LABOR DAY READING - WHEN WIND WORKS, THERE’S LOTS OF WORK IN WIND (from June 30)

The piece below falls into a category of story that will be reported here at NewEnergyNews repeatedly until the nation’s fossil fools and Not-In-My-Backyard NIMBYs get out of the way of the coming New Energy economy and allow New Energy and Energy Efficiency to rejuvenate a once and future unmatchably dynamic workforce. Happy Labor Day.

New Report Provides Blueprint for Building Domestic Wind Energy Component Supply Chain; BlueGreen Alliance, American Wind Energy Association, and USW Provide “Manufacturing Blueprint” to Build Out Domestic Wind Energy Supply Chain and Create U.S. Manufacturing Jobs
June 28, 2010 (American Wind Energy Association)

THE POINT
Wind energy is not only the most mature and capable of the New Energies right now, it is also the leading voice of the New Energy industries.

That is why it is so interesting to see that, in response to the U.S. New Energy industries’ currently slowing momentum, wind is reaching out, forming alliances and pushing harder than ever for the federal policies that will matter.

Late in 2009, the American Wind Energy Association (AWEA) and the other New Energy industries reached out to the natural gas industry in an attempt to find common ground in the nation's fight against coal dependence and the fight against greenhouse gas emissions (GhGs).

Early in June, 2010, AWEA and the United Steelworkers Union (USW) formed a Partnership for Progress and called for a national Renewable Electricity Standard (RES). Shortly after that, AWEA joined the Alliance to Save Energy, the Business Council for Sustainable Energy, the Biomass Power Association, Growth Energy, the Energy Recovery Council, the Geothermal Energy Association, the National Hydropower Association, and the Solar Energy Industries Association to declare THE TIME IS NOW for a national RES.

Now AWEA has joined the USW and its labor union and environmentalist partners in the Blue-Green Alliance to release "Winds of Change: A Manufacturing Blueprint for the Wind Industry. The Blueprint calls for an RES requiring U.S. utilities to obtain 25% of their power from New Energy sources by 2025.

click to enlarge

Wind, the ultimate American can-do energy industry, can and is doing what it has to. That it created a boom from 2004 to 2008, rose to a pinnacle of accomplishment and took over international leadership in wind energy production despite shoddy and inconsistent federal policy support means nothing now. That it went from 2,500 U.S. jobs in 2004 to 18,500 jobs in 2009 means nothing now. That it quadrupled its yearly capacity additions to 10 gigawatts in 2009 and finished the year with a world-leading 35+ gigawatts of cumulative U.S. capacity means nothing now.

What matters now is that the New Energies – and their new allies – be heard.

Political leaders in Washington, D.C., will – when they finish eulogizing Senator Byrd and tormenting Ms. Kagan – go to work on legislation in response to the April coal mine cave-in disaster that killed 29 miners and the even worse Gulf oil spill that killed 11 offshore oil platform workers and resulted in an environmental and economic atrocity for the region.

What matters now is that those political leaders get the message that fossil fuel-perpetrated devastations will only come to an end when the nation turns with all its might to New Energy.

What matters now is that those political leaders come to understand there is a choice in the kind of energy they subsidize and there are real and devastating consequences when they subsidize dirty and dangerous energies.

What matters now is that those political leaders also come to understand there is a huge opportunity for the nation in New Energy. It is an opportunity to staunch the flow of U.S. treasure to profoundly troubled places and people, to enhance the nation’s energy security, to invest in domestic sources of power generation in a way that will rehabilitate its economy and to get the nation on the world’s side in the fight against climate change and killer air pollution.

click to enlarge

So the wind industry is speaking out. It is calling for federal policies that will give it a level playing field against its Old Energy competitors. Industries like nuclear energy, natural gas and coal have long had support in the form of federal subsidies, guarantees and incentives. The Old Energies, in fact, could not exist without such support. Wind and the other New Energies aske only that the rules be fair. Either take away their competitors’ advantages or give them long term policies like:

(1) A national Renewable Electricity Standard (RES) requiring U.S. utilities to obtain 25% of their power from New Energy sources by 2025,
(2) An extension of the Recovery Act's 1603 convertible tax credit,
(3) A cap and price on greenhouse gas emissions (GhGs) with protections for vulnerable domestic industries,
(4) Legislation to facilitate extensive development of new transmission infrastructure,
(5) Expanded funding for the Advanced Energy Manufacturing Tax Credit to subsidize the building and renovation of manufacturing capacity,
(6) Further loan guarantees for new and renovated New Energy manufacturing capacity, (7) Enactment and funding of the Investments for Manufacturing Progress and Clean Technology (IMPACT) and Renewable Energy Market Access Program (REMAP) Acts to grow the domestic manufacturing supply chain,
(8) Funding for the Green Jobs Act to insure a trained job force, and
(9) Support for states to further develop similar subsidies, guarantees and incentives.

During the press conference held to announce the release of Winds Of Change, one of the speakers intended to say that not backing U.S. turbine makers with strong policies could result in the “cessation” of manufacturing activity and the wealth of economic benefits that come with it. He inadvertently said “secession” instead. But his malapropism was closer to the truth.

Turbine manufacturing will not cease. It will secede from the U.S. and move to other countries, countries like Turkey and China and India where they are backing their New Energy industries because they see what the fossil fuel addicts in U.S. political power centers refuse to see. They see that New Energy is the future and no matter how hard they try to stop it, it is coming. It is coming and it is bringing enormous opportunities for those countries smart enough to seize them. The time is now. NOW.

click to enlarge

THE DETAILS
Because Pennsylvania enacted RES, Gamesa – the world’s 7th biggest turbine manufacturer – chose the state for manufacturing facilities that added 1000+ steel workers to the job rolls.

On the strength of only an inconsistent federal production tax credit (PTC) and some strong state policies, the wind industry grew its manufacturing sector jobs 7 times over in the last 5 years to 18,500. Strong, long-term policies could generate tens of thousands of jobs.

The record-breaking growth in the wind industry from 2004 to 2009 came because
Congress sustained the PTC over that period. During that period, the domestic supply chain was developed but turbine manufacturing capacity lagged because the world’s biggest turbine companies are not based in the U.S. and require longer-term policy support to make the kinds of large and extended investments necessary to build plants.

The result of Congress allowing crucial 2009 Recovery Act benefits for wind to expire at the end 2010 is that wind development fell off in the first quarter of 2010 to its lowest point in 3 years: 539 megawatts. At its current pace, it may not achieve even a quarter of its 2009 benchmark.

click to enlarge

Another bust looms, with 14,000 planned manufacturing jobs and billions in revenues threatened.

The U.S. wind industry grew an average of 39% per year from 2004 to 2009. It added 10,000 megawatts in 2009, bringing cumulative capacity to a world-leading 35,000+ megawatts, enough to power 9.7 million U.S. homes.

The last time the U.S. led the world was in the early 1980s. Because of the failure of federal policy, U.S. wind looks to lose its world leadership to China either this year or next.

The U.S. invented utility-scale wind energy in the early 1980s as the result of the Energy Tax Act of 1978 that created a 15% Energy Investment Tax Credit (EITC) through 1985 and the Public Utilities Regulatory Policies Act of 1978 that required utilities to purchase New Energy.

click to enlarge

In 1985, the wind industry built 1,000 megawatts but – because of waning policy support and cheap natural gas – never achieved that level of development again until 2001.

In 1986, the U.S. had ~90% of the world’s wind capacity, most in California. Between 1987 and 1997, the EITC expired, Europe grew strong policies, the U.S. built less than 50 megawatts of wind per year and, by 1998, the U.S. had 1,853 megawatts of wind while Europe had 6,453 megawatts.

The U.S. got back in the game after 2001, thanks largely to state RESs, other state policies, and the re-enactment of the federal PTC yearly from 2005 to 2009. The wind industry went from a 2004 installed capacity of 6,700 megawatts to 2009’s 35,000 megawatts.

