Category Archives: Electricity Pricing

5 Reasons Virtual Net Metering is Better than Plain Ol’ Net Metering

solar gardenSeveral states have embraced net metering in order to encourage the adoption of solar energy and other distributed generation. Sometimes referred to as “running a meter backwards,” net metering allows people to generate their own electricity, export any excess electricity to the grid, and get paid for providing this excess energy to the utility who may use it to power nearby homes or manage overall electricity demand.

Net metering leads to lower – or in some cases negative – electricity bills without having to invest in expensive batteries to store excess energy, which can be cost-prohibitive. By generating energy on-site where it’s consumed, net metering also reduces the strain on distribution systems and cuts the amount of electricity lost to long-distance transmission and distribution (estimated at seven percent in the U.S.). Net metering, moreover, tends to reduce greenhouse gas emissions by incentivizing people to adopt renewable energy and become more aware of energy-saving opportunities. Read More »

Also posted in Energy Efficiency, Renewable Energy, Smart Grid| 1 Response

Germany’s Energiewende is Shifting the Energy Paradigm – Now it’s Time to Optimize

solar-cells-491701_640Revolutionary paradigm shifts often require cohesive development of many moving parts, some of which advance more quickly than others in practice. Germany’s revolutionary Energiewende (or “energy transition”) is no exception. Set to achieve nearly 100 percent renewable energy by 2050, Germany’s Energiewende is one of the most aggressive clean energy declarations in the world. While growth of Germany’s installed renewables capacity has been explosive in recent years, optimization measures designed for Energiewende have manifested at a relatively slow pace.

Germany already has one of the most reliable electric grids in the world, but as implementation of Energiewende continues, optimization will be key to its future success. This will require better sources of backup generation to accommodate the intermittency of wind and solar, a dynamic energy market that ensures fair compensation for this backup, and a more flexible, resilient grid enabled by smart grid technologies to fully optimize demand side resources and a growing renewable energy portfolio. Read More »

Also posted in Clean Energy, Demand Response, Energy Efficiency, Energy Financing, Energy Storage, Natural Gas, Renewable Energy, Smart Grid, Utility Business Models| Tagged | 3 Responses

Point – Counterpoint: Heartland Institute Gets It Wrong on Wind

Source: AWEA

Source: AWEA

On the heels of a recent Forbes blog post where I call out Texas' Comptroller for playing favorites in her biased scrutiny of Texas' wind industry, comes another Forbes piece by James Taylor from the Heartland Institute. Confusing correlation with causation, Taylor claims wind energy causes higher energy prices. However, an increase in electricity prices cannot automatically be accounted for by pointing the finger at wind energy. That’s simply playing fast and loose with the facts.

This is the same tired slant we have heard from Heartland Institute time and time again. Not surprising – when pundits want to cherry pick data to make their argument strong, it doesn’t always work.

First there are many, many factors that determine energy rates, not just one type of resource. In an analysis of utility rates, economists Ernst Berndt, Roy Epstein, and Michael Doane identified 13 reasons why an electric utility’s rates may be higher or lower than the average. They include things like the average use per customer, age of the electricity distribution system, generation resource mix, local taxes, and rate of increases prior to any implemented renewable portfolio standard (RPS). So faulting renewables for high energy prices is a bogus claim. Furthermore, there is no data showing a nationwide pattern of renewable energy standards leading to rate increases for consumers. The report states: “American consumers in the top wind energy-producing states have seen their electricity prices actually decrease by 0.37 percent over the last 5 years, while all other states have seen their electricity prices increase by 7.79 percent over that time period." Further, 15 studies from various grid operators, state governments, and academic experts have examined the impact of wind energy on wholesale electricity prices and confirmed that wind energy reduces electricity prices. Read More »

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Utility 2.0: New York State Envisions New Platform Giving Equal Priority to Clean Energy Solutions

brooklyn-bridge-71800_640New York’s “Reforming the Energy Vision” (REV) proceeding aims to reform the state’s long-standing electricity system to lay the groundwork for a cleaner and more efficient grid that allows for more customer choice and competition from third-party energy services companies. Forming the centerpiece of this 21st-century vision is a platform that would smoothly integrate innovative energy services and solutions into the existing grid, allowing them to compete on equal footing with electricity from centralized power plants.

Currently, the electric industry comprises three functions: generation, transmission, and distribution. Generation refers to making electricity, traditionally from large, centralized power plants. Transmission refers to sending that electricity along high-voltage wires to substations closer to electricity customers. Distribution refers to delivering the power from the substations to homes and businesses. In its recent straw proposal, the Department of Public Service Staff (Staff) recommends splitting the distribution function into two parts, one performing the traditional delivery service and the other serving as the Distribution System Platform Provider (DSP), to grant equal priority to energy solutions that are not centralized, such as on-site, distributed generation and energy efficiency. Read More »

Also posted in Clean Energy, Demand Response, Energy Efficiency, New York, Smart Grid, Utility Business Models| 2 Responses, comments now closed

While Critics Debate Energiewende, Germany is Gaining a Global Advantage

Source: Frank M. Rafik

Source: Frank M. Rafik

Economics is the focus of many debates surrounding Germany’s aggressive “energy transition” (or Energiewende), which plans to move the country to nearly 100 percent renewable energy by 2050. Critics say Energiewende’s costs are unjustifiable, arguing they hurt the country’s international competitiveness and systemic inefficiencies exacerbate these costs.

At first glance, it’s hard to argue with them. The scale of investment in Energiewende can seem intimidating: So far, Bloomberg New Energy Finance estimates the total cost of Germany’s clean energy expansion at €106 billion. Furthermore, the Wall Street Journal quotes government sources when predicting total costs through 2040 to be about €1 trillion.

By contrast, however, Germany’s annual investment in fossil fuels has been €90 billion; and, investments in Energiewende go into electric grid upgrades that would need to happen in Germany anyway, whereas fossil fuel investments leave the country.

When viewed in context, there are many reasons to believe investments in Energiewende will reap economy-wide rewards, giving Germany a competitive global advantage over other countries that lagged behind investing in the future.

Read More »

Also posted in Clean Energy, Energy Financing, Renewable Energy| 3 Responses, comments now closed

Solar in Texas: It's Really Happening this Time (Really)

iStock_Solar_InstallerEvery year, it seems, is predicted to be the “year for solar,” and for certain states this may ring true.

But in Texas, despite having a close relationship with the sun and its heat (2011 gave us 100 days over 100 degrees and no rain), we have yet to realize our potential for solar energy development, the highest potential of any state in the nation. Texas currently only has about 213 megawatts (MW) of solar energy installed (compared to over 237 MW in little ol’ Massachusetts). Recent developments, however, make me encouraged that the next few years will be the catalyst for finally fulfilling that potential.

Austin

A few weeks ago, the Austin City Council voted on an ambitious solar step forward, directing a “utility-scale solar target of 600 megawatts by 2017, a rooftop solar target of 200 megawatts by 2020, explicit language enabling third-party solar ownership, a floor price for the value-of-solar tariff…and a mandatory strategy to procure 200 megawatts of fast-response storage.” The resolution will require the municipal utility, Austin Energy, to obtain 60 percent of its electricity generation from renewables over the next decade, and to be completely carbon-free by 2030. Read More »

Also posted in Clean Energy, Renewable Energy| 2 Responses, comments now closed