A 50-kilowatt array has been installed at Bonnaroo paid for by donations from attendees. Voluntary contributions from Bonnaroo’s roughly 80,000 annual attendees, collected through ticket sales since 2012, footed the bill for the system. Bonnaroo reserves opt-in donations exclusively for onsite sustainability improvements. In addition, festival organizers added a $1 fee to every ticket sold in 2012 to generate additional money for green initiatives. The solar installation directly resulted from both types of fan support.This is the first permanent solar system installed at a major American music festival. The clean energy produced by the system is equivalent to 20 percent of the power consumed at Bonnaroo during the annual four-day music and art extravaganza. David Bolt’s company, Sustainable Future, installed 196 SolarWorld panels. David Bolt stated that his company will supply an additional, temporary solar array at this year’s festival, which will provide shade as well as electricity for fans. “An important aspect of sustainability is to use land efficiently. Employing panels to create shade for fans next to the solar stage at Bonnaroo is a great way to accomplish this.” The system, mounted on the roof of a metal structure in the backstage area, will generate more than 61,000 kilowatt-hours of energy each year – equal to about 20 percent of Bonnaroo’s total annual power needs. While the system will not be visible to patrons, fans will peruse a solar display in “Planet Roo,” an area devoted to sustainability.
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TVA Cuts Back on Bellefonte Nuclear Plant While Residential demand spurs U.S. solar installations in 1Q13
The nation now exceeds 8.5 GW of cumulative installed solar electric capacity, of which 7.9 GW is PV. Solar nearly made up half (48 percent) of all new electric capacity installed in the U.S in 1Q13. Meanwhile in an effort to revive the stalled build at the Bellefonte nuclear power plant, the Tennessee Valley Authority is trimming the project’s budget by 64 percent and cutting 530 jobs at the facility, The budget for Bellefonte is being cut from $182 million to $66 million. According to the AP, the massive cutbacks call the entire future of the project into question.
The cutbacks come on top of a spate of bad news for the nuclear industry, culminating in the announcement last week that Southern California Edison was permanently closing the long-troubled San Onofre nuclear plant.
U.S. solar energy installations totaled 723 megawatts (MW) from January through March, a 33 percent increase from a year ago and the solar sector’s best-ever first-quarter performance. Residential solar installations rose 53 percent year-on-year to 164 MW, with the utility segment more than doubling to 318 MW. Third-party-owned solar residential systems made up two-thirds of all residential PV installations in California (exceeding non-residential for the first time), and 86 percent of them in Arizona. Residential solar has managed to expand, at times well into double-digits, for 12 of the past 13 quarters. The only top-tier residential market to shrink in 1Q13 was Arizona, which fell 9%. Average PV system costs were $3.37/W, a 24 percent drop over the past year, though that’s about 10 percent higher than the previous quarter because of fewer utility-scale projects coming online. Residential systems fell about 16 percent Y/Y (2 percent Q/Q) to $4.93/W, non-residential also fell 16 percent Y/Y (8 percent Q/Q) to $3.92/W, and utility system prices declined 26 percent Y/Y but only 6 percent Q/Q to $1.12/W. Note that there’s an especially wide range of installed PV prices by state, anywhere between $3-8/W.
Risks to distributed generation of solar PV are threefold, say SEIA and GTM Research:
Net metering revisited. As distributed generation expands, utilities are seeking to revise, cap, and even remove net metering. This will take different forms in different regions — and varying degrees of resistance or acceptance — but it will have major implications everywhere.
Utility electricity rate structures. How utilities set up their tariff structures, incorporating time-of-use pricing and fixed or volumetric charges, will have a significant impact on the economics of solar energy systems. “While net metering is currently a more public battleground, we anticipate that rate structures will soon follow behind,” they say in the report.
Who’s going to pay for it? Distributed generation could require more than $48 billion of investments from now through 2017 — far exceeding what’s been provided to date. There will be a need for new sources of capital, new financing models (think REITs and MLPs, and crowdfunding and community solar), and new investors in existing structures (tax equity). “Project finance could serve as a significant bottleneck to growth over the next four years,” they write.
SLevy comment: This post is to present the rationale for not including renewables in the Master Limited Partnership legislation. So we have both pro- and con- arguments on proposed legislation so that you, the reader, can provide your opinion as to whether our federal legislature representatives in both houses should or should not support the MLP parity act. Send in your comments and we will post them on our site.
Master Limited Partnerships (MLPs) operate like publicly traded corporations, with publicly traded stock, but don’t pay income taxes. Most folks who’ve touted expanding MLPs to include renewable energy projects see this move as “leveling the playing field.” And it will. It will allow big energy corporations to avoid paying taxes on their renewable energy projects just like they do for pipelines. First, there are many powerful, regulated industries that would love a bite at this apple, like the existing electric and gas utilities. The cost to taxpayers from letting these hogs get to the trough is likely much, much larger than the opportunity for renewable energy. These big industries – with huge lobbying budgets – are not likely to miss the opportunity.