The supply chain grew but turbine manufacturers rarely took the plunge because of such inconsistency in federal policy.

click to enlarge

2009’s record-breaking growth was directly attributable to the Recovery Act’s extension of the PTC for 3 years and allowing it to be converted into a 30% Investment Tax Credit (ITC) that could be exchanged for a cash grant through 2010.

As AWEA and its blue collar allies continually insist, wind turbine manufacturers need longer-term policies and the long-term promise of markets – comparable to what they can get in Europe, China and India -- in order to make the big investments their facilities require.

China has set the goal of building 100 gigawatts of wind by 2020 and the central government is doing everything possible to support its wind industry in achieving the target. Its industry built almost 14 gigawatts in 2009 and looks ready to leave the U.S. industry in the dust sometime in 2011 or 2012.

click to enlarge

The U.S. wind industry’s “fundamentals” are considered sound. All that’s lacking is strong, long-term supportive policy: (1) The wind industry manufacturing sector added/expanded 100+ facilities since 2007 and has 240+ facilities in a ready-to-serve component supply chain. The domestic sector has tower and blade makers and nacelle assembly facilities. (2) Makers of nacelle internals, the smaller, highly complex, high-value “brains and heart” of a turbine, are just getting started. (3) In 2005, the U.S. wind industry built ~2,500 megawatts and ~25% was from the domestic manufacturing supply chain but in 2009 it built 10,000+ megawatts and ~50% was from the domestic manufacturing supply chain. (5) Research suggests there is no reason the domestic manufacturing supply chain cannot supply a significantly larger portion of what is installed in the U.S. if the turbines themselves are also made domestically.

Towers: There are 20 U.S. utility-scale turbine tower makers, 14 added since 2004. Texas, which has the biggest U.S. installed capacity, has 25% of the online and announced tower manufacturing. The value of imported towers fell in 2009 while the value of the domestic market grew 20%, indicating strong demand for U.S. towers.

Blades: There are 13 U.S. blade manufacturing facilities, 9 added since 2004. 3 are planned. The value of imported blades fell in 2009 while the U.S. installations grew, again indicative of strong demand for domestic blades.

click to enlarge

OEMs and Nacelle Assembly: 9 turbine manufacturers, or original equipment
manufacturers (OEMs), had more than a percent of U.S. wind installations. There 8 domestic nacelle assembly facilities and 8 more are planned.

Nacelle Internals: As nacelle assembly facilities double (see above), demand for nacelle internals, the very complex, high-value components that make up the “heart and brains” of the turbine, will grow.

The first U.S. facility for any of the 3 major components – gearboxes, generators and drives – came online in 2009. There is also a growing supply chain for smaller, sub-components like bearings, electricals and hydraulic systems.

Needed: New foundry capacity to do the castings required in utility-scale turbines. Large castings (the mainframe, hub, rotor shaft, etc.) weigh 30 tons and more. Domestic manufacturing of them is much preferable to shipping them.

click to enlarge

Offshore Wind Turbines: There is no U.S. offshore wind industry. It is all opportunity.

The study includes discussions of:
(1) the job potential in wind manufacturing (showing that the current 14,000 jobs waiting in wind manufacturing could grow to 30,000 with supportive policies),
(2) the factors that will drive growth in a domestic wind manufacturing sector (showing the most important factor is the sheer price advantage from making the 250-to-400 ton turbines near where they will be erected rather than importing them), and
(3) the role state policies can play in building a domestic manufacturing sector (showing states' biggest roles should be in supporting markets and training workers).

The last part of the new paper is a discussion of the urgently needed policy measures that will build a long-term market to support a domestic wind energy manufacturing sector.

click to enlarge

(1) A national Renewable Electricity Standard (RES) requiring U.S. utilities to obtain 25% of their power from New Energy sources by 2025:

36 countries, including China and all the EU member states, have an RES. Research shows a national RES would bring 274,000 new U.S. jobs. 29 states and D.C. already have an RES. It is not currently high on the Congressional agenda.

(2) A cap and price on greenhouse gas emissions (GhGs) with protections for vulnerable domestic industries:

Caps should match the Intergovernmental Panel on Climate Change (IPCC)-stated call for GhG reductions of 80% below the 1990 level by 2050. Mechanisms must be legislated though which the caps can be achieved. Research shows hard caps with a workable mechanism to achieve them and protections for vulnerable domestic industries could drive the growth of New Energy even more effectively than an RES.

click to enlarge

(3) An extension the Recovery Act 1603 convertible tax:

The Treasure grant in lieu of the ITC not only salvaged a recession-year downturn in the wind industry but turned it into a record year. The Renewable Energy
Expansion Act of 2010, from Congressman Earl Blumenauer (D-Ore), and the American Renewable Energy Jobs Act, from Senator Charles Schumer (D-NY), would both extend the cash grant option through 2012. Any serviceable bill should make the mechanism automatic. Any extension should also: (a) Require goals, (b) Require reporting, and (c) Require feedback data analysis to reconcile experience with the bill’s intent.

(4) Expanded funding of $5 billion for the Advanced Energy Manufacturing Tax Credit to subsidize the building and renovation of manufacturing capacity:

It should also: (a) Add selection criteria, (b) Strengthen existing selection criteria, (c) Include criteria targeting specific market segments, and (d) Establish goals and submit an analysis of collected data to Congress.

(5) Further loan guarantees for new and renovated New Energy manufacturing capacity:

Longterm, lower-cost debt is especially important to manufacturers because their capital costs are so high and the current financial environment makes it otherwise prohibitively expensive. A variety of mechanisms exist. The report recommends funding a pair of them at ~$2 billion each.

click to enlarge

(6) Enactment and funding of the Investments for Manufacturing Progress and Clean Technology (IMPACT) and Renewable Energy Market Access Program (REMAP) Acts to grow the domestic supply manufacturing supply chain:

IMPACT creates a $30 billion state-level loan fund and adds $1.5 billion to the existing Manufacturing Extension Partnership program to help New Energy manufacturers retool.

The Renewable Energy Market Access Program (REMAP) would help small and medium-sized New Energy companies export to existing and new markets abroad and learn how to best access foreign markets.

(7) Funding for the Green Jobs Act at $125 million per year to insure a trained job force:

The New Energy manufacturing sector requires workers with skills but ~1.6 million U.S. manufacturing workers are near retirement age and 57% of working adults lack basic skills or an educational credential beyond high school. The Green Jobs Act helps close the skills gap and should be fully funded at its authorized level of $125 million per year.

click to enlarge

(8) Legislation to facilitate extensive development of new transmission infrastructure:

To use 25% New Energy, a complete effort from local, state, and federal officials to fund and build new transmission infrastructure will be necessary. It will require streamlined permitting, funding, skilled workers to build and implement it but it will create big economic benefits. Policy barriers, the biggest obstacle, can be addressed through (a) Interconnection-Wide Transmission Planning, (b) Interconnection-Wide Transmission Cost Allocation and Certainty for Cost Recovery, and (c) Federal Siting initiatives.

click to enlarge

QUOTES
- From the report’s conclusion: “The American wind industry has made impressive strides towards increasing domestic content in installed wind turbines and has brought thousands of jobs online in manufacturing. However, the wind manufacturing sector is still developing, with the opportunity to bring tens of thousands of additional jobs online. In order to justify investment in opening new facilities and expanding or retooling existing facilities, Congress must take action to ensure a long-term, stable wind energy market. Coupled with other policies to support the U.S. manufacturing sector, these actions would enable the wind industry to develop robust supply chains and employ thousands of Americans in good, clean energy jobs.”

