NewEnergyNews: 02/01/2012 - 03/01/2012

NewEnergyNews

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

Every day is Earth Day.

YESTERDAY

  • FRIDAY WORLD HEADLINE-THE SOLAR CELL TURNS 60, Part 5 (continued from yesterday)
  • FRIDAY WORLD HEADLINE-THE SOLAR CELL TURNS 60, Part 6
  • FRIDAY WORLD HEADLINE-THE SOLAR CELL TURNS 60, Part 7
  • FRIDAY WORLD HEADLINE-THE SOLAR CELL TURNS 60, Part 8
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    GET THE DAILY HEADLINES EMAIL: CLICK HERE TO SUBMIT YOUR EMAIL ADDRESS OR SEND YOUR EMAIL ADDRESS TO: herman@NewEnergyNews.net

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    THE DAY BEFORE

    THINGS-TO-THINK-ABOUT THURSDAY, April 17:

  • TTTA Thursday-THE SOLAR CELL TURNS 60, Part 1
  • TTTA Thursday-THE SOLAR CELL TURNS 60, Part 2
  • TTTA Thursday-THE SOLAR CELL TURNS 60, Part 3
  • TTTA Thursday-THE SOLAR CELL TURNS 60, Part 4
  • THE DAY BEFORE THE DAY BEFORE

  • THE STUDY: NEW ENERGY POSSIBILITIES – THE MICHIGAN EXAMPLE
  • QUICK NEWS, April 16: THE RACE AGAINST CLIMATE CHANGE; THE FAST RISING POTENTIAL OF U.S. NEW ENERGY; BIG TEXAS WIND SHRINKS ELECTRICITY MRKT PRICE
  • THE DAY BEFORE THAT

  • THE STUDY: THE MONEY IN NEW ENERGY
  • QUICK NEWS, April 15: WORLD WIND TO BOOM THRU 2014; NAT GAS AND SOLAR WERE 75% OF U.S. 2013 NEW POWER; MAINE OFFICIALLY AFFIRMS SMART METERS’ SAFETY
  • AND THE DAY BEFORE THAT

  • THE STUDY: THIS COULD BE THE REAL VALUE OF SOLAR
  • QUICK NEWS, April 14: DE-RISKED RENEWABLES HAVE MORE INVESTORS THAN DEALS; THE MYTH OF CONSOLIDATION IN SOLAR; TEXAS BREAKS MORE WIND RECORDS
  • THE LAST DAY UP HERE

  • Weekend Video: Bill Maher On What’s Happening In The Oceans
  • Weekend Video: The Human Disharmony In The Climate System Symphony
  • Weekend Video: A Few Thoughts About Solar 2.0
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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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      A tip of the NewEnergyNews cap to Phillip Garcia for crucial assistance in the design implementation of this site. Thanks, Phillip.

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    Pay a visit to the HARRY BOYKOFF page at Basketball Reference, sponsored by NewEnergyNews and Oil In Their Blood.

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  • Wednesday, February 29, 2012

    TODAY’S STUDY: HOW WIND AND NAT GAS CAN MAKE EACH OTHER BETTER

    Variance Analysis of Wind and Natural Gas Generation under Different Market Structures: Some Observations
    Brian Bush, Thomas Jenkin, David Lipowicz, and Douglas J. Arent, January 2012 (National Renewable Energy Laboratory)

    Executive Summary

    An important area of current research is whether large-scale penetration of variable renewable generation such as wind and solar power pose economic and operational burdens on the electricity system. In such scenarios, this issue has also raised considerable interest in the potential role and value of electricity storage as a method of mitigating variability in generation associated with the inherently variable nature of these forms of generation. At the same time, a number of studies have pointed to the potential benefits of renewable generation as a hedge against the volatility and potential escalation of fossil fuel prices. Prior research and this work suggest that the lack of correlation of renewable energy costs with fossil fuel prices means that adding large amounts of wind or solar generation may also reduce the volatility of system-wide electricity costs. Such variance reduction in overall system costs may be of significant value to consumers due to risk aversion. In contrast to this observation, other studies have focused on returns in restructured markets and noted that, in deregulated markets, baseload natural gas power generation may be relatively more attractive to investors because—unlike wind generation—peak power prices are often strongly correlated to natural gas prices.

    click to enlarge

    The analysis in this report recognizes that the potential value of risk mitigation associated with wind generation and natural gas generation may depend on whether one considers the consumer’s perspective or the investor’s perspective and whether the market is regulated or deregulated. We analyze the risk and return trade-offs for wind and natural gas generation for deregulated markets based on hourly prices and load over a 10-year period using historical data in the PJM Interconnection (PJM) from 1999 to 2008. Similar analysis is then simulated and evaluated for regulated markets under certain assumptions. Estimating the absolute value, as opposed to the relative value, of variance reduction will also depend on assumptions about risk aversion and other consumer preferences, such as loss aversion, and this is discussed. Some key observations include:

    click to enlarge

    In a deregulated market such as PJM,

    Returns for natural gas generation are partially hedged because power prices are often set by natural gas generation, though with significant seasonal variations.

    Returns for wind generation are better hedged than natural gas generation because wind often operates in off-peak hours, where power prices are much less volatile and less correlated with natural gas prices, whereas natural gas generation operation is focused more heavily during peak hours.3

    The impact of incremental net revenue from tax credits, such as production tax credits (PTCs) or other sources of revenue, can have a significant impact on the risk return relationship. In PJM over this period with credits, wind was found to be dominant in terms of risk and reward; that is, it had both greatest returns and the lowest risk, as measured by standard deviation of returns.

    More generally, without PTCs investors may benefit from investing in both wind and natural gas generation, with the optimal mixture depending on the investor’s risk aversion (and perhaps also loss aversion) preferences due to well-known lack of correlation effects.

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    While the opportunity for investors to diversify in broader markets may reduce some of the variance reduction benefits of investing in different electric technologies, it is unlikely to completely eliminate these benefits in the electric sector where power prices are often very volatile and positively skewed, which has implications for financial distress.

    Consumers, especially smaller commercial and residential consumers, may benefit from reductions in the variance of electricity prices due to risk aversion and loss aversion effects.

    The levelized cost of energy (LCOE) of different technologies is not directly comparable if they operate in different hours because the value of electricity differs significantly throughout each day. This variation reflects the daily load profile, with hourly load and hourly power prices also showing strong seasonal effects. This effect can be seen in our analysis of PJM data when comparing the difference in the average annualized hourly price of variable wind generation and dispatchable natural gas generation.

    click to enlarge

    In a regulated market:

    The inherent nature of regulated markets means that producers earn, with some caveats, a utility-designated rate of return. A consequence of this is that the risk associated with fuel costs is passed on to the consumer. The “cost-plus” nature of regulation means that consumers also bear some increased risk associated with poor investment decisions. Consumers are partly compensated for this because the producer may be willing to accept a lower expected rate of return compared to deregulated markets.

    For consumers, who are generally risk averse, the reduced variation in electricity prices (and hence consumer costs) because of wind’s lack of correlation with other system costs should have value (as has been suggested by others). Loss aversion also may place a value on variance reduction of electricity prices and consumer costs.

    Simplified mean variance cost optimization techniques using annualized LCOEs for the power sector often fail because the assets within the portfolio are too dissimilar (e.g., baseload versus peaking or either of these versus a variable or non-dispatchable resources such as wind or solar).

    click to enlarge

    A variance reduction-based technique could, however, be used more broadly under more sophisticated representation of system costs where the hourly operation of the technologies is modeled more explicitly. Specifically for a regulated electric system, the concept of lowest-cost planning could be refined to have an array of “least-cost planning” solutions corresponding to different variances, where the values of the expected annualized system cost and the standard deviation of the annualized system cost are physical properties of the electric system that are completely independent of any risk or loss aversion preferences. The value of variance reduction could then reflect both risk aversion and loss aversion. We discuss explicitly how to estimate the difference in the economic utility between alternative system-based, expected costcost variance choices, including the impact of the distribution being positively skewed toward higher costs.

    In conclusion, we should point out that while some of the observations and findings may be generally applicable, others are empirical observations for a specific location and a specific time period under specific technology cost and performance assumptions.

