs and applications for wind datasets as inputs for integration studies. Feedback from the 

utility, forecasting, and research community at these forums has been tremendously 

positive, with participants learning a great deal about the needs and capabilities 

and limitations of the other sectors. 

The figure below illustrates the roles of the parties and the overlapping nature 

of their interests. DOE/NREL and UWIG foster open discussions on the data needs, 

differing forecast product needs, and the value of forecast improvement . This facilitation role and DOE funding of related collaboration as described in the answer to 

Question #1 are critical for continued wind power deployment and economic integration into the nations electric system. 

As wind/solar penetrations increase, operational integration challenges become 

greater. Continued forecasting improvement through public and private collaborative efforts along with DOE/NREL’s role in identifying and addressing cross sector 

issues will remain important.

Q3. Dr. Michaels noted in his testimony that, in Texas and Colorado, it has been 

found that large increases in wind power production resulted in increases in pollutant emissions, and unchanged CO2 emissions, because the baseload electricity 

required to support the wind power operations forced coal generators to make 

unusually quick adjustments that increased pollution.

Please provide NREL’s reaction to this concern. Has the issue been studied in 

sufficient depth to provide an understanding of its significance and impact? If 

not, given NREL’s expertise and the Obama Administration’s emphasis on reducing CO2 emissions and other pollutants, will NREL examining be this issue 

in further detail?

A3. DOE/NREL sponsored, and other wind integration studies examine in detail the 

needed electric system reserves and part-load operations of conventional generators 

in response to the variability and uncertainty of wind and solar power resources. 

The BENTEK study referenced was (to our knowledge) not publicly reviewed, and 

we believe it comes to erroneous conclusions regarding overall emissions rates. Xcel, 

the primary utility provider in Colorado, agrees that the report is in error. Reference Denver Post Letter to the Editor, May 28, 2010, reprinted below. 
76

DOE/NREL are committed to fully evaluating the impact of wind on utility system 

operations, including impacts on emissions. Ongoing and future work will continue 

to address emissions, system wear and tear, and generator cycling issues.
77

ANSWERS TO POST-HEARING QUESTIONS

Responses by Dr. Pascal Storck, Vice President, 3TIER

Question submitted by Representative Ralph M. Hall

Q1. You appended to your testimony a joint statement by 3Tier and two of its competitors that expresses ‘‘concerns over the emergence of ‘‘new’’ government wind 

forecasting research and product development that replicates what commercial 

providers have been doing operationally for years.’’

Please elaborate on this concern. What potentially duplicative product or service 

is the Federal Government providing, and through what agency or entity? Has 

3Tier communicated this concern to the agency or agencies in question, and if 

so where does the issue stand? Please provide any specific recommendations you 

have regarding how best to address this concern.

A1. The U.S. Government, through its agencies, such as NOAA, and its national 

laboratories, such as NREL, has become increasingly active in the area of information services in support of renewable energies. Over the past several years, as the 

renewable energy market has developed, the importance of information to characterize wind and solar fluctuations has become clear. Since weather is the driving 

fuel of a wind or solar project, understanding how it varies in time (i.e. from day 

to day) and how it varies over space (i.e. where is it windiest in a particular county), 

is key to building the most productive projects and then operating them efficiently. 

To fill this requirement for information, small and medium sized businesses, such 

as 3TIER, AWS Truewind and Windlogics (all signatories to our joint statement) 

have provided these services over the past several years. Our fear, which is beginning to be realized, is that the U.S. government now sees the opportunity to provide 

these information services in support of those that are producing tangible products 

in the renewable energy space. Put most simply, when the government talks of accelerating renewable energy for domestic and export use—it very often means supporting those that are producing the wind turbines and the solar panels at the expense of those providing information or data services. 

A perfect example of this in action is NREL (the National Renewable Energy Lab) 

creating a solar dataset to accelerate renewable energy in India. 3TIER already offers this product, but the U.S. government, in its interest to accelerate the development of renewables in India and the market for U.S. products (solar panels) there, 

wants to make this information freely available. While this may accelerate development in India, it hurts companies like 3TIER that provide these information based 

products. Most recently our CEO was on a trade mission to China, hosted by the 

Department of Commerce, and one of the active areas of discussion was the potential creation of renewable energy (wind and solar) datasets by our government (most 

likely NREL) to accelerate efforts. To be fair to NREL, it subcontracts out the creation of this data to the private sector (companies like 3TIER), but our point is that 

this simply puts industry into a role of supporting government efforts. The better 

model is one in which the users of the information come to companies like 3TIER 

directly to purchase that information, thereby putting the burden of payment on 

those that benefit, while creating an actual industry to serve this growing market. 