QUICK NEWS, 9-6: DIRTY ENERGY PROP IS MORE DENIAL; WISC SETS WIND BUILD RULES; 1 GW SOLAR POWER ADVANCES; COAL OUTSOURCES

DIRTY ENERGY PROP IS MORE DENIAL
Prop. 23: strongest effort yet at climate change denial
Thomas Elias, September 1, 2010 (Long Beach Press-Telegram)

"The Texas oil companies behind Proposition 23 don't call it an attempt to deny the existence of worldwide climate change…[But putting] AB 32, the Global Warming Solutions Act, in abeyance until unemployment levels drop to 5.5 percent or lower for a full year, amounts to getting rid of the world's strongest effort to do something about climate change.

"…[At] Glacier Point in Yosemite National Park…you will see not a single one of the many glaciers that gave the overlook its name…[In] the Scottish highlands…some botanical gardens now feature…tropical plants normally associated with places like Hawaii, Costa Rica and the Yucatan Peninsula of Mexico…[In the last 15 years, Greenland has become] much greener and far less icy…[and California hydrologists] forecast a future of steadily reduced flow in many California waterways…"

This graph compares the findings of 4 widely respected studies against business-as-usual. (click to enlarge)

"…[Deniers] say no one has proven all this has anything to do with modern civilization and its production of greenhouse gases...[E]ven if there were really no proof - and the vast majority of the world's leading climate scientists has repeatedly said [it is]… - doing what we can to avoid making things worse would still be the responsible thing to do…That's the aim of AB32, which mandates rolling back California's greenhouse gas emissions to 1990 levels within the next 10 years…Proposition 23 would stop that…

"…[O]pponents of AB32…[say it] is a "job killer"…[but] present no evidence..[except a study] whose methodology and ethics have been roundly discredited…[A] report by the state legislative analyst warns of higher energy costs and resulting job losses...[but] did not even look at potential benefits of using renewable energy sources or the jobs created by the fight against global warming…"

This graph compares the findings of 3 widely respected studies against business-as-usual. (click to enlarge)

"…[Texas-based oil refiners] Valero and Tesoro (which sells its gasoline in California under the Shell and USA brands)…put Proposition 23 on the ballot and [fuel it]…[It is more] oil company resistance to clean air measures of all types. Refiners and automakers have fought every anti-smog law California ever passed.

"…[T]he California Business Alliance for a Green Economy…noted that in May of this year…its member companies had active online postings for 7,500 new job offerings…[and said] California leads the nation in hiring for ‘green’ jobs, a phenomenon that could end abruptly if Proposition 23 passes…[With the defeat of Proposition 23] California will once again assert itself as the world leader in the search for both clean air and renewable energy."


WISC SETS WIND BUILD RULES
PSC: Finalizes wind siting rules
Teresa Weidemann-Smith, August 30, 2010 (Wisconsin Business)

"The Public Service Commission of Wisconsin…[has completed its] administrative rules governing the siting of wind turbines in Wisconsin. The rules were drafted in response to 2009 Wisconsin Act 40, recently-enacted legislation directing the Commission to promulgate rules that specify the restrictions local units of government may impose on the installation or use of wind energy systems…

"The Commission’s rules will function as a uniform ceiling of standards to guide the local regulation of wind siting, operation, and decommissioning for projects less than 100 megawatts in generating capacity. The rules specify how a political subdivision can establish setback requirements, noise and shadow flicker standards, and mechanisms that give non-participating landowners a stake in wind energy projects sited in their area…"

The new rules will move Wisconsin toward realizing the revenue benefits of its New Energy goals. (click to enlarge)

"…[1] At least 90 days before filing an application, the wind energy system owner must give notice to landowners within one mile of proposed wind turbine locations…[2] A political subdivision can require wind energy systems to be sited and operated in a manner that does not exceed 45 dBA during nighttime hours and 50 dBA during daytime hours. Noise limits will be measured from the outside wall of non-participating residences and occupied community buildings…

"…[3] A political subdivision can require wind energy systems to be sited and operated in a manner that does not cause more than 30 hours per year of shadow flicker for non-participating residences or occupied community buildings…[If it causes] more than 20 hours per year of shadow flicker, a political subdivision can require the wind energy system owner to install mitigation measures…at the expense of the wind turbine owner… [4] A political subdivision can impose minimum safety setbacks of 1.1 times the maximum blade tip height of a wind turbine for participating residences, non-participating property lines, public road rights-of-way, and overhead communication and electric transmission or distribution lines…[and] up to 3.1 times the maximum blade tip height…for nonparticipating residences and occupied community buildings…"

The new rules will move Wisconsin toward realizing the job benefits of its New Energy goals. (click to enlarge)

"…[5] The rules allow…[requirements of] monetary compensation to non-participating landowners located within one-half mile of a wind turbine site…[that may not] exceed 25% of the payments being made to a landowner hosting a wind turbine…[and, 6] rules establish complaint resolution requirements…[and a review process] appealable to the Commission.

"The Commission’s action…[ends] six months of intense work in developing uniform wind siting rules for Wisconsin…The Commission’s rules now head to the Legislature, where the presiding officer of each house will have 10 days to refer the rules to a standing committee for review."


1 GW SOLAR POWER ADVANCES
1 GW Blythe Solar Project Receives Final EIS
27 August 2010 (Solar Today)

"The U.S. Department of the Interior's (DOI) Bureau of Land Management (BLM) has issued its Final Environmental Impact Statement (EIS) for the Blythe Solar Power Project, a 1 GW solar thermal power plant planned for southeast California.

"The project, which received proposed California Energy Commission approval earlier this month, is being developed by Oakland, Calif.-based developer Solar Millennium LLC."

click to enlarge

"In the EIS, the BLM identified an "Agency Preferred Alternative" plan for the project, which considers impacts related to biological resources, cultural resources, land use, visual resources, and hydrology, water quality and water use…[and concluded] adverse impacts can be avoided or substantially reduced…"

1,000 megawatts of trough technology. That's making hay while the sun shines. (click to enlarge)

"…[T]he project would [be four power units of 250 MW for a total nominal capacity of 1,000 MW as a solar parabolic-trough generating station]…The project is expected to be constructed in four phases and will be connected to Southern California Edison’s planned Colorado River Substation…

"A final EIS is considered the last federal regulatory hurdle before a record of decision authorizing construction…Final authorization may occur as early as October…"


COAL OUTSOURCES
U.S. government may finance massive coal projects in India, South Africa
August 26, 2010 (Mongabay)

"The United States Export-Import Bank (Ex-Im Bank) voted…to seek a final review of a $900m loan for a controversial 3,960 MW coal-fired power plant in India…

"The Sasan coal-fired Ultra Mega Power and Mine Project is one of nine ‘Ultra Mega Power Plants’ being pursued by the Indian government. Each plant is roughly equivalent of eight average U.S. coal fired power plants and will generate 26 to 27 million tons of carbon dioxide annually, or about 1.7 percent of India's total greenhouse gas emissions."

THIS is what the U.S. Export-Import Bank should be funding in India. (click to enlarge)

"The move was condemned by Doug Norlen, Policy Director for Pacific Environment…[who said] 95 percent of Ex-Im’s energy portfolio is based on fossil fuels.

"The investment trend looks to continue. The agency is now looking to fund the 4,800 MW Kusile coal project in South Africa. The plant would generate 36.8 million tons of carbon dioxide annually, increasing emissions from South Africa's energy sector by nearly 13 percent and the country's overall emissions by 9.7%…"

THIS is what the U.S. Export-Import Bank should be developing in South Africa. (click to enlarge)

"Pacific Environment and its coalition partners, including Friends of the Earth and the Sierra Club, are calling upon the Export-Import Bank to halt funding of fossil fuels projects overseas and instead focus on clean energy…

"A recent study by the World Wildlife Fund found that for every million dollars invested in energy projects, 13.5 jobs are created in the clean tech export sector. For the same amount of spending in the oil and gas and coal industries, only 3.7 and 4.9 jobs are created respectively."

