In less than a month, solar energy projects will see the stimulus-funded cash grant in lieu of the 30 percent tax credit expire. The change back to tax-credit-financed projects provides a revealing look at the disadvantages of energy incentives based on the tax code, thanks especially to a recent NY Times story about the shift. (For … Read More
You can’t make this stuff up.
Montana’s two newly elected Public Service Commissioners put out numbers, during their campaigns, purporting to show that electricity from renewable energy sources – specifically, wind – is more expensive than electricity from fossil fuels like coal.
Problem is, the truth is the exact opposite. And these two people now regulate the electricity industry in Montana. Kudos to citizen Ben Brouwer of AERO and the Billings News for getting to the truth:
Here are the comparative wholesale prices for electricity that [the state’s largest private utility] NorthWestern Energy [NWE] acquires from different sources:
• Colstrip Unit 4 (coal): $56.05 per megawatt hour (MWh)
• PPL (mix of coal & hydro): $48.75 per MWh
• Judith Gap (wind): $29.25 per MWh, plus $8-13 per MWh for “integration” costs
• Energy Efficiency: $4.80 per MWh
Turns out the most expensive power acquisition for NWE is coal, with wind and energy efficiency being the least costly.
Key benefits of distributed power generation (DP). Proven technologies for DP are widely scalable. Obvious example: a wind farm can be incrementally built in multiples of approximately 1.4 MW. Bigger doesn’t necessarily mean “cheaper” for DP. Customers can match the DP capacities to precisely known needs and not have to over-buy equipment. (see Figure 1 in … Read More
An interesting graphic that shows how the definition of distributed generation can vary by technology, since one “module” of a wind power plant (~1.5 megawatts) is very different than one solar module (~250 Watts).
Image credit:Electric Power Systems Research 57 (2001) 195-204; Ackermann et. al.
Wholesale market operators should probably pay providers of smart energy demand more than gas plant generators for ancillary services such as operating reserves. Why? Because the faster response of “a battery or a dishwasher or a water heater or an aluminum pot or compressor in a Wal-Mart [that] can respond on a microsecond basis… should be rewarded a higher payment because, in fact, it’s providing a better service.”
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 are … Read More
Martifer Solar, a subsidiary of Martifer SGPS, alongside Silverado Power, signed today Power Purchase Agreements (PPAs) with Southern California Edison, for 113 MW solar projects.
These 113 MW consist of nine PV projects within close proximity to major utility lines in Southern California. These projects, expected to be concluded in 2013, are primarily located in Los Angeles County and will allow an energy supply to thousands of homes via a 20-year contract with Southern California Edison. [emphasis added]
Most states had to cut spending to close budget gaps in the 2009 fiscal year, and many face additional shortfalls in 2010. These cuts often mean shorter library hours and larger class sizes, but tax credits for renewable energy frequently emerge unscathed.
The cuts in government services tend to fall hardest on the middle and working class, while the energy tax incentives tend to benefit wealthier members of the community. The good news is that it doesn’t have to be this way. Wind turbines and solar panels don’t have to compete with schools and hospitals.
The fix is before Congress and many state governments, and it’s called a renewable energy feed-in tariff. It’s a “plug and play” policy for renewable energy, guaranteeing a grid connection to anyone with a wind or solar project, a long-term contract with your utility, and a price for electricity generation sufficient to make a small profit. It means that many more can be clean energy producers rather than just consumers, spreading the economic benefits of renewable energy over the widest possible area. A good feed-in tariff policy says, “It’s not just for rich folks anymore.”
Here’s how it works. A homeowner buys a solar power system and has it installed on her roof. The local utility connects it to the grid and signs a 20-year contract to buy her solar electricity. The price it provides will give her a small return on investment (say, 6 percent). If the homeowner’s electricity adds any cost to the system, the additional cost (amounting to pennies per month) is spread over all the utility’s ratepayers.
A feed-in tariff helped Germany get 16 percent of its electricity from wind and solar in 2010, with half its renewable energy systems locally owned, bringing economic benefits to every corner of the country. It did so at a lower price than other policy options, because having a guaranteed price lowered borrowing costs for renewable energy developers. And Germany didn’t have to argue for renewable energy tax incentives at the expense of health care, transportation or education.
A well-designed feed-in tariff can replace the maze of government rebates, grants and tax credits with the simple requirement that electric utilities pay producers for the full cost and value of renewable electricity. This strategy results in at least three significant benefits:
The policy can create a more democratic, decentralized electricity system because it removes most of the barriers to local energy generation. This dispersion of renewable electricity production will help maximize the use of the existing electrical grid (transmission and distribution). Locally owned projects return three times the economic benefits to communities that absentee-owned projects do.
The feed-in tariff also means transforming individuals from energy consumers to producers. Unlike traditional renewable energy incentives that target large-scale developments, the feed-in tariff lets anyone become a renewable energy producer. And when people make the shift from consumption to production, their energy use becomes a conscious effort to find equilibrium, rather than simply writing a check for the electric bill.
Finally, the feed-in tariff takes renewable energy incentives off the government balance sheet so that legislatures don’t have to choose between children and clean energy. It may even increase government revenues as hundreds of new renewable energy producers pay taxes on their electricity earnings. Furthermore, since these producers won’t be corporations with legal departments dedicated to reducing their tax payments, there will be more revenue per project.
State and federal budget problems recur regularly, but there’s no reason these shortfalls should pit energy independence and economic development against schools, libraries, or health care — especially when there’s a better solution for promoting renewable energy development.
This is an opinion piece I wrote this spring, published on Minnesota Public Radio’s website.
The bottom line is that Frame and other critics of the plan seem to think that electricity policy alone is what determines the survival of Ontario industry. It’s an important component, but the price on a bill doesn’t reflect other programs and initiatives in place to help alleviate the economic strain. Sure, looked at in isolation it may seem scary, and it’s easy to criticize something in isolation of other facts, but it’s not constructive to the debate…
Historically there have always been U.S. states and Canadian provinces with lower — in some cases much lower — electricity rates. Have we seen a mass exodus of industry into Quebec, or Manitoba, or Wyoming? No, because electricity rates are one of many factors that are weighed by companies. Ontario is still very much competitive with many of the states that count, including Michigan and Pennsylvania, and we’re far cheaper than New York State, New Jersey and California. The claim that our industries are going to pick up and run is scaremongering.
