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Renewables Becoming Cost Competitive
with Fossil Resources
Skyrocketing fuel prices and rising plant construction costs have made some renewable generation virtually cost equivalent with traditional fossil fuel resources, according to research by investment manager Sanford C. Bernstein & Co. Two major trends—political pressure to clean up emissions and the reality of more expensive fossil fuel generation caused by increasing marginal costs and fund flows into commodity investments—are leading to a rapid increase in investment into alternative energy, supported by surprising findings of parity in power costs of the various forms of generation.
Bernstein analysts estimate the cost to recoup initial-build investment and operating expenses in the United States today at between $75/mwh for a new coal or nuclear power plant to $100/mwh for a new natural gas-fired combined-cycle turbine generator. That compares to wind, biomass and geothermal generation that can all be procured at between $60 and $90/mwh.
“The cost to acquire renewable generation from wind, biomass or geothermal projects is thus comparable today to the cost of new coal, nuclear or gas-fired generation,” the analysts said, due to the much higher cost of fossil fuels. They said the cost of fuel for a coal-fired plant has tripled and the cost of fuel for a gas-fired plant has quadrupled in the current decade with the trend continuing at a torrid pace in 2008.
In addition, construction costs of gas, coal and nuclear plants have increased by 75 percent since 2004, Bernstein said, pushing the long-run marginal cost of generation into the realm of renewables. The cost of constructing a new coal plant has risen to an estimated $2,250/kw, an integrated gasification combined-cycle coal plant to $3,700/kw and new nuclear to $3,700/kw, compared with estimates for new wind power at $2,000 to $2,100/kw and new biomass at $2,250 to $2,500/kw.
And these fuel and construction cost increases are in an environment not yet charging for the emission of carbon dioxide (CO2). The analysts said a CO2 allowance of $25/metric ton in a U.S. carbon cap-and-trade system would increase the variable cost of generation at a coal-fired plant by more than 50 percent.
Bernstein believes renewable generation will increase from 9.5 percent of U.S. power supplies today to 12.5 percent by 2020. Wind generation, which has accounted for 90 percent of the growth in renewables over the last five years, will likely grow at a 17 percent annual rate.
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Energy Information Administration Forecasts 5.9 Percent Decline in U.S. Carbon Dioxide Emissions in 2009
The U.S. Energy Information Administration (EIA) today released updated energy projections for 2009 that imply a 5.9 percent reduction in U.S. carbon dioxide (CO2) emissions from fossil fuels from the 2008 level.
“Several factors contribute to a projected reduction of nearly 6 percent in U.S. carbon dioxide emissions from fossil fuel use in 2009, primarily associated with the economic downturn,” stated EIA Administrator Richard Newell. “Seventy percent of the expected decline—an estimated 242 million metric tons—is from reduced coal and natural gas use in industry and buildings, substitution of natural gas for coal in electric power, and an increase in carbon-free electricity,” said Newell. “The remaining 30 percent of the emissions decline—totaling 102 million metric tons—is due to reduced consumption of jet fuel and distillate fuel oil, including diesel fuel and heating oil.”
EIA reported its latest energy and CO2 emissions projections for 2009 and 2010 in the Short-Term Energy Outlook (STEO), (technical details are provided in the STEO Supplement Understanding the Decline in Carbon Dioxide Emissions in 2009).
Understanding the Decline in Carbon Dioxide Emissions in 2009 can be found here:
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Local Cooperatives Take On National Issues with “Revolutionary” Campaign
Touchstone Energy ® Cooperatives, a nationwide alliance of electric cooperatives, announced the unveiling of a “revolutionary” national energy-efficiency campaign, rolled out simultaneously across 46 states, designed to inspire consumers to easily save energy and money.
Hundreds of representatives from electric cooperatives across the nation convened on August 27 to mark the campaign’s debut on the campus of Washington University in St. Louis, Missouri. It will be the first energy-efficiency communications campaign launched by allied local electric cooperatives on a national scale.
The integrated campaign, “Together We Save,” features the simultaneous roll-out of television and radio spots, print ads, brochures, and other collateral, as well as more than a dozen energy-efficiency interactive web applications linked to a virtual home tour, all designed to encourage co-op members throughout the country to take energy-saving actions now.
A new website, TogetherWeSave.com, will be the gateway through which consumers will easily learn what to do, and the immediate cost-savings impact of those actions. The site also contains a new Touchstone Energy web-TV portal, showcasing energy-efficiency videos.
“Touchstone Energy’s ‘Together We Save’ campaign illustrates numerous ways our member-consumers can reduce their energy bills – and thereby save themselves money – by implementing a variety of changes around their homes and businesses,” said Jim Bausell, COO of Touchstone Energy. “Whether its unplugging unused appliances or adding an extra layer of insulation in the attic, what we’re showing is how simple these energy-saving techniques are, so that the end-use consumer goes from just thinking about changing some of their habits to actually taking action,” Bausell said.
