Wind power hit important milestones in 2011

The American Wind Energy Assn. said U.S. wind power achieved several important milestones in 2011.

Among the accomplishments, two states — Iowa and South Dakota — were the first to get an average of 20% of their electrical power from wind energy, the AWEA said. The 20% threshold was first mentioned as an important standard in the Department of Energy's 2008 report, "20% Wind Energy by 2030."

The AWEA said Xcel Energy's utility in Colorado set a record on Oct. 6th when 55.6% of the electricity consumer by its 1 million customers was coming from wind energy. That broke a record of 53% that had been set in Spain in 2009, the AWEA said.

In terms of total power capacity, the AWEA said California ranks third in the nation, behind Texas and Iowa.

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Photo: The Buena Vista wind farm in the Diablo Range's Altamont Pass in Northern California. The American Wind Energy Assn. says California ranks third in the nation in wind power capacity. Credit: Don Kelsen / Los Angeles Times.

Solar industry booming, but problems loom

Solar power is a booming business in the U.S., according to a report released today by GTM Research and the Solar Energy Industries Assn. (SEIA). The study said there were more domestic solar installations completed in the third quarter of this year than during all of 2009.

"The U.S. solar industry is on a roll, with unprecedented growth in 2011," said Rhone Resch, president and chief executive of SEIA, at an event announcing the release of the report. "Solar is now an economic force in dozens of states, creating jobs across America."

SEIA is the national trade association of the U.S. solar energy industry, and it has 1,100 member companies.

Some 449 megawatts of power were installed in various parts of the U.S. in the third quarter in a variety of projects that ranged in size from large, utility-scale facilities to small residential systems, the report said. One MW or megawatt is the equivalent of 1 million watts of power.

The record third quarter, which was a 140% increase over the same period a year ago, also boosted the number of domestic solar installations in 2011 past the 1,000 MW mark, surpassing the 887 MW completed during all of 2010. The projects contributed to the 100,237 solar related jobs in the U.S., a figure that has doubled since 2009, SEIA said.

The bulk of those third-quarter installations were in California, which accounted for 44% of the total or nearly as much as the next six states combined. California has 25,575 solar-related jobs, or more than one-quarter of the national total.

But the report also warned that the U.S. solar industry faces considerable uncertainty in 2012 and beyond because of the coming expiration of the Section 1603 Treasury Program. SEIA said the program had awarded over 3,600 grants totaling $1.5 billion for more than 22,000 individual solar projects in 47 states, as of November of this year.

SEIA also said that 1603 Treasury program supported over $3.5 billion in private investment. But the program expires at the end of the year, which has many in the industry worried and clamoring for an extention.

"Our industry needs stable policy on which to make business decisions, said Resch, later adding, "To keep the industry growing and creating jobs in the U.S., we need Congress to extend the 1603 program. The 1603 program has done more to expand the use of renewable energy than any other policy in U.S. history."

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Photo: Ivanpah Site Compliance Manager Douglas Davis talks to reporters during Phase 1 of the 370-megawatt Ivanpah Solar Electric Generating System construction project, currently underway in California's Mojave Desert. The domestic solar industry is booming, but advocates say problems loom. Credit: Josie Lepe / San Jose Mercury News / MCT

Wind industry says jobs will be lost if tax credits expire

A new study released by the American Wind Energy Assn. today said 54,000 jobs can be created and maintained if Congress acts to extend the Production Tax Credit, which is set to expire in 2012.

“American manufacturing jobs are coming back, with tens of thousands of new jobs from wind power,” said Denise Bode, chief executive of the American Wind Energy Assn. (AWEA). “But these jobs could vanish if Congress allows the Production Tax Credit to expire."

The federal renewable-energy production tax credit allows wind producers to take a 30% investment tax credit. They could also choose to receive a 2.2-cent-per-kilowatt-hour production tax credit as an alternative. The tax credits have been in place since 1992.

The report, by Navigant Consulting Inc., analyzed two scenarios. In the first, the tax credit is allowed to expire; in the second, the tax credit is extended through 2016.

