Colbert Talks Fracking And New Energy With Mark Ruffalo

From Comedy Central

Carried Away On The Wind

No explanation necessary. Just watch. From TheSoleSenator via YouTube

Climate Denial Crock Of The Week – The Early 80s

A scientist from Sandia National Lab talks about the simple fact, known even in the early 1980s, that the carbon dioxide humans spew is affecting the world’s climate. Now somebody figure out how to explain this this three-decade-old news to conservative Republicans. From greenman3610 via YouTube

HOW TO SAVE UP NEW ENERGY

Wind ‘on-demand’ with state-of-the-art storage
Rikki Stancich March 19, 2012 (Wind Energy Update)

[Jan Keil, State-of-the-art electricity storage systems researcher, Deutsche Bank:] "Phasing out nuclear power has several implications for the integration of renewables. One effect is that a power generation gap emerges which makes faster growth of renewable energy possible and even necessary…A challenge is that there will be a shortage risk by 2025. The gap to which supply cannot meet demand can amounts to a total of 10 TWh…due to the loss of nuclear power and…because other conventional power plants will reach the end of their life span."

[Jan Keil, State-of-the-art electricity storage systems researcher, Deutsche Bank:]"…[It can be eased by] other already existing power plants (hard coal, natural gas or biomass), an addition of new flexible natural gas plants, accelerated growth of renewables or energy imports. Energy storage can also help…[The] need to produce energy when there is no wind and sun implies demand for at least 4.5 GW of energy storage capacity or flexible new power plants by 2025 (12.5 GW by 2040)…[Some must be] conventional gas power plant capacity…[A] pan-European grid will ease many problems associated with the integration of renewable energy. A geographically larger grid, where power can be transported from Germany to Norway or to Italy and back, will raise the share of wind energy…[A] higher percentage of capacity installed can be taken as base load power [and excesses put less strain on the grid] when the area becomes larger…Both of these effects allow a higher share of wind and PV power…[V] ehicle-to-grid will [not] be a viable option for the integration of renewables. Battery storage is already expensive…In EVs it will never be competitive compared to pumped hydropower or compressed air energy storage."

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[Jan Keil, State-of-the-art electricity storage systems researcher, Deutsche Bank:] "…Pumped storage hydroelectricity is by far the cheapest and it is also the only technologically mature storage method today. Storage costs amount in some cases to just 2 cents/kWh…There will have to be compressed air energy storage at some point…but a cost and efficiency gap will remain in the near future…Electrochemical storage has great potential for the future due to its high energy density, its flexibility…and the different options to transport and store it…The main problems today are that the overall efficiency of the full cycle of electricity-to-H2 and H2-to-electricity conversions is relatively low and that the associated costs are very high…"

[Jan Keil, State-of-the-art electricity storage systems researcher, Deutsche Bank:] "…Economically efficient energy storage will have positive effects on PV and wind…Renewable energy can reach a share of 40% of all electric power generated in Germany…[but] you need storage facilities to provide backup capacity for short-term fluctuations. Also, when wind and PV reach a market share of 70%, which is our scenario for 2040, it makes sense to store 7% of all wind and PV output…[O]n the one hand storage will be essential for keeping the costs down, because if, say, 15% of all wind energy will be lost, this would imply fewer kWh of sold output per year for each wind turbine and solar installation, and thus higher costs per kWh…On the other hand, storing is costly and will raise the costs of the renewable energy that will be stored…The impact on the average costs of production of renewables will be relatively modest in our scenarios…"

V2G EXPERIMENTING

Electric car pioneer launches startup focused on EV-grid link
Katie Fehrenbacher, March 6, 2012 (GigaOm)

"…[EV pioneer] Tom Gage, the former CEO of AC Propulsion — the quiet shop behind the Tesla Roadster drive train, the electric Mini and the eBox — left AC Propulsion late last year…[and] formed EV Grid to work on so-called “vehicle to grid,” or V2G, technology, which involves using software and hardware to create a bi-directional flow from the power grid to the electric car battery. Utilities and power companies can use V2G to manage groups of electric cars plugged into their grids, and those aggregated vehicle charges can be used as on-demand energy storage, and for helping balance the grid load when needed.

"The power grid is in a constant state of flux, and utilities routinely have to manage supply and demand to keep the grid balanced…[D]ozens of electric vehicles plugged into the grid, and managed properly, could provide [energy storage] services. At the same time, utilities could pay the car owners involved in these projects, and the car owners could recoup some of the cost of electric cars, which are still pretty expensive."



"Gage…[has] been working on V2G tech for years at AC Propulsion…EV Grid’s main partner right now is the University of Delaware and NRG Energy, which together created a joint venture called eV2g to build a pilot V2G project, which will be one of the largest of its kind in the U.S., and the world…[It] already has six or seven electric fleet vehicles using V2G in the program and by the end of the year hopes to build out that fleet to dozens, or even a hundred, cars…Gage and EV Grid will work on the vehicle side of the grid, installing hardware and software in the cars to enable management of the two-way flow. eV2g will develop the grid side commands, which will manage the vehicle charges.

"It’s still very early…[A] report from Pike Research [predicted] only about 100,000 electric cars will have V2G capability by 2017. Some of the biggest barriers to V2G are the lack of electric vehicles…and the risk that electric cars using V2G will either lose their warranties or be damaged in some way. Another issue is the economics — how much will V2G-enabled grid services be worth to utilities, and by how much can they offset the cost of the cars? …Gage… will be looking to answer these questions…before he raises money from outside investors."

TO GROW SOLAR MAKERS

How To Grow The U.S.' Solar Manufacturing Base (Without Involving China)
Jessica Lillian, 27 March 2012 (Solar Industry)

"…Proponents of corrective trade action draw a link between U.S. solar manufacturers' recent struggles and China's dominance…[The U.S. Department of Commerce (DOC)] recently issued a preliminary ruling that imposes tariffs on Chinese modules, clamping down on Chinese imports…[but that] may not be the key to growing the U.S.' own solar manufacturing market…

"…In [Manufacturing Solar Photovoltaic Products in the United States from SEMI and the PV Group] a series of other, non-China-related strategies [are recommended] that the U.S. government [could] adopt in order to help PV manufacturers compete globally…Failing to enact these policies and create a larger U.S. PV manufacturing base could represent a major missed opportunity…"

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"Manufacturing jobs have a higher multiplier effect on the economy than any other type of job…[but] despite the U.S.' leading position in early-stage PV innovation and venture capital, the country's presence trails off once companies reach the commercial-scale manufacturing stage…[F]ederal- and state-level policies…[could] support the U.S.' clean-energy manufacturing base, as well as spur domestic product demand that would, in turn, stimulate in-market manufacturing…

"On the federal level, specific policies…[include a] national renewable energy standard…the vital investment tax credit…[the] Section 1603 cash-grant program…funding for the U.S. Department of Energy's solar research and development (R&D) programs…a permanent tax credit for private R&D…[and] a new financing entity called the Green Bank…"

NOT THE BEAVER’S BIKE

Electric Bicycles; Global Market Opportunities, Barriers, Technology Issues, and Demand Forecasts for E-Bicycles, Pedal-Assist Bicycles, and E-Bicycle Batteries
1Q 2012 (Pike Research)

"Electric bicycles are the world’s best-selling electric vehicles with sales expected to reach over 30 million units in 2012. E-bicycle sales volumes are being driven by macroeconomic trends such as the growth of urbanization and the increasing need for low-cost transportation in developing markets…

"…[T]he e-bicycle market is very broad, with a number of manufacturers offering different styles including throttle-controlled drive trains, pedal-assist electric bicycles (or pedelecs), and scooter-style electric bicycles. E-bicycle component companies have successfully lowered the cost of entry for manufacturers looking to enter the market…"

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"…[T]he market in North America and Latin America continues to struggle with a weak distribution network and modest demand. As a result, the e-bicycle market is experiencing an accelerated rate of acquisitions and business failures.

