NewEnergyNews: On The Road Reading: Can a “Value of Solar Tariff” Replace Net Energy Metering? Austin Energy’s VOST might be the answer to the NEM controversy.

NewEnergyNews

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

The People's Climate March is Sunday in Manhattan.

The challenge: To make every day Earth Day.

YESTERDAY

  • FRIDAY WORLD HEADLINE-CHINA, INDIA, RUSSIA LEADERS TO SKIP UN CLIMATE SUMMIT
  • FRIDAY WORLD HEADLINE-WORLD’S OFFSHORE WIND TO HIT 40 GW BY 2020
  • FRIDAY WORLD HEADLINE-SOLAR IS THE SOLUTION FOR SOUTH ASIA
  • FRIDAY WORLD HEADLINE-PARIS DIGS GEOTHERMAL
  • THE DAY BEFORE

    THINGS-TO-THINK-ABOUT THURSDAY, Sept. 18:

  • TTTA Thursday-THE WORLD HAS 15 YEARS TO DO THE RIGHT THINGS
  • TTTA Thursday-WIND MAKES THE GRID MORE RELIABLE
  • TTTA Thursday-SOLAR OIL DRILLING
  • TTTA Thursday-A SPORTS CAR THAT RUNS ON SALT-WATER
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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 THE DAY BEFORE

  • THE STUDY: THE GREEN TRANSITION – MONEY KEEPS COMING TO NEW ENERGY
  • QUICK NEWS, Sept. 17: THE NEWEST NUMBERS ON BIRDS AND WIND; BIG SOLAR COMES TO THE SOUTHEAST; WHERE THE EV CUTS EMISSIONS MOST
  • THE DAY BEFORE THAT

  • THE STUDY: THE BENEFITS OF PUMPED HYDRO STORAGE CALCULATED
  • QUICK NEWS, Sept. 16: THE ENERGY TRANSITION TAKES SHAPE; A LABOR-ENVIRO CALL FOR NEW ENERGY, NEW WIRES; ADVANCES IN WATER POWER
  • AND THE DAY BEFORE THAT

  • THE STUDY: RENEWABLES IN THE COMING ARAB WORLD
  • QUICK NEWS, Sept. 15: SOLAR SUCCEEDING ON PRICE; EVEN MORE WIND THAT HONDA EXPECTED; THE HUGE UNRECOGNIZED BENEFITS OF EFFICIENCY
  • THE LAST DAY UP HERE

  • Weekend Video: Climate Change For The Birds
  • Weekend Video: The Evidence Mounts
  • Weekend Video: Colbert On Birds And Climate Change
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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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  • Monday, February 04, 2013

    On The Road Reading: Can a “Value of Solar Tariff” Replace Net Energy Metering? Austin Energy’s VOST might be the answer to the NEM controversy.

    Can a “Value of Solar Tariff” Replace Net Energy Metering? Austin Energy’s VOST might be the answer to the NEM controversy.

    Herman K. Trabish, August 24, 2012 (Greentech Media)

    Ten U.S. utilities currently account for 70 percent of all net energy metering (NEM) -- but most solar companies and utilities are thinking about it.

    Innovative financing, unprecedentedly low panel costs and local mandates are increasing the prevalence of photovoltaic solar-generated electricity. But utilities and ratepayers without solar are concerned about potential cost inequities. Austin Energy (AE), the progressive municipally owned Texas utility, may have a solution.

    NEM allows solar system owners to roll their meters backward as they earn retail rates for the electricity their systems send into the grid. In sunny places, bills can roll back to zero. This may shift some costs to the utility and the utility’s other ratepayers.

    When a PV system owner doesn’t pay a bill, it deprives the utility of income although that utility is still serving that customer.

    When PV system owners don’t pay for electricity, they also don’t pay ancillary charges for transmission and distribution system operations and maintenance even though both their electricity consumption and production use the infrastructure. That could make such payments higher for other ratepayers.

