QUICK NEWS, 12-22: CAPE WIND PRICE CONTROVERSY; THE TOO-HIGH COST OF “CLEAN” COAL; TURNING THE STATES TOWARD EFFICIENCY; THE POWER FROM RECYCLING
CAPE WIND PRICE CONTROVERSY
Wanted: Buyer for controversial Cape Wind energy
Jay Lindsay, December 19, 2010 (AP via Washington Post)
"Cape Wind has outlasted a decade of government review, a slew of court brawls and fierce opposition from mariners, fishermen, Indian tribes and Kennedys just to win the right to sell its wind-fueled electricity…Now, all it needs are customers.
"Last month, the nation's first offshore wind farm nailed down its first buyer when the Massachusetts Department of Public Utilities approved a deal that sees Cape Wind selling half its power to National Grid, the state's largest electric utility…[T]he other half of the Cape Wind project's electricity remains available with no obvious takers, raising the possibility of a smaller project with pricier power."
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"The top prospect for Cape Wind is the state's second-largest electric utility, NStar. But Nstar…says it can find cheaper renewable power [for its customers] elsewhere…Price is always an issue with offshore wind, which costs more partly because it's expensive to build and maintain massive turbines at sea. The 468-megawatt Cape Wind, which is expected to produce enough power for 200,000 homes in average winds, is estimated to cost at least $2 billion to construct…In its 15-year deal, National Grid agreed to pay 18.7 cents per kilowatt hour for Cape Wind power beginning in 2013, with a 3.5 percent annual increase. The starting price is twice what National Grid pays today for power from fossil fuels, and regulators say the contract will add about 1.7 percent to its residential customers' bills.
"Though its price is higher, Cape Wind has big selling points, including a large generating capacity…[and] the green electricity needed to fill state renewable power mandates [in 2012] years before any other U.S. offshore project…Without other takers, Cape Wind would almost certainly have to build fewer than its proposed 130 turbines…[and then] the price goes up per lost turbine, to a maximum 19.3 cents per kilowatt hour."
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"…[T]his month, developer Deepwater Wind announced plans for a 200-turbine, 1,000 megawatt project (1 gigawatt) off Rhode Island…Deepwater has said the project's large size will help lower the price of its power…[estimated at] the "mid teens" in cents per kilowatt hour…Sue Reid of the Conservation Law Foundation, a Cape Wind advocate, estimates Cape Wind has six months to a year to find new buyers or face the disappointing prospect of building a smaller project. But she's certain that buyers, including perhaps NStar, will want to be part of a new and badly needed clean energy industry [and not be on the wrong side of history]…
"Cape Wind has been assailed since it was proposed in 2001…[O]pponents promptly sued the Obama administration after it approved the project…[S]tate utility regulators wrote that Cape Wind's power price is ‘expensive’ but cited numerous benefits that make Cape Wind ‘cost effective,’ including about 160 permanent jobs and a stable price that acts as a hedge against volatile fossil fuel prices…[and] said regional utilities simply won't be able to meet requirements to increase renewable energy sources without Cape Wind and the offshore industry it will kick off…Without NStar, Cape Wind could conceivably cobble together buyers from around the Northeast, including utilities, power suppliers, even the government. But NStar is the best prospective customer…"
THE TOO-HIGH COST OF “CLEAN” COAL
Cost blowout hits clean coal vision
Jamie Walker, December 20, 2010 (The Australian)
"Australia's hopes to lead the world in generating "clean" electricity from coal have taken a hammering…A massive cost blowout forced the Queensland government to scrap [the ZeroGen] prototype power plant that was to be in action by 2015…[which] means carbon capture technology to trap greenhouse gases produced from coal-fired plants will not be in use for a decade at least.
"While Premier Anna Bligh said yesterday the $192 million invested in ZeroGen had not been wasted, and the state and federal governments remained committed to developing clean coal processes, she admitted this was not yet economically viable."
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"A feasibility study on the ZeroGen proposal to capture carbon dioxide emissions and store them underground found the cost would have burst through the $4.3 billion budget [possibly by more than half again] and driven up power prices to unaffordable levels. The state government [said it] would not… fund an Integrated Gasification Combined Cycle power station incorporating carbon capture and storage…[because] it is not yet economically viable…"
[Queensland Premier Anna Bligh:] "Frankly, it would drive up the cost of electricity beyond the reach of normal people."
Even if they build the plant, there are other questions when they get to storage. (click to enlarge)
"ZeroGen was the most advanced of four ‘flagship’ projects funded jointly by the federal government, the states and the coal industry to produce clean electricity from a station integrated with carbon capture and storage.
"Construction of a fully-fledged 530 megawatt power station, with 90 per cent emission capture, was to have begun in 2012 under the fast-tracked timeline…[and] was to have been in operation by 2015, making it the first in the world…"
TURNING THE STATES TOWARD EFFICIENCY
Reaching the Tipping Point: Majority of States Have Now Adopted Energy Efficiency Resource Standards
December 21, 2010 (American Council for an Energy Efficient Economy)
"While the prospect of passing a comprehensive national energy policy remains uncertain for the 112th Congress, two states reminded the country last week that bold energy efficiency policies, which will save consumers and businesses millions in wasted energy costs, can win bipartisan support.
