Energy Exchange

Should America Get Behind The Fuels Of The Future Or The Past?

One of Yogi Berra’s famed quotes is about to apply to America’s energy policy:  “When you come to a fork in the road, take it.”

The truth is, America’s been staring at a fork in the road for a few decades.  Every president since Nixon has talked about freeing the country from its dependence on foreign oil.  And each recent administration has understood that our energy policy affects more than the price of a gallon of gas or a kilowatt of electricity.  It affects job growth, technological innovation and environmental progress (or decline).

The last few months of the budget and debt debate gives us a good picture of the paths America could take.

One path, embraced for years by both parties, entails government investments in new, clean, efficient and affordable energy.  It harnesses the creative talents of our top scientists, engineers, businesspeople and research centers.

The other, most recently articulated in Representative Paul Ryan’s budget, is driven only by a doctrinaire obsession with cutting government – no matter what we sacrifice in doing so.  According to that view,  the government need not invest, because the private sector has it all figured out.  That’s a stunning philosophy given that some of the most important breakthroughs – the Internet, our space program, wind and solar energy development – have happened because government and industry worked hand-in-hand.

The President recently called for a $2 billion Clean Energy Trust that would fund energy research and development.  That’s exactly the kind of thing we need in order to continue the clean energy technology revolution that will make it possible to reduce imports of foreign oil and weaken the threat of rising greenhouse gas emissions. The budget is tight, so how do we find the money for it?  By using money collected from oil companies when they drill for oil and gas on federal lands.  Put another way, we can use some of the proceeds from the fossil fuel industry to help accelerate the transition to a clean, low-carbon energy economy.  Read More »

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ALEC Updates & Action Alert: State-By-State Renewable Energy Attacks Are Underway

Back in November, I wrote about how the American Legislative Exchange Council (ALEC) was partnering up with the Heartland Institute to attack renewable energy standards across 29 states. As an organization propped up by the fossil fuel industry, this behavior comes as no surprise. But the sneaky way they are trying to undo laws that encourage solar, wind and other renewable energy sources needs to be exposed and citizens of these states must stand up to the corporate interests desperately holding onto their power to pollute.  Across the country, we are watching ALEC and industry allies try to unravel decades of progressive energy legislation.

In the sunny southwest, the Arizona Corporation Commission (ACC) has eliminated the performance-based incentives (PBIs) provided to commercial solar energy customers by the state’s two investor-owned utilities (IOUs). It also drastically reduced the upfront incentives (UFIs) provided by the IOUs to residential solar energy customers. SolarCity Governmental Affairs Director Meghan Nutting explained that “as the Arizona incentives have been slowly reduced, the industry has kept up. Ratepayers have invested in the industry to a point where we are almost without a need for incentives. But a sudden and complete elimination of all incentives that cuts the commercial solar industry off at the knees means we will have to start over.” The ACC decision, she added, means “people are going to lose their jobs in the sunniest state in the country in an industry that Arizona has depended on through the recession and should dominate.” The ACC commissioners’ rationale for the cuts was that they will reduce the Renewable Energy Standard and Tariff (REST) premium added to Arizona ratepayers’ utility bills to fund solar. The REST premium was established by the ACC in 2007 and is capped at $4.00 per month. Calculations by Arizona solar advocates concluded that the PBI cuts will save APS ratepayers no more than $0.02 to $0.06 per month.

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Colorado: A Case Study In Clean Tech Planning And Execution

In a recent posts, we revisited the recent trio of reports of the clean energy clusters in Ohio, Iowa and Colorado and shared some insights on lessons learned from Iowa and Ohio.  In this post, we’ll take a look at Colorado.

Colorado is the 12th windiest state in the U.S. and is currently 9th in installed wind capacity. It’s one of only six states that have exceeded 10% of state generated electricity coming from wind.  For more than a decade, Colorado has been atop most lists for states vying for leadership in the clean energy economy.  It has research labs, a proactive state government, universities and active economic development efforts.  All of these have combined to help Colorado excel in the new energy landscape.

Consider that Golden, CO is home to the National Renewable Energy Laboratory (NREL), the only federal lab dedicated to research, development, commercialization and deployment of renewable energy and energy efficiency technology.  For more than 30 years, NREL has been working on advancements in solar, wind, geothermal and other renewable energy sources.  NREL, Colorado universities and private companies have leveraged the hometown lab to establish specialized research centers in several of these areas and contribute more than $700 million in the economic activity of Colorado each year.

The Denver-metro area, where our report focuses, has become a particularly popular place for cleantech startups and more mature companies.  In 2011, the region had about 1,500 companies and 18,000 employees in the cleantech industry, a 35% increase in direct employment growth from 2006. In terms of the entire Colorado workforce, cleantech employees account for 1%.  But that’s twice the national average and generates more than a billion dollars in annual wages. Read More »

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30 Years Of Forward-Thinking Leaders Has Spurred Iowa’s Clean Tech Growth

People who haven’t been following the renewable energy industry will be forgiven for their reaction when they’re told that Iowa is among the most advanced, opportunistic state in the cleantech economy.  “Iowa?  Isn’t that corn country?”

Well, yes.  But it’s also wind country.  And like few other states, Iowans have turned their constant breeze into a powerful economic force.