"China is the largest market for e-bicycles and 92% of all e-bicycle sales are within China. The vast majority of the e-bicycles sold in China utilize sealed lead acid (SLA) batteries. While this has resulted in extremely low cost e-bicycles in China, it has also led to a number of challenges including e-bicycle traffic congestion, lead contamination, and manufacturers effectively ignoring laws relating to e-bicycles speed and weight limits…"

TODAY’S STUDY: INDIA, THE NEXT BIG WIND OPPORTUNITY

Reassessing Wind Potential Estimates for India: Economic and Policy Implications
Amol Phadke, Ranjit Bharvirkar, Jagmeet Khangura March 2012 (Lawrence Berkeley National Laboratory)

Abstract

We assess the techno-economic on-shore wind potential in India at three hub-heights – 80m, 100m, and 120m. Assuming a turbine density of 9 MW/km2, the total wind potential in India with a minimum capacity factor of 20 percent ranges from 2,006 GW at 80m hub-height to 3,121 GW at 120m hub-height. This techno-economic potential excludes the potential on lands that are difficult to use for wind power development such as low quality wind areas (wind power density < 200 W/m2), areas with slopes greater than 20 degrees, areas with elevation greater than 1,500m, forests, snow-covered areas, water bodies, urban areas, and protected areas. These estimates are approximately 20 times the current official estimate of wind energy potential in India (estimated at 80m hub height). The total land footprint of developing 543 GW of this wind potential (with capacity factor > 25% at 80m) is likely to be approximately, 1,629 km2 or 0.05% of the total land area in India since, typically, only 3% of the land required for wind power development is its footprint on the ground and the rest of the land can be used for other purposes.

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Executive Summary

Motivation

Wind potential estimates in India need to be reassessed for three reasons. First, two recent studies – one conducted by experts from Harvard University and the Technical Research Center of Finland (published in the Proceedings of the National Academy of Sciences) and the other by experts from The Energy Resources Institute (India) – estimate on-shore wind potential in India to be >1,000 GW (estimated at hub-heights >= 80m).1 In sharp contrast, the official wind energy potential estimate (by the Center for Wind Energy Technologies (CWET), India) used by the Indian government in its policy-making process is only 103 GW (estimated at a hub height of 80m).2 Second, recent reassessments conducted in various countries such as the U.S. and China have found much higher wind energy potential due to better technology in the form of higher efficiency, hub heights, and sizes of wind turbines. The official wind potential estimates (expressed in capacity terms) used by China have recently increased by 800% and those of the U.S. by 50% (see Figure ES 1). Wind potential estimates for the US expressed in terms of energy have increased almost 400%. Third, systematic analysis based on Geographic Information System (GIS) data provides an accurate way to identify land with wind power development potential. The potential estimate by CWET presented in the 2010 Indian Wind Atlas, arbitrarily, assumes that just two percent of the windy land is available for wind energy development. All three reasons taken together suggest that a transparent and systematic reassessment of the wind resource in India could also reveal a substantially higher potential than previously estimated and could potentially have major implications of Indian power sector policy.

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Methodology

In this study, wind energy potential for turbines at 80m, 100m, and 120m hub-heights was estimated at varying levels of capacity utilization factors. The hub-height of the most commonly sold wind turbines today is 80m.3 In general, the trend is toward steadily increasing hub-heights, with most major wind turbine manufacturers now offering turbines with hub-heights >100m and some as high as 150m.

Annual average wind power density (WPD) and wind speed data at an elevation of 80m, 100m, and 120m for each 5 km by 5 km cell in India was procured from 3Tier.4 Publicly available GIS data on topography and land use and cover (LULC) was used to exclude areas where development of wind facilities would be technically and economically unviable. The excluded sites included low quality wind areas (WPD < 200 W/m2), areas with slopes greater than 20 degrees, elevation greater than 1,500m, forests, snow-covered areas, water bodies, urban areas, and protected areas.

As observed in locations around the world, land can be used simultaneously for wind energy production and for agriculture (for example, farming, cattle-raising, etc.). Hence, wind energy potential estimates are transparently presented by LULC type without applying any subjective criteria for development.

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Key Findings

Assuming a turbine density of 9 MW/km2, Figure ES 2 shows the techno-economically viable on-shore wind potential at three different hub-heights. The total wind potential in India with a minimum capacity factor of 20 percent ranges from 2,006 GW at 80m hub-height to 3,121 GW at 120m hub-height.

More than 95 percent of the wind energy potential is concentrated in just five states in southern and western India – Tamil Nadu, Andhra Pradesh, Karnataka, Maharashtra, and Gujarat. The state with the overall largest resource is Karnataka while the state with largest best-quality resource is Tamil Nadu. From a cost-effective perspective, the full development of best-quality wind resources in Tamil Nadu – which already leads all states in installed wind capacity – would yield a capacity of 65 GW at 80m hub-height and a minimum capacity factor of 32%. This is more than four times the total installed wind capacity in India.

It is unlikely that all of the wind potential identified will be developed. The land requirement for developing 543 GW (with WPD > 250 W/m2 and CF > 25%) will be about 60,362 km2 (based on a turbine density of 9 MW/km2), about 2% of the total land area of India. Out of this land requirement, only a small percentage (typically about 3%) is disturbed permanently, primarily due to towers and roads, and the rest of the land can be used for other purposes. For example, based on the study of 93 wind farms totaling 13,897 MW in the US, Denholm, P. et al. (2009) found that the permanently impacted land due to wind power development is about 0.3 Hectare/MW. Hence, the actual land footprint of developing 543 GW of wind power is likely to be approximately 1,629 km2, about 40 km by 40 km area, or 0.05% of the total land area of India.

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Using the norms specified by the Central Electricity Regulatory Commission (CERC), Figure ES 3 shows the estimated wind potential at various levels of levelized tariffs. Based on CERC norms, approximately 200 GW of wind potential is available at a levelized tariff of Rs. 4.5/kWh or less and about 100 GW is available at Rs 4.0/kWh or less at all three hub-heights.

It is necessary to note that the estimates presented here regarding yields and the extent of land most suitable for wind power development in India are not detailed enough to determine sites for an actual wind generation facility or predict its exact output. These estimates are, however, appropriate for use in high-level policy-making; estimates based on methodologies similar to the one used here serve as the basis for policy development and long-term power sector planning purposes in the U.S., China, and the European Union.

