QUICK NEWS, 5-13: THE AMERICAN POWER PROPOSAL; NEW ENERGY WANTS A GREEN BANK; WHY NEW ENERGY INCENTIVES; ROADMAPS TO SUN

THE AMERICAN POWER PROPOSAL
Senate Climate Bill Makes Its Debut
John M. Broder, May 12, 2010 (NY Times)

"Senators John F. Kerry, Democrat of Massachusetts, and Joseph I. Lieberman, independent of Connecticut, presented their long-delayed proposal to address global warming and energy Wednesday afternoon. They are calling it the American Power Act.

"The nearly 1,000-page plan provides something for every major player – loan guarantees for nuclear plant operators, incentives for use of natural gas in transportation, exemptions from emissions caps for heavy industry, free pollution permits for utilities, modest carbon dioxide limits for oil refiners and expansion of offshore drilling for those states willing to accept the risks."

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"The bill’s overall goal is to reduce greenhouse gas emissions by 17 percent from 2005 levels by 2020 and 83 percent by 2050. The targets match those in a House bill passed last year and the Obama administration’s announced policy goal.

"It is impossible to know now whether all the concessions will add up to the 60 votes needed to thwart an attempt to filibuster the bill…But Senator Kerry said he was confident he had found a winning formula for a comprehensive approach to climate change and energy independence…"


NEW ENERGY WANTS A GREEN BANK
When Clean Energy Grants Run Out, Will a 'Green Bank' Take Over?
Peter Behr, May 10, 2010 (NY Times)

"…[A]ll but about $300 million [of funding in the 2009 American Recovery and Reinvestment Act] has been committed…Recovery Act energy dollars [are] finally entering the economy. Spending by grant recipients reached $3.5 billion in April…The question looming now is: What next?

"Recovery Act energy grants must be committed by the end of September. Energy tax credits have to be taken by the end of the 2011 fiscal year. What happens if further support programs tied to climate legislation die in Congress? …[A] wide range of new energy initiatives remain in a federal incubator…heavily dependent upon continued support from Washington. But the prospects for future backing could hardly be murkier."

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"If the Senate fails to get the 60 votes necessary to pass climate and energy legislation, clean energy proponents are looking at possibilities of tying key measures to tax or jobs legislation that has better prospects for passage this year…Backers of proposals for a new federal "green energy" financing bank say they have the answer.

"Former Federal Communications Commission Chairman Reed Hundt heads the Coalition for Green Capital, a lobbying group that supports and works with congressional sponsors of a proposed Clean Energy Deployment Administration (CEDA)…A coalition paper issued last month calculates that energy stimulus spending will peak this year at $400 billion, shrink to about $120 billion in 2011 and be virtually gone by 2015…[P]rivate investment is not strong enough to fund a trillion-dollar overhaul of the energy sector…A federal financing administration would change the equation…"

Another disruptive idea for financing New Energy (click to enlarge)

"The coalition offers an example of two higher-cost wind energy projects, one paid for solely with private financing, the other backed by federal loan guarantees…Federal loan guarantees cut the interest rate on the $165 million wind project in nearly in half, to 4.5 percent from 8 percent, and stretch out repayments, raising the amount of debt that developers of the guaranteed project could take on by $24 million, making the project easier to finance, according to the coalition.

"…A principal aim of the green bank would be purchasing old coal plants from utilities and generators, and then scrapping them. The coalition estimates that 100,000 megawatts of coal plants could be retired in this way, opening room for investments in new clean energy generation…The coalition is also lobbying for…[New Energy-favoring] tax law changes…The green bank proposal is seen by supporters as a survivor if the Senate can't produce comprehensive climate legislation…Skeptics of the green bank approach see self-interest at play…But there is no disputing the impact that federal financial backing can have on new energy projects…"


WHY NEW ENERGY INCENTIVES
U.S. in danger of losing the clean energy race
Lewis Hay (Chair/CEO, FPL Group – a top 5 U.S. utility & the biggest U.S. producer of New Energy), May 12, 2010 (The Hill)

"Last year, for the first time ever, China built more wind farms than the United States. Here in our home market, three of the top five wind energy producers are European…The United States hasn’t lost the clean energy race, but we’re falling further behind. The question is what we’re going to do about it.