Another example of this work is in wind energy forecasting, where NREL, together with a division of NOAA, the Research Applications Lab (RAL) have teamed 

together to create a wind energy forecasting system for a utility (Xcel Energy). As 

was discussed in our letter, the private sector is well positioned to provide these 

services, but the government (or certain individuals in these agencies) see an opportunity to provide a very valuable product to the renewable energy industry. What 

they often forget is that in doing so, they are displacing the efforts of the private 

sector. 

We have communicated our concerns to NOAA and NREL. While the agencies say 

all the right things about public/private partnerships, I don’t see them changing 

their behavior. Renewable energies are being actively promoted by the current administration, and the labs and agencies, especially with the funding of the Department of Energy, see the current interest as an opportunity to provide relevant products and services (such as solar maps for India and forecasting systems for Xcel). 

As was stated in my testimony, these agencies should be encouraged to focus on the 

big challenges, like providing better weather forecasts for the entire country, and 

then leave the private sector to provide specific services for specific clients in specific industries. 

(79)

Appendix 2: 

ADDITIONAL MATERIAL FOR THE RECORD
80

NREL RESPONSE TO THE REPORT Study of the Effects on Employment of Public Aid 

to Renewable Energy Sources FROM KING JUAN CARLOS UNIVERSITY (SPAIN)
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82
83
84
85
86
87
88
89

1The discussion can be found at approximately 1 hour, 25 minutes into the session video. 

2Gabriel Calzada Alvarez et al, Study of the Effects on Employment of Public Aid to Renewable Energy Sources, Universidad Rey Juan Carlos, March 2009. http://

www.juandemariana.org/pdf/090327-employment-public-aid-renewable.pdf The Committee did 

not ask me for any evaluation of that study. 3 Eric Lantz and Suzanne Tegen, ‘‘NREL Response to the Report Study of the Effects on Employment of Public Aid to Renewable Energy Sources from King Juan Carlos University (Spain),’’ 

White Paper TP-6A2-46261 (Aug. 2009), 4. (subsequently cited as Lantz and Tegen) 4 I am familiar with this process, both as author of peer-reviewed articles and as Co-Editor 

of Contemporary Economic Policy, a peer-reviewed official publication of Western Economic Association International.

SUPPLEMENTAL TESTIMONY OF DR. ROBERT MICHAELS, SENIOR FELLOW, INSTITUTE

FOR ENERGY RESEARCH, DATED JUNE 28, 2010

I. Introduction 

My name is Robert J. Michaels. I am Professor of Economics at California State 

University, Fullerton and Senior Fellow at the Institute for Energy Research. Other 

biographical data appear in the direct testimony I presented at the Committee’s 

June 16th hearing. Near the conclusion of that hearing, Dr. David Mooney of the 

National Renewable Energy Laboratory (NREL) responded to a question on job creation by investments in renewable power. He stated that NREL staff had produced 

research purporting to show that investment in renewables indeed created employment opportunities.1 I responded that I was aware of other studies, in particular 

one from Spain, purporting to show that renewables were responsible for the destruction of jobs, because building them entailed very high capital costs per worker. 

Dr. Mooney responded that NREL researchers had refuted that report. I responded 

that NREL’s computer model of job creation was at best an inappropriate research 

tool. Regardless of the data used to run it, the model’s mathematical structure guaranteed that the only possible outcome was job creation. It was then agreed that Dr. 

Mooney would give the committee a copy of NREL’s response to the Spanish study, 

and that I would provide support for my assertions about the inappropriateness of 

NREL’s model. This testimony responds to that request. 

This testimony makes and documents three basic points:

1. No matter what numerical data is input into NREL’s model, the only result 

it can possibly produce is that renewables result in job creation. With job creation its only possible finding, the model is valueless for evaluating any 

claims about either job creation or job destruction. NREL is well aware of 

this weakness, but continues using this model despite the availability of lessflawed alternatives.

2. NREL’s claim that its method is ‘‘traditional’’ is insupportable, and its model 

is in no sense a typical tool for analyzing job creation. Its primary author 

was not an economist, and the model has no foundation in the peer-reviewed 

economics literature. Its structure and findings have also not been presented 

in refereed economics journals, despite abundant opportunities for NREL 

staff to present them to the economics profession.