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Implications and Future Work

Our findings suggest that the availability of a developable wind resource is not a constraint for wind to play a major role in India’s electricity future. This is in sharp contrast with the earlier official estimate of the potential, which, if fully exploited would have provided only about eight percent of electricity demand (in energy terms) in 2022. The technical feasibility of integrating large quantities of wind energy needs to be assessed systematically. However, experience from operation of existing power systems in such places as Denmark and Germany and several studies, have indicated the techno-economic feasibility of such integration (Milligan et al., 2009 and Wiser et al., 2011). Given effective planning, policies, and programs, wind energy can be a core component of India’s affordable, reliable, and clean energy portfolio.

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Conclusions and Future Directions

The official wind energy potential estimate as described in the latest (i.e. 2012) Wind Energy Atlas of India is about 103 GW. However, two recent studies – Xi Lu (2009 and Hossain et al. (2011) – indicate that the wind energy potential for India is at least one order of magnitude greater than the official estimate. Recent re-assessments of wind energy potential in the U.S. and China that have accounted for the improved capability of the latest wind technology have led to substantial upward revision of the wind potential in each country. Lastly, the Wind Energy Atlas of India made ad-hoc assumptions about the land available for wind power development instead of systematically identifying various land uses and their suitability for wind power development. In order to address the concerns and discrepancies described above, this study – using best practice methods and vetted data – developed the potential wind energy available in India. Results include the following:

- The techno-economic on-shore wind potential ranges from 2,006 GW at 80m hub-height to 3,121 GW at 120m hub-height with a minimum capacity factor of 20 percent.

- The potential at high-quality wind energy sites alone (80m hub-height with a minimum capacity factor of 25 percent) is 543 GW, more than five times larger than the current official estimate

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More than 95 percent of the nation's wind energy potential is concentrated in five states in southern and western India – Tamil Nadu, Andhra Pradesh, Karnataka, Maharashtra, and Gujarat. The state with the overall largest resource is Karnataka while the state with largest best quality resource is Tamil Nadu.

Under the CERC norms, approximately 500 GW of wind potential is available at a levelized cost of Rs. 5/kWh or less – at 80m hub-height. At least 100 GW of wind energy potential can be developed today at less than Rs. 4/kWh at 80m hub-height.

Considering the findings of the large wind potential, it is possible to imagine scenarios where wind energy can play a substantial role in India’s energy mix and contribute significantly to reduction in power shortages in the short term and energy security and environmental sustainability in the long term. These promising results provide sufficient support for conducting further analysis (on topics such as wind integration, transmission planning, regional coordination, cost effective development, and land policies) and dialogue that would ensure that this large, cheap, and clean resource available in India is developed as quickly and as cost effectively as possible.

QUICK NEWS, March 29: CALIFORNIA FUKUSHIMA? – SAN ONOFRE UNSAFE; DIFFERENT WIND; NOT THE BEAVER’S BIKE

CALIFORNIA FUKUSHIMA? – SAN ONOFRE UNSAFE
NRC Issues Confirmatory Action Letter for San Onofre Nuclear Generating Station Restart Preparations
March 27, 2012 (Nuclear Regulatory Commission)

"The U.S. Nuclear Regulatory Commission has issued a Confirmatory Action Letter documenting actions that Southern California Edison Co. (SCE) officials have agreed to take related to unusual wear on steam generator tubes prior to restarting both units of the San Onofre Nuclear Generating Station…near San Clemente, Calif."

[Elmo E. Collins, Region IV Administrator, NRC:] “This Confirmatory Action Letter formalizes commitments that Southern California Edison has made to ensure that the cause of the tube wear in both steam generators is understood and appropriately addressed in order to ensure safe operation…Until we are satisfied that has been done, the plant will not be permitted to restart.”

Beautiful, isn't it? So was Fukushima until it became an environmental disaster. (click to enlarge)

"On Jan. 31, operators performed a rapid shutdown of the Unit 3 reactor after indications of a steam generator tube leak. Unit 2 has been shut down since Jan. 9 for a planned refueling and maintenance outage. Subsequent inspections at both units have identified unusual wear in many tubes of the steam generators, which were replaced in January 2010 at Unit 2 and January 2011 in Unit 3…SCE has identified two causes of the unusual wear: tubes are vibrating and rubbing against adjacent tubes and against support structures inside the steam generators. They are still working to determine why this is occurring…

"SCE has committed to [plug all tubes in Units 2 and 3 for which testing indicated wear in excess of industry guidelines, as well as all tubes susceptible to this wear because of their location and determine the causes of the tube-to-tube degradation and establish a protocol of inspections and or operational limits for Unit 2 and 3 to minimize the progression of tube wear, and ensure that any tube wear does not progress to the point where it compromises tube integrity] prior to restart of each unit…"

ANOTHER LOOK AT SOLAR’S RECORD YEAR
Crunching The Numbers On The Solar Market's Record-Breaking Year
22 March 2012 (Solar Industry)

"Worldwide solar photovoltaic market installations reached a record high of 27.4 GW in 2011 - up 40% year-over-year (Y/Y)…Overall market growth in 2011 was boosted by strong second-half demand ahead of further deep cuts in solar incentives…[following] over-production in the first half that triggered [2011’s] sustained price decline through the PV chain…

"…[T]he dominance of Chinese manufacturers in crystalline silicon wafers, cells and modules grew, the share of thin film declined, and demand in Asian markets grew rapidly…Overall, the PV industry generated $93 billion in global revenues in 2011 - up 12% Y/Y - while the industry successfully raised more than $8 billion in corporate equity and debt."

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"…[T]he top five PV markets were Germany, Italy, China, the U.S. and France, which collectively constituted 74% of global demand in 2011. China's solar demand soared 470% Y/Y, rising to third place from seventh in 2010…European countries accounted for 18.7 GW - or 68% - of world demand in 2011…Germany, Italy and France collectively accounted for 82% of the European market…

"Over the next five years, factory-gate module prices [are predicted to] drop between 43% and 53% from 2011 levels…Average crystalline silicon module factory-gate prices in 2012 will be at least 29% lower than the 2011 average…Over the next 12 months, European solar markets are projected to lose overall global market share, dropping to 53%. By 2016, European market share is projected to fall below 42% as North America and several Asian markets grow rapidly. China is forecast to reach 17% of the world market by 2016…"


DIFFERENT WIND
Vertical axis wind turbines: The only way is up?
Andrew Williams, March 27, 2012 (Wind Energy Update)

"…Interest in vertical axis wind turbines (VAWTs) is growing and several design concepts including DeepWind and VertiWind are undergoing development and testing. So, how do they compare with horizontal turbines - particularly in terms of performance, costs and ease of installation?