"So far, the answer is not much…[T]he United States has no price on greenhouse gas emissions, no national renewable energy standard and no transmission superhighway to carry renewable energy to population centers…The policies we have in place in the United States today are still incredibly pro-carbon. If nothing else, perhaps the gulf oil spill will remind us that fossil fuels can appear cheap but have high social costs that are seldom reflected in the price."

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"The simple fact is that clean and renewable energy do not compete on a level playing field with fossil fuels, and [won’t] until we put a policy framework in place to enable them to do…First, we need a price on carbon. Only with the proper economic signals in the marketplace can we build a world-class clean energy industry…Right now, carbon is not priced, which makes fossil fuel generation look artificially cheap. With a gradually escalating price on carbon that reflects the full social costs of burning fossil fuels, low-emissions fuel sources can compete on fair terms…

"Second, we need a national Renewable Energy Standard (RES). Even if Congress acts to put a price on carbon, it will be many years before the price rises to a level sufficient to enable clean energy to deploy on its own. An RES that requires power producers to get a certain percentage of their electricity from renewable sources is the necessary bridge…"

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"Third, we need a stronger federal role in ensuring high-voltage transmission lines are built. Renewable energy is most abundant on wind-swept plains and sun-baked deserts, but it takes transmission lines to transport it to the nation’s cities. We need legislation to give the federal government siting authority for electric transmission, just as it has for other critical national infrastructure such as railroads, interstate highways and natural gas pipelines. And the Federal Energy Regulatory Commission should use the authority it already has to ensure the cost of building new transmission lines is shared broadly and fairly…

"…[T]he energy and climate legislation being crafted by Sens. John Kerry (D-Mass.) and Joe Lieberman (I-Conn.) will move us in the right direction…Clean energy companies are not asking for the kinds of subsidies that have been used in Europe and China…[just] that carbon carry a price equal to its cost to society, that we guarantee a market for renewables until that price phases in and that we make transporting clean energy…a national priority…As a nation, we need to decide what we want our energy future to look like…[or] we will have lost the clean energy race for good."


ROADMAPS TO SUN
IEA sees great potential for solar, providing up to a quarter of world electricity by 2050
11 May 2010 (International Energy Agency)

"Solar electricity could represent up to 20% to 25% of global electricity production by 2050. This important finding emerges from two new analyses by the International Energy Agency (IEA): the solar Photovoltaic (PV) and Concentrating Solar Power (CSP) roadmaps, launched…during the Mediterranean Solar Plan Conference…

"…The roadmaps detail the technology milestones that would make [the 20% to 25% goal] possible, highlighting that the two technologies will deploy in different yet complementary ways: PV mostly for on-grid distributed generation in many regions and CSP largely providing dispatchable electricity at utility scale from regions with brightest sun and clearest skies. PV also helps provide energy access off grid in rural areas. Together, PV and CSP could generate 9 000 Terawatt hours of power in 2050."

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"…[Long-term, predictable solar-specific incentives are needed to build solar technology economies of scale.]…These incentives will need to evolve over time to foster innovation and technology improvements. To support cost reductions and longer-term breakthroughs, governments also need to ensure long-term funding for additional research, development and demonstration efforts.

"With effective policies in place, PV on residential and commercial buildings will achieve grid parity – i.e. with electricity grid retail prices – by 2020 in many regions. PV will become competitive at utility-scale in the sunniest regions by 2030 and provide 5% of global electricity. As PV matures into a mainstream technology, grid integration and management and energy storage become key issues. The PV industry, grid operators and utilities will need to develop new technologies and strategies to integrate large amounts of PV into flexible, efficient and smart grids. By 2050, PV could provide more than 11% of global electricity."

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"The IEA expects CSP to become competitive for peak and mid-peak loads by 2020 in the sunniest places if appropriate policies are adopted. Its further expansion will depend on the development of dedicated transport lines that will bring CSP electricity to a greater number of large consumption centres. Some of them will have to be developed within large countries such as China, India and the USA. Others will cross borders, and many will be needed to link the southern and northern shores of the Mediterranean Sea…

"…[With] thermal storage, CSP can produce electricity around the clock and will become competitive with base load power by 2025 to 2030. North America will be the largest producer of CSP electricity, followed by North Africa and India. North Africa would most likely export about half its production to Europe, the second largest consumer. The overall contribution of CSP could – like that of PV - represent 11% or more of the global electricity demand by 2050…"