AUSSIE STUDY AFFIRMS SAFETY OF WIND

Australian Study Concludes Wind Turbines Do Not Pose Health Risk
27 August 2010 (North American Windpower)

"There is no scientific evidence that links wind turbines to adverse health effects, according to a new study published by the Australian National Health and Medical Research Council.

"Concerns regarding the adverse health impacts of wind turbines focus on the effects of infrasound, noise, electromagnetic interference, shadow flicker and blade glint produced by wind turbines."

click to enlarge

"In addition to audible noise, concerns have been raised about infrasound from wind farms…causing negative health effects…[L]ow-level frequency noise or infrasound emitted by wind turbines is minimal and of no consequence, the report states…[N]umerous reports have concluded that there is no evidence of health effects arising from infrasound or low-frequency noise.

"The report goes on to say that the evidence on shadow flicker does not support a health concern because the chance of conventional horizontal-axis wind turbines causing an epileptic seizure for an individual experiencing shadow flicker is less than one in 10 million."

Properly sited turbines rarely create problems. (click thru for more info)

"…[M]anufacturers of all major wind turbine blades coat their blades with a low-reflectivity treatment, which prevents reflective glint from the surface of the blade. According to Australia's Environment Protection and Heritage Council, the risk of blade glint from modern wind turbines is considered to be very low."

[From the report’s conclusion:] "The health effects of many forms of renewable energy generation, such as wind farms, have not been assessed to the same extent as those from traditional sources…However, renewable energy generation is associated with few adverse health effects compared with the well-documented health burdens of polluting forms of electricity generation."

GEOTHERMAL TO CUT AFRICA POWER COSTS

Geothermal power to help cut production costs
Bernard Sanga, August 30, 2010 (The East African)

"The Geothermal Development Company (GDC), a government-owned firm has harnessed steam equivalent to 80MW of electricity in the past six months, signaling Kenya’s resolve to seek alternative reliable energy to bring down the cost of manufacturing and spur economic growth…[This increases] the quantity of geothermal energy produced in the country to 209MW.

"The plan resonates with…manufacturers’ calls for the reduction of energy costs, currently consisting of about 40 per cent of the total manufacturing costs…According to the Kenya Manufacturing Association, the high cost of energy has continued to erode the country’s products competitiveness in the regional and international markets."

click to enlarge

"The association has particularly been lamenting that the country’s energy cost — four times higher than that of its major Comesa bloc trading partner Egypt – is a hindrance to the country’s efforts of becoming a middle income economy by 2030 as per the economic blue print Vision 2030…GDC chairman Paul Gondi said the company’s goal is to accelerate the development of [Kenya’s 10,000 MW geothermal energy potential] as one way of cushioning manufacturers from high costs of production…

"…[Gondi] said that the company has acquired two rigs which will commence drilling in the Menengai area later this year, increasing the number of rigs to five. GDC uses hired rigs in drilling Ol Karia Domes and Ol Karia IV geothermal sites."

click to enlarge

"The government, he said, was keen to inject 3,000MW of geothermal electricity into the national grid by the year 2020, and increase the figure to 5,000MW by 2030…This will cushion manufactures from the adverse effects occasioned by perennial power outages that have forced the government to invite emergency independent power producer who use diesel to generate electricity…This stop-gap measure…increases the cost of energy and causes massive pollution.

"…Ormat runs a 48MW station in the Ol Karia Complex and flower firm Oserian Development Company operates a 4MW station…Mr Gondi said that the GDC is currently also drilling in the Ol Karia Domes to supply KenGen with steam equivalent of 280MW for the Ol Karia I & IV power plants…The GDC is also undertaking exploratory work in East Pokot and Turkana in northern Kenya and in Homa Hills located in Nyanza."

SOLAR POWER PLANTS IN THE WORLD

Global shifts in the concentrated solar power market underway
Rikki Stancich, 30 August 2010 (CSP Today)

"The CSP playing field has changed dramatically since the US’ lead in concentrated solar power technology back in the 1980’s – and as the global CSP market gathers momentum more radical changes are on the horizon…1762.42 MW of CSP projects are currently in the global pipeline…A further 89 plants are planned across 16 countries, representing a total of 14 GW of concentrated solar power capacity…

"…Spain currently dominates the market for installed capacity…[with] 432MW of [installed] CSP, compared to 422MW in the USA…Since July 2009 until now, Spain has [installed nine] plants with a total of 370 [operational] MW…All use parabolic trough technology, except…[one] which is a Power Tower…With 16 CSP plants currently under construction in Spain, representing 690 MW of solar capacity in the pipeline, and a further 2342 MW of pre-registered projects, it appears Spain has firmly reinforced its leadership position…[but] Spain is unlikely to continue to outpace the US in the longer term…"

click to enlarge

"…[T]he number of sites optimal for CSP project development [in Spain] is dwindling…[D]evelopers are now looking to tap other regions with a better solar resource, such as the Middle East and North Africa (MENA) region…Uncertainty surrounding Spain’s feed-in tariffs has also shaken the CSP industry…

"The United States, on the other hand, is set to benefit from a raft of initiatives…introduced in response to the global recession…The deadline for the American Recovery and Reinvestment Act funding, for example, dictates that CSP projects must break ground by December 2010…[O]ver the next few years the US may gain on Spain's lead, with planned projects amounting to approximately 1.9 GW…"

click to enlarge

"The rest of the world has by no means been sitting idle. Markets in the MENA region, Australia and India are now beginning to take shape…Several CSP plants in the MENA region, all of which are integrated solar combined cycle (ISCC) plants, are on-track to come online towards the end of 2010…India now has two 10 MW CSP plants under construction…[A] 10MW parabolic trough project will use molten salts as the heat transfer medium and to provide 8 hours of thermal energy storage…[and] Indian power company ACME is developing a 10MW solar tower…[with] eSolar…

"…[P]rojects are planned in 16 countries…[including 33 in] Spain…36 [in the U.S.]…2 for Israel…[13 in] the MENA…[5-to-13 in] India…[7 in] Australia…[and more in] South Africa…Portugal…France…and China…Attracting investment has been a major stumbling block…[but] a combination of support policies and sector-wide strategic investments are stoking investor confidence…Key mergers and acquisitions are also delineating the CSP market…[T]he CSP market is looking more robust than it did a year ago…[but] to maintain momentum, developers and investors will continue to rely on stable policy frameworks and government support mechanisms in the medium-term."

NORWEGIAN COMPANY TO BUILD GIANT TURBINES

SWAY TURBINE Formed To Focus On Offshore Turbines
30 August 2010 (North American Windpower)

"SWAY AS, a wind turbine developer based in Bergen, Norway, has created a separate business entity, SWAY TURBINE. The main focus of the new company will be to build a prototype of and subsequently commercialize a 10 MW offshore wind turbine, designed for fixed as well as floating foundations.

"SWAY founder Eystein Borgen will be appointed CEO of SWAY TURBINE, while Michal Forland will replace Borgen as CEO of SWAY."

click to enlarge

"SWAY TURBINE is currently working on building a full-scale 10 MW test turbine outside Bergen. In February, ENOVA, a Norwegian state-owned fund, committed 137 million Norwegian kroner for the construction of the test turbine. SWAY TURBINE is in the process of raising 150 million Norwegian kroner in new equity from both new and existing owners.

"With SWAY TURBINE up and running, SWAY will continue working solely on its floating foundations for offshore wind turbines."

SUN TO BUILD SUN IN JAPAN

KYOCERA to Install Solar Power Generating Systems at All Domestic Manufacturing Sites; 20 Company Sites Worldwide to Generate over 1.8MW Total
August 30, 2010 (BusinessWire via MarketWatch)

"Kyocera Corporation…will install solar power generating systems using the company's own solar modules at six domestic plants by March 2011, generating a total of 593kW…This move will increase the number of Kyocera domestic manufacturing sites equipped with solar power generating systems to 10 -- all of the company's manufacturing sites in Japan -- and the number of global group company sites to 20…

"…Kyocera already has a number of solar power generating systems installed at its group companies inside and outside Japan, which combined with the new systems, will boost the company's total output to 1,815kW (1.8MW)…Among the six plants to be equipped with new systems are the Yasu Plant (Shiga), which is the company's new solar cell manufacturing plant…The six new systems are expected to generate 591,000kWh in total per year -- equivalent to the annual power consumption of approximately 125 standard households [at annual power consumption per household of 4,734kWh]."

