RCF has extensive experience in energy economics including electric power, fuels, and the utility industry. Economists at RCF have been retained by utilities, large electric energy consumers, and the U.S. Department of Energy to perform a wide variety of studies. RCF routinely uses public and private data, market research, industry surveys, and modeling and forecasting to inform our rigorous and comprehensive analyses. RCF has assisted in a wide variety of negotiations and has provided key expert testimony in numerous regulatory proceedings. RCF led a 4-company team to prepare a report to Congress for the Department of Energy on the employment impacts of a transition to a hydrogen transportation economy.
Energy Economics Experience
RCF Publication Accepted in Energy Policy: Property Values and Tax Rates Near Spent Nuclear Fuel Storage
Energy Policy, December 2018
RCF’s study of “Property Values and Tax Rates Near Spent Nuclear Fuel Storage” was published in the December 2018 issue of Energy Policy. The study, conducted by RCF President George Tolley and RCF Associate Kirstin Munro, Assistant Professor of Economics and Finance at St. John’s University, considers the impact on property values of proximity to spent fuel at the site of a former nuclear power plant, as well as what happens to local property values following the shutdown of a nuclear power plant. Using geospatial analysis and hedonic modeling, individual home characteristics, tax rate, distance from nuclear site and time of sale were analyzed to estimate the effects of the closed plant and spent nuclear fuel on residential property values in a 10-kilometer radius surrounding the former Zion Nuclear Plant located in Zion, Illinois.
Major decisions are being made with respect to the country’s nuclear power generation facilities in response to current short-run electricity market conditions, including the recent announcements of several plant retirements. The North American Electric Reliability Corporation and ISO New England have expressed concerns that multiple nuclear power plant retirements will threaten the reliability of the North American power grid. Findings of the study indicate that negative perceptions of nuclear power plants and spent fuel storage do not translate into market behavior from home buyers and sellers. The study fails to find evidence that proximity to the spent nuclear fuel affects residential property values. Further, results provide evidence that operating nuclear facilities have a positive impact on surrounding communities by helping reduce property tax burdens on local residents. A copy of the complete study can be found here: Property values and tax rates near spent nuclear fuel storage JEPO 123.
Impacts of Market Penetration of Hydrogen Vehicles, Manufacturing and Fuel Infrastructure Deployment in Five Regions of the US, 2020-2050
United States Department of Energy, Argonne National Lab, 2016-2018
RCF developed a multi-year, multi-region economic forecast working with Argonne National Laboratory (ANL) to provide the United States Department of Energy (DOE) with estimates of the net economic impacts for the US economy resulting from the deployment of fuel cell vehicles, hydrogen fuel sales, and deployment of hydrogen fuel production and distribution infrastructure. Five regions of the US were analyzed using different market penetration scenarios for hydrogen vehicle adoption. Assumptions were made regarding US manufacturing of fuels cells and hydrogen vehicles, as well as deployment of hydrogen fuel production and distribution infrastructure necessary to meet demand. Multiple data sources including engineering models and technology forecasts, EIA fuel and vehicle forecasts, and economic data from Bureau of Economic Analysis, Bureau of Labor Statistics, and U.S. Census Bureau, were integrated for the analysis which utilized the REMI PI+ model.
The Economic Impact of Oil Production in Illinois
Illinois Oil & Gas Association, 2009, 2016, 2017
In 2008, RCF conducted the first comprehensive study of the economic impacts of the oil production industry on the Illinois economy using input-output modeling, extensive research, and interviews with industry leaders. Employment, income and output impacts were presented and mapped by legislative districts. Results of the study were presented at the 2009 IOGA Conference. A follow up study was completed in 2016 looking at how the industry performed through the Great Recession. In 2017, RCF completed additional regional analyses of oil production industry employment compared to other industries in downstate Illinois.
Effects of Dry Cask Storage on Property Values at Pilgrim Nuclear Station
Entergy Corporation, 2014 and 2016
RCF provided expert witness support in a legal proceeding focusing on property value impacts of a proposed, on-site nuclear waste storage facility at the Pilgrim Nuclear Plant, Pilgrim, Massachusetts. In an April 2017 decision, the Massachusetts Land Court credited Dr. George S. Tolley, President of RCF, and Professor Emeritus of Economics at University of Chicago, with successfully testifying that no proof had been offered of depressive effects on property values from spent nuclear fuel in dry cask storage. The case involved the Pilgrim plant in Plymouth, Massachusetts. Dr. Tolley’s testimony was instrumental in convincing the court that Plaintiffs had not offered credible evidence of damages, saving the defendant Entergy the expense that would have ensued from loss of the case. Dr. Tolley further demonstrated there were positive property value impacts from Entergy’s payments in lieu of taxes, which had the effect of reducing local property taxes thus acting actually to increase property values.