    QUICK NEWS, February 29: CHINA SHOPPING FOR U.S. WIND; BETTER BIPV; THE POWER OF BUILDINGS

    CHINA SHOPPING FOR U.S. WIND
    China's State Grid in talks to buy AES' U.S. wind assets: sources
    Wan Xu and Don Durfee (w/Ian Geoghegan and Jason Neely), February 27, 2012 (Reuters)

    "State Grid Corp of China has had talks with U.S. power firm AES Corp (AES.N) about taking a controlling stake in its U.S. wind power business…as China's cash-flush state-owned power companies go on an overseas buying spree…[T]he assets could be worth around $1.65 billion…The deal involves wind power assets with capacity of around 1,100 megawatts (MW) and would give State Grid a roughly 80 percent stake in AES's U.S. wind power business…

    "…It would be State Grid's first foray into the United States…China's cashed up state power groups have been scooping up bargains, with dominant power distributor State Grid establishing a presence in the Philippines, Brazil and Portugal…One driver for such deals is a tightly regulated Chinese market that holds down profits for power firms…[The] agreement…[and] specific details… are still under negotiation…"




    "AES Wind Generation, a wholly-owned part of AES Corp, operates more than 1,800 MW of wind power generation capacity in the United States, China and Europe. Of that, nearly 1,346 MW is in the United States…[It] has a market value of $10.5 billion…Any deal would need both Chinese and U.S. regulatory approval…Since the failure of China's state oil firm CNOOC's bid to buy California rival Unocal in 2005, few Chinese companies have tried to buy U.S. conventional energy assets…[A] successful deal by State Grid would represent a significant step for China's efforts to enter the U.S. power market...

    "…[T]he Chinese company signed a deal to buy a 25 percent stake in Portuguese power grid operator REN for around $508 million. [I]t bought seven Brazilian power transmission companies with investments totaling nearly $1 billion…[A] consortium led by State Grid [won] operation of the Philippine power grid…[in] an auction for a 25-year operation license for $3.95 billion…AES, in which sovereign wealth fund China Investment Corp CIC.UL holds a 15 percent stake…[wants] to sell all or part of its businesses in China, a deal that could raise $300-400 million…"



    BETTER BIPV
    Report Recommends Ways To Improve BIPV Glass For Solar Applications
    24 February 2012 (Solar Industry)

    "The total market for building-integrated photovoltaics (BIPV) glass will reach $6.4 billion in revenues in 2016, compared to $1.5 billion this year….

    "Today's BIPV glass provides transparency well below 50%, and the initial markets for BIPV glass are found in skylights, facades, spandrels, curtain walls and atrium roofing, where high levels of transparency are not required…[B]y improving on the current level of transparency, manufacturers of BIPV glass may be able to expand their addressable markets…"


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    "[O]ne way that transparency can be improved is through new absorber materials, such as very thin layers of copper indium gallium diselenide or advanced dye-sensitized cells (DSC) using more transparent dyes…Another approach is to use advanced optics to enable the positioning of the PV panels so that they do not block sunlight to the same degree as in conventional BIPV glass panels, the report adds.

    "A similar evolution is expected to occur in the nature of the BIPV glass products themselves. Currently, all BIPV glass is highly customized to the needs of specific projects…[A]s BIPV glass shifts…to the broader commercial construction market, off-the-the-shelf products will have to be developed that can be sold through large construction firms and PV systems integrators…[F]uture generations of BIPV glass products will be characterized by monolithic integration and the incorporation of lighting, dimming and self-cleaning capabilities."



    THE POWER OF BUILDINGS
    Viridity, ConEd Solutions Take On Demand Response 2.0; Viridity and ConEd Solutions launch a commercial-scale effort to turn buildings into energy market resources.
    Jeff St. John, February 24, 2012 (Greentech Media)

    "Demand response -- turning down building power loads to shave peak grid demand -- sometimes gets split into 1.0 and 2.0 versions…[DR 2.0] comes when buildings can lower their peak power use not only to respond to utility emergency calls (DR 1.0), but to actually bid their power reduction into energy markets…But to manage it, this DR 2.0 technology has to stretch from the individual building, all the way to the energy markets where blocks of power are bought and sold every day...Viridity Energy and big energy services company ConEdison Solutions…[have built a platform to do that and thereby offer] building owners a chance to lower power bills and bring in new energy revenues, all at little to no cost.

    "The program has…a big target market, in the form of ConEd Solutions’ energy services (ESCO) and commodity energy trading customers…As a sister company of New York utility Consolidated Edison, ConEd Solutions is comparable to Honeywell and Johnson Control in terms of ESCO work, and competes against the likes of Constellation Energy and Dominion Power in the business of buying and selling power for big customers."


    click to enlarge

    "Viridity and ConEd Solutions bring a distinct new challenge to the competition for the title of the first commercial-scale demand response 2.0 project…[against] EnerNOC, Comverge, Constellation Energy, Johnson Controls, Honeywell…[which are] working on projects that link building control systems with energy markets ready to pay a premium for fast-responding, reliable power shed…

    "…ConEd Solutions’ big customer base gives it an advantage…[and] its energy commodity trading business [offers] more insight into how to better manage customer energy use to lower their rates and bills…Viridity has also proven its ability to handle both the emergency capacity demand response markets, which pay customers a monthly fee in exchange for a promise to cut power drop a few times a year, and the energy, or economic, demand response markets, where customers actually bid power reductions into energy markets…"

    Tuesday, February 28, 2012

    TODAY’S STUDY: HOW TO OPEN UP NEW ENERGY ON WESTERN PUBLIC LAND

    Western Region Renewable Energy Markets: Implications for the Bureau of Land Management
    Scott Haase, Lynn Billman, and Rachel Gelman, January 2012 (National Renewable Energy Laboratory)

    Executive Summary

    At the request of the U.S. Department of the Interior (DOI) and the Bureau of Land Management (BLM), the National Renewable Energy Laboratory conducted an analysis to estimate the gap between the renewable energy (RE) generation supply and demand in the western states, and how that impacts BLM activities in this sector. The purpose of this analysis is also to provide DOI and BLM with an overview of RE markets, transmission planning efforts, and the role of BLM RE projects in the electricity markets of the 11 states (Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming) that comprise the Western Electricity Coordinating Council (WECC) Region.

    Without new policies at either the state or national level, and without the extension of special federal programs3that support the development of renewable electricity facilities, current state renewable portfolio standards (RPS) requirements will remain the primary driver for new RE deployment in the western United States. The quantitative portion of this analysis is based on RPS-driven demand, because projections for that demand are available. Other market drivers will also play a part in motivating investment decisions, such as the voluntary consumer market, other federal and state incentives of various types, utility decisions driven by improving RE economics and transmission availability, and other policies that arise from the desire of some states to diversify their economies and create green jobs. Modeling the impacts of these other drivers was beyond the scope of this analysis.

    click to enlarge

    In total, the WECC states in 2010 generated more than their total RPS requirement for RE [53,500 gigawatt-hours (GWh) generated compared to 49,500 GWh required for RPS policies]. To analyze the possible gap between demand and supply in RE in 2020, three datasets were compared: one for demand and two for supply. The comparison was made in terms of capacity, rather than generation, to meet the needs of the BLM.

    The source data for future demand was taken from analysis by Lawrence Berkeley National Laboratory (LBNL) of state RPS requirements (Barbose 2011), and includes projected RE generation required in 2020 to meet today’s RPS requirements. The total RPS-required demand for WECC states in 2020 is estimated to be 134,000 GWh. To convert this generation requirement into a demand in terms of capacity, three different approaches to capacity factors were used: LBNL’s approach based on an average capacity factor of 50%, a scenario using a lower capacity factor (26%), and a scenario using a higher capacity factor (53%). These different approaches estimated that WECC states in 2020 may require installed capacity in the range of 28,000 MW to 46,000 MW, as shown in Table ES-1. This required capacity does not include RE demand that may result from voluntary consumer demand or other types of market drivers. Various market factors could increase or decrease these market estimates. States could revise RPSs downward or electricity demand could decrease in the future. As a point of reference, nationwide voluntary consumer demand markets totaled 35,000 GWh in 2010.

    click to enlarge

    One source of data for supply was the current (2010) installed capacity of RE in WECC states. Actual installed nameplate capacity in December 2011 was about 18,400 MW (SNL 2011b), as shown in Table ES-1.
    The other source of data for supply was taken from planned projects as tracked by SNL Financial (SNL 2011a). Only planned projects that are under construction or in advanced development4were included in this analysis; the planned capacity of these projects totals about 18,900 MW. The output from planned projects was assigned to states based on the location of the power purchaser, if known (about two-thirds of the planned capacity); if not known, the output was assigned to the state where it is planned to be located (about one-third). Some larger power purchasers sell their power across several states. In those cases, a recent analysis (Hurlbut 2011) examining each utility’s power purchase agreements was used to apportion the output. The sum of actual installed capacity today and planned capacity is about 37,000 MW, as shown in Table ES-1.
    Compared to the range of required RE capacity, Table ES-1 shows that the gap between demand and supply in 2020 ranges from a potential oversupply of 8,000 MW to an unmet demand of 9,000 MW. Because the demand estimates were only based on meeting RPS requirements, other types of market drivers, as mentioned above, should also be investigated within each state, to present a more complete picture of 2020 demand.

