ANTARES Report Published on Colorado Energy Office Website

The Colorado Energy Office (CEO) released a report entitled, “Colorado Customer-Sited Energy Study.” The published report is a summary of a more detailed study completed by ANTARES late in 2015. Colorado Customer-Sited Energy Study_0_001The press release for the announcement can be found here. The purpose of the study was,

…to conduct a study to determine the size and characteristics of the market for customer-sited energy systems in Colorado. The study primarily targeted energy technologies that are eligible under Colorado’s renewable energy standard (RES), including solar photovoltaics (PV), small wind turbines, small and micro-hydropower, waste heat recovery, solar thermal heating, ground source heat pumps (GSHP), and energy storage.

As part of the effort, ANTARES constructed a large database and used advanced data analytics to validate data collected from a variety of sources. Data analysis included the use of geolocational data to validate address information and energy system data.

The importance of this work is that the baseline data will be useful in cataloging and characterizing the long-term performance of small-scale renewable energy systems across the Colorado. In the future, ANTARES believes that the data collection and analytical methods developed are broadly applicable to jurisdictions across the United States. ANTARES is engaging state energy offices across the country to complete similar assessments. Look for more reports to come in the near future.

Worldwide Energy Consumption Shifts Toward Renewable Energy

This month Germany made leaps and bounds in becoming a nation predominantly powered by renewable energy sources. In the past year 33%, on average, of Germany’s total energy came from renewable resources; this portion skyrocketed on May 8 for on this day Germany had high wind speeds nationwide, causing roughly 87% of the country’s electricity to be produced by renewables, including wind, solar, hydropower, and biomass plants. During this time, the country found that the net prices for electricity became negative, meaning that some customers were being paid to use electricity. As importantly, much of the advancement in the German renewable energy industry is being driven by investments German citizens are making themselves [1].

WindSunset

Photo by Tim Clark

 

Those critiquing renewable energy believed that a future energy industry completely supported by renewable sources was impractical because of variations in availability (such as changes in wind speeds). While this is true for almost every renewable resource, Germany, the international leader in the switch to renewable energy, is implementing a diverse infrastructure for renewable energy, including on and offshore wind, solar power, hydropower, and biomass plants [1].

Germany’s drastic switch to the renewable energy sector can be explained by the country’s expected 40 percent decrease from 1990 carbon emission levels by 2020 with a projected 80 percent decrease by 2050. Chancellor Angela Merkel states that the country will make this happen primarily by expanding their solar, wind, and hydropower energy sectors while simultaneously shutting down their nuclear reactors due to safety concerns [2]. Although the country still relies heavily on fossil-fuels, the decline of nuclear power, combined with the country’s desire to increase the number of wind and solar farms, has greatly accelerated the growth of the renewable energy sector; consequently, electricity prices for renewable energy is being driven downward and high penetration renewable energy scenarios are now more real than ever [3].

Portugal is also setting a worldwide example for the potential of the renewable energy industry. Within the past five years Portugal strode to increase the portion of energy produced from renewable sources following the announcement of the European Union’s renewable targets for 2020; between 2013 and 2015, the portion of the nation’s energy generated by renewables rose from 23% to 48% with almost half of the total renewable energy sourcing from wind power. Recently Portugal made landmark records by running for 107 hours on energy produced solely from renewable sources, including wind, solar and hydropower [4]. This is a major milestone for the renewable industry as it points to a reality that many felt was unlikely; renewable energy sources can be a major part of our energy future. As a result of its achievement, Portugal has received endless positive feedback following the event, and now sees great potential in becoming a nation powered solely from renewables.

Industry groups are also suggesting, that projects like those in Portugal will lead to green energy exports throughout the EU, permitting wind to produce 25% of Europe’s power needs within the next fifteen years [4]. In the past year Denmark became a leader in the renewable energy industry after results illustrated wind power’s potential to produce 140% of their national electricity needs; as a result, Denmark began exporting electricity to Sweden, Norway and Germany [5]. Europe continues to make advancements in the renewable energy sector in hope of reaching the EU’s goals.

