NewEnergyNews: Holiday Reading: Will Third-Party Finance Bring Solar Hot Water to a Boil? Skyline Innovations is making money by providing hot water with no upfront costs.

NewEnergyNews

Gleanings from the web and the world, condensed for convenience, illustrated for enlightenment, arranged for impact...

The new challenge: To make every day Earth Day.

YESTERDAY

  • THE STUDY: A SUPPRESSED STUDY OF OHIO NEW ENERGY JOBS
  • QUICK NEWS, November 26: WHY PEOPLE DENY CLIMATE CHANGE; THE FORCE OF SOLAR; POWER ELECTRONICS MARKETS TO BOOM
  • THE DAY BEFORE

  • THE STUDY: THE DOE LOAN PROGRAM PAYS OFF
  • QUICK NEWS, November 25: THE PRESIDENT’S CLIMATE CHANGER; SOLAR AND WIND BEAT COAL, GAS ON PRICE; LED LIGHTING TO DISRUPT, TRANSFORM THE INDUSTRY
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    THE DAY BEFORE THE DAY BEFORE

  • THE STUDY: RUNNING OUT OF GAS
  • QUICK NEWS, November 24: NEW ENERGY DOMINATES THE U.S. NEW BUILDS AGAIN; SIERRA CLUB, UNITED STEELWORKERS WANT WIND JOBS; THE ABUNDANCE OF SOLAR
  • THE DAY BEFORE THAT

  • Weekend Video: Much More Inhofe Now
  • Weekend Video: Jon Stewart Talks Keystone, Politics, And Jobs
  • Weekend Video: Jon Stewart On How Keystone Opponents May Be Caught In Their Own Trap
  • AND THE DAY BEFORE THAT

  • FRIDAY WORLD HEADLINE-A NEW WAY TO SEE CLIMATE CHANGE
  • FRIDAY WORLD HEADLINE-EU OCEAN WIND TO CUT COSTS, KEEP GROWING
  • FRIDAY WORLD HEADLINE-COST-COMPETIVE NEW ENERGY, GERMANY’S ‘GIFT TO THE WORLD’
  • FRIDAY WORLD HEADLINE-NEW ENERGY MATCHES COAL ON COST, CAPACITY IN TURKEY
  • THE LAST DAY UP HERE

    THINGS-TO-THINK-ABOUT THURSDAY, November 20:

  • TTTA Thursday-TOP REPUBLICAN DROPS CLIMATE DENIAL
  • TTTA Thursday-FORD ELECTRIC CARS FOR ‘THE MASSES’
  • TTTA Thursday-MIDWEST SOLAR MAKES SENSE AND CENTS
  • TTTA Thursday-NEW ENERGY JOBS BY THE BAY
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    Anne B. Butterfield of Daily Camera and Huffington Post, is a biweekly contributor to NewEnergyNews

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT)

    November 26, 2013 (Huffington Post via NewEnergyNews)

    Everywhere we turn, environmental news is filled with horrid developments and glimpses of irreversible tipping points.

    Just a handful of examples are breathtaking: Scientists have dared to pinpoint the years at which locations around the world may reach runaway heat, and in the northern hemisphere it's well in sight for our children: 2047. Survivors of Superstorm Sandy are packing up as costs of repair and insurance go out of reach, one threat that climate science has long predicted. Or we could simply talk about the plight of bees and the potential impact on food supplies. Surprising no one who explores the Pacific Ocean, sailor Ivan MacFadyen described long a journey dubbed The Ocean is Broken, in which he saw vast expanses of trash and almost no wildlife save for a whale struggling a with giant tumor on its head, evoking the tons of radioactive water coming daily from Fukushima's lamed nuclear power center. Rampaging fishing methods and ocean acidification are now reported as causing the overpopulation of jellyfish that have jammed the intakes of nuclear plants around the world. Yet the shutting down of nuclear plants is a trifling setback compared with the doom that can result in coming days at Fukushima in the delicate job to extract bent and spent fuel rods from a ruined storage tank, a project dubbed "radioactive pick up sticks."