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    The BLM is required by the Energy Policy Act of 2005 to approve 10,000 MW of non- hydropower renewable energy to be located on public lands by 2015. To date, the BLM has approved or authorized more than 5,200 MW of RE on federal lands.5 Another approximately 8,000 MW in advanced development is included in the BLM list of 2011 and 2012 high priority projects. Based on this list and the progress made in 2011, the BLM appears to be on track to meet its EPAct goal of authorizing 10,000 MW by 2015, and indeed is likely to accomplish this goal by late 2012 or early 2013. The 5,200 MW of approved or authorized BLM projects represent 11%-18% of the projected capacity additions needed to meet RPS requirements in WECC states by 2020.

    It should be noted in Table ES-1 that California is the primary driver for RE development across the WECC, representing over half of projected 2020 demand. California’s demand has in-state as well as regional implications for transmission, and its policy environment moving forward will be a critical influence on future RE supply/demand balance.

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    The transmission portion of the analysis concludes:

    In total, WECC’s highest priority (“foundational/common case”) transmission projects would add more than 5,500 line miles, which may ultimately improve the viability of some of BLM’s planned projects (WECC 2011).
    The interagency Rapid Response Transmission Team, initiated in 2011 through the U.S. Council on Environmental Quality, recently announced a coordinated and expedited permitting process for seven pilot transmission lines. Five of these lines are located in the western United States, and the BLM is the lead agency on four of these five lines. The focus on these lines represents a concentrated effort to connect potential renewable energy supplies with loads in the northwest and in southern California.
    Most of the BLM’s priority wind and geothermal projects are within 20 miles of existing transmission lines; most of BLM’s priority solar projects are within five miles of existing transmission lines. The analysis of whether there is capacity available on these lines, or whether they could be upgraded, has not been undertaken at this time.
    In general, new RE development projects sited close to load centers are less likely to be impacted by constraints of the current transmission infrastructure over the next 10 years; however, for more remotely sited RE projects, which will likely include some of the BLM projects, additional transmission infrastructure will be required. The additional 19,600 miles of new transmission lines (between 115 and 500 kV) currently planned for WECC states will support some of the expansion required for RE deployment required to meet western state mandatory RPS requirements. In some cases, the cost of some renewable resources located remote to load may offer the potential to reduce overall costs to ratepayers of meeting RPS requirements (WECC 2011).

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    Suggestions for the BLM Renewable Energy Program

    Based on the analyses of supply and demand in WECC states, and BLM’s interests in leasing land for RE projects, a number of specific suggestions are provided below to advance BLM efforts in this sector.

    Update the RE project list. The information on BLM projects presented in this report changes frequently. Reviewing and updating the status of the projects on the master RE project list will help BLM prioritize necessary actions. The BLM Washington office has recently issued a call for information and data for geographic information systems (GIS) analysis of the wind and solar projects that the BLM’s state and field offices are tracking. This information will be useful for updating the status of projects for FY12.

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    Focus on high-value project sites. In addition to the approved and high priority projects, BLM has received applications for more than 58,000 MW of renewable energy projects on public lands. The integration of BLM RE projects with planned transmission lines (especially the five pilot lines) will take on greater significance over the next few years, and BLM lands within potential interconnection distance of these lines are likely to see increased interest by industry, provided that these lands also meet all other suitability criteria for development. Further, any suitable BLM lands that are located close to load centers in states that are falling short of RPS requirements, or are located in regions that can potentially export to California, may see increased interest from developers. BLM should consider screening these lands, the solar energy zones, and other regions undergoing landscape-level planning (e.g., the Desert Renewable Energy Conservation Plan [DRECP], the West Chocolate Mountains Renewable Energy Evaluation Area, and the Arizona Restoration Design Project), against criteria designed to identify prime sites for future competitive leasing requests.

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    Work with other federal agencies and developers to facilitate project siting. A number of federal agencies, including other DOI bureaus and agencies, the Department of Defense, Department of Homeland Security, Department of Agriculture, Department of Energy, and Department of Commerce are interested in deploying renewable energy technologies to meet their internal mission goals. As specific examples, the Environmental Protection Agency’s RE-Powering America’s Land program seeks to promote the development of renewable energy projects on brownfield sites such as abandoned mining lands, landfills, and contaminated lands. The Bureau of Indian Affairs and many tribes are working to develop renewables on tribal lands. Developers are also targeting state, local, and private lands. Similar to the approach being taken by the BLM’s Restoration Design project in Arizona, BLM could benefit from continuing to work cooperatively with other agencies and industry to identify and better understand the optimal suitable locations for development, regardless of land ownership.

    Site projects to help support critical national needs. Similar to the strategy of siting RE to take advantage of drivers and interests of other agencies and private developers, there may be opportunities to increase the strategic value of BLM’s RE projects by co-locating in prime areas that would also support national or regional energy security and resiliency, and support national environmental goals. As an example, BLM projects could be sited in locations that, in an emergency situation, could help supply power for critical loads such as water pumping and treatment facilities, hospitals, military installations, National Guard facilities, critical substations, radar sites, data centers, and other high value loads. In some cases, BLM may choose to work with the developers and recommend a shift of the BLM projects to other locations in the region that may offer greater strategic advantages. Continuing to avoid projects on environmentally sensitive lands will support national environmental goals. GIS and additional landscape level planning analyses such as those being undertaken by the DRECP and WECC’s Environmental Data Task Force can help identify these specific locations and opportunities. Specific examples and case studies could be assessed in greater detail.

    Identify options to integrate projects into existing fossil fuel generation. Siting RE projects near old, retiring or seldom used fossil fuel plants takes advantage of existing infrastructure and potential synergies. For example, BLM lands located near existing coal or gas plants may be candidate sites for solar thermal plants that are constructed from the outset to integrate fully into existing facilities. The National Renewable Energy Laboratory (NREL) and the Electric Power Research Institute recently completed an initial screening of fossil fuel plants that may be suitable for solar augmentation (NREL 2011). However, additional detailed work is needed in this area.

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    Conclusions

    Absent new policy drivers and without the extension of the DOE loan guarantee program and Treasury’s 1603 program, state RPS requirements are likely to remain a primary driver for new RE deployment in the western United States. Assuming no additional policy incentives are implemented, projected RE demand for the WECC states by 2020 is 134,000 GWh. Installed capacity to meet that demand will need to be within the range of 28,000-46,000 MW.

    BLM projects that are currently authorized or approved should provide 11%-18% of the total capacity (9% of the generation) needed to meet the 2020 RPS requirements across WECC. If all of the currently authorized and 2011/2012 high priority BLM RE projects are deployed, RE projects on public lands will support 35% of the 2020 total requirement for new RE capacity.

    With 5,200 MW of RE authorized or approved, and approximately 8,000 MW of additional 2011 and 2012 high priority projects, the BLM appears to be on track to meet the EPAct 2005 requirement of approving 10,000 MW of RE on public lands by 2012.
    Most of the BLM’s priority wind and geothermal projects are within 20 miles of existing transmission lines; most of BLM’s priority solar projects are within five miles of existing transmission lines. New RE development projects sited close to load centers are not expected to be constrained by the current transmission infrastructure over the next 10 years; however, for more remotely sited RE projects, which some of the BLM projects will likely be, additional transmission infrastructure will be required. The additional 19,577 miles of new transmission lines (between 115 and 500 kV) currently planned for WECC states will support some of the expansion required for RE deployment required under western state mandatory RPS.

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    Based on the analyses of supply and demand in WECC states, and BLM’s interest in leasing land for renewable energy projects, the following suggestions may be helpful for BLM:

    Update the renewable energy project list. The information on BLM projects presented in this report changes frequently. NREL suggests that at least once per year, BLM go through its master project list and obtain updates on the status of the projects on its books. The BLM Washington office has recently issued a call for information and data for GIS analysis of the wind and solar projects that BLM’s state and field offices are tracking. This information should be useful for updating that status of projects for FY12.

    Focus on high-value project sites. The integration of BLM renewable energy projects with planned transmission lines (especially the five pilot lines) will take on greater significance over the next few years, and BLM lands within potential interconnection distance of these lines are likely to see increased interest by industry. Also, any BLM lands that are located close to load in the desert southwest in states that are potentially falling short on RPS requirements may see increased interest from developers. BLM should consider screening these lands, and the solar energy zones and other regions undergoing landscape-level planning, against criteria designed to identify prime sites for development of competitive leasing requests.