Platte-Clay will begin using the ads and logo in its material.
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Co-ops Can Help Schools Make the Grade on Energy Efficiency
Courtesy Electric Co-op Today, Sept. 2009, Michael Kahn
Schools don’t always get good grades when it comes to energy efficiency, but a new program will help co-ops step in and be great tutors.
“It will help co-ops work in partnership with their schools to improve energy efficiency and strengthen the bond between co-ops and schools,” said Alan Shedd, NRECA southern region manager for C&I business development.
This year’s goal is to partner with co-ops in a pilot program, and then fine-tune it for a full rollout in 2010.
What can co-ops do to help schools?
In an era of tight budgets, Shedd said it’s best to emphasize low-cost and no-cost measures to improve existing buildings. To do that, you have to know what you’re dealing with.
“Benchmarking gives you a snapshot of what the current status is of your building,” said Shedd. “Once you’ve identified how it’s performing, you can compare it to other facilities and identify those facilities that need the most attention.”
Along with comparing schools within a district, it’s also helpful to compare them statewide and even nationally. “Do you have a real winner here to do or do you have a dog? And if you have a dog, how do you make it a show dog?” Shedd said during a Web conference, “The Schools Equation: Program Energy Efficiency in Schools.”
One place to turn for answers is the Portfolio Manager, a free online tool from the Environmental Protection Agency’s Energy Star program.
“It can track the energy use of any building, and for schools you can receive an energy performance rating, which is our score from 1 to 100 that is a comparison of a particular school to our nation’s building stock of K-12 schools,” said Katy Hatcher, Energy Star national manager, public sector.
The tool takes information about a school, including location, number of computers, and energy use for 12 consecutive months.
It compares that school to the nation’s building stock of schools. “The tool can be used to establish a baseline, set goals and track and measure performance over time,” said Hatcher.
Judy Dyer of the U.S. Department of Energy noted that DOE has a “Guide to Operating and Maintaining Energy Smart Schools,” which includes a list of low- and no-cost tips to help schools get started on the road to energy savings.
For more information on the new schools efficiency program, contact Alan Shedd.
Energy Star’s Portfolio Manager
DOE’s “Guide to Operating and Maintaining Energy Smart Schools”
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NRECA Asks High Court to Take Grid Case
Courtesy Electric Co-op Today, Sept. 2009
NRECA, the National Rural Electric Cooperative Assoc., has asked the U.S. Supreme Court to review an appeals court’s decision that the association said puts “the reliable and secure operation of the nation’s electric grid . . . at stake.”
The 2-1 decision by a three-judge panel of the U.S. Court of Appeals for the Fourth Circuit, issued Feb.18, 2009, said that state regulators’ denial of a transmission permitting request did not represent withholding approval of the request under language in the Energy Policy Act of 2005.
The meaning of the statutory phrase “withheld approval” was limited to situations in which a state failed to act on the permitting request, the panel’s majority said.
If a state failed to act on an application within one year of the request, the Federal Energy Regulatory Commission could exercise its permitting authority under the Energy Policy Act. But FERC could not exercise this authority if a state commission denied the request, the appeals panel said.
NRECA and other petitioners based their Sept. 18 request for high court review of the February decision in Edison Electric Institute, et al v Piedmont Environmental Council, et al, on several factors, including the following:
* The case involved a critical issue, strengthening grid infrastructure.
* The Fourth Circuit’s decision was counterintuitive, assuming that EP Act gave FERC authority to review permits conditioned so as to effectively deny a line application, but refusing it the same authority when permits were denied outright.
* The Fourth Circuit’s “erroneous interpretation of this vital legislation” would become final unless reviewed by the Supreme Court.
While the high court has not indicated whether it will take the case, “senior FERC officials have expressed their appreciation to us for seeking its review in this matter,” said Rich Meyer, NRECA senior regulatory counsel.
Despite FERC’s request, the Solicitor General, who has sole responsibility for deciding whether to seek Supreme Court review on behalf of the federal government, had not filed a similar petition on the commission’s behalf, Meyer noted.
This official typically does so only about 20 times annually, on the basis of which cases are most in the interest of the federal government to pursue, and does not typically state the reason for its choices, he added.
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Electric Co-ops Warn Members Against Utility Payment Fraud
“You will be disconnected if you don’t provide your credit card information,” said the insistent caller, demanding the account number from a rural co-op consumer-member earlier this summer.
Unfortunately, the elderly woman who gave in to the demand didn’t find out until later that the aggressive caller did not represent Janesville, Wis.-based Rock Energy Cooperative.
“She gave the caller her Social Security number, her maiden name and her credit card information,” said Barbara Uebelacker, the co-op’s communications specialist. “She could be a victim of identity theft down the road.”
Similar reports are coming in from co-ops across the country.