    With all these horrors to ponder you wouldn't expect to hear that you should also worry about the United States running out of coal. But you would be wrong, says Leslie Glustrom, founder and research director for Clean Energy Action. Her contention is that we've passed the peak in our nation's legendary supply of coal that powers over one-third of our grid capacity. This grim news is faithfully spelled out in three reports, with the complete story told in Warning: Faulty Reporting of US Coal Reserves (pdf). (Disclosure: I serve on CEA's board and have known the author for years.)

    Glustrom's research presents a sea change in how we should understand our energy challenges, or experience grim consequences. It's not only about toxic and heat-trapping emissions anymore; it's also about having enough energy generation to run big cities and regions that now rely on coal. Glustrom worries openly about how commerce will go on in many regions in 2025 if they don't plan their energy futures right.

    2013-11-05-FigureES4_FULL.jpgclick to enlarge

    Scrutinizing data for prices on delivered coal nationwide, Glustrom's new report establishes that coal's price has risen nearly 8 percent annually for eight years, roughly doubling, due mostly to thinner, deeper coal seams plus costlier diesel transport expenses. Higher coal prices in a time of "cheap" natural gas and affordable renewables means coal companies are lamed by low or no profits, as they hold debt levels that dwarf their market value and carry very high interest rates.

    2013-11-05-Table_ES2_FULL.jpgclick to enlarge

    2013-11-05-Figure_ES2_FULL.jpg

    One leading coal company, Patriot, filed for bankruptcy last year; many others are also struggling under bankruptcy watch and not eager to upgrade equipment for the tougher mining ahead. Add to this the bizarre event this fall of a coal lease failing to sell in Wyoming's Powder River Basin, the "Fort Knox" of the nation's coal supply, with some pundits agreeing this portends a tightening of the nation's coal supply, not to mention the array of researchers cited in the report. Indeed, at the mid point of 2013, only 488 millions tons of coal were produced in the U.S.; unless a major catch up happens by year-end, 2013 may be as low in production as 1993.

    Coal may exist in large quantities geologically, but economically, it's getting out of reach, as confirmed by US Geological Survey in studies indicating that less than 20 percent of US coal formations are economically recoverable, as explored in the CEA report. To Glustrom, that number plus others translate to 10 to 20 years more of burning coal in the US. It takes capital, accessible coal with good heat content and favorable market conditions to assure that mining companies will stay in business. She has observed a classic disconnect between camps of professionals in which geologists tend to assume money is "infinite" and financial analysts tend to assume that available coal is "infinite." Both biases are faulty and together they court disaster, and "it is only by combining thoughtful estimates of available coal and available money that our country can come to a realistic estimate of the amount of US coal that can be mined at a profit." This brings us back to her main and rather simple point: "If the companies cannot make a profit by mining coal they won't be mining for long."

    No one is more emphatic than Glustrom herself that she cannot predict the future, but she presents trend lines that are robust and confirmed assertively by the editorial board at West Virginia Gazette:

    Although Clean Energy Action is a "green" nonprofit opposed to fossil fuels, this study contains many hard economic facts. As we've said before, West Virginia's leaders should lower their protests about pollution controls, and instead launch intelligent planning for the profound shift that is occurring in the Mountain State's economy.

    The report "Warning, Faulty Reporting of US Coal Reserves" and its companion reports belong in the hands of energy and climate policy makers, investors, bankers, and rate payer watchdog groups, so that states can plan for, rather than react to, a future with sea change risk factors.

    [Clean Energy Action is fundraising to support the dissemination of this report through December 11. Contribute here.]

    It bears mentioning that even China is enacting a "peak coal" mentality, with Shanghai declaring that it will completely ban coal burning in 2017 with intent to close down hundreds of coal burning boilers and industrial furnaces, or shifting them to clean energy by 2015. And Citi Research, in "The Unimaginable: Peak Coal in China," took a look at all forms of energy production in China and figured that demand for coal will flatten or peak by 2020 and those "coal exporting countries that have been counting on strong future coal demand could be most at risk." Include US coal producers in that group of exporters.