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    Work with other federal agencies and developers to facilitate project siting. A number of federal agencies, including other DOI bureaus and agencies, the Department of Defense, Department of Homeland Security, Department of Agriculture, Department of Energy, and Department of Commerce are interested in deploying renewable energy technologies to meet their internal mission goals. As specific examples, the Environmental Protection Agency’s RE-Powering America’s Land program seeks to promote the development of renewable energy projects on brownfield sites such as abandoned mining lands, landfills, and contaminated lands. The Bureau of Indian Affairs and many tribes are working to develop renewables on tribal lands. Developers are also targeting state, local and private lands. Just as BLM has done with its Restoration Design project in Arizona, the BLM could benefit from continuing to work cooperatively with other agencies to identify the most suitable locations for development, regardless of land ownership.

    click to enlarge

    Site projects to help support critical national needs. Similar to the strategy of siting projects to take advantage of projects and interests by other agencies and private developers, there may be opportunities to increase the strategic value of BLM’s renewable energy projects by co-locating in areas that would support national or regional energy security and resiliency, and support national environmental goals. As an example of this, BLM projects could be sited in locations that, in an emergency situation, could help provide power supply for critical loads such as water pumping and treatment facilities, hospitals, military installations, National Guard facilities, critical substations, radar sites, data centers, and other high value loads. In some cases, BLM may choose to work with the developers and recommend a shift of the BLM projects to other locations in the region that may offer greater strategic advantages. Continuing to avoid projects on environmentally sensitive lands will support national environmental goals. GIS analysis can help identify these specific opportunities.

    Identify options to integrate projects into existing fossil fuel generation. Siting renewable energy projects near old, retiring, or seldom used fossil fuel plants takes advantage of existing infrastructure and potential synergies. For example, BLM lands located near existing coal or gas plants may be candidate sites for solar thermal plants, including those with thermal storage, that are constructed from the outset to integrate fully into existing plants.

    QUICK NEWS, February 28: SAVING NEW ENERGY IN THE EU; SIEMENS WIND TO MID-AMERICA FOR MIDAMERICAN; A NEW GENERATION OF PV MANUFACTURING

    SAVING NEW ENERGY IN THE EU
    Carbon Trust and GE Partner to Pump Up Europe’s Clean Tech Sector
    February 24, 2012 (GE Reports)

    "In a step to reverse Europe’s falling share of clean energy investment, GE has partnered with British non-profit Carbon Trust to infuse the European clean tech sector with fresh capital. The initial phase of the alliance includes a business incubation fund of $5 million to support new low carbon technologies in infrastructure applications. The initiative is an extension of GE’s ecomagination Challenge – a $200 million global program to find and fund the best ideas in clean technology.

    "Some of the impetus to forge the new relationship came from trends revealed in a Bloomberg New Energy Finance report that shows a discouraging 40% drop in Europe’s share of clean energy investment over the past five years, a period during which Asia Oceania almost doubled its share."


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    "GE’s Innovation Barometer shows that roughly half of UK businesses see the UK as a challenging environment for innovation. 84% of them also believe that developing partnerships and collaborating with a combination of players – including government, big business, SMEs and individuals – is crucial for their success in innovation.

    "In light of those facts, Carbon Trust will work with GE to sift out the most promising early stage companies focusing on clean tech infrastructure in areas such as smart grids, lighting systems, heating and ventilation and building controls. Those fortunate start-ups will receive funding and support from GE and Carbon Trust…"



    SIEMENS WIND TO MID-AMERICA FOR MIDAMERICAN
    Siemens wins 407MW MidAmerican deal
    James Quilter 24 February 2012 (Windpower Monthly)

    "Siemens will supply 176 SWT 2.3 108 turbines…[and] five-year maintenance…[to projects in Iowa’s] Vienna, Marshall and Tama counties (103.5MW)…Eclipse, Guthrie and Audubon counties (200MW)…[and] Morning Light, Adair County (101.2MW)…"

    Iowa is number 2 with a bullet! (click to enlarge)

    "…The turbines will be produced in Siemens’ factories at Fort Madison, Iowa, and Hutchinson, Kansas. The nacelle assembly facility in Hutchinson was opened in December, for Siemens’ 2.3MW and 3MW turbines."


    A NEW GENERATION OF PV MANUFACTURING
    20 GW of PV Manufacturing Equipment To Be Replaced By 2016
    Tim Dawson, February 2012 (PV Group)

    "Despite the outlook for the PV manufacturing equipment market remaining bleak in 2012, a new report from IMS Research forecasts that there could be a 20 GW opportunity for the upgrade or replacement of existing capacity over the next four years.

    "…[R]evenue declines of over 65% are forecast for the PV manufacturing equipment market in 2012. However, a new opportunity has been identified as equipment vendors seek out new market bright spots in the industry."


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    "Aging equipment requiring upgrade or complete replacement represents the biggest opportunity currently and this is where the majority of equipment revenues will come from in 2012…[T]his could provide a 20 GW opportunity for equipment suppliers, generating some $25 billion in revenues over the next four years.

    "Ingot, wafer, cell and module makers are all placing less criticality on expanding production, and are instead focusing on increasing end-product quality and overall efficiencies. Utilization rates are at an all-time low and the current lull in new demand and capacity across the supply chain will provide a potential opportunity for PV-product makers to gain market share longer-term through upgrading equipment now…"

    Monday, February 27, 2012

    TODAY’S STUDY: HOW IBM WOULD SPREAD THE WORD ON THE EFFICIENCY

    Knowledge is power; Driving smarter energy usage through consumer education
    Michael Valocchi and John Juliano , February 2012 (IBM Institute for Business Value)

    Consumers have tremendous expectations for future energy services. However, they are largely unaware that they need to take a more active role in managing energy decisions for their visions to become reality. In many cases, consumers lack even the basic knowledge necessary to accomplish this. Utilities and other smart grid advocates need to improve information transfer to consumers to build broader support and the customer engagement that can follow. Delivered through trusted and generation-appropriate channels, this information must address consumers’ specific knowledge levels, most important motivating influences and current perceptions of providers.

    Expectations have been running high for what smart meters and smart grid technology will provide to residential energy consumers in the long run. In the minds of consumers, gaining more control over energy use, improving environmental impacts and managing costs have been firmly associated with the term “smart grid.”

    Communications and media coverage related to government economic stimulus packages and environmental priorities have played a role in building these perceptions…Further boosts have come from consumer-focused magazines like one whose cover page featured “Extraordinary Solutions for a Clean-Energy Century” and lists like the one that ranked smart meters one of the top 20 green technology concepts…Even the numerous consumer surveys focused on consumers’ future energy wants and needs, including our own 2007 and 2009 Global Utility Consumer Surveys, may have contributed to expectation setting through questions about a future rich with data, tools for energy usage control, and new products and services…

    In the past two years, smart meter deployments have begun in some places and moved into final planning stages in others. In the process, this rosy view of the future often became clouded by uncertainty and confusion, driven by more imminent concerns and by influencers with a variety of messages. Some consumers are now raising questions: Are smart meters really accurate? Is the collection of energy data a threat to my privacy? Will criminals know more about me and my family through my smart meter readings?

    What has been in many ways absent from the picture is the question of how people feel about the paths that would have to be traversed to get to an attractive future state where smart grids and smart meters provide improvements in energy use, environmental impacts and cost management. From our prior surveys, we know that consumers like the idea of having cleaner power options and more control and efficiency at their fingertips. But have they assumed these benefits would be accessible immediately once a smart meter was attached to their homes? Do they have sufficient understanding that, in order to optimize these benefits, changes in energy consumption patterns and more permission to access information about that energy usage might be required?

    With questions like these in mind, we prepared our 2011 Global Utility Consumer Survey for launch to more than 9,000 respondents in 15 countries…This time, our primary focus was not the compelling products and services consumers want to see emerge in the future. Similarly, we did not highlight useful energy efficiency actions they might be able to take with better technology and data. Instead, we sought to discover the key set of interconnections that define a consumer’s current expectations: What perceptions are driving these expectations? How much underlying knowledge is behind the key perceptions? Finally, who or what factors are the strongest influences in developing that critical knowledge?

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    We found that the following factors contribute most strongly to an environment of long-term expectations conflicting with short-term reluctance:

    •• Consumer perceptions established early on – such as saving money and reducing environmental impact – remain strong, but energy independence and national economic benefits, among others, are now getting similar levels of attention.

    •• A newer perception – that of a privacy threat posed by the increased availability of energy data – has emerged strongly, shaping attitudes along several dimensions.

    •• Consumers’ knowledge about their energy transactions with their providers is strongly correlated with perceptions that impact willingness to embrace smart meters and change energy consumption patterns.

    •• Despite its importance, the level of knowledge consumers have today about energy and their providers – even at the most basic levels – is unsatisfactory.

    These factors are best explained in the context of a consumer energy experience chain, which recognizes that:

    •• Expectations are driven by perceptions

    •• Perceptions are created by retained knowledge

    •• Knowledge is retained in the context of core personal influences and passed on by trusted influencers.

    More fundamental information must be provided to consumers to increase this knowledge base – but through both traditional and new influencers, and with specific messages and channels tailored to suit different age groups.