Natural Gas Vehicles and Fueling Infrastructure
U.S. Department of Energy, Argonne National Lab, 2012 to 2016
RCF worked with Argonne National Laboratory to develop a publicly available Excel-based model for the U.S. Department of Energy that explores the employment and economic impacts resulting from near-term deployment of natural gas vehicles and natural gas fueling stations in the U.S. Using the RIMS II (Regional Input-output Modeling System) model of the U.S. economy, the model provides the ability for users to calculate the economic impacts of the deployment of multiple types of natural gas vehicles and natural gas fuel stations.
Hydrogen Fuel Cells and Hydrogen Vehicle Fueling Infrastructure
U.S. Department of Energy, Argonne National Lab, 2010 to 2016
RCF worked with Argonne National Laboratory to complete work on JOBS FC (Jobs and economic impacts of Fuel Cells), a publicly available Excel-based spreadsheet tool for the U.S. Department of Energy designed to help users estimate the economic impacts of the manufacturing and use of select types of hydrogen fuel cells in the United States. JOBS FC uses RIMS II input-output methodology to estimate the economic impacts associated with changes in industry expenditures, and calculates the ripple effects of these changes throughout the economy. The hydrogen fuel cell technologies represented in the tool are materials handling, backup power, and prime power replacement. The capability to estimate the economic impacts from the construction of fuel cell manufacturing facilities is also included. The tool is designed to be as flexible as possible, and to allow users with diverse interests to perform economic impact estimates.
Effects of Indian Point Nuclear Energy Center on Property Values
Entergy Corporation, 2009 to 2012
Over several years, RCF provided extensive expert witness testimony, supporting information, including rebuttal testimony, and conducted original, path-breaking original research on the subject of the economic impact of relicensing of a nuclear power plant on land values of the surrounding community vs. the no-action alternative. A rigorous hedonic regression analysis was developed and applied.
Economic Benefits of Smart Grid Technology
Commonwealth Edison Company, 2011
RCF was requested to develop and prepare a paper outlining the economic benefits of pending smart grid legislation (Senate Bill 1652) on the economy of the state of Illinois. RCF worked collaboratively with Commonwealth Edison upper management. Considerable progress was made exploring the economic impacts of SB 1652 on the state’s economy before the measure was ultimately approved by the state General Assembly. A detailed outline entitled “Energy Modernization and the Illinois Economy” was prepared and forwarded to the client.
Clean Coal Cost Estimates
Commonwealth Edison Company, 2011
RCF was retained to produce a report on the costs of clean coal technology in response to the Illinois Power Authority’s Draft Power Procurement Plan for the period June 2012 to May 2017 which included clean coal as a resource. Levelized costs of energy for all major technologies were assembled and compared. The report included a discussion of the uncertainty surrounding clean coal technology and the current lack of climate legislation for control of greenhouse gas emissions which would have the potential for raising costs of alternatives to levels above those of clean coal.
Hydrogen Infrastructure and Market Adoption of Hydrogen Vehicles
U.S. Department of Energy, 2006 to 2010
RCF led an inter-disciplinary effort featuring economic and physical modeling, with industry co-operators and Department of Energy Input through Argonne National Laboratory. Factors affecting the rate of adoption of hydrogen vehicles from early transition to a mature hydrogen economy were analyzed using an agent-based approach where the individual actors are vehicle purchasers/drivers and infrastructure investors. Effects were estimated of seemingly irrational actions in the form of bounded rationality, learning, expectations formation, risk perception, risk aversion, and alternative hydrogen infrastructure technologies. The results were brought together in the form of a scenario approach adaptable as a tool for evaluating future policy actions as conditions change in the future.
Multi-State Economic Impact Study of Climate and Energy Legislation
The Energy Foundation, 2009
RCF completed an eleven state study of the economic impacts of the Waxman-Markey Act. This study focused on employment impacts, changes to the energy supply portfolio, and development of renewable energy generation in the Midwest.
Jordan Cogeneration Feasibility Study
U.S. Department of Energy, 2008 to 2009
In 2008, the Kingdom of Jordan requested that the U.S. Department of Energy conduct a feasibility study for proposed cogeneration plants in the Aqaba region. These plants would produce electricity using nuclear power, and also would desalinize water that could be exported to Israel and other neighboring countries. In response to this request from Jordan, Argonne National Laboratory and RCF developed an economic model that analyzed how such cogeneration projects might be affected by changes in the overnight capital costs of nuclear power, possibilities of exporting water at a premium price, the price of water, and the price of electricity.