But even more important, the extension of MLPs to renewable energy is likely to reinforce centralized, corporate control of the energy system. Right now, renewable energy – particularly solar – is transforming the energy system. It’s turning energy consumers into producers, re-routing energy dollars back into community economies, and giving cities and towns more control over their energy future. Half or more of new solar power in the U.S. is being put on the rooftops of homes and small businesses. New community solar policies (like one just adopted in Minnesota!) are giving even more Americans a chance to have skin in the energy game and share in the profits of a transition to renewable energy.
The average American isn’t going to be a shareholder of a Master Limited Partnership, but they probably will pay a share of phantom taxes in their electric and gas rates if MLPs are expanded to other energy industries. Even if Congress miraculously limits the MLP expansion to just the renewable energy industry, subsidiaries of most of the large corporations in the energy business (Shell, BP, Exxon) are building wind and solar projects. These subsidiaries would certainly be reorganized as MLPs, giving them a tax advantaged opportunity to crowd out competitors (like community solar or other distributed generation) AND make larger profits off their renewable energy business.
John Farrell authored the original article
Some U.S. utilities are looking at getting into the solar rooftop business as the installations are creating an increasing threat to their business model.
The Wall Street Journal reported companies such as American Electric Power co. and Southern Co. are looking at making the move.
Arizona Public Service Co. has only a rooftop program for government and schools. Salt River Project has built a large solar system and allowed people to buy into it instead of getting rooftop solar.
update: An appropriate quote from an article in the Forbes article: “The electric utility business model is broken. Rather than burn the Earth in political battles over net metering, we should be reimagining the regulatory compact between utilities and ratepayers and regulators.” to which I say Amen.
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.
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.
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.
SLevy: The price of electric power in parts of California is as high as 35 cents per kilowatt-hour. A strong motivation for solar whereas Tennessee has a lower price of electricity at the present. The motivation here in Tennessee is improved air quality and a buffer against future costs with other forms of electric power generation.
The town of Sebastopol, in the apple- and grape-growing rolling hills of western Sonoma County, is following suit with a much more aggressive ordinance, suggesting that solar-by-fiat might be more viable as policy. In Sebastopol, a system would also qualify if its output meets three-quarters of the building’s electrical load on an annual basis. The ordinance also includes a provision that allows officials to exempt buildings from the requirement if a site isn’t conducive to solar, but a fee or other energy-saving measures could be required.
Mayor Michael Kyes told the Press-Democrat in nearby Santa Rosa that Sebastopol, with a population of around 7,500, already had some 1.2 megawatts of installed solar capacity. “This ordinance will add to it,” the mayor said. According to the Press-Democrat, there was a citizen objection to the solar requirement registered at the Sebastopol Council meeting; someone said “mandatory sort of implies coercion” (a sentiment it’s hard to argue with). But of course all manner of building requirements are essentially coercive, and Councilman Robert Jacob seemed to capture the sentiment of the town leaders when he said that “this ordinance is not only cost-saving…it’s the responsible thing to do.”
SLevy: Every solar investor wants to maximize its return on investment. In my judgement the reason for Sun Power’s success is they provide a product with the greatest return on investment over the long term. What I mean by long term is tens of years and beyond. Their panels produce the highest output power per area of any other manufacturer. We know that the life of the premiere monocrystalline panels is beyond 40 years. Using 40 years in computing the Levelized Cost of Energy results in more realistic results in cost per kilowatt-hour.
PV energy provider (PVEP) SunPower has revealed that demand exceeded its ability to supply product and services in the first quarter of this year.
The PVEP reported that it had exceeded revenue, gross margin and earnings forecast for the first quarter of 2013, while generating significant free cash flow of US$216 million, including lease financing, which was sold out in the quarter.
SunPower noted that due to several massive PV power plant projects in full swing in the US, strong demand for lease financing rooftop business in the US and ongoing PV module partnership success in Japan that was set to continue throughout the year, it was sold out for the year.
Management noted that its project development business was on course to provide US$3.5 billion in revenue and approximately US$1 billion in gross margin from 2013 through 2016.
Importantly, SunPower said that during the first quarter, the company was awarded 65MW of rooftop projects in France during a recent tender process, which had been supported by majority company owner, Total.
With demand increasing, SunPower said that it increased cell production in the quarter to 208MW, up 36% from the previous quarter. SunPower recognised 172MW of sales, while it shipped 186MW. Total module production capacity remained at 1.2GW. Full capacity was expected to be reached in the second half of the year.
Scientific instruments showed that the gas had reached an average daily level above 400 parts per million — just an odometer moment in one sense, but also a sobering reminder that decades of efforts to bring human-produced emissions under control are faltering.
The best available evidence suggests the amount of the gas in the air has not been this high for at least three million years, before humans evolved, and scientists believe the rise portends large changes in the climate and the level of the sea.
Carbon dioxide rises and falls on a seasonal cycle, and the level will dip below 400 this summer as leaf growth in the Northern Hemisphere pulls about 10 billion tons of carbon out of the air. But experts say that will be a brief reprieve — the moment is approaching when no measurement of the ambient air anywhere on earth, in any season, will produce a reading below 400.
“It feels like the inevitable march toward disaster,” said Maureen E. Raymo, a scientist at the Lamont-Doherty Earth Observatory, a unit of Columbia University.