Navigant's study says that the wind market will shrink dramatically without the tax credits, with the number of jobs in the wind industry falling from nearly 78,000 to about 41,000 by 2013.

Navigant says the number of wind energy supported jobs will climb to 95,000 by 2016 if the tax credits are extended.

Related benefits of an extension would include a reduction in carbon dioxide emissions of about 170 million tons, the report said.

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Photo: A field of 200-foot-tall wind turbines make up the Nine Canyon Wind Project in the southeast corner of Washington state. A new report says that wind power investment will decline sharply if tax credits are not extended. Credit: Tri-City Herald/MCT

Buffett company purchase gives solar industry big boost

Warren Buffett’s MidAmerican Energy Holdings company has agreed to buy a giant, 550-megawatt photovoltaic farm currently under construction in San Luis Obispo County for $2 billion, giving a huge boost to the solar industry that could spur investment by other major players.

The "utility-scale" facility MidAmerican is purchasing is being built by First Solar Inc. of Tempe, Ariz. A spokesman for First Solar, Alan Bernheimer, said the farm would produce enough power to provide for the energy needs of 160,000 California homes. But the investment had deeper meaning for an industry that still has only a small footprint in the nation's energy mix and has been battered by recent bankruptcies.

"In a lot of ways, this is classic Warren Buffett," said Bruce Bullock, executive director of the Maguire Energy Institute at Southern Methodist University. "He comes in to an industry that is starving for capital investment. At the same time, this is something that also tells people it's time to take solar power seriously."

Solar power currently provides just 1% of the nation's renewable power generation, according to the Energy Department. But it is also the nation's fastest-growing energy generation platform, said Michelle Kinman, a clean-energy advocate for Environment California.

"Solar is a sound investment," Kinman said, "a fact bolstered by MidAmerican's announcement today."

Others thought it was a little too early to get excited.

"It's one purchase of one very large system," said Paula Mints, a market research analyst and director in Navigant Consulting Inc.'s energy practice. "If he [Buffett] continues to invest in this sector, it will be significant."

Bernheimer of First Solar said the the project was being built on 3,500 acres of unproductive farmland and would average about 400 construction jobs over the course of its development. Construction is expected to be completed by 2015, but the facility is expected to begin producing power for Pacific Gas & Electric sometime next year.

Berkshire shares fell 1.1% after the announcement, while First Solar shares climbed 7.7% to $49.65.

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Photo: Investor Warren Buffett is moving into solar power in a big way. Berkshire Hathaway's MidAmerican Energy holdings company has agreed to buy First Solar Inc.'s 550-megawatt solar farm in San Luis Obispo County for $2 billion. Credit: Nati Harnik / Associated Press

California invests in 'green' bonds

California is buying $400 million worth of so-called green bonds from the World Bank.

The purchase is a good deal for the state's taxpayers and also for financing of needed environmental projects in dozens of countries, state Treasurer Bill Lockyer said.

The short-term bonds, which mature on Dec. 16, 2013, will be used by the international financial institution to pay for reforestation, alternative energy and water purification projects, among others.

"These bonds are a great investment for California and its taxpayers," Lockyer said. "We're earning an excellent return, strengthening our portfolio and backing our policies with money in the fight against global warming."

The bonds have a 0.51% yield, roughly double the current rate on two-year U.S. Treasury bonds, 0.26%, Lockyer said.

The purchase is the state's second since April 2009, when California became the first U.S. buyer of the international green securities, acquiring $300 million worth in an investment that matures next April.

The bonds were bought by the state Pooled Money Investment Account, which manages $65 billion for the state, local governments and school districts.

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Photo: A solar power plant in the Mojave Desert. Credit: PBS photo

SolarCity proves there is life after federal loan guarantees

SolarCity, the San Mateo-based company that is one of the country's largest residential solar energy system providers, is proving that you don't need a federal loan guarantee to find financing for major projects.

SolarCity Corp. had seen its hopes for a U.S. loan guarantee evaporate in the political fallout from the widely publicized Solyndra LLC bankruptcy. But the company said this week it was able to obtain financing from Bank of America Merrill Lynch.