    Our world is undergoing many sorts of change and upheaval. We in the industrialized world have spent about a century dismissing ocean trash, overfishing, pesticides, nuclear hazard, and oil and coal burning with a shrug of, "Hey it's fine, nature can manage it." Now we're surrounded by impacts of industrial-grade consumption, including depletion of critical resources and tipping points of many kinds. It is not enough to think of only ourselves and plan for strictly our own survival or convenience. The threat to animals everywhere, indeed to whole systems of the living, is the grief-filled backdrop of our times. It's "all hands on deck" at this point of human voyaging, and in our nation's capital, we certainly don't have that. Towns, states and regions need to plan fiercely and follow through. And a fine example is Boulder Colorado's recent victory to keep on track for clean energy by separating from its electric utility that makes 59 percent of its power from coal.

    Clean Energy Action is disseminating "Warning: Faulty Reporting of US Coal Reserves" for free to all manner of relevant professionals who should be concerned about long range trends which now include the supply risks of coal, and is supporting that outreach through a fundraising campaign.

    [Clean Energy Action is fundraising to support the dissemination of this report through December 11. Contribute here.]

    Author's note: Want to support my work? Please "fan" me at Huffpost Denver, here (http://www.huffingtonpost.com/anne-butterfield). Thanks.

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    Anne's previous NewEnergyNews columns:

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT), November 26, 2013
  • SOLAR FOR ME BUT NOT FOR THEE ~ Xcel's Push to Undermine Rooftop Solar, September 20, 2013
  • NEW BILLS AND NEW BIRDS in Colorado's recent session, May 20, 2013
  • Lies, damned lies and politicians (October 8, 2012)
  • Colorado's Elegant Solution to Fracking (April 23, 2012)
  • Shale Gas: From Geologic Bubble to Economic Bubble (March 15, 2012)
  • Taken for granted no more (February 5, 2012)
  • The Republican clown car circus (January 6, 2012)
  • Twenty-Somethings of Colorado With Skin in the Game (November 22, 2011)
  • Occupy, Xcel, and the Mother of All Cliffs (October 31, 2011)
  • Boulder Can Own Its Power With Distributed Generation (June 7, 2011)
  • The Plunging Cost of Renewables and Boulder's Energy Future (April 19, 2011)
  • Paddling Down the River Denial (January 12, 2011)
  • The Fox (News) That Jumped the Shark (December 16, 2010)
  • Click here for an archive of Butterfield columns

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    Some details about NewEnergyNews and the man behind the curtain: Herman K. Trabish, Agua Dulce, CA., Doctor with my hands, Writer with my head, Student of New Energy and Human Experience with my heart

    email: herman@NewEnergyNews.net

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    Your intrepid reporter

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  • TODAY AT NewEnergyNews, November 26: THANKSGIVING THURSDAY, November 27:

  • Fast Fun Facts About Thanksgiving
  • A Lesser Known Bit Of Thanksgiving History
  • A Funky History Of Thanksgiving

  • Wednesday, December 26, 2012

    Holiday Reading: Will Third-Party Finance Bring Solar Hot Water to a Boil? Skyline Innovations is making money by providing hot water with no upfront costs.

    Holiday Reading: Will Third-Party Finance Bring Solar Hot Water to a Boil? Skyline Innovations is making money by providing hot water with no upfront costs.

    Herman K. Trabish, July 9, 2012 (Greentech Media)

    Solar water heating (SWH) specialist Skyline Innovations just picked up a million dollars in venture capital, $30 million in backing from the investment arm of a natural gas utility, and added three multi-family buildings to its customer list. It's another sign that, in solar, third-party financing might in fact please all of the people all of the time.

    Small-business-oriented VC firm Advantage Capital Partners’ million dollars will go to extending Skyline’s operational capabilities through software development, project management, and sales force hiring.

