Archive for Middle Tennessee News

On Rooftops, a Rival for Utilities


For years, power companies have watched warily as solar panels have sprouted across the nation’s rooftops. Now, in almost panicked tones, they are fighting hard to slow the spread. And yet, to hear executives tell it, such power sources could ultimately threaten traditional utilities’ ability to maintain the nation’s grid. The battle is playing out among energy executives, lawmakers and regulators across the country. At the heart of the fight is a credit system called net metering, which pays residential and commercial customers for excess renewable energy they sell back to utilities. Currently, 43 states, the District of Columbia and 4 territories offer a form of the incentive, according to the Energy Department.

Many utilities cling to their established business, and its centralized distribution of energy, until they can figure out a new way to make money. It is a question the Obama administration is grappling with as well as it promotes the integration of more renewable energy into the grid. “I see an opportunity for us to recreate ourselves, just like the telecommunications industry did,” Michael W. Yackira, chief executive of NV Energy, a Nevada utility, and chairman of the industry group the Edison Electric Institute, said at the group’s convention. But utility executives say that when solar customers no longer pay for electricity, they also stop paying for the grid, shifting those costs to other customers.

Utilities generally make their profits by making investments in infrastructure and designing customer rates to earn that money back with a guaranteed return, set on average at about 10 percent. A handful of utilities have taken a different approach and are instead getting into the business of developing rooftop systems themselves. Dominion, for example, is running a pilot program in Virginia in which it leases roof space from commercial customers and installs its own panels to study the benefits of a decentralized generation.

Featured in the July/August issue of Solar Today Magazine is our remedy for this issue. Solar energy through micro-investing could be a solution for both the utility company and the customer. The individual or business would invest in solar energy with a small monthly purchase, perhaps $5 per month, using the micro-investment plan. This would provide opportunities to for all rate payers to invest in solar projects that would directly benefit them through lower electricity rates and return on investment. It overcomes the financing and siting obstacles that can keep would-be investors on the sidelines. As an example, if all TVA ratepayers became micro-investors at a rate of $5 per month, each year TVA would generate $135 million for constructing solar farms. This model protects everyone’s interest.

Arizona leads states in per-capita solar energy

The report notes that it is not availability of sunlight that makes states solar leaders, but the degree to which state and local governments have enacted effective public policy for the development of the solar industry.


Arizona leads the nation in per-capita solar energy, according to a report released Thursday.

Following Arizona, in descending order, are: Nevada, Hawaii, New Jersey, New Mexico, California, Delaware, Colorado, Vermont, Massachusetts, North Carolina and Maryland.

The details are in a report titled “Lighting the Way: What We Can Learn from America’s Top 12 Solar States,” released by the Environment America Research & Policy Center. The organization — online: www.EnvironmentAmerica.org — is a public interest group that advocates for strong environmental policy.

“The sky’s the limit on solar energy,” Rob Sargent, energy program director with Environment America, said in a news release. “The progress of these states should give us the confidence that we can do much more. Being a leader in pollution-free solar energy means setting big goals and backing them up with good policies.”

The report emphasizes that it is not availability of sunlight that makes states solar leaders, but the degree to which state and local governments have enacted effective public policy for the development of the solar industry.

Reference: http://www.thetowntalk.com/article/20130725/BUSINESS/130725020/Arizona-leads-states-per-capita-solar-energy-report-says

Do we want to control our energy future, or continue to rent it from other countries?

We will choose, either actively or subjectively

Do we want to control our energy future, or continue to rent it from other countries? This is the overarching question that we, the citizens of these United States, have to answer. It is decision making time. If we do not express our individual feelings about how our country moves forward to meet the energy challenges of today and of tomorrow, then we have only ourselves to blame. This question was raised by Hal Harvey, the chief executive of Energy Innovation, in an article by NY Times Thomas L. Friedman Op-Ed Columnist in a July 2, 2013. As Mr. Friedman so acutely points out. “We also have to ensure that cheap natural gas displaces coal but doesn’t also displace energy efficiency and renewables, like solar or wind, so that natural gas becomes a bridge to a clean energy future, not a ditch. It would be ideal to do this through legislation and not E.P.A. fiat, but Republicans have blocked that route, which is pathetic because the best way to do it is with a Republican idea from the last Bush administration: a national clean energy standard for electricity generation — an idea the G.O.P. only began to oppose when Obama said he favored it.”

Such a standard would say to every utility: “Your power plants can use any fuel and technology you want to generate electricity as long as the total amount of air pollutants and greenhouse gases they emit (in both fuel handling and its electricity conversion) meet steadily increasing standards for cleaner air and fewer greenhouse gases. If you want to meet that standard with natural gas, sequestered coal, biomass, hydro, solar, wind or nuclear, be our guest. Let the most cost-effective clean technology win.”