3. Despite its use in analyzing numerous renewable projects, NREL has produced no publicly available studies that compare its predictions of job creation with the actual outcomes of those projects. There are good reasons to 

expect that the model’s predictions will in fact be far off the mark.

This testimony does not address the study brought up at the hearing whose authors found job destruction resulting from renewable investments in Spain.2 The 

Committee specifically requested backing for my claim that NREL’s method of calculating job creation is fundamentally flawed, and these flaws exist independently of 

whatever other research might exist. NREL’s critique of the Spanish study is primarily devoted to comparisons between its research methods and NREL’s, and in 

particular it provides no figures that might usefully be compared with the Spanish 

study’s numerical estimates of job destruction.3 To my knowledge, neither of the two 

studies has been subjected to the type of peer review process normally required for 

publication in professional economics journals.4

II. The structure of NREL’s model guarantees that its only possible finding 

will be job creation. 

NREL’s ‘‘JEDI’’ (Job and Economic Development Impact) model is an ‘‘input-output’’ system. At a conceptual level, it can illustrate interdependencies of production 

in various sectors of the economy and their possible effects on employment and incomes. As implemented in JEDI, consider a planned renewable project. The builders 
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5 Note that the effects on employment will be largely transitory. After they are finished the 

construction workers (and workers in supplier industries) will receive no more income from it 

and will be unable to budget for higher spending. There will, of course, be some workers who 

obtain long-term employment operating and maintaining the plant. 6 NREL, The Jobs and Economic Development Model (JEDI), About JEDI and Frequently 

Asked Questions (FAQ), July 2008, unpaginated. http://www.nrel.gov/analvsis/jedi/pdfs/

jedi¥manual¥0708.pdf 7Sandra Reategui et al, ‘‘Generating Economic Development from a Wind Power Project in 

Spanish Fork Canyon, Utah: A Case Study and Analysis of State-Level Economic Impacts,’’ 

Utah State University, DOE/GO-102009-2760, App. B. http://www.windpoweringamerica.gov/

pdfs/economic¥development/2009/ut¥spanish¥fork.pdf 8There are variants of JEDI used for (e.g.) comparisons between investments in coal-burning 

generators and wind turbines. Reports based on them often turn opportunity cost reasoning on 

its head. Thus we see claims that a wind unit is to be preferred because it requires more workers to build and operate than a similarly sized coal unit. By that reasoning, some other technology that required still more workers than the wind unit would be even better. In reality, the 

extra workers are an increased cost and not a benefit—employing them here means sacrificing 

more of the economy’s alternative outputs than necessary. Eric Lantz and Suzanne Tegen, Variables Affecting Economic Development from Wind Energy, NREL Conference Paper, NREL/CP500-43506 (June 2008). 9 Both statements are from Suzanne Tegen et al, Jedi II: Jobs And Economic Development Impacts from Coal, Natural Gas, And Wind Power, Poster Presentation at 2006 Windpower Conference, Pittsburgh. http://www.windpoweringamerica.gov/pdfs/wpa/poster¥2006¥jedi.pdf

must purchase construction materials and services. The funds flow to workers on 

the project (a ‘‘direct’’ effect) and ultimately to those employed by suppliers of materials (an ‘‘indirect’’ effect). The increased demand for building materials may require 

that suppliers expand and hire more workers, and quite possibly those who supply 

the suppliers may also need to do so. The various workers spend their new incomes 

on consumer goods and services, which may also expand those industries. The cumulative effect is that of a ‘‘multiplier’’ in which spending to build the renewable 

leads to expansions of output and employment in numerous other industries. Summing all of the induced changes yields a figure for job creation. 

The only possible outcome of this model is job creation. Both the initial expenditure on the renewable and all subsequent rounds of respending can only increase 

demand for construction materials, consumer goods, and workers in all of these industries. There is nothing in the model that could conceivably decrease employment 

or output in other sectors of the economy. Any project considered by JEDI, no matter how efficient or inefficient as a source of electricity, will show a positive effect 

on employment. That increase may be large or small, but we can be certain that 

it will not be negative.5

JEDI’s plausibility depends heavily on unrealistic assumptions. If these assumptions are untrue, the picture becomes far more complex and ambiguous. Begin by 

asking where the workers come from. Unless there is a large pool of long-term unemployed people with just the right skills and experience, the new workers (in both 

construction and in supplier industries) must largely be attracted from other jobs. 

The net effect on employment may still be positive, but only in exceptional circumstances (not yet shown to hold for renewables) will a large percentage of the 

employees be taken out of long-term unemployment and jobs truly be ‘‘created.’’ 

