Climate Challenge Participation Accord

DOE's Energy Partnerships for a Strong Economy

This Participation Accord describes the commitments that Northeast Utilities Service Company, as agent for Northeast Utilities' operating companies (Utility), and the U.S. Department of Energy (DOE) have made to participate in the Climate Challenge Program in pursuit of the President's goals for reducing greenhouse gas emissions. The Climate Challenge Program is a joint, voluntary effort of DOE and the electric utility industry to reduce, avoid or sequester greenhouse gas emissions. The framework of the Climate Challenge Program was established in the Climate Challenge Program Memorandum of Understanding and exhibits thereto dated April 20, 1994 (the Climate Challenge Program MOU) (see Attachment A to this Participation Accord).

I. Utility Commitments

A.
Consistent with paragraph II.B.1 of the Climate Challenge Program MOU, Utility voluntarily pledges to reduce its annual carbon dioxide (CO₂) emissions by one (1) million tons in the year 2000, and to limit and reduce its cumulative CO₂ emissions over the 1995-2000 period by three (3) million tons below the average annual baseline levels actually experienced during the 1987-1990 period. Current accounting for actual CO₂ emissions indicates that Utility's historic annual average over this period was 15.1 million tons. Utility's reductions on this basis are:

                           Pledged Utility System CO2 Limits
                                   Millions of Tons        

                                  Interim    Pledged
                       Year        Goals    Reductions
                       
                       1995        15.1        0.0
                       1996        14.9        0.2
                       1997        14.7        0.4
                       1998        14.5        0.6
                       1999        14.3        0.8
                       2000        14.1        1.0
                                               ===
               1995-2000 Cumulative Reductions 3.0

This voluntary pledge thus contains year 2000 and pre-2000 goals. System-wide CO₂ emissions include emissions from the Utility's generating facilities, and from the facilities of others from whom the Utility is purchasing power under life-of-unit contract, except to the extent that the generator of the purchased power reports to the Utility that it has offset its own emissions.

In order to achieve the goals described in the first paragraph, Utility has engaged and will engage in activities which are described in an accompanying report (see Attachment B to this Participation Accord). This report, entitled "Northeast Utilities System Climate Challenge," further discusses and explains Utility's Climate Challenge goals, and discusses various events that have a significant influence on the Utility's ability to meet its voluntary pledge, and mid-course corrections that may be necessary.

For example, the Utility's pledge rests on its commitment to nuclear, demand-side management, and other non-fossil resources, and assumes that they will continue to contribute to system CO₂ emissions reduction over the 1995-2000 period. But the emerging competitive environment within which electric utilities must operate may alter the Utility's current forecast of customer sales. If the Utility's assumptions prove to be inaccurate, then Utility will meet with the DOE in order to consider appropriate changes to the pledge.

B.
Utility will report annually on activities and achievements under the Climate Challenge Program. Results achieved during each year shall be reported in a clear and understandable manner that is consistent with the guidelines adopted pursuant to subsection 1605(b) Energy Policy Act and Exhibit B of the Climate Challenge Program MOU. The first such report may include a description of the activities and achievements of the Utility prior to its becoming a participant in the Program, expressed on an annual basis to the extent possible (See Exhibit B).

C.
Utility will confer with DOE on or before December 15, 1997 to evaluate jointly the progress of the Utility in achieving its Climate Challenge Program goals and to discuss possible adjustments to its voluntary commitments.

D.
The Climate Challenge Program representative for Utility will be:
William L. Stillinger
Northeast Utilities Service Company
P. O. Box 270
Hartford, Connecticut 06141-0270


Utility agrees to notify DOE prior to or, in any event, no later than 30 days after any change in the contact.

II. DOE Commitments

A.
DOE's commitments to Utility are those set out in section III of the Climate Challenge Program MOU, which are hereby incorporated in this Participation Accord by reference.