"…[O]ne advantage of VAWTs is that they have an 'omni-directional' operation and low centre of gravity - leading to good structural stability…[They could dispense] with struts, simplifying structural complexity compared with previous designs…[L]arge-scale VAWTs could be better at avoiding the 'gravity issues' that plague large horizontal-axis turbines (HAWTs), which can quickly exhaust blades…[O]ne of the disadvantages of VAWTs is that it can be difficult to access machinery, which is below the main turbine axis and often dug into the ground. However, in floating foundations, like their own WindFloat design, the hull can be hollowed to enable access…"

VertiWind's floating vertical wind turbine (artist's conception - click to enlarge)

"In terms of output capabilities, the general consensus is that VAWT efficiency is currently either the same or lower than HAWTs…[T]he VertiWind VAWT has been designed for a 2MW output, with a power curve comparable to HAWTs of the same rated power…[but] Walt Musial, Principal Engineer - National Wind Technology Center at NREL, argues that VAWT efficiency is maybe 20% less 'give or take a little' …[another expert argues] it is approximately 10% less…

"…CAPEX is 'probably higher' for VAWTs now but should 'be about equal in the long run.'…OPEX costs can go both ways - but are likely to be higher at present…because of a lack of experience…CAPEX and OPEX costs for VertiWind are comparable with a HAWT bottom-mounted solution in shallow waters - even though they operate in deeper waters…[G]rid-connection costs are 'related to distance to shore' and are therefore more difficult to compare like-for-like…[T]he VertiWind design lends itself very well to high-volume manufacturing…[and] transportation…VAWTs have a number of novel advantages…[but] a good deal of work remains…to convince the wider industry that they can compete…"

TODAY’S STUDY: WHAT EFFECTIVE GOVERNMENT CAN DO

Renewable Energy; Federal Agencies Implement Hundreds of Initiatives
February 27, 2012 (Government Accounting Office)

What GAO Found

Governmentwide, 23 agencies and their 130 subagencies GAO reviewed implemented nearly 700 renewable energy initiatives in fiscal year 2010. The Departments of Defense (DOD), Agriculture (USDA), Energy (DOE), and the Interior were collectively responsible for almost 60 percent of all initiatives.

The initiatives supported a range of renewable energy sources, and the most commonly supported sources were bioenergy, solar, and wind. Also, the initiatives supported a range of public and private sector recipients, but the large majority provided support to the private sector. Many initiatives supported multiple renewable energy sources and types of recipients, while many others targeted support to one source or recipient. Agencies’ renewable energy efforts increased in recent years as a result of the provisions of the American Recovery and Reinvestment Act of 2009 and other factors, but the level of future efforts is less certain with the expiration of these provisions and budget constraints.

Across agencies, more than 80 percent of initiatives span four key federal roles—supporting research and development; using renewable energy in vehicle fleets and facilities; providing incentives for commercialization and deployment; and regulation, permitting, and ensuring compliance. Certain agencies led efforts in each federal role: DOE, DOD, and USDA for research and development; DOD, the General Services Administration, and DOE for fleets and facilities; Treasury and USDA for commercialization and deployment; and Interior and the Environmental Protection Agency for regulation, permitting, and compliance.

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Why GAO Did This Study

The nation’s reliance on imported oil, rising energy costs, and fossil fuels’ potential contribution to climate change have renewed the federal focus on renewable energy. Many federal agencies support renewable energy activities, raising congressional concerns about the number and roles of agencies implementing such efforts. Currently, there is no comprehensive inventory of federal renewable energy initiatives, making it difficult to identify potential fragmentation or duplication.

GAO was asked to (1) identify agencies’ renewable energy-related initiatives and (2) examine the federal roles agencies’ initiatives supported. GAO collected data from agencies’ budget documents, strategic plans, websites, and through agency data requests and interviews with officials from most of the 24 federal agencies subject to the Chief Financial Officers Act of 1990. These 24 agencies accounted for roughly 98 percent of all federal outlays in 2009. GAO developed an inventory of agencies’ renewable energy initiatives, including initiatives for which renewable energy was the focus, as well as initiatives for which it was part of a broader effort. GAO focused on developing this inventory, and as such, did not evaluate initiatives based on financial support or other factors.

This report contains no recommendations. In response to the draft report, Commerce agreed with the overall findings as they relate to the Department, while Homeland Security neither agreed nor disagreed with GAO’s findings. The other agencies provided technical or clarifying comments, which GAO incorporated as appropriate, or had no comments.

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The Honorable Joseph I. Lieberman Chairman
The Honorable Susan M. Collins Ranking Member
Committee on Homeland Security and Governmental Affairs
United States Senate

Americans’ daily lives, as well as the economic productivity of the United States, depend on the availability of energy, particularly from fossil fuels. However, concerns over the nation’s reliance on imported oil, rising energy costs, and fossil fuels’ potential contribution to global climate change have renewed the focus on developing renewable energy resources and technologies to meet future energy needs.1 According to the Department of Energy’s (DOE) Energy Information Administration, domestic renewable energy use grew by 21 percent from 2006 to 2010 and accounted for about 8 percent of U.S. energy consumption in 2010.2During the same period, nuclear energy use increased by about 3 percent, and the use of fossil fuels decreased by about 4 percent largely as a result of the recent economic downturn. Over the coming decades, the Energy Information Administration projects that the strongest growth in the domestic energy sector will be in the use of renewable energy to generate electricity and produce liquid fuels for transportation.

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Congress and some federal agencies have emphasized the importance of renewable energy as a means to address issues of national concern and have committed substantial federal resources to initiatives in this area. 3 For instance, DOE’s Office of Energy Efficiency and Renewable Energy (EERE) received about $630 million in its fiscal year 2010 appropriation for research related to bioenergy, geothermal, solar, water, and wind energy—an increase of about 43 percent from the fiscal year 2008 level of about $440 million.4 EERE received an additional $1.4 billion from the American Recovery and Reinvestment Act of 2009 (Recovery Act) for renewable energy-related efforts.5 The federal government also creates incentives for investment in certain types of renewable energy-related projects and for the production and consumption of renewable energy by, for example, providing favorable tax treatment, such as tax credits, to businesses and individuals. These tax preferences—which are referred to as tax expenditures and are administered by the Department of the Treasury’s Internal Revenue Service (IRS)—result in forgone revenue for the federal government.6 Revenue losses associated with renewable energy-related tax expenditures were estimated to be almost $8.9 billion for fiscal year 2010, according to estimates from the President’s 2012 budget.7 The Recovery Act and other recent legislation established, extended, or changed the scope of a number of these tax expenditures.

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The federal government is also uniquely positioned to affect the development of renewable energy resources through its land management and regulatory activities and as a consumer of energy. For example, the Department of the Interior (Interior) manages approximately 500 million acres, or one-fifth, of the nation’s land and 1.7 billion acres off its shores. Interior has recently emphasized development of renewable resources in these areas by, for example, implementing measures to streamline the regulatory processes associated with constructing solar energy projects on some of these lands. The federal government is also the single largest user of energy in the United States, and a number of recent federal laws and executive orders have established requirements and direction for federal agencies to (1) reduce energy consumption and greenhouse gas emissions and increase renewable energy use at their facilities, and (2) to reduce petroleum consumption and increase the use of alternative fuels in their vehicle fleets.8

The wide range of federal activities related to renewable energy and the recent increase in these efforts have raised congressional concerns about the number of agencies implementing such activities, as well as the roles of agencies responsible for regulating and providing funding to various segments of the renewable energy industry. However, there is currently no comprehensive inventory of which federal agencies are implementing renewable energy-related initiatives and the types of initiatives they are implementing. In light of efforts to balance the federal budget and target spending on activities that will most effectively meet national needs, the lack of available information on agencies’ renewable energy initiatives has further raised congressional concerns about the ability to identify whether efforts are fragmented, duplicative, or operating at cross-purposes.