Is this consistent with the position that Senator Alexander has publicly stated, let the most cost-effective technology win? The one word omitted from the Senator’s message was the word “clean” which I am sure he would agree with having fought these many years for our natural resources such as preserving the environment of our own Smokies. Why not resurrect the Republican idea for a national clean energy standard for electricity generation? You must decide: “Is this in the best interests of our nation?”

Times article

US Utility Business Model Woes

Jennifer Runyon is managing editor of RenewableEnergyWorld.com

Jennifer Runyon, managing editor of RenewableEnergyWorld.com, had a three minute conversation with Dr. Stephen Chu, former Energy Secretary that emphasized the need for electric generators and distributors to change their business model to reflect the addition of renewables, particularly solar PV, as a significant addition to the energy mix. Chu feels that utilities ought to own solar panels and energy storage systems that they put on their customers’ roofs and in their garages. He said if utilities could outfit homeowners with solar panels and a 5-kW battery system, they could continue selling that customer power just as they do now. The utility would own the system, maintain the system and the customer would have no out-of-pocket expenses for it other than continuing to buy power at the same rate or at perhaps an even lower rate. This would nicely fit into the TVA distributors future business model for distributed solar installations while preserving the distributor’s mission of providing their customer base with high quality, reliable electric power.

When it’s just a quarter or a half of one percent of a utility’s customers that have their own PV and are selling their solar power to the grid at the retail rate, the utility doesn’t care. But energy storage and PV panel costs are dropping, and once that percentage of utility customers’ that are zeroing out their bill goes to 5, 10 or 15 percent then “it’s a big deal” said Chu.

Chu said he told utilities that PV and energy storage is going to come and they should “form a new business model” NOW so that what today is a potential revenue loss, could become an area of growth for them in the future. Plus, he said this model would eventually lead to a more stable grid for us all.

TSEA’s suggested micro-investment model suggested for TVA would complement the distributor’s suggested model, supplying solar energy at the most affordable prices with ownership of large solar farms in the hands of the ratepayer investors. The TSEA model avoids having to loan money from banks; instead, it will earn interest on the monies deposited in investments increasing the income the ratepayer investors make. The question is whether TVA and its distributors will accept these business model changes.

Runyon’s article

FREE NABCEP 40 HOUR TRAINING WITH THE NABCEP ENTRY LEVEL EXAM


Steve,
I wanted to inform you of some free solar classes I will be putting on. The 40 hour NABCEP course and exam will be given in all three regions of Tennessee. The first one will be in Middle Tennessee ( Spring Hill ) the week of July 22. The second class will be in East Tn , probably the last week of August and probably in Johnson City. The third will probably be in Jackson the week of September 9. The reason I don’t have specifics is that I am still working on venues for east and west Tennessee. If you could please spread the word so we can fill the classes. This is through Tennessee Department of Environment & Conservation; Office of Energy Programs.

Sincerely,
Earl

Earl Pomeroy
UT/CIS, TMEP
6615 Allen Road
Springfield, TN 37172
Office: 615-384-0629
Cell: 615-347-4381
Fax: 615-532-4937
Email: earl.pomeroy@tennessee.edu

Solar Industry Calls for Market Driven Approach to TVA Solar Programs

Wall Street Journal June 25, 2013

KNOXVILLE, TN–(Marketwired – Jun 25, 2013) – TenneSEIA, the state business association representing the solar industry, responded to the closure of TVA’s solar programs today by publically urging the authority to abandon the practice of setting arbitrary calendar year caps on solar installations and instead, adopt a market driven model that decreases incentives based on the amount of solar installed and incorporates the value of solar energy into the budgeting process. TenneSEIA hopes to resolve these issues prior to the TVA Board of Directors voting on the 2014 budget at its August 22(nd) meeting in Knoxville.

“Consumer demand for solar energy has grown faster than TVA’s ability to adjust, therefore leaving the market underserved, restricting the investment of private capital and creating unnecessary uncertainty for businesses,” said Gil Hough, president of TenneSEIA. “TenneSEIA is committed to working with TVA to create a fair and market driven approach to solar energy development in the Valley.”

TenneSEIA quickly sprang into action to work with TVA after the April 24(th) program closure announcement.

original article

MAJOR FUNDING Through Micro-Investments

The new July/August issue of Solar Today contains an article by TSEAs Technical Director offering a new idea for a solar program within TVA. Micro-investments allow anyone to invest in a project because the cost of a single share is affordable. A recent micro-investment concept was developed by Muhammad Yunus, a Bangladeshi banker who won the Nobel Peace Prize in 2006 for his work in creating economic and social development for the poor. A similar concept, savings bonds, was used in the United States and other countries to finance costs for World War I and World War II. During World War II, half the U.S. population purchased approximately $186 billion in savings bonds. This investment accounted for nearly three-quarters of total federal spending from 1941 to 1945 — all from families whose average wage was $50 per week.

