When discussing centralized v. decentralized solar power, there’s an inevitable comparison between solar thermal electric power and solar photovoltaic (PV). But the fact is that solar thermal power – or concentrating solar power (CSP) – can also be done in a distributed fashion. In fact, of the 21 operational CSP plants in the world, 18… Continue reading
Viewing all Articles from Energy Page 39 of 78
The CEO of a leading Indian solar energy firm issues a call for a U.S. federal feed-in tariff in yesterday’s New York Times:
Two things happened last month to give us pause to reflect on clean energy. First, Germany added the equivalent of nearly 1 percent of its electricity supply with solar energy between January and August. The first 1 percent took 10 years to achieve; the next 1 percent just 8 months. Second, the author of this revolution, Hermann Scheer, died.
The United States is one of the two top energy consumers in the world (along with China), so the world cares how fast America becomes convinced that there is a viable replacement to fossil fuels. The domestic American market should reach 1,000 megawatts next year. But to put that in perspective, Germany next year could add 1,000 megawatts in just 1.5 months.
To catch up, President Barack Obama needs to push for a federal feed-in tariff, or a mandate for states to have one, and fund it with a surcharge on conventional power — small enough to pass, but big enough to move solar away from cumbersome grants and tax incentives that come and go with the annual budget circus.
In mid-October, yet another municipality joined the growing list of lawsuits against the Federal Housing Finance Agency, Fannie Mae, and Freddie Mac over the popular Property Assessed Clean Energy (PACE) program. Arguments in the court case will be heard next week.
A federal judge will consider next week whether to dismiss lawsuits questioning the Federal Housing Finance Agency’s decision to effectively shut down a White House-supported home energy efficiency program.
In a closely watched case, U.S. District Judge Claudia Wilken of the Northern District of California will hear arguments Dec. 2 over whether to dismiss several lawsuits against the agency, including one filed by the state of California.
I’m hopeful that the plaintiffs can win – PACE could really open the door to major improvements in home energy efficiency and expansion of distributed renewable energy.
It’s rarely mentioned that a home with a solar array still gets most of its electricity from the grid. In fact, without storage, a typical home solar array might only serve one-third of a home’s electricity use, even if the system is big enough to meet the home’s peak needs. The problem is a mis-match… Continue reading
Yesterday, the Interstate Renewable Energy Council (IREC) released their model program rules for community renewable energy projects [pdf]. IREC’s new model rules consider many of the basic issues facing community renewables programs. These include: renewable system size, interconnection, eligibility for participation, allocation of the benefits flowing from participation, and net metering of system production. IREC… Continue reading
IN this environmentally conscious college town, thousands of bicyclists commute each day through a carefully cultivated urban forest whose canopy shields riders and their homes from the harsh sun of this state’s Central Valley.
The intensity of that sunshine also makes Davis an attractive place to generate clean green energy from rooftop solar panels. And therein lies a conundrum. Tapping the power of the sun can also mean cutting down some of those trees.
Enter community solar. Individuals can invest in a nearby, common solar PV installation, saving kilowatt-hours and trees.
But the article provides some poor examples: the Sacremento Municipal Utility District’s Solar Shares and SunSmart in St. George, UT. In the case of the former, participants pay extra for their solar power. In the case of the latter, participants pay extra for solar and – worse – pay up front for 20 years of more expensive power.
In our recent report – Community Solar Power: Obstacles and Opportunities – we provide a case study of nine operational community solar projects – five of them provide a payback on investment rather than asking a premium price for clean power.
Community solar can save trees, but it can also save participants money.
For two years, solar and wind energy producers seeking federal incentives have been able to take cash grants in lieu of tax credits. The stimulus act program helped keep the renewable energy industry afloat as the credit crunch and economic downturn dried up the market for reselling tax credits to banks and other investors with large tax bills.
The cash grant program is set to sunset at the end of this year, but solar and wind energy advocates are hoping it will be extended, for good reason:
In fact, the tax credits were always an awkward tool, some argue. Rhone Resch, the head of the Solar Energy Industries Association, said that many of the companies doing the installations were not making a profit either, so these tax credits were sold as “tax equity,” a secondary market, at a loss of 30 to 50 cents on the dollar to the seller. [emphasis added]
The tax credits were worth 30% of a project’s value, so the transaction costs of reselling the credits meant that renewable energy projects without sufficient internal tax liability were 13 to 21% more expensive than projects that could use the credits themselves.