The Bank of America financing will allow SolarCity to move ahead on its five-year, $1-billion "SolarStrong" rooftop project for military housing. As part of the project, SolarCity plans to partner with privatized military housing developers to install, own and operate rooftop installations and provide solar electricity for Armed Forces families at lower costs than traditional utility power.

SolarCity officials said they hope that the project will provide power to as many as 120,000  military housing units, adding that they would be creating the largest residential solar photovoltaic project in American history. They added the effort was groundbreaking in other ways as well.

"This is the first project of this kind of scale to be financed without a federal loan guarantee. We would not be able to do this without Bank of America Merrill Lynch," said Lyndon Rive, SolarCity’s chief executive officer.

Rive said that the deal was also a sign that lenders were becoming more comfortable with the idea of making major financing available for large-scale solar projects.

"Last year, this would not have been possible without the backup of a federal loan guarantee," Rive said.

Jonathan Plowe, head of new energy and infrastructure solutions at BofA Merrill, said two things tipped the scales in favor of SolarCity.

"Until a few months ago, there were no large-scale debt financing tools available for distributed solar projects," Plowe said. "But we have been able to develop a business model that can work without a loan guarantee.

The other factor, Plowe said, was BofA Merrill's confidence in SolarCity as a well-run company.

"We have spent a tremendous amount of time learning about their business," Plowe said. "SolarCity is clearly a leader in this space and we have gotten to know this project very well over the last several months."

Before the financing agreement with BofA Merrill, the Energy Department had offered SolarCity a conditional guarantee in September for 80% of a $344-million loan to support SolarCity’s military housing project. But that came during the same week that Fremont-based Solyndra filed for bankruptcy after it had received $535 million in guarantees from the same program.

In an atmosphere of increased scrutiny after the Solyndra debacle, it became apparent that SolarCity's loan guarantee paperwork wouldn't be completed before the program expired. Now, under the terms of the new agreement, Bank of America will provide up to $350 million in financing.

SolarStrong Installations have already begun at military housing units at Joint Base Pearl Harbor-Hickam in Hawaii. SolarCity said the program will expand into states such as California, where electricity rates are higher than other parts of the U.S.

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Photo: Workmen install solar panels at a SolarCity project at Hickham Communities at Joint Base Pearl Harbor-Hickam. Credit: Lend Lease.

California ratepayer advocate complains of high solar power costs

California consumers will be paying too much for electricity generated by a large solar-thermal power plant being built in the Mojave Desert, the state's independent ratepayer watchdog agency said.

The Division of Ratepayer Advocates questioned the California Public Utility Commission's 4-1 vote Thursday to approve the Mojave Solar Project's 25-year power contract with Pacific Gas & Electric Co.

"The commission has the power to keep the cost of renewable energy reasonable," said the division's acting director, Joe Como. The commission, he said, "is signaling to the market that California will accept overpriced renewable energy and that it is willing to lock customers into higher rates for decades to come."

In a statement, the PUC confirmed that the contract "is more costly than other procurement opportunities available to PG&E," but said it "determined that the value of adding the Mojave Solar Project to California's fleet of renewable energy generation capacity warranted approving the project."

The contract had to be renegotiated higher because of an expected delay in upgrading the transmission network, the PUC said.

 PUC Commissioner Mark J. Ferron said he has "high confidence" that the Mojave plant will get built.

"The technology is tried and true, the financing is all wrapped up with the U.S. Department of Energy loan guarantee," he said, "and we're told that the hard hats are on and the bulldozers are ready to roll."

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Photo: Mirrors concentrate solar power at Mojave Desert power plant. Credit: PBS

Biofuels, wind power show gains, but hurdles remain

Biofuels and wind power are having the biggest new impact in American power generation, according to a report released today by the U.S. Energy Department. Consumption of biofuels has risen 16-fold since 2000 and wind power use has seen an eight-fold increase during the same period.