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Due to these concerns, you asked us to provide information on federal renewable energy initiatives. Our objectives for this report are to (1) identify federal agencies’ renewable energy-related initiatives governmentwide, and (2) examine the federal roles these agencies’ initiatives support. Appendix II and GAO-12-259SP provide more detailed information on individual agencies’ initiatives.9In addition, we provide information on the extent to which the Recovery Act established, expanded, or modified agencies’ renewable energy-related initiatives, and identify those initiatives, such as certain tax expenditures that supported ethanol or other biofuels, for which authority has recently or will soon expire without congressional action. This information is provided in appendixes III and IV, respectively.

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To identify federal agencies’ renewable energy-related initiatives, we collected information on initiatives that were funded, planned, implemented, or authorized in fiscal year 2010 by reviewing agencies’ budget documents and other key information sources, such as strategic plans and websites. From this effort, we developed data on agencies’ initiatives that were related to renewable energy through a specific emphasis or focus, even if renewable energy was part of a broader effort. 10 We defined an initiative as a program or group of activities serving a similar purpose or function, and the initiatives we identified included agency spending programs as well as tax expenditures. In some instances, these initiatives corresponded to distinct agency programs or initiatives. In other cases, we identified and grouped similar activities into initiatives based on our own judgment when there did not already appear to be a formal name for the initiative, or disaggregated higher-level activities that included multiple initiatives.11 We focused on agencies subject to the Chief Financial Officers Act of 1990 (CFO Act) with renewable energy-related activities that went beyond standard governmentwide efforts to incorporate renewable energy into their vehicle fleets and facilities in response to requirements and direction established by federal laws and executive orders.12 These agencies were: the departments of Agriculture (USDA), Commerce, Defense (DOD), Energy, Homeland Security (DHS), Housing and Urban Development (HUD), the Interior, Justice, Labor, State, Transportation (DOT), and the Treasury; as well as the following independent agencies: the Environmental Protection Agency (EPA), General Services Administration (GSA), National Aeronautics and Space Administration (NASA), National Science Foundation (NSF), Small Business Administration (SBA), and U.S. Agency for International Development (USAID). Of these 18 CFO Act agencies, we collected data on DOD activities separately for the Air Force, Army, Marine Corps, Navy, and other DOD components that report to the Office of the Secretary of Defense. In addition, we collected data for the Federal Energy Regulatory Commission (FERC) separately from DOE.13

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We submitted a structured data request to agencies to provide information on each of their renewable energy initiatives, including the responsible agency component(s); a description of its purpose, how it is implemented, and how it relates to renewable energy; the applicable renewable energy sources; the recipients of funding, services, or other types of support; the extent to which it was established, expanded, or modified by the Recovery Act; and whether the legislative authority for the initiative has expired or may expire. We then conducted interviews with agency officials responsible for providing the data to collect additional information and assess the accuracy, reliability, and completeness of the data provided. We determined the data to be sufficiently reliable for the purposes of this report. We then analyzed the data we collected to develop descriptive information across the agencies’ renewable energy-related initiatives. We recognize that measures other than the number of initiatives implemented, such as the level of financial support provided, are also important to understanding renewable energy efforts governmentwide. An agency may have many initiatives, but the total financial support provided for these initiatives could be substantially less than the financial support provided by an agency with fewer initiatives. We did not review agencies’ renewable energy-related initiatives on the basis of the level of financial support agencies provide for their renewable energy efforts because, for example, officials stated that financial support for renewable energy is often not tracked separately from other activities. Therefore, we could not collect reliable renewable energy-specific funding data or revenue loss estimates across the full inventory of initiatives we identified.

To examine the federal roles agencies’ renewable energy initiatives support, we analyzed the initiative data we collected to identify the federal roles of the initiatives each agency implemented. Specifically, we categorized agencies’ initiatives on the basis of four key federal roles, including (1) research and development; (2) commercialization and deployment; (3) regulation, permitting, and compliance; and (4) fleets and facilities.14 In some instances, we found that agencies’ initiatives did not fit into any of these four roles, and in such instances, we included these initiatives in an “other” category…

QUICK NEWS, March 28: WIND, THE BIG GUYS; SOLAR POWER PLANT BLDR IN $182.5BIL IPO; STILL CHALLENGES FOR SMART GRID

WIND, THE BIG GUYS
Vestas holds onto no1 manufacturer spot
James Quilter, 26 March 2012 (Windpower Monthly)

"Vestas has continued to hold onto its top spot in the in the league of the world's biggest wind turbine manufacturers, according to research analyst BTM…[Once again], Chinese manufacturers were well-represented within the top 10 with Ming Yang joining Guodian United Power, Sinovel and Goldwind.

"According to BTM, Vestas has a 12.9% share of the market, with Goldwind leaping into second place with a 9.4% share. They are followed by GE on 8.8%...The five companies hovering outside the top 10 are Nordex, Dongfang, XEMC, Sewind and Enercon India."

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"Onshore turbine size continued to grow with the average size delivered to market in 2011 at 1,678kW. Offshore the growth has been more pronounced with the average size rising 710kW to 3,700kW…[D]espite the relative strength of the Asian market, the average growth rate for new installations is 10%. This year a growth of around 3.5% is expected…partly due to fall out from the European debt crisis.

"Make Consulting also published its own report into turbine manufacturer market share. Again it rated Vestas as market leader, but found GE was at number six with only 7.4% of the market…Vestas – 12.9%...Goldwind – 8.8%...Enercon – 7.6%...Suzlon Group – 7.6%...Siemens - 7.6%...GE Wind – 7.4%...Sinovel – 7.2%...United Power – 7.0%...Gamesa – 6.4%...Mingyang – 2.9%"


SOLAR POWER PLANT BLDR IN $182.5BIL IPO
BrightSource Seeking Up to $182.5 Million in Solar-Thermal IPO
Andrew Herndon, March 21, 2012 (Bloomberg News)

"BrightSource Energy Inc (BRSE) the developer of solar-thermal power plants, is seeking as much as $182.5 million in an initial public offering…The company is offering 6.9 million shares at $21 to $23 apiece…The stock would be listed on the Nasdaq Stock Market under the symbol BRSE. The offering is expected to be priced on April 11…

"BrightSource, based in Oakland, California, plans to use proceeds from the IPO to develop additional solar-thermal power plants, which use mirrors to focus the sun’s energy on boilers that make steam to drive turbines. The company has 13 contracts to sell power from projects totaling 2.4 gigawatts of capacity to electric utilities of PG&E Corp. (PCG) and Edison International (EIX)…"

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"BrightSource is vying with other developers including Abengoa SA (ABG), Areva SA, Acciona SA (ANA), Siemens AG (SIE) and ABB Ltd. (ABBN) to commercialize its technology…Other solar-thermal developers are using so- called parabolic trough systems, with curved mirrors that focus sunlight on an overhead tube that contains a heat transfer fluid and is routed to steam generators…The [company’s] first power plant is expected to enter operation in 2013…[It] is backed by a $1.6 billion loan guarantee from the U.S. Energy Department, as well as equity investments from Google Inc. and NRG Energy Inc. (NRG) …

"Alstom SA (ALO), an existing investor, and Caithness Energy LLC’s development unit agreed to purchase $65 million and $10 million worth of the company’s stock, respectively, in a concurrent private placement…Alstom, BrightSource’s largest backer currently with a 19.9 percent stake, would [then] own 21.9 percent…[O]ther backers include Draper Fisher Jurvetson [5.9 percent]…VantagePoint Capital Patners [24 percent]…and Morgan Stanley (MS) [9.4 percent]…Goldman Sachs (GS) Group Inc., Citigroup Inc. (C), and Deutsche Bank AG (DBK) are leading the proposed offering…[and] have an option to purchase an additional 1.035 million shares."