The Tennessee Solar Energy Association (TSEA), an ASES chapter, has as its mission the promotion of the widespread use of solar energy in the state of Tennessee. Unlike most states, Tennessee is served entirely by electric distribution companies who purchase power from the Tennessee Valley Authority (TVA). The TSEA will use the concept of micro-investment to provide opportunities to all ratepayers to invest in solar projects in Tennessee. The success of our endeavors in Tennessee will mean that the concept can easily be duplicated in other states.

Financing solar projects through micro-investments offers many advantages. First, consumers and businesses would neither have to finance nor build their own solar projects on their properties. This eliminates three barriers they often face: (a) unsuitable properties for solar because of trees or rooftop alignments; (b) building permits and grid interconnections; and (c) large financial investments with long payback periods. Second, by opening investment opportunities for all ratepayers, a micro-investment plan should attract customers who otherwise would or could not have considered their own solar projects. Third, micro-financing can be used for large solar projects to benefit entire communities, taking advantage of the lower overall costs of large-scale projects. Finally, micro-investments would provide large sums to utilities and other solar companies who might otherwise not be able to finance a solar project.

Proving the Model at TVA
In the Tennessee Valley, TVA is a closed system in which all 155 distributors buy power from TVA, making it an ideal utility for studying this micro-investment model. Moreover, as a federal power authority, TVA plays an important role in the Tennessee Valley as the regional stewardship agency and supplier of public power. TSEA envisions that TVA would establish a micro-investment program, achieving even greater economies of scale than the individual distributors could achieve.

A 2012 Hart Research survey, funded by the Solar Energy Industries Association, found that 92 percent of voters “believe it is important for the United States to develop and use solar power.” TVA, serving 9 million people in the Tennessee Valley, can play a large role in finding the relationship between how much the public says it wants solar energy and how much the public is willing to invest.

TVA’s aging coal-fired plants are more than 50 years old and are depleting TVA funds to meet increasingly strict air-quality standards. As a result, the TVA has little funding available for solar energy. Although TVA has a renewable energy program known as Green Power Providers, which provides long-term power purchase agreements, the program has not produced a bankable level of funding that has resulted in loss of jobs and statewide solar installers to look elsewhere for work. The small amount of funds allocated for the program were absorbed in the first trimester of this year.

As a federal authority, TVA is in an ideal position to undertake a micro-investment program. Under the TVA charter, the president can direct the U.S. Department of Energy to provide support and resources as requested by the TVA board, which is directed to make studies “in the application of electric power and a better balanced development of the resources of the region” (Tennessee Valley Authority Act of 1933, Section 10). Furthermore, TVA pays no property tax, has a plethora of sites where large solar installations can be located, knows where in its power system to best locate large solar farms to provide the greatest ROI, has the staff to manage the program, can handle the procurement actions and can set aside a percentage of the installations for local installers. Thus TVA can avoid all the soft costs that ordinarily burden solar purchasers. In addition, its purchasing power, backed by the aggregated micro-investments, will produce the lowest cost through competitive bidding.

I suggest to all our members and readers of this column to join ASES and help promote solar energy in their region.

Read the article and the entire Solar Today magazine

Tennessee Senators – Level the Playing Field of the Master Limited Partnership Legislation

Senator Alexander is quoted in a National Journal article as acknowledging climate change and the need to reduce carbon pollution. Two of his “four grand principles” includes ending the obsession with taxpayer subsidies and strategies for expensive energy and allowing marketplace solutions to create an abundance of clean,cheap, reliable energy. Right now taxpayers are subsidizing energy sources including all fossil-fuels and one wonders if our two senators are willing to eliminate all subsidies for all energy sources. The United States taxpayer is fossil fuels’ largest benefactor at $502 billion in 2011. That $502 billion is just over 3% of the US economy, currently being given away to big fossil fuels companies. Now let’s talk about leveling the playing field for energy choices based on Senator Alexander’s desire for clean, cheap, reliable energy. Depends on how you choose to compare these choices. For example, the industry uses “Grid Parity.” “Grid Parity” is defined as the point when PV-generated electricity becomes competitive with the retail rate of grid power. TVA has stated that it expects grid parity for solar in the valley by 2016. With the cost of solar energy decreasing and the cost of traditional power increasing, the abundance of clean, cheap, reliable energy will favor renewables after 2016 which is less than 3 years away.