Germany, Portugal, Denmark, and many other European countries project drastic changes in their electricity supply as they shift toward renewables. This move toward renewables results in a larger domestic energy supply with the accompanied greater potential to become an electricity exporter. Recent events in Germany and Portugal prove clean electricity sources to be feasible, environmentally beneficial options for large-scale electricity production; as a result, renewable energy can soon expect increased growth in European economies and hopefully in the near future for the United States.

[1] http://qz.com/680661/germany-had-so-much-renewable-energy-on-sunday-that-it-had-to-pay-people-to-use-electricity/

[2] http://ngm.nationalgeographic.com/2015/11/climate-change/germany-renewable-energy-revolution-text

[3] http://cleantechnica.com/2015/12/08/renewable-energy-can-take-over-is-much-cheaper-than-nuclear-or-fossil-fuels/

[4] http://www.theguardian.com/environment/2016/may/18/portugal-runs-for-four-days-straight-on-renewable-energy-alone

[5] http://www.theguardian.com/environment/2015/jul/10/denmark-wind-windfarm-power-exceed-electricity-demand

Permitting Wind Energy Projects

Few people really appreciate how long the permitting and approvals stage of the development process can be, particularly for renewable energy projects that are among the first of their kind in a particular jurisdiction.

ANTARES was recently contracted by a county in the mid-Atlantic to evaluate a Special Exception Permit (SEP) application filed by a developer who wishes to build a utility-scale wind farm. This developer has been engaged in discussions with the county for over two years, after acquiring the project from another developer who had also worked on it for a few years. After a very detailed review by ANTARES and the county’s own staff, the county recommended that 17 conditions be placed on the approval of the developers special exception permit. After a public hearing, the county’s Planning and Zoning Committee made a unanimous recommendation to the county’s Board of Supervisors to approve the permit. A few weeks, and anther public hearing later, the Board of Supervisors also made a unanimous decision to approve the SEP with the recommended conditions.

In the project situation described, renewable energy projects under 100 MW are subject to a Permit by Rule process overseen by the state Department of Environmental Quality (DEQ). Before the process can begin at the state level, the local government must certify compliance with local land use requirements.

After learning of the developer’s interest in the site, the county took action and passed a wind ordinance that regulates the permitting, construction, operations, and eventual decommissioning of utility-scale wind projects within its jurisdiction. In addition to outlining the regulatory process, the adoption of a wind ordinance is an important step in that it protects the interest of the county, its citizens, and its resources. Creating a wind ordinance from scratch can be an ordeal; to facilitate the process, the U.S. Department of Energy’s WindExchange program maintains a catalog of 411 wind energy ordinances from across the country. The WindExchange includes a link to the DOE’s Regional Resource Centers, which were created to provide regionally-focused information on topics such as the wind resource, geography, wildlife, electricity infrastructure, and costs.

The state DEQ acts as the lead agency and coordinates the inputs of the other state and federal agencies that will weigh in on the potential environmental, cultural and historic impacts to the project. At the end of the process, the DEQ issues a report that includes mitigation measures that must be taken to reduce or eliminate impacts of the project. Mitigating measures could involve things like limiting construction to certain seasons, avoiding certain areas of the site, or even curtailing operations during certain seasons and weather conditions.

This particular project is on track to be among the first utility-scale wind projects permitted, and among the first to be approved via the Permit by Rule process. The end of 2017 is earliest it could possibly reach commercial operation, assuming that the rest of the process goes smoothly; at that point, the project will have been under development for nearly 9 years.

ANTARES staff have an exceptional depth of experience in renewable energy projects ranging from owner’s engineering services, to assisting local jurisdictions review projects for ordinance compliance and with public outreach and education. Give us a call if we can assist you with your project.

Third Quarter Wind Installations Released for US

Last week the American Wind Energy Association (AWEA) released its Third Quarter 2015 Market Report.