STILL CHALLENGES FOR SMART GRID
Smart Grid Standards Challenges Remain, Report Finds
March 23, 2012 (Metering.com)

"The introduction of smart grid interoperability standards has the potential to transform the electric industry and the fundamental electric utility business model, but there are challenges in the short, mid and long terms, according to a new report…from the National Institute of Standards and Technology’s (NIST) Smart Grid Advisory Committee (SGAC)…

"…[T]he Committee has identified several common emerging themes across the smart grid stakeholder landscape. In the short to mid-term, these include prioritizing, streamlining and leveraging the smart grid activities of NIST, given the shortage of resources to participate in these activities, and the urgent need for a communication plan and an education and outreach effort for utilities and regulators to enhance their understanding of the smart grid and interoperability standards."

"In the longer term, as the smart grid evolves NIST will need to develop greater expertise in the technological and administrative functions necessary to support the smart grid. There will also be a need for interagency collaboration, for example between NIST and the Department of Homeland Security (DHS) to define the federal response to national cyber emergencies.

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"The SGAC was established in September 2010, with representatives from U.S. industry, academia, and trade and professional organizations to advise NIST on smart grid standards, priorities and gaps, and on the overall direction, status and health of smart grid implementation by the industry…[T]he SGAC also reviewed NIST’s smart grid research activities…[and found] that NIST should be a facilitator of multi‐stakeholder smart grid research collaboration, and it should invite and promote strong collaboration with utilities and the private sector on research into metrics for interoperability, cybersecurity, and other properties of the smart grid. NIST also should conduct research to determine the metrology requirements for smart grid devices…"


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TODAY’S STUDY: WHAT THE MEDIA IS MISSING IN THE GAS PUMP PRICE STORY

Study: Media Missing The Mark On Gas Prices
March 20, 2012 (Media Matters)

A Media Matters analysis of print and television coverage of rising gasoline prices between January 1 and February 29 finds that news outlets often provided a shallow and shortsighted treatment of the issue. For instance, several outlets largely overlooked fuel economy standards -- a key policy solution that mitigates U.S. vulnerability to price spikes -- while promoting increased U.S. drilling and the Keystone XL pipeline, which would likely move gas prices by only a few cents, if at all. In addition, cable news outlets primarily hosted political figures rather than energy experts or economists to comment on gas prices. Fox News, which covered gas prices far more frequently than any other outlet, regularly blamed President Obama for the recent price increase, a claim in line with Republican strategy but not with the facts.

The following chart shows the total coverage of gas prices between January 1 and February 29:

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TV News Buries Key Policy Addressing Gas Price Woes

Reducing Consumption Is Key To Mitigating Our Vulnerability To Price Spikes.
According to the Energy Information Administration, the cost of crude oil, which is set on the world market, determines 76 percent of the price of gasoline. Energy experts agree that the way to reduce our vulnerability to gas price spikes is to decrease our dependence on oil, regardless of where the oil comes from. [Media Matters, 2/23/12]

Michael Levi, Council on Foreign Relations: "Since oil is traded on a global market, the effects of volatility are reflected in the price of every barrel of oil regardless of its origin. This problem can be addressed only by making the U.S. economy more resilient to oil price swings, which includes -- most significantly -- lowering total U.S. oil consumption."

Economist Severin Borenstein: "To fix the problem, we just need to use less oil."
Energy analyst Chris Nelder: "Increasing efficiency is going to be a far more productive policy tool than increasing supply."

Moody's Chris Lafakis: Higher average fuel economy, "be it through electric vehicles or improved efficiency on conventional vehicles," lowers "the percentage of consumers' incomes that they spend on gasoline."

News Outlets Largely Overlooked Fuel Efficiency Policies. Only 2% of broadcast coverage, 4% of cable coverage, and 13% of print coverage of gas prices mentioned fuel economy standards, which have been significantly raised by the Obama administration. Two of the 9 mentions of fuel economy standards on Fox were GOP candidates calling for their repeal. CBS and The Los Angeles Times did not mention fuel efficiency standards in their gas price coverage at all. Out of 69 print items on rising gas prices, only three made the point that reducing oil consumption is the best long-term solution. These figures include views expressed by those interviewed or quoted.

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Nearly All TV Outlets Promoted Drilling More Often Than Fuel Efficiency.

With the exception of NBC, every television network mentioned expanded drilling as a solution more often than fuel economy standards. Fox News promoted the narrative that more domestic oil production will lower gas prices in 45% of its coverage. These figures include guests' comments if they were not challenged by the anchor. Energy experts, including those who are politically conservative, have repeatedly debunked the idea that increasing U.S. production is an effective solution to high prices. In fact, even the American Petroleum Institute won't say that expanded drilling would hold down prices. An analysis by the Energy Information Administration estimated that the difference between a scenario in which the Atlantic, Pacific and Eastern/Central Gulf of Mexico are open to offshore drilling and a scenario in which they remain off-limits is 3 cents per gallon of gasoline in 2030. Such a small effect would be dwarfed by the impact of rising oil consumption in Asia, geopolitical conflicts, or OPEC supply adjustments. [Media Matters, 2/23/12, 6/23/11, 5/12/11]

Cable News Falsely Presented Keystone XL As A Gas Price Remedy. Economists say that TransCanada's Keystone XL oil pipeline would not noticeably lower gasoline prices. Even Ray Perryman, the economist hired by TransCanada said the effect would be only "around 3.5-4 cents per gallon" and not until the pipeline was "flowing reasonably close to capacity" in several years. He added that "a modest change of this nature will often be swamped by the day-to-day factors that impact market prices." Some analysts say the pipeline could actually raise prices in some parts of the country. But every cable news outlet promoted Keystone XL more often than fuel economy standards. In almost 40% of its coverage, Fox suggested that approving Keystone XL would help relieve rising gas prices. These figures include guests' comments if they were not challenged by the anchor. [Media Matters, 2/23/12]

Cable News Offers Political Figures Rather Than Energy Experts
Cable Networks Relied On Politicians To Explain Rising Gas Prices. In total, 63% of those interviewed or quoted on gas prices by cable outlets were political figures (including politicians, strategists, White House officials and campaign advisors), and only 13% were economists or oil industry experts. By contrast, 49% of those quoted by print outlets were economists or industry analysts and 35% were political figures. On the broadcast networks, 49% of those interviewed or quoted were consumers, 32% were political figures, and 17% were economists or industry analysts. The following chart breaks down the credentials of gas price commentators on CNN, Fox News and MSNBC:

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Experts Say It's Simply Bad Economics To Blame Price Spike On The President.