Schematic of the 214kW headquarters system. (click to enlarge)

"At present, Kyocera has solar power generating systems installed at 14 of its group company locations around the world…

"In Japan, Kyocera's solar energy field-testing facility -- the Sakura Solar Energy Center…is equipped with a 43kW solar power generating system that was installed in 1984. The system has continued to perform efficiently for over 25 years, and has provided unprecedented, long-term field-test data…In 1998, the company's new global headquarters was constructed in Kyoto with a 214kW solar power generating system…"

The Sakura Solar Energy Center 43kW system. (click to enlarge)

"In 2005, KYOCERA MITA Espana S.A. installed a solar power generating system on its facilities in Madrid. In the same year, the Kyocera Group's North American headquarters, KYOCERA International Inc. in San Diego, installed a solar power generating system built in the unique design of a grove of solar trees in the staff parking lot. The system generates electricity under the Southern California sun, while also acting as a shade to keep the sun off of cars.

"Kyocera will continue to make contributions to the promotion of solar power as a solar module manufacturer and strive to reduce environmental burden in the course of its business activities by installing solar generating systems at more of the company's sites…"

Calling Out The 7 Greenhouse Gases

It is absolutely amazing what is on YouTube. Take, for instance, this catchy presentation of the seven gases responsible for aggravating the greenhouse effect and driving climate change. Sound boring? Just listen. From medicinesocks via YouTube

A Word About Wind And CO2

Speaking of greenhouse gases, the fossil fuel industries have their minions out spreading the insidious (not to mention ridiculously untrue) rumor that adding wind energy to the power generation system won’t reduce carbon dioxide emissions. Here, American Wind Energy Association (AWEA) CEO Denise Bode sets the record straight. For more on this, check out Undermining the Critics of Wind Power; Controversial energy commenter Robert Bryce gets fact-checked (Herman K. Trabish, September 1, 2010, Greentech Media) From americanwindenergy via YouTube

Letterman Talks Solar With A Real Leader

The always-inspirational Bill McKibben sets David Letterman straight about solar power and the power of a movement that refuses to take no for an answer. For more info, click thru to 350.org From 350org via YouTube

CALIF 33% NEW ENERGY AMBITIONS WAYLAID

California Fails to Pass 33 Percent Renewable Standard, But Arnold May Intervene; At midnight, one of the most ambitious plans for renewable energy turned into a pumpkin.
Michael Kanellos, September 1, 2010 (Greentech Media)

"…The California Legislature…failed to pass SB 722, a bill that would have required California public utilities to obtain 33 percent of their power from "new renewables," i.e., solar, wind, geothermal, and biomass, but not large-scale hydroelectric dams. Debate was proceeding on a companion bill when August 31 turned into September 1 and the session ended.

"The failure is a blow to environmentalists, but also to outgoing Republican Governor Arnold Schwarzenegger, who has made growing California's green economy one of the major pillars of his administration. A.B. 32, the carbon regulation passed by the state years earlier, has created 500,000 jobs, according to Bill Weihl, Google's green energy czar."

click to enlarge

"But…Arnold still has time before the election to call a special session of the legislature to get it passed. He's done it before…

"The bill has widespread support among Silicon Valley executives. There are exceptions. Two semi-retired Valley executives -- former eBay CEO Meg Whitman and fired Hewlett Packard CEO Carly Fiorina -- are against it and are, respectively, running for Governor and the U.S. Senate. Whitman has also vowed to suspend A.B. 32…"

click to enlarge

"California currently requires that the public utilities get 20 percent of their power from new renewables by 2010. The three big utilities -- PG&E, SDG&E, SCE -- will not make it. However, the law has a built-in extension and most will likely comfortably meet the expanded requirement. All three utilities have been aggressively signing contracts to get energy from solar thermal power plants and other renewable power providers. Independent power providers, though, have been having difficulties getting permits and funding for the projects.

"Despite bills like A.B. 32 and a thriving startup culture, the bureaucratic tangles have hurt California's efforts to build a green industry. In this year alone, Mississippi and its Republican Governor Haley Barbour have wooed three green companies -- Soladigm, Twin Creeks Technologies and Kior -- with loans from the state and other ARRA-like stimulus packages to build factories in that state. (The bipartisanship on the state level in many areas is actually quite heartening.) The costs are lower and the permits are easier to obtain. Michigan…has become attractive for similar reasons, along with the added bonus of a large population of process and mechanical engineers…"

GULF STREAM CURRENT POWER

Swarms of marine turbines could 'tap the Gulf Stream'
Lakshmi Sandhana, 30 August 2010 (BBC News)

"Darris White…engineer at Embry-Riddle Aeronautical University…is currently finalising designs for a series of turbines that could be used to harness the immense energy of the Gulf Stream, flowing deep in the Atlantic Ocean…[It] contains around 21,000 times more energy than the Niagara Falls and by some estimates, could potentially provide up to one-third of Florida's electricity needs…[but] harnessing that energy needs to happen 1,200m below the surface of the ocean in turbulent and constantly changing conditions.

"The "marine energy" industry has come up with a number of ideas to make use of the movement of water…ocean waves, tides…[and] regular ocean currents like the Gulf Stream…The more common solution to the problem has been to build large turbines, to be anchored to the seabed…But the nature of the Gulf Stream presents different challenges…The solution, Professor White and his team suggest, are autonomous turbines with so-called ‘swarm intelligence’ that can navigate through the ocean currents, similar to a school of fish searching for food…A prototype is currently under construction and should be complete within the next 18 months…"

click to enlarge

"The team plans to equip the turbines with sensors that detect the change of hydrodynamics and the swarm's own movements, along communication mechanisms so that turbines can ‘talk’ to one another and share their position…The entire swarm will either be tethered to the sea floor with anchors, allowing them to migrate within a limited area, or be attached to a movable platform for fixing and transferring the power…Power from all the turbines will be integrated into a single transmission line and transmitted to a substation on land through high-voltage power lines.

"…Gulf Stream Turbines is a start-up company that holds several patents for water turbine designs; its founders hope to tie up with interested parties to develop the technology further and produce inexpensive energy continuously from the ocean currents…Professor White and his team believe their solution has several advantages over other approaches and current renewables, such as wind turbines…[especially because] streams, rivers and ocean currents provide a relatively constant source of power with fewer intermittence problems [near population centers]…[30 to 50 turbines should] generate around 15 to 20 million Watts of electricity at the sweet spot in the Gulf Stream…enough energy to meet the requirements of around 6000 to 8000 houses."

click to enlarge

"…[S]ome experts are sceptical of the idea [primarily because]…the forces involved with extracting energy form the Gulf Stream are huge…[so] the turbines [might] need to be fixed to the seabed…Professor White and his colleague[s] are not put off [and argue that because the Gulf Stream moves]…fixing the turbines in place wouldn't allow for optimal operation during all seasons…[and] existing mooring systems developed for movable offshore rigs could be adapted to help the swarm operate, rather than developing an entirely new fixture…They are also trying to head off other potential problems early, like the turbines' effect on sea life…[I]n-built intelligence [could] down the turbines or move the whole swarm out of the way of sea life.

"…[T]ests in 2012…will require the team to gain permission and permits from several federal agencies including the US Army Corp of Engineers…[but] it will be worth it if they can prove the concept works…"

SMACKDOWN – “CLEAN” COAL V. NAT GAS

Politics aside, natural gas is beating up on clean coal
Shelley DuBois, August 30, 2010 (CNN Money via Fortune)

"Coal has always been cheap and dirty. And the dirty part was justifiable because it was so cheap. Now, gas prices are dropping, threatening coal's dominance in the North American energy market. Which means gas could take over before coal gets a chance to clean up its act.