The U.S. currently has an installed wind capacity of 69,471 MW and 49,860 wind turbines. The wind industry installed 1,602 MW of capacity in the third quarter of 2015, on top of the 1,994 MW were installed in the first two quarters of 2015, for a total of 3,596 MW year to date.

Current US Wind Power Capacity Installations, by State:

wind 1

It’s fairly safe to say that these projects started construction in 2014 or earlier. This is noteworthy, because although the PTC is expired, wind projects that began construction before December 31, 2014 are still eligible to claim the 30% credit.

US Wind Power Capacity Installations, by Quarter:

wind 2

The report also indicates that 1,250 MW of new construction began in the third quarter, for a total of 4,650 MW of new construction activity reported year to date.  This includes 1,200 MW reported in the 1Q and 2,200 MW for the 2Q. Unless the PTC is retroactively renewed, these new projects will not be eligible for the PTC.

Of particular note is that the 3Q new construction activity includes the largest wind project to be constructed in the Southeast, the 208 MW Amazon Wind Farm US East, which will be located in Pasquotank and Perquimans Counties, North Carolina, with a planned commercial operation date of December 2016. The only other wind project currently operating in the Southeast is the 29 MW Buffalo Mountain Wind Energy Center, which is located near Oak Ridge, Tennessee, and was completed in 2004.

Japan Completes Large Offshore Wind Turbine Project

Japan recently completed the installation of the world’s largest offshore wind turbine, with plans for it to be operational by September 2015. The 7 MW wind turbine is located 12 miles off the coast of Fukushima, and is designed to withstand 65-foot waves. This project will join the 45.6 MW of offshore wind capacity that is already installed, with several hundred additional megawatts planned.  Additional information on the planned offshore wind projects is located here.

Floating-turbine-Fukushima

One of the floating turbines at Fukushima.

Are you considering a wind installation project?  ANTARES provides wind resource assessment services to assist in evaluating the potential of large, utility-scale wind farms as well as small, community- or facility- scale wind projects.  Don’t hesitate to contact us today.

Installing Wind Turbines in Viaducts Have Potential to Produce Electricity

Researchers in Great Britain have determined that wind turbines installed between the pillars of viaducts have the potential to produce electricity.  See the full press release here.  Their analysis was based on the Juncal Viaduct, which is located on the island of Gran Canaria.  The results of the study showed that although a variety of turbine configurations are possible, the most viable configuration would be two 0.25 MW turbines placed next to each other.

This application may be beneficial in areas where traditional wind turbine configurations are not possible due to geographical constraints or existing development.

wind turbine in viaduct

Conceptual drawing of two turbines installed in a viaduct.

Thinking about installed a wind turbine?  We can help you!  Our staff includes professional engineers, project managers, and analysts who have supported the development of over 450 MW of operational utility-scale wind power, and includes many gigawatts of projects in various stages of early development.

2014 Energy Flow Charts Released by LLNL

The first time I saw one of these charts, I was a senior in high school in a Southern state where coal was king.  It was revolutionary to me: how very much energy we were using!  And how much of it was just wasted!  That moment was one of the reasons I went into energy engineering, and I’ve been keeping an eye on these charts ever since.

2014_us_energy

Lawrence Livermore National Laboratory (LLNL) just issued the most recent chart (above; press release here), which had some promising news.  LLNL points out that solar energy generation increased 33% and wind energy generation increased 8% versus 2013, and natural gas continued to displace higher carbon-intensity coal in electricity generation and petroleum in the transportation sector. These are small changes — I would love to see more than a pencil width shift in the lines on that chart – but they are in the right direction.  What is not so promising is that increases in wind capacity have slowed down versus previous years (see our blog post here about one of the reasons why), biomass contributions are almost unchanged, and geothermal is still only a drop in a bucket.

If you want to make your own changes to this chart, whether by improving your energy use efficiency or generating your own energy, please don’t hesitate to contact us.  We would love to help.