B.
DOE will consider Utility requests to intervene in regulatory proceedings of federal, state and local commissions and boards on issues pertinent to the Climate Challenge Program. Before DOE intervenes in regulatory and other proceedings pertaining to Utility for purposes of addressing Climate Challenge Program issues, it will provide notice to Utility.

C.
DOE will provide an annual report to Utility describing the actions that it has taken to fulfill its commitments under section III and Exhibit C of the Climate Challenge Program MOU and the results of those actions.

D. The Climate Challenge Program representative for DOE, who will serve as liaison to Utility, will be Allan R. Hoffman, Room 6B-128 (EE-10), U.S. Department of Energy, 1000 Independence Avenue, S.W., Washington, D.C., 20585, (202) 586-1786. DOE agrees to notify Utility prior to or, in any event, no later than 30 days after any change in liaison responsibilities or personnel.

III. General Provisions

A.
Use of DOE-developed materials by Utility will be governed by the provisions of section IV of the Climate Challenge Program MOU, which are hereby incorporated in this Participation Accord by reference.

B.
In addition to the foregoing provisions, DOE and Utility agree to act in accordance with the principles set out in section I of the Climate Challenge Program MOU and the general provisions set out in subsections V.A-V.D, V.F and V.G of the Climate Challenge Program MOU, which are hereby incorporated by reference.

C.
Either party may withdraw from this Participation Accord or any of its activities under the Climate Challenge Program without penalty and without being subject to remedies at law or equity.

(Original signed by)
__________________________________
Vice President - Corporate and
Environmental Affairs
Northeast Utilities Service Company

__________________________________
Date

(Original signed by)
__________________________________
Secretary of Energy or designee
U.S. Department of Energy

__________________________________
Date

Attachments:

Attachment A - Climate Challenge Program MOU and exhibits

Attachment B - Northeast Utilities System Climate Challenge Report

1. INTRODUCTION AND SUMMARY

2. GREENHOUSE GAS REDUCTION AS A PRIORITY FOR NATIONAL ENVIRONMENTAL POLICY

3. THE BASIS FOR NU'S COMMITMENT TO REDUCING CARBON DIOXIDE EMISSIONS

4. NU'S RESOURCE PLANNING AND COMMITMENTS HAVE RESULTED IN ITS ABILITY TO REDUCE CARBON DIOXIDE EMISSIONS SIGNIFICANTLY

5. LOOKING AHEAD TO FURTHER GREENHOUSE GAS REDUCTION AS PART OF THE CLIMATE CHALLENGE

6. PLANS FOR DEALING WITH UNCERTAINTY

7. REPORTING NU'S GREENHOUSE GAS REDUCTION

8. GLOSSARY OF TERMS

1. INTRODUCTION AND SUMMARY

The Northeast Utilities System (NU) is the largest electric utility system in New England, comprising 7,800 megawatts of generating capacity, and furnishing electric service to 1.7 million customers with a peak demand of over 6,000 MW. NU operating subsidiaries include The Connecticut Light and Power Company, Western Massachusetts Electric Company, Holyoke Water Power Company, and Public Service Company of New Hampshire. We serve a three-state area that covers some 11,000 square miles and stretches from Long Island Sound to the Canadian border.

As its contribution to the U.S. Department of Energy's (DOE) Climate Challenge Program in pursuit of the President's goal for reducing greenhouse gas emissions, NU voluntarily pledges (i) to reduce its annual carbon dioxide (CO₂) emissions by one (1) million tons in the year 2000, and (ii) to limit and reduce its cumulative CO₂ emissions over the 1995-2000 period by three (3) million tons below the average annual baseline levels actually experienced during the 1987-1990 period. NU's actual emissions over this period averaged 15.1 million tons per year. Our pledged reductions are:

		Northeast Utilities System CO2 Emission Limits for 1995-2000
                               Millions of Tons        