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    Perception: The first link in the consumer energy experience chain

    Reining in energy expenditures and mitigating the environmental impact of power generation have been the most prominent perceptions driving consumers’ vision of benefits from the smart grid ecosystem. We noted these in 2007 when we conducted our first survey and reconfirmed them in 2009. By then, in fact, the impact of the global economic crisis strongly reinforced the emphasis on cost, particularly related to personal and family expenditures. See, for example, the drop in willingness to spend for “green products and services”…

    As 2012 begins, the influence of other perceptions is building. About 60 percent of our surveyed consumers with an opinion expect smart grid technologies to benefit their family and foster energy independence for their nations. Over half also believe that these technologies will improve household energy awareness and control, lowering total costs for household energy usage…

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    A little knowledge is a good thing

    Perceptions about new technologies and programs in general are driven in large part by the level of knowledge consumers have, and smart meters are no exception. There is a strong correlation between basic knowledge and willingness to change behavior patterns to meet broad goals (for example, help reduce peak demand by changing the time when energy is used). Similarly, overall approval of smart grid programs that are being deployed or proposed locally is directly related to the knowledge level of the respondent. For example, among consumers with very little knowledge of common industry terms, only 43 percent approve of technology deployment programs, versus 50 percent for those with moderate knowledge and 61 percent with strong knowledge. Similar correlations can be seen in responses to questions about whether these programs will benefit consumers’ families and if they are likely to change energy use patterns. In fact, the patterns were stunningly consistent for virtually all measures of a consumer’s likelihood of positively embracing changes…

    However, this pattern is reversed where privacy is concerned. Here, the more knowledge consumers had about energy, the more concerned they were with privacy issues with home energy usage data. Less than a quarter of those with low to moderate levels of knowledge have privacy concerns; among high-knowledge respondents, the number is 38 percent…However, the elevated privacy concerns do not adversely impact the favorability of these high-knowledge consumers toward new deployments and programs. The support for smart meter programs and data sharing among high-knowledge respondents who expressed privacy concerns was virtually identical to that of those high-knowledge consumers who had no concerns or a neutral opinion…

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    Missing the consumer education target

    The fact that knowledge leads to positive consumer actions is the “good news” side of the results. The bad news is that such knowledge, even for basic concepts, is severely lacking. For example, when asked if they understand the standard pricing unit for consumption (for example, cents or euro per kWh), over 30 percent of consumers reported that they had never heard of the unit or do not know what it means. This has major implications for the implementation of programs like time-of-use pricing (a term which half of those surveyed did not recognize at all). Over 60 percent didn’t know what “smart meter” and “smart grid” mean, and “customer energy portal” had no meaning to more than three in four respondents…

    In some markets, this void in understanding has been aggressively tackled by forces both pro- and anti-change with messages delivered through a wide variety of channels. Many of these messages addressed valid areas of concern and presented important parts of the debate. However, some of the messages focused on negative outcomes that are highly unlikely with adequate protections in place. Others focused on more positive outcomes for which the timing and availability are not yet known with certainty. In combination, consumers are often getting conflicting messages that do not present a clear picture of the future.

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    Driving behavior patterns

    Influences that drive a consumer’s expectations take two forms: messages that most strongly influence motivations for change and sources that provide the strongest channels of delivery of knowledge and opinion. Each is important separately, but because of strong differences in their impacts on different age groups, their interaction is critical as well.

    Saving money remains the strongest behavioral influence overall. However, the importance of other influences is on the rise. In about half of the countries surveyed, motivations to change energy consumption behavior to help keep the national economy strong and improve energy security outweighed motivations based on improving impact on the environment. This was particularly true in the United Kingdom, the United States and Poland. In the other half, environmental concerns did outweigh economic ones, with Denmark, Canada and Chile leaning most strongly in that direction.

    Regardless of which influence played a stronger role in motivating change, the age of the respondent is a strong driver of what is important. Those 45 or older were as much as 40 percent more driven by concerns related to cost control, energy security and the impact of energy prices on the national economy. Conversely, among younger consumers – particularly the under-25 group – the influence of environmental concerns was much higher than for the 45-and-older group.

    Beyond this month’s bill

    If consumers are to be better informed and influences more targeted, what are the best ways to deliver the messages? The most effective channels of influence differ across age groups as well. Not surprisingly, the youngest age group we evaluated – age 18 to 24 – had some of the most distinctive factors. In this age group, people gravitate to energy information they can find online (particularly social media-based) to a much greater degree than older consumers. Online social networking was twice as often reported to be a primary source of information for respondents under 25 than for those 25 to 34, and six times more than for those 35 and older. Similarly, online video content was cited as a primary source of information five times more than for those 18 to 24 than for those 25 to 34, and nine times more than for those 35 and older.

    The most significant finding about messages and influences, however, comes from looking at the aggregate contribution of sources that have significant influence on consumers’ knowledge and perceptions. In this year’s survey, the percentage reporting that they use an information source that is not under the control of the consumer’s provider exceeds the percentage that uses a source directly under the control of the provider…This finding points to a major shift in messaging power.

    Consumers are now relying less on information that comes from their own energy provider and more on other influences. The effect increases when looking at the emerging economies and is stronger for younger consumers than for older ones. These findings seem in line with the diffusion of information and opinion via the Internet, mobile applications and social media – a phenomenon that is changing the way companies in almost every industry engage their customers.

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    Making choices: Too much of a good thing?

    As part of our ongoing research into the future of residential energy service, experts in consumer marketing and behavioral economics from IBM and academia participated in a workshop to examine the intersection of influences, messaging campaigns and decision making. One of the more important ideas discussed in the workshop was the role of “decision frames” – psychological structures that people create to organize and simplify the world around them…

    Often, industry advertising campaigns focus strongly on a particular long-term impact that smart meters and smart grid technology may have on the individual – such as cost, environmental impact, reliability or reduced dependence on nondomestic energy sources. These core themes are often deployed across a broad media spectrum and centered on a simple, easy-to-understand message addressed to the broadest audience possible within the entire consumer base.

    However, the role of these impacts as decision frames for energy in consumers’ minds makes this very difficult to achieve. A simple message can miss the mark with a very high percentage of consumers either because it simply does not resonate with them, or worse, it is in direct conflict with the decision frames in which they view energy-related decisions…

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    Conclusion

    In general, energy providers and utilities have done a good job of painting a vision – getting consumers, regulators and the media to imagine what possibilities new energy technologies lend to the future. They have also garnered a sense of what new products and services might create the greatest value and satisfaction. However, this successful communication of the broad societal case for smart grid and smart meter technologies may have created an environment in which the long-term possible benefits have come to represent the immediate expectation of benefits. This has created an opening for influential parties – who now have a stronger voice than ever due to consumers’ increasing reliance on sources outside their providers’ control – to paint this gradual build-up of capabilities and benefits as a failure to provide them at all.

    Without a good core knowledge level on which they can rely, consumers can only work with what they learn through their most trusted channels, even if inaccurate. This is why it is critical to recognize that almost half of consumers are deficient in even basic knowledge. The good news that comes out of this survey is if that knowledge core can be improved, higher levels of approval and willingness to engage are likely to follow, and system and societal goals can be easier to meet.

    Regardless of their knowledge bases, consumers have perceptions that result from existing influences and knowledge levels must be taken seriously, as they are the most important factors driving expectations and willingness to engage. It will be critical for energy providers, governments and other parties with a stake in the future of the smart grid to discuss perceptions in an honest and complete manner, regardless of source or context. For example, perceptions on privacy are critical; tell consumers how each of them is being addressed in meter and data deployment and oversight plans. Even unrealistic perceptions should be addressed with an honest explanation of how any negative outcomes will be avoided or mitigated. Examples across other consumer impacts – such as meter accuracy, total costs and health effects – need to get the same scrutiny and care in communication.

    Companies involved with the planning for, deployment of and business development related to smart grid and smart meter technologies should consider the following actions to address critical gaps in the influence-knowledge-perception-expectation chain:

    •• Recognize that certain motivators and channels of delivery hit specific demographic categories most effectively; align messages and channels to optimize impact.

    •• Leverage key lessons from behavioral science and economics to better align consumer response with knowledge resources and provider messages.

    •• In the short term, forego the push to educate consumers on the details of smart meters and smart grids. Instead, renew focus on the most basic information for the majority, including assuring that data privacy protections are in place. Provide self-learning resources for those who are ready for more complex ideas.

    •• Consider a more social strategy for communicating knowledge and success stories to reach groups where traditional communication via bill inserts and advertising fails to connect with important groups of customers. This is particularly true for consumers with strong family dynamics and consumers younger than 25.

    •• To help address the knowledge gaps and areas of concern for smart meters, learn from and employ marketing techniques being used in other industries facing technological and
    consumer engagement upheaval.

    Navigating the consumer energy experience chain will be one of the core competencies in coming years that will help determine how smoothly smart meter and smart grid deployment will go and how engaged consumers will be. The industry needs to understand and manage the expectations of consumers by driving perceptions that are realistic in impact and timing of availability. This can only be done successfully if providers and retailers provide much-needed knowledge at the right level of sophistication – from very basic to fairly advanced – and do so through the most effective influencers for specific groups of consumers. If analyzed within the context of local demographics and dominant decision frames, this chain can build much-needed engagement and help ensure the right messages are reaching the right people through their trusted channels.