Economic Impacts of Green Energy In Illinois
Environmental Law and Policy Center, 2008
To help the Environmental Law and Policy Center (ELPC) update its 2001 study, Repowering the Midwest, RCF conducted an input-output analysis of the employment and income impacts of building solar and wind generation facilities and of savings from more efficient use of electricity.
Modular Construction of Reprocessing Facilities
In preparation for participation in the U.S. Department of Energy’s Global Nuclear Energy Partnership program, RCF carried out a study for AREVA of possibilities for the construction of nuclear reprocessing facilities in modular increments as contrasted with single, large units.
Employment Impacts of Transitioning to a Hydrogen Economy
U.S. Department of Energy, 2006 to 2007
RCF led a 4-company team to prepare a report to Congress for the U.S. Department of Energy on the employment impacts of a transition to a hydrogen economy in the U.S. This project was executed on an accelerated, 3-month schedule to meet legislative requirements facing DOE. Engineering analysis of new technologies identified sectoral locations (5-digit NAICS industries) of initial impacts, and input-output analysis yielded estimates of secondary and induced impacts. Impacts on five regions were also estimated. Separate analysis estimated effects on U.S. international competitiveness.
The Economic Future of Nuclear Power in the United States
U.S. Department of Energy, Argonne National Lab, 2004
RCF led a team of University of Chicago students and recent graduates, and staff members of Argonne National Laboratory, in an analysis requested by the Undersecretary of Energy of the cost of electricity from new nuclear reactor designs in the United States. The study’s findings were influential in recent legislation and administration policy recommendations, as well as in major utilities’ decisions to begin actively considering new nuclear power plants.
Statistical Tests of Incentive Measures to Improve Rate Structure
Pacific Gas & Electric, 1992
RCF developed a series of statistical tests to evaluate alternative schemes of incentive regulation. The goal of the work was to determine whether an improved incentive scheme could be practically implemented in a rate structure. This work required the development of a comprehensive database including relevant FERC cost data.
Renewal of Commonwealth Edison Company’s Franchise Agreement with the City of Chicago
City of Chicago, 1990 and 1992
RCF performed an extensive cost/benefit analysis for the City of Chicago on various alternative scenarios to the City’s franchise agreement with Commonwealth Edison Company. The report included in-depth studies of the existing rate structure, demand growth, and energy usage patterns, as well as a comprehensive cost/benefit analysis of acquisition of facilities by the City of Chicago.
Cost Factors Affecting Inter-Utility Electricity Rate Differences
Public Utilities Fortnightly article, 1990
George Tolley co-authored a paper evaluating different production costs associated with alternative rate-making structures, cost estimates and economic forecasts.
Recommended Acquisition Price for a Utility
Northern States Power Company, 1988
RCF evaluated and recommended an acquisition price for a municipal utility including debt versus equity financing, generation asset, regulatory structures, rates structure and design, and valued the utility using engineering, accounting, and economic methods.
Evaluation of Energy Conservation Programs
Peoples Gas Light and Coke Company, 1987
RCF assessed the costs and benefits of its energy conservation programs. To do this, RCF managed the collection, organization and analysis of household energy use data both before and after the creation of the conservation programs. A focus of the study was measuring the effects of “free riders,” those households who would have undertaken their own conservation measures without any conservation program.
Commercial Cool Building Decision Guide
Electric Power Research Institute, 1983
RCF prepared a report detailing the costs and benefits of cool storage in commercial buildings to reduce peak electricity load demand and energy costs.
Evaluation of Thermal Energy Storage for Utility Load Management
Potomac Electric Power Company, 1980
RCF addressed the economic attractiveness and marketability of thermal energy storage. This study assessed electric utility load management for commercial building applications within the PEPCO service territory. RCF calculated rates of return on investment for commercially available storage systems and estimated market penetration under alternative assumptions about future load curves and electricity pricing schedules.
Economic Effects of Switch from Illinois to Western Coal
Commonwealth Edison Company, 1978
RCF evaluated the overall effects to the Illinois economy of changing from Illinois-based high-sulfur coal to Western low-sulfur coal versus installing air pollution control equipment in order to meet the air pollution control regulations. Findings included increased unemployment for Illinois coal miners, reduced pollution, and lower overall costs to customers.