                                              Pledged
                        Year       Goals    Reductions
                        1995        15.1        0.0
                        1996        14.9        0.2
                        1997        14.7        0.4
                        1998        14.5        0.6
                        1999        14.3        0.8
                        2000        14.1        1.0
                                                ===
         1995-2000 Cumulative Reductions        3.0

2. GREENHOUSE GAS REDUCTION AS A PRIORITY FOR NATIONAL ENVIRONMENTAL POLICY

NU is quite aware of the scientific uncertainties surrounding the effects of greenhouse gases upon the planet's further warming, inducing potentially significant shifts in climate and ocean levels. But can the Nation and the world await more precise cause-and-effect data about global warming before initiating actions to slow down the increase in emissions from man-made combustion sources?

According to the Intergovernmental Panel on Climate Change, even if worldwide emissions of CO₂ were capped at present levels, atmospheric concentrations of the heat-trapping gas would continue to increase for at least two centuries, rising well beyond the point at which the earth's climate would be disrupted.

The latest report from the Panel, which advises the United Nations, is designed to guide parties who signed the climate treaty in mid-1992, as they discuss whether the treaty should be strengthened. That discussion is expected to begin at the parties' first meeting in March 1995 in Berlin. As ratified by more than 80 countries, including the United States, the treaty requires developed countries to take actions aimed at capping carbon dioxide emissions at 1990 levels by the year 2000.

The Administration's 1993 Climate Change Action Plan, if implemented in a timely manner, would return net U.S. greenhouse gas emissions to 1990 levels by the target year. We believe this is a realistic, achievable goal, and one to which the electric utility industry can and should contribute, as its operations are among the principal sources of CO₂ emissions.

The Action Plan's premise is that the sooner the Nation succeeds in slowing down emission rates (which are currently projected to grow by almost 75 percent between 1990 and 2000 without the Plan), the better is the longer-term outlook for a cost-effective and environmentally responsible achievement for both energy suppliers and consumers. Further, with an early commitment to CO₂ emission reductions, the Nation may be able to avoid having to take much more drastic actions in the future, should the warming trend turn out to have a stronger scientific basis than has been demonstrated to-date.

In doing its part, NU can meet and improve upon the year 2000 target while strengthening its relationship with customers and enhancing its competitive position as a reliable energy supplier. This is a winning situation, enabling NU management to step forward with the voluntary general commitment that was formally accepted by the Secretary of Energy on April 20, 1994. With the signing of NU's Participation Accord in February 1995, that commitment specifically begins to limit NU system CO₂ emissions in 1995 at historic (1987-1990) levels, and gradually lowers the annual limit to 1 million tons below historic levels in the year 2000. Over the six years covered by our pledge, we should accumulate 3 million tons of CO₂ emission reductions.

3. THE BASIS FOR NU'S COMMITMENT TO REDUCING CARBON DIOXIDE EMISSIONS

NU engages in environmental improvements by reducing the impacts of electricity generation upon our shared natural resources, renewable and nonrenewable.

Here is yet another opportunity for NU to reduce emissions, thereby helping the Nation to meet its international commitment to CO₂ containment, as articulated in the Administration's Climate Challenge Action Plan of October, 1993. This voluntary action is being taken in the same spirit as the Company's 1993 donation of sulfur dioxide (SO₂) allowances - another form of emissions credit - to the American Lung Association. That donation was part of an "early bird" contribution to the allowance trading mechanism stimulated by the Clean Air Act Amendments of 1990.

NU has an interest in furthering such voluntary actions. By stepping forward under the Climate Challenge initiative, we hope to convince the Administration and the Congress that allowing utilities to achieve jointly acceptable reduction targets in a cost-effective manner is superior to the "command-and-control" approach to environmental regulation that has prevailed for the past 20 years.

NU has an opportunity to explore and implement a variety of approaches. These might include, for example, a demonstration that the accelerated introduction of electrotechnologies on customers' premises can result in multiple benefits: providing for greater efficiency in energy applications that can help customers improve their competitive position; reducing customers' costs towards curbing their own emissions; and achieving lower overall emissions as a result of the introduction of more efficient machinery and equipment.