Among renewable energy sources, only solar power is rising faster, the Energy Department said. But solar and photo-voltaic power are still the smallest contributors to the nation's energy needs, accounting for just 1% of the renewable total.

Hydroelectric power remains the biggest resource, at 31% of all renewable energy produced in the U.S., but it is not a growing resource. Wood is next, at 25%, followed by biofuels (23%), wind (11%), waste (6%), and geothermal (3%). Altogether, renewables account for 8% of U.S. energy production.

The Energy Department said that improved technology was part of the reason for the growth in electricity generation from wind power, which rose from about 6 billion kilowatt-hours in 2000 to about 95 billion kilowatt-hours in 2010. But the Energy Department also cited the importance of financial incentives in the form of federal production tax credits and grants.

The American Wind Energy Assn. is lobbying Congress to extend the tax measures amid partisan political wrangling over the issue, fearing the industry's ability to thrive without them.

Biofuels have made a huge splash recently. Earlier this month, Continental Airlines Flight 1403 made history when it landed at Chicago's O'Hare airport as the nation's first biofuel-powered revenue generating passenger flight. Alaska Airlines this week launched a round of 75 flights it said would be powered by biofuels.

But the biggest hurdle for renewables is cost. For 11 days of biofuel-powered flights, Alaska Airlines purchased 28,000 gallons of biofuel for a whopping $476,000. That works out to about $17 a gallon or about six times more than what it would have paid for regular jet fuel.

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Photo: Turbines line the hillside at First Wind's power project in Sheffield, Vt., which is ready to generate power after an eight-year planning and building process. Photo credit: Toby Talbot/AP

New geothermal maps show vast potential energy source

Geothermal energy is hardly new. There is evidence that it was used in the U.S. as early as the 1800s. In 1904, a fellow named Piero Ginori Conti opened the first geothermal plant in Larderello, Italy. It was a dry steam reservoir that was used to generate electricity.

But geothermal, like a lot of alternative energy technologies, barely registers in a nation that still depends mostly on oil and coal. Currently, there is only about 3,000 megawatts of installed geothermal energy capacity in the U.S., according to the Southern Methodist University Geothermal Laboratory. That's in a nation with a total energy generating capacity, from all sources, of 1 million megawatts.

Now, the SMU laboratory has released a new series of geothermal maps of the U.S. that show a practically limitless source of energy -- if it can be tapped.

David D. Blackwell, a geophysics professor at the lab, said the "technical potential" of what could be tapped was roughly equal to about 3 million megawatts, or three times the nation's current energy production.

"The technical potential is our best estimate of what actually might be extracted," Blackwell said. "The question is, 'Do we have the will to go ahead and try to really develop it?'"

The new maps, such as the one displayed here at a depth of 6.5 kilometers underground, show heat sources that range from a relatively cool 50 degrees Celsius (about 122 degrees Fahrenheit) to 300 degrees Celsius.

Most of the hottest spots are in the Western U.S., but SMU officials said that newer technologies for tapping geothermal sources could take advantage of cooler hot spots in West Virginia, Texas and along the Gulf Coast.

"The eastern two-thirds of the country were always dismissed in terms of geothermal potential," said Cathy Chickering, an SMU lab geothermal specialist, adding that the newer technologies could produce energy in those areas.

As an example of the new technologies, Pickering cited the Chena Hot Springs in Alaska, where geothermal energy is being produced in water that is 74 degrees Celsius. "That's significantly cooler than the temperatures people think of as necessary for generating geothermal energy. Other technologies can exploit dry heat by injecting water underground.

The maps were funded in part using by a three-year $480,000 grant from Google. They can be viewed here.

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Graphic: One of the SMU Geothermal Laboratory's new "temperature at depth" maps of potential new sources of energy. Credit: Courtesy of SMU Geothermal Laboratory.

 

Energy watchdog warns against reliance on fossil fuels

The Paris-based International Energy Agency warned today that world governments are locking themselves into a potentially disastrous future that depends too much on fossil fuels. The message came as the IEA released its annual World Energy Outlook.

The IEA has served as a kind of energy watchdog for industrialized nations since the 1973-74 oil crisis.