“The daughter of an elderly consumer-member was visiting when a caller claiming to represent the electric company called to demand payment; she refused to give them anything,” said Steve Moore, member services manager of West Central Electric Co-op, Higginsville, Mo., recalling a case in his service territory.
In today’s economy, it’s not surprising that we are seeing an uptick in identity theft and other fraud schemes,” said Tracey Steiner, NRECA senior corporate counsel, who tracks consumer protection legal issues for the association.
The problem prompted a call to action to Iowa’s electric co-ops from the Iowa Association of Electric Cooperatives in Electrigram, the statewide’s weekly publication.
“We encourage all statewide co-ops to inform members on how to protect themselves from fraudulent callers,” said Brian Kading, executive vice president and general manager of statewide association. Articles warning of the threat have appeared in several co-op publications in Iowa over the past year.
In recent months, a variation on the scam has involved vague references to federal stimulus dollars. In Georgia, Sawnee Electric Membership Corp., Cumming, and Jackson Electric Membership Corp., Jefferson, have both heard from consumer-members who’ve been encouraged to apply for grants of up to $350 to help senior citizens and low income consumer-members pay their utility bills.
“We don’t know of any such program and we’re telling our consumer-members not to give out any information because the callers are trying to get their account numbers,” said Brent Cochran, Jackson EMS’s director of customer service. “People need to report such calls to their co-ops and to their local authorities.”
By Derrill Holly
Electric Co-op Today
September 4, 2009
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Innovative Ice Index Could Soon Be in Use Nationally
Electric Co-op Today, September, 2009
An important tool to help co-ops prepare for ice storms could soon be available nationwide, and has earned a co-op veteran a top honor for his work.
Sid Sperry, director of public relations, communications, and research at the Oklahoma Association of Electric Cooperatives, and Steve Piltz, meteorologist-in-charge of the National Weather Service office in Tulsa, Okla., developed the Sperry-Piltz Ice Accumulation Index.
It predicts the anticipated severity of ice storms, rating them on a scale similar to those used for hurricanes and earthquakes.
“The sole reason that the SPIA Index was created was to shorten the amount of time that consumers were left without electricity due to devastating ice storms—something that we here in Oklahoma have experienced at least eight times during the last 10 years,” Sperry said.
Their expertise will now benefit many more people.
While Sperry has made the technology available free to any public agency, the only weather service office to use it was the one in Tulsa. But after meeting last month with Sperry and Piltz, the weather service’s southern region director instructed that the SPOA Index undergo operational tests this winter at four more offices: Amarillo, Texas; Fort Worth, Texas; Little Rock, Ark.; and Norman, Okla.
Once it passes, Sperry said the weather service could make the SPIA Index available nationally as early as winter 2010.
“I know that electric cooperative officials in other states would most certainly be able to benefit from this technology,” Sperry said. “And we hope that implementation of the SPIA Index by the National Weather Service will soon provide such advance warning that additional preparedness time can be given to utilities across the country.”
This month, Sperry received the prestigious 2009 Technical Innovation Award from the American Public Works Association.
“The usefulness of this Index is not limited to the electric utility industry, but public works and transportation departments can use the information to position road
crews,” said Peter King, association executive director/CEO.
The SPIA Index has also attracted the attention of the National Association of Regulatory Utility Commissioners. At this summer’s meeting, its Committee on Critical Infrastructure passed a resolution calling on the weather service to consider implementing the SPIA Index at any office “across the United States that could possibly be affected by devastating ice storms.” It also urged adoption “by disaster preparedness and emergency response agencies to better prepare for future ice storms.”
Sperry likes the sound of that. “Perhaps,” he said, “there will come a day when electric utilities and other agencies across the country will be able to fully benefit from being able to use our Index.”
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Renewables Becoming Cost Competitive
with Fossil Resources
Skyrocketing fuel prices and rising plant construction costs have made some renewable generation virtually cost equivalent with traditional fossil fuel resources
READ ARTICLE |
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Energy Information Administration Forecasts 5.9 Percent Decline in U.S. Carbon Dioxide Emissions in 2009
Several factors contribute to a projected reduction of nearly 6 percent
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Local Cooperatives Take On National Issues with “Revolutionary” Campaign
Touchstone Energy ® Cooperatives, a nationwide alliance of electric cooperatives, announced the unveiling of a “revolutionary” national energy-efficiency campaign
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Co-ops Can Help Schools Make the Grade on Energy Efficiency
Schools don’t always get good grades when it comes to energy efficiency
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NRECA Asks High Court to Take Grid Case
U.S. Supreme Court to review an appeals court’s decision that the association said puts “the reliable and secure operation of the nation’s electric grid . . . at stake.”
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Electric Co-ops Warn Members Against Utility Payment Fraud
It’s not surprising that we are seeing an uptick in identity theft and other fraud schemes
READ ARTICLE |
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Innovative Ice Index Could Soon Be in Use Nationally
An important tool to help co-ops prepare for ice storms could soon be available nationwide
READ ARTICLE |
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