4. NU'S RESOURCE PLANNING AND COMMITMENTS HAVE RESULTED IN ITS ABILITY TO REDUCE CARBON DIOXIDE EMISSIONS SIGNIFICANTLY

There are three principal reasons why NU has already been able to achieve major CO₂ emission reductions: (1) it invested in nuclear and other non-fossil resources as it expanded its generation system in the 1970s and 1980s; (2) it has converted many of its fossil fueled plants to lower CO₂-emitting fuels; and (3) it undertook a major program to promote and achieve reductions through the efficient use of energy by its customers.

The two major non-fossil resources the company has developed are nuclear generators and the firm purchase of Hydro-Quebec energy starting in 1991. NU built the Connecticut Yankee nuclear facility in the late 1960s and the 3-unit Millstone nuclear plant in the 1970s and 1980s. Over this period it also invested in New England's first nuclear project, Yankee Rowe, as well as in Vermont Yankee, Maine Yankee and the Seabrook nuclear plant. Today NU is responsible for operating five nuclear plants and holds ownership shares in these and other plants for a total nuclear entitlement of about 3,100 MW. In 1973, the annual energy contribution from nuclear facilities to total system energy requirements was 19 percent. This contribution grew to 50 percent by 1980, and to over 60 percent by 1993.

Another major non-fossil (thus non-emitting) resource in which the Company is participating is the firm energy purchase from Hydro Quebec of about one-third of the amount of hydro power purchased through the New England Power Pool (NEPOOL). This purchase began in 1991. The energy contract with Hydro-Quebec offsets CO₂-emitting fossil energy produced by regional power plants. The contract expires in 2001.

Over the past 25 years, NU has switched fuels at its plants, significantly reducing system CO₂ emissions. First came the conversion to oil of what had been coal-burning plants; later some of them were further converted to dual fuel (oil and gas) operation. By converting from coal to oil at a generating unit, CO₂ is reduced by about 15 percent; and a conversion from oil to gas results in a further reduction. In the early 1970s, about 1500 MW of coal burning facilities were converted to oil. Since then, about 800 MW have been converted from oil to oil/gas burning capability.

Through programs and services, NU routinely provides information, incentives, and other inducements to its customers to help them use energy more efficiently. Our demand-side management programs have avoided the generation of significant additional energy from fossil sources. In 1993, it avoided about 800 GWh of energy consumption, hence 600,000 tons of CO₂ emissions; by 2000 this saving should grow to about 1,800 GWh, or 1.4 million fewer tons of CO₂. NU has been the most successful promoter of energy efficiency on customers' premises in New England. Proof: though NU provides but one-third of the energy consumed in the region, about one-half of the region's demand-side management savings are due to our programs.

We now can see that the total environmental benefit of NU's past resource decisions is staggering in comparison to what other electric utilities which remain heavily dependent on fossil fuels can achieve. In addition to avoiding tens of millions of tons of CO₂ emissions, we can point to comparably significant reductions in other air emissions such as sulfur dioxide (SO₂), nitrogen oxides (NOX), and particulates.

NU is responsible for far fewer CO₂ emissions per unit of energy provided (kilowatt-hours or kWh) than the remainder of New England, and for only about one-half the national average emissions per kWh from U.S. electric utilities. A comparison of NU, regional and national average CO₂ emissions per kWh is shown on the accompanying graph for 1993.

Comparative Utility CO₂ Emission Rates

Per Unit of Output in 1993

(lbs/kWh)

---

Having so dramatically reduced its gaseous emissions during the past 25 years from what they would have been without the historic resource decisions described earlier, NU is prepared to pledge even further system reductions between now and the year 2000, and to have them recognized as part of the DOE's Climate Challenge Program.