This is the last in a trio of posts highlighting the findings from EDF’s reports on the cleantech economies of Ohio, Colorado and Iowa (here is my last post on Ohio).  Today, I’ll focus on Iowa.

Despite its size, Iowa produces the second most wind power in the U.S. (Texas is #1 and California is #3) and is one of only two states that receives over 20% of its electricity from wind power.  More impressive has been the state’s ability to capture the economic — not just the environmental — benefit of that ranking.  According to the American Wind Energy Association, Iowa has attracted more major wind industry manufacturers than any other state.  It’s a great example of supply meeting demand.

Politically, wind power has been supported by both parties for three decades.  It was the first state to pass a Renewable Portfolio Standard, under republican Governor Terry Branstad in 1983.  In 2005, democratic Governor Tom Vilsack signed a tax credit for renewable energy production.  And in 2007 democratic Governor Chet Culver created the Iowa Power Fund to invest in local renewable energy research and development projects.  This level of across-the-aisle cooperation is unique among states and has given Iowa a considerable advantage in competing against larger and richer states. Read More »

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We Cannot Afford To Undo Economic And Environmental Progress In Ohio

EDF is working with Ohio elected officials, the small business community and other stakeholders on adopting an on-bill repayment (OBR) program in Ohio.  As a private capital solution to financing energy efficiency (EE) and renewable energy (RE) projects, OBR enables building owners to access low-cost capital, with repayment on their utility bills.  Small businesses in particular have trouble accessing affordable financing for energy projects, as it is hard for lenders to assess small to medium-sized business (SMB) credit risk and SMB properties are likely rentals that experience high turnover rates.  OBR provides lenders with significant credit enhancement, since the repayment obligation is tied to the utility meter and survives changes in rental and ownership.  At the same time, utilities and customers can benefit from a well-designed OBR program – one that compensates utilities for their services and allows utilities to receive credit toward state mandates for the OBR-enabled EE and RE investments.

As we at EDF endeavor to increase demand for clean energy projects in Ohio, other parties, including the American Legislative Exchange Council (ALEC), have proposed rollbacks to Ohio’s energy efficiency and renewable portfolio standards.  The standards were established by SB 221 in 2008, with bi-partisan support,– and there is a strong effort underway to defend them.  EDF is working with other Ohio clean energy stakeholders to keep the existing standards in place.  As we actively participate in this dialogue, EDF vigorously supports the State’s commitment to investing in clean energy – a commitment that has resulted in environmental and economic progress from which we cannot afford to undo.

EDF’s clean energy economic development series documented progress made in Ohio to date, which is extremely promising:

Stimulating Demand

The 1992 Energy Policy Act seeded demand for renewable energy and energy efficiency through tax credits and other programs.  In Ohio, two important state efforts in 1999 expanded on this federal support.

The Advanced Energy Fund, created by the Ohio Electric Restructuring Act, provided funding for energy efficiency and renewable energy projects.  The same bill introduced net metering, which allows homes and businesses that install alternative energy technology — solar, wind, biomass, hydro, etc. — to receive credit for the excess energy their systems generate.  Combined, these two efforts provided ways for individuals to reduce the cost of deploying “clean tech” or even turn it into a revenue generator.   Read More »

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Solar, Wind Prompting Electricity Grid Innovation In California

In a February Wall Street Journal article (“California Girds for Electricity Woes”), reporter Rebecca Smith gives an alarmist and misleading account of California energy regulators’ efforts to secure a cleaner, less expensive, more reliable electricity grid.  Right now, California has plenty of power:  44 percent more generating capacity than it typically uses, including a considerable fossil fuel energy portfolio.  Renewables – large scale, rooftop solar, wind, and, increasingly, energy storage – make up almost 15 percent of the grid, a percentage that will more than double in the next decade.  These clean, innovative energy technologies are working to improve the system by reducing the need for fossil fuels.

The reality is that the grid is changing, driven by California’s quest to secure an environmentally safe and affordable electricity system. Increasing the amount of renewable energy on the grid will mean that more generation is variable; electricity output from solar and wind depends on sunshine or windiness, respectively.    Up to this point, California has met this challenge by backing up clean resources with fossil fuels.  But California’s ratepayers can’t afford to keep doing this, so instead of “girding for woe,” the CAISO and the CPUC met to proactively address our changing future – to move California towards cleaner, less expensive electric grid planning.

This new approach can increase California’s ability to rely on clean energy generation by building greater flexibility into the system – while giving more options to consumers.  Not only can customer-based (“demand-side”) clean energy technologies reduce reliance on polluting power plants, they are quite likely to be more reliable and are potentially more cost-effective.   Demand response, or the ability of customers to choose to save money by responding to a price or electronic signal from the grid operator in times of excess system demand, will be key to integrating large amounts of intermittent solar and wind without back-up fossil or storage.   In fact, during afternoon peak demand, where supply is extremely limited in its ability to serve load, the addition of virtual generation resulting from the participation of DR into the market will actually lower energy prices.

California has already installed a robust digital metering infrastructure – and it’s time to put these meters to work by enabling customers to participate in demand response and other demand-side programs.  Coupled with technologies that now allow for fast, reliable, automated ‘set-it-and-forget-it’ adjustments to electricity use, we can seamlessly integrate variable electricity resources, such as wind and solar, without disrupting energy users.  Customers can choose to become an energy resource instead of fossil fuel plants.  Read More »

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