    According to Skyline Innovations CEO Zach Axelrod, the $30 million investment from WGL Holdings, Inc., a natural gas utility and energy marketer/wholesaler, “should enable us to build 100 to 300 projects. Our average project is a mid-size commercial project worth from $100,000 to $300,000.”

    Skyline just completed three such SWH system installations in Southern California. Building owner Williams Holdings had no upfront cost and will get solar hot water at a 25 percent fixed discount to its utility rate for water heating.

    “We offer guaranteed savings on the hot water we provide,” Axelrod said. “We do that by measuring the BTUs we deliver and charging a fixed percentage discount to what a building owner or operator would have paid.”

    “We work with multi-family buildings that are 50 units and up that have centralized hot water systems,” explained Skyline Marketing spokesperson Sandra Lee. “Our business model was engineered with the specific focus of taking the question of payback off the table for customers because we recognize that constraints on capital and fear of financial risk and uncertainty about payback are the major barriers to solar.”

    Skyline exclusively uses third-party financing, today’s hottest concept in distributed solar. Using investors’ money, Lee said, “we fully finance and pay for, install, maintain and monitor the systems.” The only thing the customer pays for, she added, “is the hot water that gets delivered to their tap that they use that has originated from our system, not from the utility.”

    Skyline was founded in 2009 and now has, Axelrod said, “about 45 systems. Our savings rates vary from 15 percent to 35 percent or 40 percent off what somebody would have paid for water heated by gas, electricity, propane or fuel oil.”

    “A simple analogy we use,” added Lee, “is that if they pay a dollar per therm and they lock in a 30 percent savings rate, that means they pay 30 cents less per therm. They will always be better off with Skyline. They will always pay less for water heated by the sun than what they would pay their utility for water heated by any other conventional fuel.”

    Third-party financing use has nearly tripled over the last year in the booming rooftop solar PV sector.

    Though SWH technology is much older than PV, with patents as far back as the 1890s, the U.S. industry is growing much more slowly. And while the U.S. is among the world leaders in most renewable technologies, its SWH industry had only 2.3 gigawatts-thermal in 2010, while China had 118 gigawatts-thermal and the world had built about 185 gigawatts-thermal. The U.S. market is five times bigger than it was in 2005 and growing at 6 percent annually, according to recent SEPA statistics.

    Third-party financing may be the boost SWH needs to gain a footing in the U.S. market. But industry veterans have expressed that the sector is urgently in need of standards -- both for equipment and installers.

    Skyline’s success stems at least in part from the fact that it is widely recognized for using high-quality equipment and doing smart installations.

    “Photovoltaic panels, in terms of output, are about 15 percent efficient. Solar thermal panels are somewhere between 40 percent and 70 percent efficient, depending on the collector type,” Axelrod said. But “the big difference between thermal and PV, in terms of efficiency, is that PV has a grid to push unused electricity back to.”

    A SWH system has storage tanks, he explained. “If you size the solar hot water system appropriately, certainly you will collect more energy from solar hot water than from PV.”

    Proper sizing, he said, “is a factor of the customer’s load profile matched against the size of the system in terms of both collectors and storage. Those three things all work together to determine your efficiency.”

    The metric used in SWH for cost of capacity that compares to PV’s dollars per watt, Axelrod said, is dollars per square foot of collector. “For commercial, it is generally between $90 and $150 per square foot, which translates to, say, $3,600 to $6,000 per 40-square-foot collector. For residential, it’s a little higher.”

    Skyline’s three new projects in Southern California, and its new Los Angeles office, mark a move there to take advantage of the opportunity offered by the California Solar InitiativeThermal Program’s $350 million allocation for the deployment of multi-family and commercial solar water heating systems.

    Low natural gas prices, on the other hand, have hurt SWH. But, Axelrod noted, “they hurt everybody in the generation industry across the board. It hurts nuclear, wind, coal, natural gas power plants, and it hurts PV.” And, he added, “We are no different than anyone else. We often price against natural gas directly. But everyone in the generation business prices against natural gas either directly or indirectly. It hits us like it hits everyone.”

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