"We cannot continue to rely on insecure and environmentally unsustainable uses of energy,” said IEA Executive Director Maria van der Hoeven, adding that recent events helped illustrate the dangers, "The Fukushima nuclear accident, the turmoil in parts of the Middle East and North Africa and a sharp rebound in energy demand in 2010, which pushed CO2 emissions to a record high, highlight the urgency."

The IEA has projected a growth in world energy demand of 33% by 2035, most of it driven by China, India and emerging economies. But it also believes that the share of global energy provided by renewable sources, under current mandates, will rise from 13% currently to only 18% during the same period.

That means that the demand for oil, for example, will only continue to increase, from 87 million barrels a day in 2010 to 99 million barrels a day in 2035, the IEA said. The use of coal, the IEA predicts, will rise 65% by 2035.

“Governments need to introduce stronger measures to drive investment in efficient and low-carbon technologies," van der Hoeven said.

The IEA said the modest rise in the share of energy gained by renewables by 2035 was also predicated on a growth in government subsidies from a current $64 billion to $250 billion by 2035, a rise that is by no means certain "in this age of fiscal austerity." The IEA also noted that government subsidies of fossil fuels amounted to $409 billion in 2010.

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Photo: A National Transitional Council fighter patrols the Libyan Oil Refining Co. in Ras Lanuf, west of Tripoli. The Libyan civil war shut down that country's 1.6-million-barrel-a-day oil production. The unrest throughout the Middle East was a sign, says the IEA, of the peril of dependency on fossil fuels. Credit: Youssef Boudlal / Reuters

 

 

White House orders loan review to avoid more Solyndras

The White House, shifting its position on the Energy Department's loan guarantees, said it will now review the entire program for such ill-fated decisions as the much-publicized $535-million loan guarantee for California solar equipment maker Solyndra, which later fell into bankruptcy.

The step aims to defuse the embarrassing Solyndra episode, which has given rise to criticism that the Obama administration has wasted hundreds of millions of dollars in taxpayer money.

In a news conference this month, the president asserted that "the overall portfolio has been successful." He said: "It has allowed us to help companies, for example, start advanced battery manufacturing here in the United States. It’s helped to create jobs."

Obama’s defense opened him to charges that he has been tone-deaf to Solyndra’s implications. With the economy still weak and deficits topping $1 trillion, the White House can’t afford to be seen as lax overseers of taxpayer dollars.

Republicans have seized on the issue. As Obama crisscrosses the country pressing for his $447-billion jobs plan, Republicans have been citing Solyndra as an example of stimulus spending that backfired.

GOP presidential candidate Mitt Romney, speaking at the Values Voter Summit this month, said: "I welcome renewable energy. But as an old venture capitalist myself, I can tell you this: There will be no more Solyndras."

White House chief of staff William Daley ordered the 60-day evaluation and asked for recommendations about "how to improve the loan monitoring process," according to the White House.

Leading the inquiry is Herb Allison, a former Treasury official who oversaw the federal bailout program for the financial sector.

In a statement, Daley said that "while we continue to take steps to make sure the United States remains competitive in the 21st century energy economy, we must also ensure that we are strong stewards of taxpayer dollars."

Investigators are poring over the Solyndra deal. The Justice Department and congressional Republicans have been investigating the loan since the company filed for bankruptcy. At the request of Republican-controlled congressional committees, the White House has turned over thousands of emails, some of which showed administration officials rushing to approve the deal in time for a glitzy photo op.

The White House has balked at releasing everything in its possession, including the president’s BlackBerry messages. Republicans are threatening to use subpoenas to get more information even as the administration prepares to release thousands more email communications in the coming months.

They aren’t stopping at Solyndra. Congressional investigators have recently turned their attention to loan guarantees granted by the Energy Department to two automakers -- Fisker Automotive and Tesla Motors -- and to the U.S. subsidiary of a steel company owned by a Russian firm.

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Photo: Solyndra's headquarters in Fremont, Calif. Credit: Robert Galbraith / Reuters