    QUICK NEWS, February 27: PRES WANTS PERMANENT PTC; FEDS BACK SUN R&D; THE DONALD (TRUMP) VS. OCEAN WIND

    PRES WANTS PERMANENT PTC
    Obama tax plan takes scalpel to oil tax breaks, boosts renewables
    Andrew Restuccia, February 22, 2012 (The Hill)

    "The Obama administration outlined a plan…to eliminate a slew of oil-and-gas industry tax breaks, while extending a key tax credit for renewable energy… in a broad corporate tax reform framework unveiled by the Treasury Department…

    "The plan echoes President Obama’s longtime call to [cut $39 billion worth of tax breaks for oil and gas companies over a decade in his fiscal 2013 budget request because]… the industry receives preferential treatment…Among other things, the plan would repeal the expensing of intangible drilling costs and percentage depletion for oil and natural gas wells."


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    "Obama’s plan to nix tax breaks for oil and gas companies faces major opposition from many Republicans, oil-state Democrats and the oil industry. Recent efforts to pass legislation to eliminate the tax breaks have fallen short…[It] is the latest indication that the president hopes to revive the yearlong fight over oil industry tax breaks, signaling the White House believes it’s a winning election issue…Republicans have ramped up attacks on Obama over his energy policies in recent months, pointing to rising gas prices…

    "Obama’s tax framework also calls for making permanent the production tax credit for [each kilowatt-hour of electricity that is produced], which is set to expire at the end of the year…A study commissioned by the American Wind Energy Association, the wind industry’s trade group, says that expiration of the production tax credit could cost as many as 37,000 jobs… Republicans have attacked plans to extend the tax credit…[and called it] an unnecessary subsidy for ‘Big Wind.’"



    FEDS BACK SUN R&D
    DOE Awards Millions In Funding To Solar Energy Research And Development
    24 February 2012 (Solar Industry)

    "The U.S. Department of Energy (DOE) has awarded $9 million in funding to its Bridging Research Interactions through collaborative Development Grants in Energy (BRIDGE) program for solar energy research and development.

    "…[As] part of the DOE's SunShot Initiative, research teams will be able to access the tools and staff expertise at existing DOE Office of Science research facilities so fundamental scientific discoveries can be rapidly transitioned to existing product lines and projects."


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    "The BRIDGE program is the first within the SunShot Initiative to provide engineers and scientists who are developing solar technologies with the tools and expertise of the Department's Office of Science research facilities, including major facilities for x-ray and neutron scattering, nanoscale science, advanced microcharacterization, environmental molecular sciences, and advanced scientific computing.

    "…[The DOE said a] collaborative approach will accelerate innovations to lower the cost of solar technologies…"



    THE DONALD (TRUMP) VS. OCEAN WIND
    Trump backs Cats over wind farm row
    James Quilter, 23 February 2012 (Windpower Monthly)

    "US entrepreneur and TV celebrity Donald Trump's war against the Vattenfall-led 100MW offshore wind farm in Aberdeenshire Bay, Scotland has taken a new turn with his company stating Trump will do ‘whatever it takes’ to stop the plans.

    "The Aberdeenshire Bay project is being developed by a Vattenfall-led consortium in Aberdeen Bay to test next-generation wind turbines. Trump is opposed to the project as he believes they will spoil the view from a golf course he is building nearby. The offshore project is currently going through the permitting process…Trump has ordered work on the golf course to be stopped."


    This guy's opposition is a good argument FOR the offshore wind. (click to enlarge)

    "…Trump is [reportedly] planning to work alongside anti-wind group Communities Against Turbines Scotland (Cats)…[and] back Cats financially…The issue puts the Scottish government in a difficult position. Although renewable energy is a keystone of the ruling Scottish National Party's policy, the party's leader and Scottish first minister Alex Salmond has previously thrown his weight behind Trump's plans…"

    [Dan Barlow, head of policy, World Wildlife Fund Scotland:] "Given the urgent need to tackle climate change it is deeply depressing to hear in detail how Donald Trump intends using his vast wealth to try to kill-off one of the clean, green solutions available to the people of Scotland."

    Sunday, February 26, 2012

    MORE THAN A THIRD OF GERMANY’S POWER BY 2020

    Germany: 36 per cent of electricity in to be generated from renewables by 2020
    21 February 2012 (World of Photovoltaics)

    "The energy market in Germany will see dramatic changes during the next few years. With the nuclear energy capacity halved, the landscape to 2020 will look very different with renewable energy to account for 36 percent of electricity generated...

    "…[A new forecast predicts] that overall electricity generation will decline from 625TWh in 2010 to 590TWh in 2020, due to energy efficiency measures and increased imports (which will be needed to fill part of the gap left by the nuclear plant closures). However, the installed capacity is set to rise from 153GW to 179GW in 2020. This is mainly because of the growth in wind and solar, both of which have relatively low availability and need to be supported by back-up power such as gas turbines…"


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    "…Solar PV capacity is forecast to treble while wind will grow by average of 2GW per year…Energy efficiency will play an important role in the reduction in demand; the Energy Efficiency Act (EnEfG)…[aims] to reduce energy consumption by 9 per cent in 2020, in comparison to consumption 2001-2005.

    "…[F]rom now till 2020…coal will remain the leading fuel (37 per cent of generation) but Germany will experience a decline in lignite-fired output as older power stations are decommissioned…[There will also be] an increase in [the] share of gas through an accelerated development programme – though greater shares [are] anticipated post-2020…"

    IRELAND AND CHINA PARTNER ON WIND FOR CHILE

    Mainstream links with Goldwind for Chilean project
    Ros Davidson, 20 February 2012 (Windpower Monthly)

    "Ireland-based developer Mainstream Renewable Power has inked a new 50/50 joint venture with China’s Xinjiang Goldwind Science & Technology of Beijing for a wind project in Chile.

    "Goldwind’s US subsidiary is supplying 47 of its 1.5MW direct-drive permanent-magnet turbines for the first phase of Mainstream’s Ckani project in Antofagasta, northern Chile. Construction is expected to start this year…The Mainstream/Goldwind deal will use non-recourse financing from the China Development Bank (CDB)…"


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    "Previously, Mainstream bought 23 of Goldwind’s 1.5MW turbines for the 34.5MW Negrete Cuel project, also in Chile…Negrete Cuel was the first Western-owned wind venture to use CDB non-recourse financing.

    "Goldwind’s 106.5MW Shady Oaks project, to be completed this quarter in the USA, was bought from Mainstream…A publicly traded firm, Goldwind has a $6 billion credit line from the CDB and $5.5 billion in internal financing from Beijing Tianrun New Energy Investment, a unit of the CDB."

    CHINA MOVES ON SOLAR PRICE

    China Solar Silicon Production Curbed 30% to Lift Prices: Energy
    February 16, 2012 (Bloomberg News)

    "China’s polysilicon industry, the biggest supplier to solar-panel manufacturers worldwide, has idled almost one-third of production and may keep the plants closed until prices recover from a 60 percent plunge…The price tumble spurred the smallest producers including units of Baoding Tianwei Baobian Electric Co. (600550) and Dongfang Electric Corp. to halt plants…China has about 45 percent of global production capacity to purify silicon into polysilicon…

    "The suspensions may be short-lived because the average spot price for the most expensive ingredient in making solar panels rose 9 percent since mid-December from a decade low [driven by a shift from European demand to China’s anticipated domestic demand]…[Chinese producers will double the number of panels that will be installed this year from the 2.2 gigawatts erected in the country in 2011]…"


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    "…A recovery would boost margins for the biggest makers such as GCL-Poly Energy Holdings Ltd. (3800), China’s largest, and Hemlock Semiconductor Corp. of the U.S., which is No. 1 in the world by capacity…

    "…[Chinese authorities and industry analysts] forecast prices will jump to $40 to $50 a kilogram this year. That’s enough to prompt a return to production in the first half of most of the halted plants, which…[are] about 30 percent of the total…Polysilicon will average about $30 this year, and companies including the units of Baoding Tianwei and Dongfang Electric will probably resume production as early as May…Bloomberg New Energy Finance has forecast polysilicon average spot prices to reach $25 per kilogram this year."

    JAPAN BUYS MEXICAN WIND

    Mitsubishi buys into Latin America's biggest wind project
    James Quilter, 24 February 2012 (Windpower Monthly)

    "Mitsubishi has taken a stake in a Mexican project to build a 396MW wind farm using Vestas 3MW offshore turbines… [Located on the wind-rich] Isthmus of Tehuantepec, in the La Ventosa region of Oaxaca of Mexico, [it] will be developed by Marena Renovables. The isthmus represents the narrowest piece of land separating the Gulf of Mexico and the Pacific Ocean.