Wind Vision: A New Era for Wind Power in the United States

The Department of Energy recently released a report documenting the current state of the utility-scale wind power industry in the US, and envisioning a scenario in which wind energy could supply 10% of national end-use electricity demand by 2020, 20% by 2030, and 35% by 2050. The total cumulative wind power capacity by 2050 in the Study Scenario was 404 GW, which included 80 GW of offshore capacity. The report concludes that this level of deployment is both viable and economically compelling, with the Study Scenario resulting in $149 billion (3%) lower cumulative electric system expenditures, a 14% reduction in cumulative GHG emissions (12.3 gigatonnes of CO2 equivalents), and 23% lower water consumption for the electric power sector. Realizing these levels of deployment, however, would depend upon both immediate and long-term actions, including the addition of needed transmission capacity, and supporting and enhancing siting and permitting activities.

The report resulted from the DOE’s collaboration with over 250 experts from industry, electric power system operators, environmental stewardship organizations, state and federal governmental agencies, research institutions and laboratories, and siting and permitting stakeholder groups. It can be accessed here http://www.energy.gov/windvision

Learning to Look Critically at Your Vendor Energy Savings

Whenever I talk to a vendor, I always learn something new because they truly are experts in their field.  With that being said, even though these guys are really good, you have to keep in mind that they don’t work for you, they aren’t your energy managers, and they aren’t the ones who answer to upper level management as to why a project isn’t performing adequately.  At the end of the day, only you can make the final call if a project is a good investment or not.

As part of their sales pitch, many vendors present a high-level energy savings estimate showing you just how much energy or money you could be saving by implementing their equipment.  It is important to keep in mind that these energy savings estimates are based on a series of assumptions that may or may not be totally inaccurate for your facility.  You’ll need to do a “sanity check” and then make the decision as to whether or not you can reasonably believe the provided estimates.

Things to Look For

The vendor analysis will usually outline a series of assumptions that were used to complete the calculations (and if they don’t outline their assumptions, you need to be extra careful!).  Check the following metrics to make sure that they line up with what you would expect for your facility:

  • Annual hours of operation – how long is your equipment really on?  How much product are you really using?  Check the assumptions against your historical data.
  • Equipment efficiencies – Check boiler efficiency (%) and cooling equipment efficiencies (kW/ton).  These can really vary depending on the age, type of equipment (ex: steam boiler vs. hot water boiler), and how often the equipment cycles on and off (more cycling = less energy efficient).  When in doubt, check out the ASHRAE rated efficiencies for your type of equipment and rated capacity for a good starting point, and then make adjustments as needed depending on your situation.  Want some more reading material?  I really like this write-up, which was done by a PE engineer out in California and talks about looking critically at boiler efficiency claims.
  • Utility rates – Your natural gas rates in $/therm and electricity rates in $/kWh.  Make sure you take into account your supply rates too, if you go through a third party provider.  And check out this article that Clair wrote on utility rates that may be just a little too optimistic for their own good.
  • Historical utility consumption – We frequently look at historical utility bills to make sure that the level of savings proposed makes sense.  Total up your annual consumption and compare it to the vendor energy savings.  Anything that’s really high is probably too good to be true.
  • Peak Loads – You may have three 100 ton chillers, but maybe only two of them operate at peak load.  The vendor won’t know this until you tell them.  Conversely, maybe you have separate winter and summer boilers.  When does each one operate throughout the year?

Real Life Examples

Facility #1 – This facility was installing a new tank-less hot water heater.  The vendor estimated that the facility was consuming 6,000,000 gallons of water each year, when in reality they were only consuming about 2,000,000 gallons (per their historical water bills).  This one assumption alone cut their energy cost savings down to 1/3 of the vendor’s initial estimate.  The vendor also estimated that the site was paying $1.00/therm of natural gas, when in reality the facility was paying close to $0.60/therm.  This cut their energy cost savings down even further.  The vendor estimated $30,000 in annual energy cost savings.  In reality, the energy cost savings were closer to $2,000.  Ouch…

Facility #2 – This manufacturing facility was upgrading their Building Automation System (BAS) that would automatically control their heating and ventilation units.  Initial vendor estimates projected that the facility would save a total of 80% of their existing natural gas consumption.  This magnitude of energy savings doesn’t seem realistic because the facility still needs to heat its large manufacturing area.  In reality, the projected energy savings are closer to 26% of the facility’s existing natural gas consumption.  Contributing factors to the over-estimation of the energy savings included over-estimating the facility’s annual run hours and under-estimating the new amount of outside air needed to keep the building pressurized.