As countless experts and fact-checkers have noted, global factors largely determine the price of oil, not U.S. policy changes, let alone any actions President Obama has taken.

Energy economist Severin Borenstein, a professor at U.C. Berkeley's Haas School of Business, explained: "Oil prices drive gasoline prices and current oil prices are high. But $125 per barrel oil today is no more the fault of President Obama than $147 oil was President Bush's fault in June 2008. There is very little the U.S. president can do to change oil prices over months or a few years. U.S. oil production was up 13 percent in 2011 over 2008, but still remains less than one-tenth of the world oil market." [U.S. News & World Report, 3/2/12]

In a U.S. News & World Report column, Cato Institute fellows Peter Van Doren and Jerry Taylor wrote: "President Obama is no more responsible for production increases than other presidents were responsible for production declines. Unfortunately, presidents get blamed for world market changes that occur during their time in office ... but generally, they do not cause them." [U.S. News & World Report, 3/2/12]

Tom Kloza, chief analyst for the Oil Price Information Service, told USA Today: "We'll continue to see plenty of blame attributed to both parties if we see prices go higher. But there is very little a president can do to impact gas or crude oil prices over the short term." [USA Today, 3/8/12]

Nevertheless, More Than Half Of Fox News Coverage Falsely Suggested Obama Is Responsible. Our results show that Fox News covered gas prices far more often than other news outlets -- more than CNN and MSNBC combined. 55% of Fox News coverage suggested that President Obama is to blame for rising gas prices. In total, Fox blamed Obama 144 times in two months - more than three times as much as all other news outlets combined. These figures include guest quotes if they were not challenged by the anchor or author.

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Fox Narrative Mirrors GOP Campaign Strategy.

The New York Times reported in February that Republicans see rising gas prices as an opportunity to attack President Obama on the economy:

"In a closed-door meeting last week, Speaker John A. Boehner instructed fellow Republicans to embrace the gas-pump anger they find among their constituents when they return to their districts for the Presidents' Day recess.

"This debate is a debate we want to have," Mr. Boehner told his conference on Wednesday, according to a Republican aide who was present..."

And talking points from the Republican National Committee that go out to conservative commentators every Friday often include rising gas prices among the "Top Line Messaging" for the week. A recent "Pundit Prep" document cited the national debt, unemployment and the price of gas as the three best ways to define the "Obama economy." [New York Times, 2/18/12]

Methodology

This report analyzes print and television coverage of U.S. gasoline prices between January 1, 2012 and February 29, 2012. Our analysis includes the major broadcast networks (ABC, NBC and CBS), the major cable networks (CNN, Fox News, and MSNBC), and five major print outlets (New York Times, Washington Post, USA Today, Los Angeles Times, and Wall Street Journal).

For print outlets and CNN transcripts, our results are based on a Nexis search for "(gas w/3 price!) or gasoline". For the Wall Street Journal, which is not available in Nexis, we searched Factiva for "(gas near3 price!) or gasoline". For the Fox News and MSNBC shows not available in Nexis, we relied on an internal television archive. Our analysis includes any article or segment devoted to gas prices, as well as any substantial mention (more than one paragraph of an article or news transcript.)

QUICK NEWS, March 27: PRES CHALLENGES OPPONENTS OF NEW ENERGY; BIG CHANGES IN MATURING WIND INDUSTRY; GUANTANAMO GOES SOLAR

PRES CHALLENGES OPPONENTS OF NEW ENERGY
Obama knocks GOP over solar power
David Jackson, March 21, 2012 (USA Today)

"…[On his energy policy tour last wee], President Obama said…Republicans would cause gas prices to rise even higher by withholding federal support for alternative energy sources."

[The President:] "If some politicians have their way, there won't be any more public investment in solar energy…There won't be as many new jobs and new businesses…As long as I'm president, I will not walk away from the promise of clean energy…"

A recent Pike Research poll showed the public overwhelmingly agrees with the President. (click to enlarge)

"…[The tour included stops at oil and gas fields in New Mexico, an oil pipeline project in Oklahoma, and an energy speech in Ohio…With gas prices rising, Republicans said Obama is not doing enough to promote domestic oil production. They also criticized his alternative energy investments, particularly the now-bankrupt Solyndra…

"Obama is promoting what he calls an ‘all-of-the-above’ energy policy, one he said includes developing new sources as well as increasing oil production…Domestic oil production is up, Obama said, but ‘drilling alone’ will not solve the problem of higher gas prices…"


BIG CHANGES IN MATURING WIND INDUSTRY
Wind Energy Update: End of Warranty Requirements for Wind Energy
March 24, 2012 (San Francisco Chronicle)

"Over 100,000MW of wind energy capacity is set to come out of warranty by 2020 forcing operators to either repower or retrofit their wind farms or lose money… the Retrofitting, Reliability & Repowering report 2012…[found that of the countries with turbines] between 8 and 20 years of age and either entering or approaching post-warranty status… China leads the way with over 40,000MW capacity followed by the US with 37,000, Germany with 15,000MW and the UK's 4000MW…

"The report…assesses how wind farm operators can best measure the reliability of their operations post warranty and… what they can do…[R]etrofitting…[which is] improving…existing turbines efficiency and capacity by fitting new technology such as better grid connections or the latest blade designs…[is compared with] repowering…[which is] decommissioning…existing turbines and building [more modern turbines]…"

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"…[O]perators need… [to understand] failures that occur when a turbine warranty ends and the [productivity and profitability impacts of paying] for their repairs… 42% of events after a warranty ends are related to component failures…21%...relate to control system failures…

"…The cumulative number of failures in a year for a single wind turbine is 2.43 with the most affected parts being the Electrical System (0.57 failures per year) and the Electronic Control (0.43 failures per year). The most reliable component is the drive train…[but] the biggest loss of downtime, lethal to site profitability, at an average of 6 days is [from] the gearbox…"


GUANTANAMO GOES SOLAR
Solar Source Installs PV At Guantanamo Bay
15 March 2012 (Solar Industry)

"…Solar Source has completed construction on a 1,200-panel solar power system at the Naval base in Guantanamo Bay, Cuba. The solar array, which is the first of its scale on the island, will produce electricity to power a new fitness center for military personnel…Solar Source provided engineering, procurement and construction for the approximately 300 kW system, which required six-foot screws, custom engineering and pre-drilling to penetrate the dense shell and rock ground. The turnkey solar installation is part of a larger military effort to save money by lowering power bills."

A view of the Guantanamo solar array after security redaction. (click to enlarge)

"The military base at Guantanamo Bay has produced its own electricity since the 1960s, when Rear Adm. John Bulkeley spearheaded the base's efforts to become independent from Cuba's water and power supplies. However, electricity is expensive for the base, with diesel fuel shipped in from overseas…The naval base is undergoing several conservation measures."