    "When complete, [Marena] will be the largest project in Latin America…Under the deal, Mitusbishi will own 34%...Other investors are Macquarie Mexican Infrastructure Fund and PGGM. Mitsubishi, which is developing its own 7MW offshore turbine, said it hopes to gain operational experience through the development of the project."


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    "Power purchase agreements are in place with beverage manufacturers Fomento Económico Mexicano, the world's largest bottler of Coca-Cola, and Cerveceria Cuauhtémoc Moctezuma, which produces Heineken…In November last year, The Inter-American Development Bank (IDB) has approved a $72 million loan to develop the project.

    "Oaxaca is arguably a stronghold for Mexican wind energy and, as a result of its position on the coast and high wind speeds, represents around two-thirds of the country's wind capacity."

    Saturday, February 25, 2012

    Time To Blot Out The Sun


    This is a wonderful parody of the people who are making so much out of one bad DOE bet. A recent study showed DOE's loan guarantee program is making legitimate, substantive investments. Nobody gets it right 100% of the time. From MarkFiore via YouTube

    The Hand Of Man


    This is a great tune and an even greater contribution to the anti-coal cause. What was done by the hand of man can be stopped by the hand of man and redeemed by the hand of man. From mau222 via YouTube

    Trust

    TRUST Arizona from Our Children's Trust on Vimeo.


    This may seem like a story about water but it's really a story about the future.

    Friday, February 24, 2012

    COMING SOON TO NEW ENERGY

    Clean-Tech Predictions for 2012
    Michael Butler, February 20, 2012 (Clean Edge)

    "At Cascadia Capital, we predict that [2012] political and economic debates will drive increasing interest throughout the sustainable industries this year. We also believe that financing and M&A will continue to accelerate, led in part by activity in the solar and energy efficiency sectors…1. Renewable project financing market in turmoil as European banks pull out…2. Renewable energy and climate change come back into public focus as XL pipeline protests gain attention…3. Renewable energy M&A accelerates, led by energy efficiency…4. Despite speculation, solar continues to dominate the renewable energy mosaic…"

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    "Renewable energy will come to the forefront of many political and economic discussions in 2012 due to the presidential election, environmental policy debates, and decreased investment by European banks. Despite some uncertainty in the market, we believe renewable energy project financing will remain steady in 2012 due to investment from alternative sources. We expect this dynamic industry landscape to be highlighted by M&A in energy efficiency, and continued adoption of solar as the barriers to entry rapidly decline."

    LEGO BUILDING OFFSHORE WIND

    Lego buys into offshore wind energy
    James Quilter, 23 February 2012 (Windpower Monthly)

    "Lego-owner the Kirkbi Group has acquired a 32% share in the 277MW Borkum Riffgrund 1 offshore project from Dong Energy.. Dong has sold an additional 18% to the Oticon investment group. The move is part of Dong's strategy of selling off the 50% shares in its offshore projects. The total deal is worth DKK 4.7 billion (€633 million).

    "Borkum Riffgrund 1 consists of 77 3.6MW Siemens turbines. Under the deal, Dong has committed to completing the project by a fixed date and price. The two companies will begin receiving a return on their investment on 1 October 2015. Any income prior to that date will go to Dong."


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    "The terms of the deal are similar to Dong's DKK6 billion (€804 million) deal with two pension funds - PensionDanmark and PKA - over the Anholt offshore project in March last year…[It is] part of the company's strategy to sell off parts of its developments in order to secure more funding for new projects…

    "This is not Lego's first involvement in the wind sector. The company is also a founder member of the WindMade trade standard for companies and brands who have invested in wind energy. The brand wants to 100% of its energy needs to come from renewables by 2020…to help enable future generations of children to grow up in a better world…"

    NO-ELECTRIC-BILL HOMES

    SolarCity, Shea Homes Introduce 'No Electric Bill' Program
    23 February 2012 (Solar Industry)

    "Solar City and homebuilder Shea Homes have partnered to launch a ‘no electric bill’ home option available to home buyers in all Shea Homes Active Lifestyle and Trilogy communities in Arizona, California, Florida, Nevada and Washington."

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    "Homes with the option will be branded as SheaXero. SheaXero homes aim to achieve net-zero electric bills by generating as much electricity as they consume through a blend of energy-efficient features and a solar power system that is included in the home's purchase price…The partnership allows SolarCity to provide solar services to homeowners in Florida and Nevada for the first time…"

    INSTALLING SMART METERS SAVES

    Results from Recent Real-time Feedback Studies
    February 23, 2012 (ACEEE)

    "…[Results from Recent Real-time Feedback Studies] This report summarizes the results of recent, large-scale real-time feedback pilots and experiments in the U.S., U.K., and Ireland. It builds upon a previous meta-review by ACEEE of small residential feedback pilot studies, and was undertaken to further investigate the range of savings found in the earlier report in light of recent large-scale pilots conducted in the U.S. and Europe…

    "The studies reviewed here tested various combinations of interventions, but we have limited our discussion to savings from interventions providing direct, real-time feedback on residential electricity consumption and prices through in-home displays, web interfaces, and prepayment meters…"


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    "Residential electricity savings from real-time feedback in the nine pilots reviewed here ranged from 0 to 19.5%, with average savings across the pilots of 3.8%. The largest savings came from the replacement of pre-existing prepayment meters in Northern Irish homes with new prepayment meters having a real-time display. The smallest savings were observed in two pilots, which found no aggregate effect of real-time feedback on overall electricity consumption…

    "One of the most promising results is that a small percentage of households in several of the pilots had large savings of up to 25%. We propose calling this group the cybernetically sensitive, because they seem to respond more readily to feedback."

    Thursday, February 23, 2012

    TODAY’S STUDY: BRINGING ENERGY EFFICIENCY HOME

    Delivering Energy Efficiency to Middle Income Single Family Households
    Mark Zimring, Merrian Goggio Borgeson, Ian Hoffman, Charles Goldman, Elizabeth Stuart, Annika Todd, and Megan Billingsley, December 2011 (Lawrence Berkeley National Laboratory)

    Executive Summary

    Middle income American households – broadly defined here as the middle third of U.S. households by income1 – are struggling. The recession has exacerbated long term trends that are putting downward pressure on these households, threatening fundamental aspirations like economic stability, secure retirement, and educational opportunities (Commerce 2010). Many middle income households are under significant financial strain, and rising energy bills are a contributor to this stress…Energy efficiency improvements have the potential to provide significant benefits to these households – by lowering bills, increasing the structural integrity of homes, improving health and comfort, and reducing exposure to volatile, and rising, energy prices. Middle income households are also responsible for a third of U.S. residential energy use (EIA 2005).3 Increasing the energy efficiency of their homes would deliver substantial public benefits: reducing power system costs, easing congestion on the grid, and avoiding emissions of greenhouse gases and other pollutants.

    To achieve those goals, utilities and governments are beginning to look beyond typical residential energy efficiency programs that discount compact fluorescent light bulbs (CFLs) or provide rebates for high efficiency appliances and equipment. Increasingly, they are turning to programs that improve the energy efficiency of the entire house – by sealing up leaks, reducing plug loads, adding insulation, and replacing inefficient heating and cooling systems. These more comprehensive programs typically offer the same incentives for all non-low income households and usually require customers to pay a significant portion of the costs. These comprehensive home energy improvements often cost $5,000 to $15,000 per home. In practical terms, higher income households are better positioned financially to take advantage of programs that promote comprehensive home energy upgrades and require substantial household investment…

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    This leaves millions of middle income homes leaking energy and exposed to rising energy costs. Delivering comprehensive energy efficiency improvements to just one-third of the 32 million single family middle income households could save roughly as much energy each year as is used by every home in Houston, Phoenix and San Francisco, for as long as the more efficient measures last. These energy upgrades – at minimum, adding insulation, sealing air leaks and repairing ducts – would require an investment of roughly $30 billion to $100 billion for just a third of the single family middle income market…

    By comparison, total estimated program funding for multi-measure home energy efficiency upgrades targeted at all non-low income households is about $7.7 billion over the next decade.6 And while there is some private sector energy efficiency services activity occuring, the costs of delivering multi-measure energy upgrades to the middle income market far exceed both expected public resources and naturally occurring market activity. A more aggressive effort to target middle income households will require both significant customer contributions to fund these energy saving measures and an interlocking framework of supportive public policy and more innovative program design.

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    Research Scope & Methodology

    The large majority (83 percent) of middle income households lives in single family homes, and 67 percent of middle income households own their home (more than 75 percent of single family dwellers own their home) (see Figure 1). The highest concentrations of middle income households live in metropolitan areas, but chiefly in the smaller cities and suburbs outside of the largest cities. Their homes present good energy savings opportunities as they are are often older and less efficient than those of their wealthier peers. This report focuses on that 83 percent of middle income households who live in single family homes and either rent or own them – a total of 32 million U.S. households.