Again, NREL has admitted so much, saying that JEDI ‘‘does not account for potential constraints on labor and money [i.e. capital] supplies.’’ Further, it ‘‘assumes 

there are adequate local resources and production and service capabilities to meet 

the level of local demand identified in the modeling assumptions.’’ 6 It is not enough 

to have the right numbers and types of workers in the area—to actually create jobs 

on a net basis they must also be long-term unemployed. 

Authors of studies using JEDI acknowledge that it ‘‘offers a gross analysis rather 

than a net analysis; that is, the model does not account for the net impacts associated with alternate spending of project funds.’’ 7 A ‘‘gross analysis’’ is one that disregards the fundamental economic concept of opportunity cost. JEDI treats the renewable like a proverbial ‘‘free lunch,’’ a gain to the economy for which nothing need 

be sacrificed.8 Many other effects might reduce job creation or possibly turn it into 

destruction. JEDI’s creators have noted that ‘‘the JEDI model does not factor in 

costs to consumers,’’ which can be important because higher energy bills mean fewer 

employment slots in other industries where consumers do not spend. They also note 

that ‘‘[f]luctuations in different technologies (e.g., natural gas prices) may make construction of a new power plant price prohibitive,’’ i.e. that the cost of increasing employment (assuming that it happens) may be too high to warrant construction of the 

renewable.9

JEDI’s creators recognize that the net effect of increased renewable investments 

on employment is ambiguous. On occasion they have cited the works of others who 
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10Lantz and Tegen (at 4–5) in fact cite such studies and results from Europe, but do not discuss the importance of their consequences for their own JEDI findings. 11Lantz and Tegen, 4. They supply no references or citations. 12 NREL contracted with Marshall Goldberg of MRG Associates to construct the model. See 

Goldberg et al, ‘‘Job and Economic Development Impact (JEDI) Model: A User-Friendly Tool to 

Calculate Economic Impacts from Wind Projects,’’ (Preprint, 2004), 2. Goldberg’s 2005 biography 

is at http://puc.sd.gov/commission/dockets/electric/2005/el05-022/goldbergexhibita.pdf. Of 

NREL people associated with the model that I have been able to check, none has any published 

works in peer-reviewed economics journals. These checks were made using the standard databases JSTOR and Econ Lit. I have not been able to check citations in the more specialized energy literature. 13 I acknowledge in advance that this search may not have been complete. It was made using 

the standard databases JSTOR and Econ Lit. A new version of JEDI, known as JEDI !!, retains 

the same basic structure as the original. See Suzanne Tegen, Marshall Goldberg and Michael 

Milligan, ‘‘JEDI II’’ at http://www.nrel.gov/docs/fy06osti/39908.pdf 14 Rategui et al, Op. Cit. 25. 15This has other interesting consequences. In some cases the authors of such studies treat 

it as a virtue that the immediate area of the project gains most of the benefits. An economist 

should immediately note the consequences—if the area in which I can trade is small, I will not 

be able to trade on terms as advantageous as if it is large. Among those who will suffer are 

distant suppliers who are foreclosed from competing for my business, and ratepayers in the area 

who will pay more for their plant than they had to. 

use more complex models capable of forecasting both job creation and job destruction. Such models can incorporate factors that include responsiveness to higher 

power prices, reductions in employment in conventional power, and the ‘‘crowding 

out’’ of other capital spending by increased investment in renewables. Sometimes 

such models produce negative effects on employment in the long run.10 NREL’s researchers are thus aware that other models that capture important complexities are 

available (or they could surely create their own). For unknown reasons, they instead 

persist in using a model that can produce only the single result of job creation from 

renewables. 

III. NREL’s model is neither ‘‘traditional’’ nor mainstream, and claims of its 

professional credibility are without foundation. 

Despite JEDI’s unrealistic structure, Lantz and Tegen have claimed that it uses 

‘‘traditional methods.’’ Specifically, those methods applied in jobs and economic impacts analyses ‘‘rely on input-output models to estimate job creation or loss.’’ 11 By 

this standard, JEDI is hardly a traditional model—instead of estimating ‘‘job creation or loss’’ it can only produce estimates of creation. Perhaps the most convincing 

evidence that JEDI is far from the mainstream is its near-total absence from the 

peer-reviewed economics literature. One would expect researchers who believe JEDI 

is scientifically useful to publish its results in academic journals, where its structure 

and findings could be evaluated by a wider readership than is enjoyed by NREL reports. 