"On December 10, Arkansas became the first state in the Southeast to adopt a comprehensive set of policies on utility energy efficiency programs, including an Energy Efficiency Resource Standard (EERS). Four days later in Wisconsin, the Joint Committee on Finance approved recommendations set in an Order given by the Public Service Commission of Wisconsin (PSCW) to increase funding to Focus on Energy, the statewide energy efficiency provider, and set performance goals that will function as an EERS. An EERS requires electricity and natural gas providers to meet annual energy savings goals by providing energy efficiency program services…"
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"Max Neubauer, ACEEE Research Associate and author of an energy efficiency potential study for Arkansas:] “The orders given by the Arkansas Public Service Commission signify a break from the commonly voiced doctrine in the Southeast that any expense on utility bills is a bane of business and economic growth. In fact, it is quite the opposite with regards to energy efficiency. It costs far less to save a kWh than to generate one, so energy efficiency encourages economic growth by creating a robust, sustainable energy market that offers new business opportunities, generates jobs, saves consumers money, and curbs the strain on our environment.”
"The Arkansas targets are moderate, rising from an annual reduction of 0.25% of total electric kilowatt-hour (kWh) sales to 0.75% of total electric kWh sales over the next three years (and slightly less for natural gas sales), but require a high level of verification to ensure that utility companies are fairly rewarded, and that consumers get solid cost benefits."
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"The Wisconsin electricity goals, as a percent of peak load and electric sales, amount to 0.75% in 2011, ramping up to 1.5% in 2014. The PSCW also approved natural gas goals of 0.5% in 2011, ramping up to 1% in 2013.
"Twenty-six states now have an EERS, accounting for 65% of the country’s electricity demand. The policies currently on the books will provide electricity savings equal to 6% of nationwide retail sales by 2020…"
THE POWER FROM RECYCLING
Waste-to-Energy Technology Markets; Thermal and Biological Processes for Electricity and Heat Generation from Municipal Solid Waste: Market Analysis and Forecasts
Philippe Tob and Clint Wheelock, 4Q 2010 (Pike Research)
"...The gigantic amounts of waste that are hauled to dumps and accumulate in heaps and open pits have grown to become a major environmental issue. Landfilling is still the world's most widely used method for managing and treating waste. This [unsustainable] practice has detrimental effects on the environment: land occupation, greenhouse gas (GHG) emissions, groundwater pollution, odor, and aesthetics…[W]here landfilling is impractical…incineration is the preferred method…[I]ndustrialized countries have adopted regulations to divert waste from landfills through recycling, treatment, and materials and energy recovery. In addition, economic conditions and regulated markets have stimulated the use of waste as a resource and a source of energy.
"Waste-to-energy (WTE) encompasses methods by which to extract the valuable energy entrapped in waste for the production of electricity and heat. Waste collected in cities contains a large amount of biological and renewable materials. It is therefore a source of renewable energy. As a consequence, energy-from-waste contributes to energy security and diversification, and matches the growing demand for renewable energy in a carbon constrained world…Policies, regulations, and changing economic conditions are driving the growth of WTE capacity worldwide, creating attractive business opportunities for providers of WTE technologies and related components. Combustion is the dominant technology and is entrenched in the market. Yet, advanced thermal treatment (ATT) technologies such as plasma arc gasification are emerging in the market. Moreover, biological technologies for treating waste offer an attractive alternative to thermal treating methods."
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"Today, more than 900 thermal WTE plants operate around the globe. These plants treat an estimated 0.2 billion tons of municipal solid waste (MSW) with an estimated output of 130 terawatt hours (TWh) of electricity…The definition of MSW of the International Energy Agency (IEA): Waste in WTE is MSW where MSW is described as household waste and commercial and industrial waste that has a composition similar to the composition of household waste…Pike Research does not consider the extraction of energy from decaying waste in landfill and the harnessing of landfill gas (LFG) in this report…
"Pike Research has focused the scope of this study on the thermal and biological treatment methods that yield energy in the form of heat and electricity. As such, waste-to-fuel applications, such as purified biogas for injection in natural gas grids, are excluded. Thermal methods include combustion, gasification, and pyrolysis. Biological treatment is limited to anaerobic digestion…"
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"In 2010, the world population will produce an estimated 1.7 billion tons of MSW. More than 1 billion tons will end up in landfills; while close to 0.2 billion tons will fuel thermal WTE plants….Only a few countries, such as the Netherlands and Germany, are nearing the decoupling of waste and GDP…Policies, regulations, and rules have had a fundamental impact on the evolution and structure of the WTE market…Mass burn, or as-received combustion, dominates the WTE market. The market share of mass burn and refuse derived fuel (RDF) combustion is 98% globally, which dwarfs the share of other thermal and biological treatment technologies…
"According to Pike Research estimates, the global market for thermal and biological WTE technologies will reach $3.7 billion in 2010 and grow to $13.6 billion in 2016. Asia Pacific will contribute the largest portion of the growth, which will take off in 2012. The market in this region will likely grow to $6.6 billion at a compound annual growth rate (CAGR) of 31%. Market conditions in Western Europe – saturated, slow, or halted – will depend on the country. Certain countries could achieve the decoupling of waste generation and GDP and decrease the amounts of waste that emerge in the WTE market. Pike Research therefore anticipates erratic growth in Western Europe. The Western European market will grow from an estimated $1.7 billion in 2010 to $3.2 billion in 2016 at a CAGR of 11%. The U.S. market, which was dormant for over 15 years, shows a revival of activity. Favorable economic conditions for thermal WTE activity could spur market growth. As such, the U.S. market could grow at a very high CAGR of 40% and attain $1.2 billion in 2016."