    The question posed in this report is: How can programs motivate these middle income single family households to seek out more comprehensive energy upgrades, and empower them to do so?

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    Research methods included interviews with more than 35 program administrators, policy makers, researchers, and other experts; case studies of programs, based on interviews with staff and a review of program materials and data; and analysis of relevant data sources and existing research on demographics, the financial status of Americans, and the characteristics of middle income American households.

    While there is no ‘silver bullet’ to help these households overcome the range of barriers they face, this report describes outreach strategies, innovative program designs, and financing tools that show promise in increasing the attractiveness and accessibility of energy efficiency for this group. These strategies and tools should be seen as models that are currently being honed to build our knowledge and capacity to deliver energy improvements to middle income households. However, the strategies described in this report are probably not sufficient, in the absence of robust policy frameworks, to deliver these improvements at scale. Instead, these strategies must be paired with enabling and complementary policies to reach their full potential.

    Driving Demand for Energy Improvements…Reduce Participant Costs & Risk…Use Trusted Messengers…Solve a Problem that Households Recognize…Make It Easy (But Not Too Easy)…

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    Building Structure Issues

    A significant number of middle income houses have building structure and maintenance issues that reduce their value and can adversely affect the health and safety of their occupants. Households are often aware that these problems need to be addressed, but in an uncertain economy, households are reluctant or unable to invest scarce resources in making fixes before those problems turn into emergencies. Frequently, these problems must be addressed before – or in conjunction with – the installation of energy improvements. While more expensive in the short run, addressing non-energy issues as part of energy efficiency program delivery can attract more participants and address important health and safety hazards. The following program elements may make addressing these issues easier for programs and households alike.

    �� Leverage Weatherization Contractors. The existing network of more than 1,000 organizations that deliver the services of the federal Weatherization Assistance Program may have the skills and experience needed to serve middle income households with both energy and non-energy housing issues.

    �� Allow Non-Energy Measures in Energy Efficiency Financing. Allowing households to use a portion of their energy efficiency loan for non-energy measures may be an attractive way to address these issues.

    �� Coordinate Public Funding from Multiple Sources. Streamlining existing funds and services can reduce intervention costs and enhance benefits for households by presenting the homeowner with multiple complementary services in a single, coordinated package. For example, the Green & Healthy Homes Initiative is bundling weatherization services with home health services (such as lead hazard reduction and indoor allergen reduction) to implement a comprehensive assessment, intervention, and education program that improves health, economic and social outcomes of low and middle income families.

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    Access to Capital

    The upfront cost of home energy improvements is a significant barrier to investment. Middle income households have historically invested in home improvements, and many (65 percent) have not needed financing to do so (Guererro 2003). But the recession has depleted household savings, suggesting that many middle income households need financing to overcome this barrier.

    Challenges to Accessing Capital

    Housing wealth is the primary asset against which middle income households have historically borrowed, and that foundation has eroded. Nationally, housing prices have declined by almost a third (32 percent), but middle income households have been disproportionately impacted, as they had more of their wealth invested in their primary residences heading into the recession and their primary residences have lost a greater percentage of property value as compared to the homes of their wealthier peers…

    At the same time that home equity has declined, lenders have responded to increasing consumer risk by restricting access to other types of loan products. Today, many of the largest energy efficiency loan programs have application rejection rates in the 20-50 percent range – and these rejection rates are higher among middle income households than upper income households.

    Opportunities for Increasing Access to Capital…Credit Enhancements…Alternative Underwriting Criteria…

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    Innovative Financing Tools.

    New financial products may be more effective at serving middle income households. Here we highlight four of these financing tools:

    �� On-bill financing (OBF). Many households have long histories of paying their utility bills regularly, and some financial experts believe that on-bill repayment will reduce loan delinquency and increase household willingness to finance energy improvements. In some cases, programs attach the repayment obligation to a household’s utility meter (instead of the individual customer). Subject to existing regulatory practices, nonpayment could also trigger utility shut-off, a powerful customer incentive to make payments…

    �� Loan products that are paid off when properties transfer (deferred loans). Some middle income households – particularly those on fixed incomes – simply do not have the financial capacity to make consistent principal and interest payments on debt. This is especially true when the financed improvements lead to uncertain cash flow, or if building rehab needs to be funded in addition to energy upgrades, increasing net monthly payments. There are many housing and economic development agencies around the country that will fund home improvements through deferred loans – often health and safety-related rehab for fixed income seniors that have equity in their homes. No monthly payments are required, but a lien is attached to the property that must be paid off when the property is sold or otherwise transferred.

    �� Paycheck-deducted loans. Paycheck-deducted financing involves repaying a loan through regular, automatic deductions from an employee’s paycheck. Under one model developed by the Clinton Climate Initiative, a credit union provides the loan capital, and loan repayment is deducted through payroll and automatically transferred to the credit union. The security of the payroll deduction allows credit unions to do more lenient underwriting and offer a lower interest rate than they would otherwise offer for standard unsecured loans.

    �� Property assessed clean energy (PACE). For those middle income households who have equity in their homes, PACE may be a promising financing tool if it gets past the current regulatory hurdles. PACE programs place tax assessments in the amount of the improvement on participating properties, and property owners pay back this assessment on their property tax bills. Like other property taxes, these assessments are treated as senior liens – which makes them very secure. PACE is debt of the property, which suggests that underwriting need not be based on a borrower’s personal creditworthiness (and that the financing can be transferred with the property) – potentially getting around the credit score and debt-to-income issues highlighted in Chapter 5: Access to Capital. PACE currently faces significant regulatory hurdles, which have largely eliminated its use around the country for the residential market, pending court rulings or federal legislation.

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    The Role of Policy

    While important for reaching middle income households, the program design, outreach and financing strategies outlined in this report are probably not sufficient to deliver energy improvements to this market at scale. Instead, they should be seen as potential bridges or complements to more robust public policies that bring additional focus and funding to bear on unlocking this energy efficiency resource. A range of policy options are discussed below – and several are likely to enhance energy efficiency across all markets, in addition to ensuring that substantial allocations are made for delivering home energy improvements to middle income households.

    Energy Savings Targets

    More than half of the states have established energy savings targets of some sort through an Energy Efficiency Resource Standard (EERS), a statutory requirement for utilities to acquire all cost-effective energy efficiency, or energy efficiency goals that are described in utility resource plans. These states and the federal government are expected to spend $7.7 billion on non-low income multi-measure home energy efficiency programs over the next 10 years (SEE Action Residential Retrofit Working Group 2011). The design features of these policies influence the degree to which energy efficiency program administrators are motivated to provide more comprehensive home energy services. EERS’s with comprehensive, long-term savings goals and “all cost-effective” policy guidelines that consider a societal perspective (e.g. including social impacts, environmental externalities) are more likely to encourage comprehensive residential energy efficiency programs.

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    Cost Effectiveness Considerations…Building From Voluntary Programs to Regulatory Solutions

    Better funding for voluntary programs targeted at driving demand for middle income energy improvements are just one piece of an evolving effort to secure energy savings for the public at large. Additional policy options include codes, standards, labeling, and upgrade regulations.

    �� Codes, Standards and Work Specifications. Building energy codes and appliance, lighting, and equipment standards can contribute substantially to efficiency among middle income households. “Reach” codes and financial incentives for even higher efficiency buildings and equipment can encourage market innovation.

    �� Labeling, Disclosure and Upgrade Regulations. Labeling and energy use disclosures can build a more efficient marketplace by making the full costs of operating a home more transparent to renters and homebuyers. These tools make energy efficiency more visible—and valuable—in the home real estate market. They can also build the foundation for the implementation of regulations as these disclosures can be transitioned into minimum energy performance standards. Augmenting voluntary programs with regulations may allow policymakers and energy efficiency program administrators to target limited public funds toward increased support for the most financially vulnerable low and middle income households.

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    Conclusion

    It is important to recognize that progress is being made on delivering home energy efficiency upgrades to the residential sector. Many residential energy efficiency program administrators are reducing their reliance on lighting and appliance rebates and increasing their emphasis on more comprehensive home energy upgrade program offerings. As the mix of residential programs evolve, contractors are adding to their skill sets and adjusting their business models. Despite this progress, improving the home energy efficiency of middle income households is a challenging prospect.

    There is no single solution to this challenge. Beyond the significant barriers to driving demand that exist in the general population, middle income households face greater financial insecurity that can make proactive investment in energy improvements prohibitive. Those middle income households who are motivated to act are often unable to access financing or must address costly structural and maintenance issues in their homes before investing in energy efficiency. This report describes a number of financing tools, program delivery models, and outreach strategies that show promise in overcoming these barriers. However, it is clear that while these approaches may prove effective on the margin, they are not enough to be effective at the requisite scale for addressing broad public policy goals. Instead, these approaches should be seen as potential bridges or complements to robust public policies that provide access to energy efficiency for all market segments.

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