Then there is the “Levelized cost of energy” (LCOE). LCOE is the minimum price at which energy must be sold for an energy project to break even. Typically LCOEs are calculated over 20 to 40 year lifetimes, and are given in the units of currency per kilowatt-hour, for example USD/kWh. Solar’s LOE uses a life of 20 years. We know that is an understatement for the useful life of solar based on monocrystalline silicon based panels. First, the panels are warranted to have a 80% output at the end of 25 years. Second, studies of 30+ year old panels showed no degradation. A more rational life of the premium solar panels should be either 30 or 40 years in life. This drastically reduces the LOE for solar.

We can further decrease cost of solar by giving it the same tax benefits as all the other energy fuels. This can be done by including renewables in the recent legislation offered in the house and senate. In the senate the legislation is called “The Master Limited Partnerships Parity Act.” The Master Limited Partnership includes all fossil-fuels but not renewables. Both houses have bi-partisan support for the addition of renewables. In a Duke study, a baseline LCOE for all energies included in the MLP showed a decrease in LCOE of 5 cents per kilowatt-hour without federal tax credits. In addition the inclusion of renewables in the MLP legislation would reduce the cost of financing of renewable energy projects by that same 5 cents per kilowatt-hour. Today,the cost of financing makes up an ever-greater fraction of the total cost of renewable projects by as much as 50% according to Brookings.

Should the federal government continue research into solar photovoltaics? The answer is yes. The aim should be to increase the efficiency of future solar systems while keeping close control of the cost of manufacturing.

Senators Alexander and Corker, support the Master Limited Partnership Parity Act and hold to Senator Alexander’s principal of to create an abundance of clean,cheap, reliable energy.

Master Limited Partnership Parity Act – What It’s All About

In the race to capture the economic benefits of the growing clean energy sector, the Master Limited Partnership Parity Act would provide an opportunity for U.S. businesses to mobilize private capital and better compete. It would provide the same tax treatment for investments in clean energy and fossil fuels . Sen. Chris Coons (D-DE) introduced the bipartisan bill today with original co-sponsors Jerry Moran (R-KS), Lisa Murkowski (R-AK), and Debbie Stabenow (D-MI). Congressmen Ted Poe (R-TX), Mike Thompson (D-CA), Peter Welch (D-VT), Chris Gibson (R-NY), and Cory Gardner (R-CO) co-sponsored companion legislation in the House.

“We applaud this bipartisan group of co-sponsors on the introduction of the Master Limited Partnership Parity Act,” says Phyllis Cuttino, director of Pew’s clean energy program. “Our research indicates that nations with consistent, transparent clean energy policies do better in attracting private investment.”

If approved by Congress, this tool could lower financing costs for clean energy projects, some by as much as 50 percent, according to Recycled Energy Development, a waste energy power producer. The market value of the master limited partnerships has grown to about $370 billion The bill is supported by clean energy businesses (PDF), labor and environmental groups, and policy organizations.
A master limited partnership is a business structure that has the tax advantages of a partnership but whose ownership equity can be traded as easily as public stock. Energy projects qualifying as a master limited partnership have access to low-cost capital and liquid investment opportunities as well as a relatively high rate of return for investors. Master limited partnerships have existed since 1981 and are available to investors in fossil-fuel extraction and pipeline projects.

By expanding the list of qualifying projects to include solar, wind, geothermal, and other clean energy and transmission technologies, renewable-power projects could access new financing markets, thereby increasing investment and deployment of these clean technologies.

original article

Returns on investing in solar has banks and investors funding distributed solar

SLevy: Distributed solar is disruptive to electric distributors, especially in regions with high power rates. Solar will accelerate installations, a fact that must be factored into the future business plans of our distributors here in the valley. To support this statement Edison Electric Institute recently published a report entitled “Disruptive Challenges: Financial Implications and Strategic Responses to a Changing Retail Electric Business.” TSEA offers distributors its services in understanding the impact and has suggestions towards solutions to avoid faced with unpleasant alternatives.

There were a record number of solar panels installed in the U.S. on rooftops and on ground-mounted systems in 2012. Now both traditional financing companies and new types of investors are starting to get in on the trend of providing the funds for the high upfront costs of installing solar panels, in exchange for making some money back several years down the road. But the potential to make money in this way has only just started.

Solar leases are a contract between the building owner and SolarCity, whereby SolarCity pays the upfront cost of installing the system, owns and maintains the panels, and the building owner pays for the monthly electricity for the power from the panels over around 20 years. As Ucilia noted on GigaOM Pro today, the residential solar leasing market alone is expected to grow from $1.3 billion in 2012 to $5.7 billion in 2016, according to GTM Research.

SunPower said earlier this month that demand for its residential solar leases is far greater than the money available to finance them.

It’s not just banks and corporate do-gooders that want the opportunity to make a decent return — some 10 to 12 percent in some cases. Crowd-funding is starting to appear as an interesting blip on the radar. Startup Solar Mosaic says that it’s now raised $1 million from its crowd-funders for its solar panel systems, which offer around a 4.5 percent annual yield.

original article