5. LOOKING AHEAD TO FURTHER GREENHOUSE GAS REDUCTION AS PART OF THE CLIMATE CHALLENGE

NU's response to the Climate Challenge focuses on a one-million ton CO₂ reduction in the year 2000 from a "baseline" level. CO₂ emissions will also be reduced in the interim period prior to 2000. NU can achieve its pledge because several new resource decisions have reinforced the environmental benefits of the company's historic resource planning. These decisions are represented by: the addition of Seabrook, the conversion from oil to oil/gas capability of generating units at the Newington and Devon stations, and continued demand-side management programs. In addition to these principal CO₂ reducers, there are numerous other efforts (some of them quite modest) underway or planned which can provide an environmental benefit.

As part of our commitment, we have examined our on-going activities to identify projects that can contribute to CO₂ and other greenhouse gas reductions. Some of these are committed, while others are in various stages of planning. The activities seem to fall into two categories: those relating to NU's own facilities, i.e., "keeping our house in order" by improving the performance of our buildings and transportation fleet, and those which relate to improving the production, distribution, and sale of electricity to our customers. All of these projects will be described in a separate report "Northeast Utilities Climate Challenge Projects," expected to be issued in April 1995.

Many of these efforts (like renewable resource development) will reduce greenhouse gases and other air emissions in addition to CO₂. Others (like methane recovery) address greenhouse gases other than CO₂. And some others such as electric vehicle development, might actually increase electric use while reducing air emissions from mobile and stationary sources outside of our control with only slight increases in emissions from our facilities. We will pursue and monitor these projects to identify their environmental and economic merits, even if some of them would not contribute directly to, or even work against, our system-wide CO₂ reduction goal.

Over the coming years, our customers can be expected to require increasing amounts of efficient electric energy. Without the many greenhouse gas-reducing projects in place and the resources NU is marshalling as part of the DOE's Climate Challenge, our system-wide CO₂ emissions would inexorably increase quite substantially. But as these projects are activated, we can be confident that the system-wide influences that increase emissions (resulting from load growth and plant retirements) would be more than offset, thus enabling us to achieve CO₂ reductions in the future.

Activities which improve the environmental and energy-efficient performance of our buildings and transportation fleet include such varied initiatives as a grid-connected 4 kW solar photovoltaic generator on the roof at our corporate headquarters or using synthetic oil in our cars and trucks. We intend to explore new areas to reduce system costs and to highlight work practices and changes that can be of use to our customers and others.

The list of projects to achieve greenhouse gas reductions is even more varied in the process of producing, distributing and selling electricity. Demand-side management programs and the adoption of new electrotechnologies are building on efforts that NU began in 1980: they address energy use in existing buildings and new construction for residential, commercial and industrial users.

Applications of electrotechnologies can result in significant net energy and fossil fuel emission savings as well as the more efficient use of electricity. Electric vehicle projects, for example, include those that demonstrate and test electric vehicles or anticipate the future market development for electric cars, light trucks, mass transportation, off-road vehicles and airport electrification.

Renewable resource development encompasses a broad range of hydroelectric, methane recovery, solar photovoltaic and wind resource development projects. Generation projects involve improvements in generating plants, further conversions to dual fuel capability, and others. Transmission and distribution projects cover equipment installation and activities that are already part of the NU's normal design practice. Forestry operations maximize the economic return from company-managed forests and the improved sequestration of CO₂ by the forests. We are also sponsoring community-based programs to support tree planting.

Further, NU is engaged in Joint Implementation efforts (international projects to reduce greenhouse gases). One is a pilot project proposal for CO₂ reduction credits from a soon-to-be-built 20 MW wind farm in Costa Rica, called the Plantas Eólicas S.A. Wind Facility. A subsidiary of NU is participating in its development. The Costa Rica project overall could create over 100,000 tons of CO₂ offsets each year.

6. PLANS FOR DEALING WITH UNCERTAINTY

NU's voluntary pledge under the Climate Challenge is to reduce CO₂ emissions in 2000 by 1 million tons below historic levels, and to limit and reduce CO₂ emissions starting in 1995, so that by the end of the year 2000 reductions will have added up to 3 million tons.