    The result is a growing clamor from non-solar owning ratepayers and utilities to end NEM.

    Solar advocates say NEM is vital to the growth of solar. It plays a pivotal role in the decision to bear the large upfront costs of installing solar because it significantly reduces the “payback period” for system purchasers.

    The rapidly expanding third-party-ownership model is eliminating the hurdle of upfront costs for residential rooftop solar. But NEM remains essential to the new financing scheme’s funders because it hastens the return on their investment.

    AE has been involved in solar for decades, explained AE Solar Incentives Program Manager Leslie Libby. It has long provided NEM because “costs were so high it was never going to be able to compete with coal or nuclear.” AE’s analysis, Libby added, is that even NEM, without a rebate on the system cost, is inadequate. “We still need to overcome the obstacle of upfront capital costs.”

    Because of considerations pertaining to the deregulated Electric Reliability Council of Texas (ERCOT) electricity market, AE does not allow third-party ownership in its service territory, although, Libby noted, as solar approaches grid parity, a transition to third-party ownership will likely be necessary.

    Solar supporters at AE could see solar delivering an array of up-to-then unquantified benefits to a city that basks under one of the richest U.S. solar resources. “If we quantified them," Libby said, “we could pay more for solar.”

    The result was Austin Energy’s Value of Solar Tariff (VOST), an alternative to NEM that moves from a production-based incentive to a hard value that balances out in the utility’s bookkeeping. It may satisfy utilities, ratepayers and solar advocates.

    The VOST was derived from analyses by PG&E, Sandia Labs, Clean Power Research and others. It was, Libby said, “an inclusive process” that recognized the multiple added benefitssolar brought the municipality, including:

    1. Energy value for predictably priced point-of-consumption electricity production;

    2. Generation value for the avoided cost of building traditional generation;

    3. Environmental value for reduced emissions and pollution;

    4. Transmission and distribution system value for reduced burdens on existing wires and infrastructure and the eliminated need for new wires and infrastructure;

    5. Disaster recovery value for serving when central stations go offline;

    6. Reactive power value for stabilizing voltage drops that cause outages; and

    7. Loss savings value for preventing all the above-named losses.

    In the 12.8 cents per kilowatt-hour 2011 update of the annually revalued tariff, “the value for solar went up,” Libby said, because the times “when solar is produced match [the times] when ERCOT needs power.”

    Beginning in October, AE’s solar system owners will be billed the same five-tiered, seasonally adjusted rates ranging from 1.8 cents to 11.4 cents per kilowatt-hour and the $10 monthly Customer Charge levied on all other AE electricity consumers. No meters will roll backwards.

    But solar owners will also be credited with 12.8 cents for every kilowatt-hour they send to AE.

    Theoretically, there should be no revenue loss to utilities or undue burden to other ratepayers because AE will only be paying for value it receives.

    Solaria Vice President for External Relations and Vote Solar co-founder David Hochschild, who helped lead the recent fight to protect California’s NEM, said AE’s VOST is still an unknown.

    Its viability as a solar support, he noted, depends entirely on where the tariff is set. But, he added, “it’s good to see Austin Energy showing leadership.”

    The VOST applies only to AE’s residential solar. AE bills list it as the residential solar rate. Some AE promotional materials call it Gross Metering.

    “What it is not,” Libby insisted, is an incentive. It is a credit applied to our customer’s bill for bringing this valuable resource into our service territory. That resource has a value to Austin Energy and we are going to credit them for that value.”

    What made the VOST “palatable both internally and externally,” Libby said, “is that a residential solar system owner is billed like every other customer for their total consumption. The brilliance of it is this piece. Solar system owners are no longer a special class of customer.”

    At the same time, she added, “we don’t have non-solar-owners hounding us anymore. But system owners get credited at the rate the utility has agreed is the value of bringing this resource into Austin. So far, it makes sense to everybody.”

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