"Natural gas…[has been] trading at under $4 per million British thermal units-the unit used to measure energy output. The price is competitive with coal on a Btu basis…Coal is still cheaper at $2.25 per million Btu in 2010…[but] the coal market is starting to feel the burn from gas on its heels…Coal stocks are down, across the board…[T]he largest U.S. coal producer, Peabody Energy Corp., fell 5.2 %, to $40.96. The second biggest producer, Arch Coal Inc., fell 5.9 % to $21.08. Massey Energy Co., the largest Central Appalachia coal producer, plunged $1.40, or 4.6 percent, to $28.75."

click to enlarge

"So if natural gas is accessible, cheap, clean, and getting cleaner, should the government keep spending billions on clean coal? …[T]he government has tried to spearhead projects…But the flagship federal clean coal project, FutureGen, has mutated since it started in 2003, and had to be completely resuscitated after being scrapped in 2008…FutureGen 2.0…will retrofit a current coal plant as opposed to building a new one, and it will be in a different location…[It] was going to cost $1.1 billion…but could change depending on a recent quirk in finding a location to store the captured carbon.

"The government established the Clean Coal Power Initiative in 2002 to try to partner with industry and push clean coal technology. So far, the intiative has completed 3 of the 18 total projects, 7 of which have been terminated…[It] hasn't helped the U.S. clean coal industry…These projects need to kick into gear fast, if coal is going to compete with gas. Gas is especially threatening to coal because it's a local fuel…just like coal…"

It's the cost of NEW generation that is determinative. (click to enlarge)

"In both new projects and business expansions, power producers have also already started choosing gas over coal… American Municipal Power Inc. planned to build a coal-fired plant on the Ohio River…In early August, the company announced that it would build a 600-megawatt gas-fired plant in that location instead…NRG Energy signed a $1.9 billion deal to buy five power plants in California…Four out of the five plants will burn gas…[T]he Tennessee Valley Authority [TVA],,,was going to idle nine coal-fired generating units at three plants, starting in 2011…[and] build natural gas generators to replace several…

"As dirty as coal is, people do have reservations about the environmental impacts of producing more gas…[T]here's concern that extracting gas from shale could contaminate groundwater with drilling fluids…But if regulators…oversee the United State's copious shale gas reserves, then coal will really be in trouble. Coal won't just be able to rely on being cheap anymore, it will have to be clean too. And yet, if natural gas stays cheap, it will still become increasingly difficult to make the economic or political case to keep throwing clean money after dirty coal."

NEW ENERGY STORAGE BREAKTHROUGH

200-fold boost in fuel cell efficiency advances 'personalized energy systems'
August 23, 2010 (EurekAlert)
"The era of personalized energy systems — in which individual homes and small businesses produce their own energy for heating, cooling and powering cars — took another step toward reality…[S]cientists reported discovery of a powerful new catalyst that is a key element in such a system…which could help free homes and businesses from dependence on the electric company and the corner gasoline station…"

[Daniel Nocera, team leader/Professor, MIT:] "Our goal is to make each home its own power station…We're working toward development of 'personalized' energy units that can be manufactured, distributed and installed inexpensively. There certainly are major obstacles to be overcome — existing fuel cells and solar cells must be improved, for instance. Nevertheless, one can envision villages in India and Africa not long from now purchasing an affordable basic system."

Schematic of the concept. (click to enlarge)

"…[The] system would consist of rooftop solar energy panels to produce electricity for heating, cooking, lighting, and to charge the batteries on the homeowners' electric cars. Surplus electricity would go to an ‘electrolyzer,’ a device that breaks down ordinary water into its two components, hydrogen and oxygen. Both would be stored in tanks. In the dark of night, when the solar panels cease production, the system would…[feed] the stored hydrogen and oxygen into a fuel cell that produces electricity (and clean drinking water as a byproduct). Such a system would produce clean electricity 24 hours a day, seven days a week — even when the sun isn't shining.

"…[T]he electrolyzer…needs catalysts — materials that jumpstart [the] chemical reaction…that break[s] water up into hydrogen and oxygen…Good catalysts already are available for the part of the electrolyzer that produces hydrogen…[but there had not been] inexpensive, long-lasting catalysts for the production of oxygen. The new catalyst fills that gap and boosts oxygen production by 200-fold. It eliminates the need for expensive platinum catalysts and potentially toxic chemicals used in making them."

Dr. Nocera looking for a better catalyst. (click to enlarge)

"The new catalyst has been licensed to Sun Catalytix, which envisions developing safe, super-efficient versions of the electrolyzer, suitable for homes and small businesses, within two years.

"The National Science Foundation and the Chesonis Family Foundation provided funding…Nocera did the research with post-doctoral researcher Mircea Dinca and doctoral candidate Yogesh Surendranath. The U.S. Department of Energy's Advanced Research Projects Agency… awarded…a grant, which it plans to use to search for related compounds that can further increase the efficiency of its electrolyzer technology. The team hopes that nickel-borate belongs to a family of compounds that can be optimized for super-efficient, long-term energy storage technologies."

LATEST FORECAST FOR ELECTRIC CARS

Plug-in Electric Vehicles; Battery Electric and Plug-in Hybrid Electric Vehicles: OEM Strategies, Demand Drivers, Technology Issues, Key Industry Players, and Global Market Forecasts
Dave Hurst and Clint Wheelock, 3Q 2010 (Pike Research)

"Plug-in vehicles are being launched in two different forms: Plug-in Hybrid Electric Vehicles (PHEVs) and Battery Electric Vehicles (BEVs). Both…[offer] improved fuel economy or no petroleum based fuel usage, lower or zero emissions while driving, and a quieter ride. PHEVs are similar to current hybrid electric vehicles (HEVs), but provide the additional benefit of allowing owners to plug the vehicle into the electric grid to recharge the batteries. In both BEVs and PHEVs, stored energy in the batteries provides power to an electric motor…PHEVs deplete the batteries before the internal combustion engine (ICE) starts. The ICE may provide power to the wheels or just recharge the battery…HEV batteries are recharged solely through regenerative braking and/or the ICE. BEV batteries are charged solely from connecting to the grid and do not have an ICE onboard…

"PHEVs have received a great deal of media attention…[but] the concept…is not actually new; for years, HEV owners have been converting their vehicles to plug into the electric grid…[New and] less expensive lithium-ion batteries…provide higher power density at a lower weight…HEVs have been in the market for more than 10 years and a significant number of vehicles have been sold globally…PHEVs offer increased electric driving range over HEVs and are expected be priced higher…BEVs do not require petroleum fuel because they plug into the electric grid for all their energy, but have about one-third to one-half the range of PHEVs."

click to enlarge

"…Pike Research expects that sales of PHEVs and BEVs will be strong – 107% compound annual growth rate (CAGR) and 106% CAGR, respectively, between 2010 and 2015…[it forecasts] the HEV market will grow…[to] 12.7% CAGR between 2010 and 2015 (compared to 4.8% CAGR for the overall light-duty vehicle market)…in almost every market segment…PHEVs will follow HEVs’ lead…[and] will be launched in passenger cars initially, followed closely by the small SUV segment….BEVs will be initially focused on small [more efficient] cars…[that] allow use of a smaller, less expensive battery…

"…PHEVs operate in electric mode until the batteries reach a certain level of depletion (typically between 10 and 40 miles). Once that occurs, an ICE maintains the batteries’ state of charge…Batteries are among the most expensive components in PHEVs and BEVs…[L]ithium-ion (Li-ion) batteries…offer good power density (300 W/kg to 1,500 W/kg) and high nominal voltage (3V to 4V)…[L]ead acid and nickel metal hydride [batteries] cannot match the weight-to-power ratio…[but] Li-ion is also a more expensive technology…[C]osts [range] from $175 to $500/mile…"

click to enlarge

"…Some research shows that U.S. consumers are still wary about high up-front costs for vehicles, regardless of savings on fuel. Because of this, government incentives will continue to play an important role…Many consumers may ultimately choose a plug-in vehicle that is aligned with a brand they already trust. Toyota and Honda are likely to benefit from their established positions…GM’s early entry into the market is expected to help bolster its initial PHEV sales (by 2015, GM is anticipated to have 20% global PHEV market share).