Assuming there are no events to alter significantly our forecast of demand and resource availability to serve customers' needs, NU's CO₂ reductions could be even larger than our pledge. We hope that actual system emissions will be well below the goal levels stated at the beginning of this report.

The NU pledge rests on its commitment to nuclear, demand-side management and other non-fossil resources that can be expected to continue to contribute to system-wide CO₂ emissions reductions over the 1995-2000 period. However, the emerging competitive environment within which NU must now operate may cause a dramatic shift in our current forecast of customer sales and, as a consequence, the amount of fossil generation required to match customer demand.

Our ability to honor the Climate Challenge pledge incorporates a margin of protection in the event load growth should be higher than currently anticipated, or if the availability of nuclear or other non-fossil resources is less than forecast, entailing higher amounts of replacement power and associated air emissions.

Uncertainty over NU's emission predictions is compounded by the fact that our generating units are centrally dispatched by the New England Power Pool (NEPOOL), as part of a single six-state NEPOOL control area. In essence, NEPOOL dispatch means that future CO₂ emissions from our facilities depend in part on future actions (or inactions) by other utilities and non-utility generators in the region. Further, CO₂ emission levels may even depend upon the trend of fossil fuel prices.

Dealing with all this uncertainty calls for continual monitoring of operations over the period 1995-2000. At a minimum, NU has agreed to confer with the Department of Energy on or before December 15, 1997, to jointly evaluate our progress in achieving Climate Challenge Program goals, and to discuss possible adjustments to our voluntary commitments. This may involve refining the greenhouse gas reduction projects -- some of which are only in the conceptual stage today. These are summarized in Section 5 of this report. A mid-course correction and goal revision may become necessary. The DOE recognizes the need for flexibility in making such timely adjustments in the language of NU's Participation Accord.

7. REPORTING NU'S GREENHOUSE GAS REDUCTION

Monitoring and reporting its voluntary pledge under the Climate Challenge will be done in conformance with Exhibit B of the Industry-Wide Memorandum of Understanding and Section 1605(b) of the National Energy Policy Act. The Company will report to the DOE and Energy Information Agency (EIA) on its activities, annually through the year 2000. NU's first report, for 1995, will include emission data and information for the years 1991-1994, as well as for the average base period 1987-1990.

Additional details about NU's Climate Challenge reporting include:

1. NU has elected to report its direct system-wide carbon dioxide emissions in short tons.

2. Noteworthy projects or measures resulting in significant reductions in non-system carbon dioxide emissions or other greenhouse gases may be reported separately.

3. All assumptions, calculations and data used to compute its greenhouse gas reductions will be clearly documented and referenced.

4. In addition to the official report on Form EIA-1605, NU will issue an annual report on its progress to the general public.

8. GLOSSARY OF TERMS

Climate Action Report - First formal U.S. communication under the Framework Convention on Climate Change. It was released by the State Department in September, 1994, and contains a description of the present U.S. program.

Climate Challenge - A DOE-administered program. One of the two so- called "foundation initiatives" contained in the government's Climate Change Action Plan, which specifically involves voluntary activities undertaken by the electric utility industry.

Climate Change Action Plan - A national program issued by the Administration in October, 1993, which outlines a series of 50 initiatives designed to return emissions of greenhouse gases in the United States to 1990 levels by the year 2000. It contains two "foundation initiatives," the Climate Challenge Program and the Climate-Wise Program.

EnviroTech Investment Fund - One of five electric utility industry initiatives created as part of the Climate Challenge. It establishes a limited partnership to invest a pool of $100- $150 million in promising energy efficient and environmentally beneficial electrotechnologies and renewable energy technologies. The goal is to put these technologies on the market, thereby reducing their cost and making a wider range of emissions reductions equipment available to industry and consumers.