TODAY’S STUDY: THE BEST PLACES IN THE WORLD FOR NEW ENERGY

Renewable Energy Country Attractiveness Indices
February 2012 (Ernst & Young)

Global highlights

While 2011 saw record levels of new investment into clean energy, eecially solar, the outlook for 2012 is far less certain, particularly in the West. The sovereign debt crisis continues to stifle the Eurozone, and also policy setters’ ambitions in relation to renewable energy deployment. Capital scarcity and increased competition from Asia will continue to put pressure on Western players for the foreseeable future. All this points to almost inevitable consolidation of the wind and solar sectors, and also increased vertical integration as equipment manufacturers seek ever more innovative routes to market.

Emerging markets will continue to prosper in 2012, thanks to ambitious installations programmes securing investments, while the more established countries will endure increasing constraints. Only five years ago, Spain was the most attractive country for renewable investment, but today it has dropped out of the top ten as the Government has temporarily suspended premiums paid to all new renewables plants. A similar suspension has occurred in Portugal, while other countries (such as Italy and Ireland) cut feed-in tariffs (FITs) and other support mechanisms.

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There is no change at the top of this edition of the CAI. But while China continues its prominence, some mixed signals have emerged: increased solar targets (15GW by 2015) to soak up excess supply, together with grid infrastructure issues that are preventing wind connections. And while domestic market growth plateaus, Chinese corporates are increasingly looking to Europe to acquire stakes in relatively low-priced targets.

For example, China Three Gorges has purchased a significant portion of Energias de Portugal and LDK Solar has offered to purchase Germany’s Sunways.

Meanwhile, the US (in 2nd position) has completed a bumper year for the wind industry. The now-expired Treasury Grants and loan guarantee program underpinned a surge to around 7GW of installed capacity. And recently, President Obama appeared to indicate that the Production Tax Credit (PTC) support mechanism would be extended beyond 2012, and we have scored the US on this basis.

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Third placed Germany gained a point due to continued funding for renewables to fill the nuclear gap. Development bank, KfW, and utilities RWE and E.ON have promised hefty investments in coming years. The solar PV market boomed in 2011 with more than 7GW, but a 15% tariff cut and the threat of monthly reductions will suppress activity in 2012.

Emerging markets have grabbed most of the good news headlines. South Africa has moved up seven places on the back of a very successful first round of a new tender bidding process, totaling 1.4GW of new capacity. South Korea climbed a point across all technologies with Government backing for bold ambitions, especially in offshore wind.

Romania and Ukraine also increased their appeal — mainly due to strong wind markets
Another part of the world that holds great potential for renewable generation is the Middle East and North Africa — especially for solar power, and this issue of the CAI includes a special focus article on this region. Most of the countries already have perational pilot projects as well as ambitious plans for significantly sized installations.

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The lead article in this issue reflects on current events and discusses the future benefits of more distributed ownership and generation — through community based schemes and smart grid networks. This upbeat vision for the future is tempered by the debt focus article, which examines how current liquidity constraints are likely to hamper project financing deals through 2012.

Overview of indices:

The Ernst & Young CAI provide scores for national renewable energy markets, renewable energy infrastructures and their suitability for individual technologies. The indices provide scores out of 100 and are updated on a quarterly basis.

The CAI take a generic view and different sponsor or financier requirements will clearly affect how countries are rated. Ernst & Young’s Renewable Energy Group can provide detailed studies to meet specific corporate objectives. It is important that readers refer to the guidance notes set out on page 28 referring to the indices.

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Long-term indices

The long-term indices are forward looking and take a long-term view (up to five years); hence, the UK’s high ranking in the wind index, explained by the large amount of unexploited wind resource, strong offshore regime and attractive tariffs available under the Renewables Obligation (RO) mechanism. Conversely, although Denmark has the highest proportion of installed wind capacity to population level, its score is relatively low because of its restricted grid capacity and reduced tariff incentives.

All renewables index

This index provides an overall score for all renewable energy technologies. It combines individual technology indices as follows:
1. Wind index — 65% (comprising onshore wind index and offshore wind index)
2. Solar index — 18% (comprising solar photovoltaic (PV) index and concentrated solar power (CSP) index)
3. Biomass and other resources index — 17%

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Individual technology indices

These indices are derived from scoring:
• General country-specific parameters (the renewables infrastructure index), accounting for 35%
• Technology-specific parameters (the technology factors), accounting for 65%

Renewables infrastructure index

This provides an assessment, by country, of the general regulatory infrastructure for renewable energy.

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Technology factors

These provide resource-specific assessments for each country.

Long-term wind index

This index is derived from scoring:
• The onshore wind index — 70%
• The offshore wind index — 30%

Long-term solar index

This index is derived from scoring:
• The solar PV index — 73%
• The solar CSP index — 27%

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Post Durban: can community renewables and smart grid brighten a low-margin decade?
Jonathan Johns

The COP17 agreement in Durban to sign up to an unspecified legally binding treaty by 2020, was welcome but weak. It did not remove carbon and climate change wholly from the agenda, but it hardly provided an imperative to invest. Indeed, the subsequent withdrawal of Canada, Japan and Russia from the Kyoto Protocol, fresh after the home planes had landed, foretells the difficulties to come.

The 2015 to 2020 negotiations will thus take place at a time when a material increase in global emissions by the new growth economies is likely to have outstripped any \reductions in the West, even after any impacts from a recession. Higher rises in global temperatures than the two to three degrees currently contemplated may by then be on the cards — if emerging scientific consensus is accepted.

Post Durban, renewables will need to compete within a wider investment class for funds.

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Renewables no longer has the climate change investment arena largely to itself. Forward–looking investment is likely to flow to energy efficiency and climate–affected scarce resources (e.g., water infrastructure). In January 2012, the Chinese Investment Corporation placed its first significant investment in the UK, with a 9.9% stake in Thames Water. This followed a similar investment a month earlier by the Abu Dhabi investment authority, the latter having already invested in the London Array offshore wind farm through Masdar. Post Durban, carbon trading will not bank the renewable
investment challenge.

Largely due to the impact of continued recession and the euro crisis, carbon prices in Europe could well struggle to get materially beyond current low levels of €7/tonne to €8/tonne (for European Union Allowances — EUAs) unless a reserve price is adopted, as some parties are suggesting. In addition Certified Emissions Reduction certificates — carbon credits based on emissions – reduction projects in the developing world — fell to €3.28 per tonne on the EU Emissions Trading Scheme (ETS) last week, half the price of European Emission Allowances, which are themselves near historic lows. This has had the side effect of reducing European funds available for investment in clean energy sourced from carbon credit sales budgeted at higher levels.

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By turning away from setting a global carbon price, Durban has pushed the spotlight back to individual countries’ domestic support mechanisms. Investment in renewables in the poor developing world is likely to be left in limbo and at the mercy of flagship funds, such as the Durban fund whose announcement, while welcome, was not accompanied by concrete and immediate funds. In the West, the political imperative has moved more to financial housekeeping and away from the inconvenience of climate change.

The continued recession is acting as a brake on policy intervention, as ‘renewables-friendly’ stimulus measures are not always renewed and their perceived generosity is challenged. Concerns about the impact of rising energy prices on industry costs and fuel poverty are already having an impact on policy-makers. However, the fact that investment today reduces exposure to rising fossil fuel prices tomorrow does still strike a chord…