"…[T]he 107% CAGR for the PHEV market will result in global sales of 472,612 vehicles in 2015. Pike Research anticipates that the United States will lead…with 204,110 PHEVs sold in 2015 – followed distantly by Japan with 62,143…Pike Research anticipates that BEVs will steal some of the [China PHEV] volume…[S]ales of BEVs in China are expected to reach 262,203 vehicles in 2015 (compared to 47,982 PHEVs) thanks to strong government support…Combined, BEVs and PHEVs will result in a fast-growing marketplace…[V] ehicles that plug into the grid (BEV and PHEV) will reach just over 1 million in five years (1,081,294 vehicles in 2015), with PHEVs accounting for 44%…"

THE COST OF OFFSHORE WIND (from May 11)

If it weren’t for the fact that offshore wind is going to be the next big thing in New Energy, the report described by the post below would be way too wonky to visit, much less to revisit. But it is, so it is. In addition to the larger message set out in the report – that offshore wind is far more economically within reach if the external costs of “cheap, abundant” fossil fuels are considered – there is something else to consider: Building an offshore wind industry is paying tribute to this nation’s future as an international powerhouse whereas supporting the dirty energies is literally digging this nation's economic grave.

Study outlines Virginia offshore energy prospects
Steve Szkotak, May 3, 2010 (AP via Bloomberg BusinessWeek)

THE POINT
It is no mere coincidence that Virginia Offshore Wind Studies, July 2007 to March 2010; Final Report begins with a discussion of power prices and the impact that putting a price on greenhouse gas emissions (GhGs) will have on power prices. The Virginia Coastal Energy Research Consortium (VCERC), which oversaw the long and authoritative study and produced the report, knows only too well what the rest of the nation is about to learn: The future of offshore wind energy depends on how much electricity costs ratepayers.

Right now, much of the price of fossil fuel-generated electricity is paid by taxpayers in the form of healthcare costs, transportation system costs and many other costs that are external to the price for electricity on ratepayers’ utility bills and are therefore called externalities.

Electricity generated from fossil fuels seems "cheap" in the same way that the price of vehicle gas refined from oil seems "cheap." The "cheap" gas does not include the REAL costs carried by taxpayers for cleaning up messes the oil industry makes like the current Gulf Coast oil spill just as "cheap" electricity does not include REAL costs carried by communities and taxpayers for coal mine cave-ins and coal mining's environmental devastation.

Those who understand the importance of shifting to a New Energy economy want to see such externalities become internal to the price of fossil fuels. Those who don’t want a New Energy economy describe the cost imposed by making externalities a part of the price of gas and electricity as a subversive tax. Actually, shifting REAL costs to the price at the pump and the price on the utility bill is a shift from one form of tax to another. Such a shift would more accurately price the cost of burning for transportation and spewing to generate electricity and thereby make the use of sun and wind and water power more equitable.

click to enlarge

Virginia is uniquely positioned to both understand and be burdened by the falsely "cheap" price of fossil fuel-generated electricity. Its Atlantic winds are abundant. Yet the cost of reaping those winds is nowhere near competitive with the cheap coal-fired power its profligate citizens now consume unconcerned by consequences and unburdened by REAL costs.

The VCERC paper runs the numbers and demonstrates that offshore wind is on its way to becoming cost competitive but will not likely be so before 2018. Shifting to the fossil fuel industries the costs for the pollutions they generate will hasten that parity. The responsibility can be imposed in the form of a price for GhGs or a requirement to install GhG-capturing equipment or any combination of those and other means.

The paper identifies 25 leasing sectors off Virginia's coast with a 3,200-megawatt offshore wind potential that could be developed without creating any conflicts with other offshore activities (Naval, Aeronautic, recreational, fishing, shipping, oil and gas drilling, etc.) in the region. The offshore projects would be 12 miles offshore where they would raise no aesthetic objections.

Development of offshore wind can benefit Virginia in several ways. The high cost of offshore wind can be diminished if there is a domestic turbine manufacturing industry and supply chain. This offers economic opportunity especially appropriate to the shipbuilding industry along Virginia’s Hampton Roads Naval coast. Such an industry, designed to reap the fullest benefits of Virginia's readily available offshore assets, could generate 9,700 to 11,600 jobs within 20 years, add an estimated $403 million to the local economy and cut electricity costs an estimated 1.5 cents per kilowatt hour.

An observation from VCERC on the environmental impacts of offshore wind: A utility (PJM) study found that 15,000 MW of wind capacity would displace 26,300 gigawatt-hours (GWh) of coal and 13,000 GWh of natual gas, cutting 34-to-37 million short tons of CO2 per year even without a price on emissions. This could lower electricity prices $4.50 to $6.00 per MWh. Assuming a yearly demand of ~789,000 GWh in 2013, this is customer savings of $3.55-to-$4.74 billion per year. More importantly, it saves innumerable shellfish and other ocean life by preventing more severe ocean acidification.

One final point: The paper points out that the affordability of offshore projects hinges on the use of economic best practices because the subsidies so effectively used in Europe to drive offshore wind’s growth are unlikely to be legislated into practice in Virginia.

click to enlarge

THE DETAILS
Based on new generation projects of 600 megawatts going into service in 2012, LCOE in March 2008 dollars are $105-to-$130 per megawatt-hour (MWh) for an offshore wind farm using 3 MW turbines with 90m diameter rotors, $85-to-$100 per MWh for a coal-fired plant, and $80-to-$100 per MWh for a combined-cycle natural gas turbine (CCGT) plant.

Assumptions, based on utility forecasts and market futures: (1) coal at $65-to-$70 per short ton in 2012 and going up 0%-to-2% per year and (2) natural gas at $7.00-to-$7.50 per million BTU in 2012, going up 2%-to-4% per year.

Not included: (1) CO2 costs, (2) sales of renewable energy certificates, and (3) the cost of carbon capture and sequestration (CCS).

It is reasonable, based on the best recent studies, to assume for CCS: (1) a $50 per ton of carbon dioxide (tCO2) cost, (2) 1.0 tons of CO2 per MWh for coal plants and (2) 0.4 tons of CO2 per MWh for a natural gas CCGT plant.

CCS would make the cost of a coal plant $135-to-$150 per MWh and the cost of a natural gas plant $100-to-$120 per MWh.

CCS would make offshore wind cost competitive and likely cheaper than fossil fuels.

click to enlarge

Without CCS, fossil fuel plants will no doubt have to pay for their greenhouse gas emissions through a Cap&Trade system, a carbon tax or some combination of those and other means, adding comparable costs to fossil fuel-generated electricity.

The sale of RECs is likely to offset the costs for offshore wind.

VCERC's estimates of offshore wind costs are based on the Vestas V-90 3MW turbine with a hub height of 80 meters above sea level. Wind speed data from the Chesapeake Light tower (CHLV2) confirms the productivity assumptions used.

The best utility and market forecast predictions show fossil fuel price volatility and escalation. It is expected to double by 2018 and triple by 2028. The rigorous VCERC modeling showed offshore wind becoming competitive as soon as 2017.

Dominion Virginia Power’s reliance on fossil fuels makes Virginia electricity price increases likely. Offshore wind would serve as a hedge against the price volatility until it becomes price competitive.

The 3 major costs for an offshore wind project (80% to 85%) are (1) the turbine-and-tower packages, (2) the foundations, and (3) the deep sea transmission cables.