EV America - One of five industry initiatives created as part of the Climate Challenge. Its purpose is to foster the improvement and commercialization of electric vehicles. EV America is a partnershhip between the electric utility industry and government to demonstrate the commercial potential of electric vehicles (EVs) in the U.S. The multi-phase, market demonstration program is expected to place up to 500 EVs in various regions of the country by the end of 1995 and then introduce up to 5,000 of the vehicles in fleet applications in those regions by the end of 1997. NU is a participant in this program.

Framework Convention on Climate Change - International agreement to address the danger of global climate change resulting from anthropogenic emissions of greenhouse gases. It was signed at the Earth Summit Conference in Rio de Janeiro in June, 1992.

Greenhouse Effect - A popular term describing the interaction of trace gases in the atmosphere with solar radiation, trapping heat and resulting in the Earth's surface being warmer than it would be otherwise. These radiatively active gases do not absorb much incident short- wave solar radiation, but do absorb most of the long- wave radiation which is reradiated from the surface. This traps heat in the atmosphere. The concern is that increasing concentrations of these gases from anthropogenic emissions may enhance the greenhouse effect and cause global climate change.

Greenhouse Gases - Trace gases in the atmosphere which do not absorb much incident short- wave solar radiation, but do absorb most long- wave radiation form the earth's surface, increasing heat energy in the atmosphere. Examples are water vapor, carbon dioxide (CO₂), methane (CH₄), nitrous oxide (N₂O), and various halogenated substances, such as chlorofluorocarbon (CFC).

Intergovernmental Panel on Climate Change - A United Nations panel on climate change, established in 1988 to assess the scientific information related to climate change and to formulate response strategies.

International Utility Efficiency Partnership Program - One of five electric utility industry initiatives created as part of the Climate Challenge. Its purpose is to promote energy efficiency and thus reduce emissions of greenhouse gases through international utility modernization efforts. The goal is to reduce or avoid greenhouse gas emissions by increasing both supply- and demand-side energy efficiencies and by expanding the use of renewables in international electric system projects.

Joint Implementation Project - International efforts undertaken jointly by United States entities and foreign partners whose purpose is to reduce, avoid, or sequester greenhouse gas emissions.

Memorandum of Understanding (MOU) - Voluntary industry- wide agreement between U.S. electric utilities and the Department of Energy to establish the framework of the Climate Challenge, signed in April 1994.

National Earth Comfort Program - One of five electric utility industry initiatives created as part of the Climate Challenge. It establishes the Geothermal Heat Pump Consortium to increase annual unit sales of geothermal heat pumps from 40,000 to 400,000. NU is a participant in this program. The consortium is an organization that will bring together environmental organizations with electric utilities and their equipment manufacturers and allies. A geothermal heat pump uses the moderate temperatures under the earth's surface to heat and cool homes and businesses. The goals of the program are to reduce the front-end costs of geothermal heat pumps and to promote customer acceptance of the technology on a wide scale, while reducing greenhouse gas emissions.

Participation Accord - The agreement between an individual U.S. electric utility and the Department of Energy under the Climate Challenge. This is the vehicle by which utilities make voluntary pledges to reduce, avoid, or sequester greenhouse gases.

Section 1605(b) - A section of the 1992 Energy Policy Act which calls for voluntary reporting of activities designed to reduce, avoid, or sequester greenhouse gases. Guidelines for such reporting activities have been published by the DOE.

Sequestration - A term used by DOE and the industry referring to the industry's efforts to add to nature's fixation of atmospheric carbon in a carbon sink. Tree planting, for example, sequesters carbon using biological processes such as photosynthesis, to offset industrial emissions of CO₂.

Utility Forest Carbon Management Program - One of five electric utility industry initiatives created as part of the Climate Challenge. This will result in a coordinated effort to manage carbon dioxide through various types of forestry activities. NU is a participant in this program.

Please send comments to:
Lawrence.Mansueti@hq.doe.gov