JEDI itself was not created by a professional economist, but by an independent 

consultant who holds a Master’s degree in Community and Regional Planning and 

whose biography includes no peer-reviewed articles in economics journals.12 I have 

found no other NREL employee associated with JEDI who has published applied research based on that model in peer-reviewed economics journals.13 Further, renewables are not economically unique. If JEDI’s structure is indeed useful, one would 

expect to see variants of it used to analyze other governmental policies and private 

investment projects. Models structured like JEDI might be particularly valuable for 

evaluating the consequences of the numerous stimulus programs that have been enacted during the current recession, but I am not aware of any such studies that 

have used them. 

IV. There are no publicly available reports comparing JEDI’s predictions 

with actual project performance. 

NREL is right in saying that models like JEDI can at best be approximations that 

are far from comprehensive. One JEDI-based report puts readers on notice that 

JEDI ‘‘is not intended to be a precise forecasting tool. Rather it provides a reasonable profile of how investment in a wind project may affect a given economy.’’ 14 Unfortunately, that statement gives no guidance regarding reasonableness. How could 

one possibly determine which profiles are ‘‘reasonable’’ without making comparisons 

between JEDI’s predictions and post-project reality? More subtly, what is a ‘‘given’’ 

economy? A substantial number of JEDI-based studies appear to have been performed for localities to forecast local tax revenues and employment.15 This is an odd 

allocation of effort by a Federal laboratory—the fact that a project generates local 
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16There can be further problems for researchers, but they are probably of second-order importance relative to the basic calculation. For example, It is possible that the jobs formerly held 

by newly-hired renewables workers would have vanished soon after they quit, leaving them 

long-term unemployed were it not for the renewables. Estimating the numerical importance of 

phenomena like these will be an additional task for those making the comparisons. 17See, for example, EIA, Annual Energy Outlook Retrospective Review: Evaluation of Projections in Past Editions (1982–2009) DOE-EIA-0640 (2009), Mar. 2010. http://www.eia.doe.gov/

oiaf/analysispaper/retrospective/retrospective¥review.html

employment and tax revenue carries no implications that such benefits will expand 

to a wider region or to the entire nation. 

The issue of localized benefits becomes particularly important if a substantial 

fraction of project-related jobs will in fact be filled by persons who are already otherwise employed. NREL could perform a genuine service and possibly increase public 

confidence in its activities by looking at the actual origins of people who fill new 

job slots associated with renewables projects. Such a question requires no complex 

modeling at all. Just identify the newly created positions, interview the people filling them, and find out whether they came from other employments, and where 

those employments may have been. The more of them came from employment elsewhere, the fewer the jobs the project actually created.16 Funding such studies would 

be a minor fiscal burden, and they could easily be integrated with other NREL research programs. Other governmental modeling efforts are under continuous scrutiny for the accuracy of their predictions. For example, elsewhere in the Department 

of Energy those responsible for the National Energy Modeling System (NEMS) 

produce the Energy Information Administration’s Annual Energy Outlook forecast. 

With that forecast come annual retrospective reviews of its predictions that will be 

used to help improve the future predictive powers of NEMS.17 Surely one can envision such retrospective studies that might sharpen the logic and improve the forecasting abilities of JEDI. 

V. Conclusions 

NREL’s models of job creation by renewables are inadequate in virtually every dimension. As a bare minimum, any such model should be able to forecast both increases and decreases in employment depending on the data input to it. JEDI, however, can only generate increases in employment. For unclear reasons its authors 

chose not to acknowledge the fact that the only truly new jobs created by renewables will be held by those who were not employed elsewhere prior to starting them. 

Implicitly, for truly new jobs to match JEDI’s ‘‘gross’’ figures, there must be massive 

numbers of long-term unemployed persons with just the right types of skills. This 

picture hardly corresponds with the realities of unemployment, even in today’s recessionary economy. JEDI is a singular model that is far from the mainstream of 

economics, whose authors have for unknown reasons apparently chosen not to 

present it in peer-reviewed economics journals. It remains open to potential improvements that could make it both more trustworthy and applicable to analysis of 

projects other than renewable powerplants. Doing so, however, would require that 

its predictions be tested against reality and its structure modified as necessary to 

minimize the variance between them. In its current form, however, JEDI can only 

mislead and produce a far-too-optimistic picture of the real consequences of investment in renewables.
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THE INSTITUTE FOR ENERGY RESEARCH: THE NREL’S FLAWED WHITE PAPER ON THE

SPANISH GREEN JOBS STUDY
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