However, not all of the projects that we evaluate are this far off.  Below is a bar chart summary of ten different vendor cost savings estimates versus the savings that were compiled by ANTARES for a random selection of past projects.  As you can see, some of the vendor estimates are close to, or even less than the energy cost savings that we evaluated for the project.  However, 2 of these 10 projects were disastrously different. It would be counterproductive to generalize from this sample, but in our experience, these are not isolated examples.

Vendor Savings Chart

What You Can Do

Make sure that your vendor has as much information as possible—utility rates, efficiencies, annual hours of operation etc.  The more information that you give them, the more accurate their calculations will be.  If you are spending lots of money on a new project – it may be a good idea to get a second opinion upfront, rather than pay for the forensic opinion after management asks you, “What went wrong?!”

Renewable Energy Tax Incentives – 2015 Update

The start of a new year always generates lots of questions on the current state of renewable energy tax incentives. This is particularly true for the Tax Increase Prevention Act, which was signed into to law on December 19, 2014. In a move that has become all too familiar to anyone working in this industry, the Tax increase Prevention Act took many of the biofuel and renewable energy tax credits that had previously expired at the end of 2013 and retroactively extended them through the end of 2014. It is important to note that as of January 1, 2015, these affected incentives have expired once again, and that their ongoing status for the 2015 year has not yet been addressed. This post will review what was changed by this legislation, and highlight the gist of some important incentives that are still available.

Biofuels

Some of the biofuels tax credits that were affected include the Second Generation Biofuel Producer Tax Credit and the Alternative Fuel and Alternative Fuel Mixture Excise Tax Credit, among others, which were retroactively extended through 2014, but not otherwise modified. The full list of extensions is rather long, and can be found at the Alternative Fuels Data Center.

Production Tax Credit (PTC)

The Section 45 Production Tax Credit (PTC) was also retroactively extended through the end of 2014. This is excellent news for the 4,859 MW of wind generating capacity that was installed in the US in 2014. This is four times as much wind as was installed in 2013, although far short of the record 12,000 MW of capacity installed in 2012. For more discussion on the PTC, background information, and the terms of its expiration, please see my post from January 2014.

Investment Tax Credit (ITC)

No legislative changes have been made to the Section 48 Investment Tax Credit (ITC) since the last update I posted. In summary, it is still available through the end of 2016 for the following technologies:

  • Solar, fuel cells, and small wind turbine are entitled to a credit equal to 30% of expenditures.
  • Geothermal heat pumps, microturbines, and CHP are entitled to a credit equal to 10% of expenditures.
  • At the end of 2016, the credit for solar will reduce to 10%, the credit for geothermal electricity production will remain at 10%, and the credit for all other technologies will expire.

Section 1603 Grant

The Section 1603 Grant, which was created by the American Reinvestment and Recovery act of 2009, is a close relative of the PTC and ITC.  Many people do not realize that although the deadline for submitting new applications for the Section 1603 Grant was October 1, 2012, the “placed in service” deadline associated with this grant is not until January 1, 2017, for several renewable energy technologies. Projects that applied for the Section 1603 Grant must be placed in service before the credit termination date, located in the table below by technology, and in the Treasury Guidance Document.

Section 1603 Grant summary

Renewable Energy Tax Incentive Summary Table

As always, DSIREUSA.org is a great place to seek out basic information on local, state, and federal incentives. If you have more complex questions, please give ANTARES a call. We have helped a variety of clients evaluate their opportunities for bringing alternative funding to their projects, including tax credits.