This is dumb policy. Ratepayers pay a higher price for renewable energy because incentives filter through the tax code instead of the general fund.
But the cash grant v. tax credit issue is just one symptom of a larger disease affecting American renewable energy policy. Transaction costs are increasing the cost of renewable energy in nearly every state with a renewable portfolio standard (RPS).
Under most state RPS policies, utilities put out requests for proposal to acquire renewable energy to meet the state mandates. These solicitations attract thousands of developers who all have to front their project development costs. But in California, for example, 90% of projects don’t make the utilities’ shortlist for the solicitation, stranding over $100 million in development costs.
Some of those projects may eventually get online, but most of that money is flushed because the U.S. prefers to let utilities act as gatekeepers to clean energy rather than open the market to any potential producer. It’s not the only way.
There’s a renewable energy policy that’s responsible for 75% of the world’s solar and half its wind power. It has the lowest transaction costs because there’s no fiddling with the tax code and no parasitic costs from auctions or solicitations. Instead, utilities are required to interconnect and take the power from any developed renewable energy project, and to provide a price sufficient to provide a reasonable return on investment (just like the utilities enjoy in rate regulated states).
The policy is funded entirely through the electricity system, so renewable energy doesn’t have to compete with other budget priorities.
It’s called a feed-in tariff.
The U.S. can extend the cash grant program, but it merely treats a symptom of the disease. A better policy awaits.
A new 25 megawatt wind project in southwestern Minnesota will feature greater local ownership than most, using a model that Project Resources Corporation calls “Minnesota Windshare”. The project should be online by early 2011:
Construction crews this fall are assembling 11 turbines that will make up the $51 million Ridgewind project near Lake Wilson, about 20 miles east of Pipestone. The project also will come with a new endeavor for its developer, Minneapolis-based Project Resources Corp., that the company hopes will increase the economic influence wind projects can have on a community.
The PRC project will use the familiar “Minnesota Flip” model of wind project development, where a large equity investor provides the capital and holds majority ownership for 10-15 years, along with any landowner who hosts a turbine. The interesting twist is in the flip, where more community investors can come into the project when the equity investor departs. This WindShare program [pdf] could allow many people who don’t have land suitable for wind or significant capital to nevertheless participate in a wind power project.
The news story is featured in a South Dakota paper, the Argus Leader, which quotes a South Dakota Public Utilities Commissioner saying that the Minnesota-based PRC project won’t capture the economies of scale of a larger, 100 MW project in South Dakota.
“Frankly, the South Dakota model is better,” Johnson said. “If you take a large wind farm, you get economies of scale. You carve out a piece of that where local South Dakota investors can put their money into that,” he said.
Except that the data show wind power plant economies of scale are maximized for projects in the 5-20 MW range, not 100 MW and over.
What if you could support this site and help the Institute for Local Self-Reliance (ILSR) win up to $1,000 just by logging in and giving a few bucks? Tuesday, November 16th is Give to the Max Day – a donor will be randomly chosen every hour to have $1,000 added to their donation. The top two organizations with the highest number of donors will be eligible to win up to $20,000. Your donation – big or small – could have a huge impact for our ongoing work. We appreciate your support!
Federal tax credits for wind energy projects are due to start expiring at the end of this year, which means developers face the prospect of dishing up proposals for wind farms that can’t be financed, said White, president of Project Resources Corp., a Minneapolis company that does ‘community wind’ development. The answer, he and others in the community wind industry say, is to go smaller. Smaller projects, which are a hallmark of most community wind projects, are easier to finance and easier to connect to the power grid, they say.
Federal tax credits for wind energy projects are due to start expiring at the end of this year, which means developers face the prospect of dishing up proposals for wind farms that can’t be financed, said White, president of Project Resources Corp., a Minneapolis company that does ‘community wind’ development.
The answer, he and others in the community wind industry say, is to go smaller. Smaller projects, which are a hallmark of most community wind projects, are easier to finance and easier to connect to the power grid, they say.