Offshore wind turbines similar to the Vestas V90 3 MW design manufactured in the U.S. and ordered in quantity would cost $2,160 per kW for the turbine-and-tower package.

click to enlarge

This is based on the 630 MW turbine supply contract for Phase I of the London Array: €1 billion ($1.36 per €) to Siemens in May 2009 for 175 3.6 MW turbines.

The cost of foundations to meet Virginia’s offshore wind and wave conditions (monopiles averaging a weight of 362 metric tons) was estimated by VCERC at $410 per kilowatt. The costs were based on Britain’s 300 MW Thanet offshore wind project and the Vestas V90 3MW turbine in comparable water depths.

Foundations require 110 metric ton transition pieces of steel. They also require secondary steel (access ladders, boat landings, platforms, railings and stanchions, J-tubes, mountings for sacrificial anodes). Estimates were made for the cost of steel and the manufacture of the secondary parts. For foundations, VCERC estimated a $431 per kW cost.

The high-voltage, armored submarine power cables, for which there are no manufacturing facilities in North America, would be purchased from Italy (Prysmian), Germany (NKT), Norway (Nexans), or Sweden (ABB).

Cable cost estimates were based on the 630 MW Phase I London Array project. Each cable core has three copper conductors. Delivered in 2011 and 2012, the cost is estimated at $2.67 million per kilometer or ~$5.48per km per kW. Cable prices will fluctuate with copper prices.

Between 2007 and 2008, average turbine prices varied 7% to 13.5%. In the same time period natural gas prices fluctuated by a factor of 2.5-to-2.6 times.

In March 2009 in Europe, offshore wind project costs averaged €2.1 million per MW and onshore project costs averaged €1.2 million per MW, a ratio of 1.75. The cost for U.S. land-based projects in 2008 was $1,915/kW. Multiplying this by the European offshore-to-land-based cost ratio of 1.75 suggests U.S. offshore project costs would be $3,350/kW, or 3% more than the $3,260/kW estimate in the VCERC model. Other modeling methods reinforce the general accuracy of the VCERC calculations.

click to enlarge

The risk that the VCERC estimates are inaccurate hinge largely on the accuracy of estimated wind data, especially the projected project location, wind speed and resource height.

The single most important way to control costs is to bring turbine manufacturing to Virginia or, in essence, near to where the turbines will be installed. Virginia’s Hampton Roads is the ideal type of assembly plant location because it has large, open areas where deep-water wharves have unconstrained access to open ocean.

Bringing manufacturing to Virginia means building a chain of first- and second-tier suppliers locally that would utilize Virginia’s steel fabricators to supply components (yaw bearings, gears, shafts, nacelle base plates, etc.).

Costs for both turbines made in Europe and turbines made domestically are dominated by the cost of the turbine but domestic manufacturing, if the right turbines are chosen, control costs significantly more effectively.

Domestically manufacturing turbines would likely lower project costs $480 per kilowatt, lowering the cost of offshore wind-generated electricity by ~$15 per MWh to $90 to $115 per MWh.

The savings from the installation of 2 ~600 megawatt projects would pay the ~$500 million cost of building a turbine manufacturing complex.

It also minimizes shipping costs and shipping delays.

click to enlarge

These considerations are crucial because the financing advantages created for offshore wind by European incentives are unlikely to be available for U.S. offshore wind. This makes it vital that U.S. offshore wind projects be as cost competitive as possible.

Specific environmental issues that will affect the siting of offshore projects in the Mid-Atlantic Bight:

(1) Surveys requiring further study suggest resident seabird activity diminishes with distance from shore and beyond 12 nautical miles may be minimal, though it increases near the Gulf Stream, beyond the continental shelf.

(2) Little is known about north-south bird migration over the open Atlantic, even less is known about bats and migration routes are unmapped but it is known that some federally-listed threatened and endangered species of shorebirds (Roseate Tern, Piping Plover, Red Knot) fly from the Delmarva Peninsula to the West Indies and South America, which takes them over possible offshore wind project sites.

(3) Varying species fly at varying heights – pertaining to turbine height selection – at varying times, seasons, weather and other conditions and more information is needed.

(4) Some bird species, in some conditions, may avoid turbines and some (gliders like petrels and shearwaters) can less avoid collisions, especially in high winds and storms.

click to enlarge

(5) Turbines can act as artificial reefs and increase the hazard for some species (cormorants, gannets, gulls, pelicans) that look for more frequent landings.

(6) Sea ducks and gannets use the shoals that are lower-cost foundation sites but further study could identify shoals outside their routes.

(7) Visual study and avian radar monitoring must be correlated.

(8) FAA requirements dictate proper lighting for turbines and met towers.

(9) Best-practice guidelines for onshore projects point the way to effective lighting.

(10) Mimimum structural factors at turbine bases will prevent avian roosting and nesting. Blade colors can minimize bird collision risk.

(11) Interstate coordination of offshore wind project construction up and down the Atlantic Coast can minimize the impact on North Atlantic Right Whale seasonal
migration.

click to enlarge

(12) Minimizing the noise from high-energy hammers driving monopile foundations will protect some marine mammals (Bottlenose Dolphins, sea turtles) during construction and acoustic pingers can drive some (seals, Harbor Porpoises) away.

(13) Because at least 2 of the 5 Atlantic Ocean sea turtles federally listed as threatened or endangered will probably forage around offshore turbine bases for crabs and mussels that will be abundant on foundation structures, trawling there must be prevented.

(14) Building turbine foundations and laying cables will kill and dislocate some shellfish and related invertebrates but populations should recover within months.

(15) The U.S. Navy may have the best environmental data available.

(16) There will be air and water harm from construction and other equipment.

(17) Environmental risk assessment studies should be rigorously designed and include post-construction monitoring and mitigation plans.

click to enlarge

The VCERC paper also includes sections on mapping and the economic development potential for the region.

In a detailed commercial development roadmap, VCERC makes it clear the decision to proceed will not come sooner than the first half of 2010, it will take 2-to-3 years for a non-competitive or competitive leasing process so that construction could not start before 2016-to-2017 and generation would not likely come before 2019-to-2020. It could come a year earlier if the leasing process is the less time-consuming non-competitive one.

The only way offshore wind in the Mid-Atlantic Bight will be price competitive is with the best designed equipment and a price on GhGs.

A government policy roadmap begins with policies that streamline approvals and leasing. Policies that put a price on GhGs are also essential. Equally important are policies that facilitate transmission system approvals and upgrades, including backbone systems that make project development less expensive. Finally, policies that spawn improved R&D and better cheaper technology will make offshore wind more price competitive sooner.

Also needed:
(1) More meteorological, oceanographic, avian, and marine environmental data;
(2) Public-private partnerships to build better ports and logistical equipment (barges, cranes, etc.); and
(3) Make commercial development of offshore wind compatible with other ocean
uses (naval facilities and operations, government and commercial space flight operations, shipping lanes, recreational and commercial fisheries, and avian and marine species and habitats).

From elaborate mapping of the offshore wind resource and the other offshore activities in the region, the VCERC study identified the 25 most likely areas where development can move ahead without conflict.

The paper also identifies where offshore oil and gas development is possible and how wind projects can avoid or be compatible with them.

click to enlarge

QUOTES
- From the VCERC study: “If our region simply replicates the European model, we run the risk of developing and building offshore wind projects that cannot be commercially viable without government policy incentives and financial subsidies comparable to those available in Europe. This report describes an alternative path of commercial development, applied research, and government policy-making that VCERC believes is more likely to yield offshore projects with sustainably profitable financial returns, creating an entirely new energy economy.”

click to enlarge

- From the VCERC study: “Given the large offshore wind resource that exists in shallow waters beyond the visual horizon off Virginia and the center of shipbuilding and military-trained workforce candidates that exist in Hampton Roads, the Commonwealth has every reason to become a national leader in this development.”