Author Archives Laura Arnold

California will require utilities to pay consumers for generating more solar and wind power than they use and will boost the payoff for certain solar facilities. The laws take effect Jan 1.

By Tiffany Hsu, latimes.com

October 13, 2009

Gov. Arnold Schwarzenegger has approved two major initiatives that will require utilities to pay consumers for generating extra power and will boost the payoff for certain solar facilities.

Homes, businesses and schools that have solar panels or wind turbines previously had no financial incentive to use less electricity than they generated. But AB 920, written by Assemblyman Jared Huffman (D-San Rafael), will encourage efficiency, supporters say.

SB 32, by state Sen. Gloria Negrete McLeod (D-Chino), requires utilities to purchase solar electricity from facilities that produce up to three megawatts and could increase installations on unused spaces such as warehouse roofs. The old limit was 1.5 megawatts.

The two bills will go into effect Jan. 1. Schwarzenegger signed them late Sunday, the last day to act on bills from this year's legislative session.

Under AB 920, the state Public Utilities Commission will set a rate for utilities to compensate customers whose solar or wind systems produce more power than they use in a year. Under California's current law, customers are not paid for any surplus electricity they feed back into the grid.

The state requires that when a consumer installs a solar power system, it be the right size to produce only enough power necessary for on-site use. Rebates from the California Solar Initiative, overseen by the utilities commission, discourage anything larger. So customers who later reduce their energy consumption often end up underutilizing their solar panels.

"The current system instills a perverse incentive for people to waste their solar electricity just so they don't give it away for free to the utilities," said Bernadette Del Chiaro, a clean energy advocate with Environment California, which sponsored the bill.

The new law could boost sales of photovoltaics, especially in regions with sunny summers. Homes that use less power than they did when their solar panels were installed -- such as those that add energy-efficient appliances, insulation or weatherproofing -- and those with children who have moved out can also benefit.

"This bill applies to individual homeowners as well as small businesses, farms, wineries, schools and even affordable housing developments," Huffman said in a statement.

Customers can either receive a check for the extra energy or have credit rolled forward on their electricity bills. Experts, however, said they should expect little profit.

SB 32, meanwhile, could spark more interest in commercial rooftop systems. The law expands an existing program to include municipal utilities, which now must purchase solar power at a set rate until they reach their portion of a statewide 750-megawatt cap. The limit was previously set at 500 megawatts.

The utilities commission will set the rate, which will be higher than market price after incorporating environmental compliance costs and other benefits, said Sue Kateley, executive director of the California Solar Energy Industries Assn., which sponsored the bill.

Between the sweeping solar installations in the desert and the small-scale ones on homes, she said, there had been a category of properties that had plenty of space but didn't use enough power to justify setting up huge solar panels.

But now, owners of large storage units and similar low-energy facilities will be able to install solar power systems and sell the extra electricity back to the utilities, a program known as a feed-in tariff.

The program took cues from countries such as Germany -- where, some in the industry have complained, a similar tariff format stimulated the market so much that prices of solar energy shot too high. Other critics are worried that the tariff could be too low to interest investors.

"We didn't want to replicate the German model, which was a social movement to create an industry," Kateley said. "In California, we already had an industry, but we wanted to fill a market gap. And within the community, it's really exciting because this law will create local jobs."

In a note to the state Senate on Sunday, Schwarzenegger encouraged the utilities commission to continue investigating an expanded tariff for small to medium-size producers of renewable energy.

"In order to meet our greenhouse gas emission reduction goals and a Renewable Portfolio Standard of 33% by 2020, we will need to use all the tools available under our existing programs," he said.

But Schwarzenegger vetoed a slate of bills -- including SB 14 and AB 64 -- that would have required the state to rely on renewable resources for at least one-third of its electricity. He has issued an executive order to meet the 33% goal using a different plan and supports efforts to create 1 million solar roofs by 2018.

Assemblyman Paul Krekorian (D-Los Angeles), chairman of a renewable energy committee, called the vetoes a dangerous setback. The bills, Krekorian said, would have created "green" jobs and steadied price volatility while cutting market manipulation from solar hubs outside of California. He said the vetoes would sour developers to the California market, leading them elsewhere.

"If we don't get started now," he said, "our opportunities to complete projects are going to be missed."

tiffany.hsu@latimes.com

Copyright © 2009, The Los Angeles Times

October 13, 2009

California, United States [RenewableEnergyWorld.com]

California Governor Arnold Schwarzenegger last week signed two solar bills designed to give added incentive to businesses and homeowners to invest in a solar system and help the state achieve its aggressive renewable energy goals.

AB 920 and SB 32 were both signed on the last possible day the Governor could act on bills passed on the final days of the 2009 legislative session.

The first bill, AB 920, was authored by Assembly member Jared Huffman (D-Marin) and requires utility companies to write a check to their customers for surplus solar electricity generated on an annual basis. Previously, under the state’s net metering law, utility companies were allowed to receive surplus solar electricity from their customers for free.

The bill also requires the California Public Utilities Commission (CPUC) to set a rate at which utility companies shall compensate solar customers whenever a solar system generates more electricity than a home or business uses in a given year.

The second bill, SB 32, was authored by Gloria Negrete McLeod (D-Chino) and establishes a new feed-in-tariff program for the state. A feed-in-tariff policy requires utility companies to purchase solar electricity at a set rate over a twenty-year period.

AB 920 and SB 32 were both signed on the last possible day the Governor could act on bills passed on the final days of the 2009 legislative session.

http://www.reuters.com/article/internal_ReutersNewsRoom_BehindTheScenes_MOLT/idUSTRE59A1HE20091011

Sun Oct 11, 2009 11:58am EDT

By Erik Kirschbaum

BERLIN (Reuters) - Germany's conservatives and their Free Democrat allies will reform the Renewable Energy Act (EEG) but cuts for solar power rates will be modest to prevent harming the fast-growing industry, a coalition source said on Sunday.

"We're not going to take an axe to the EEG and we obviously won't agree to any changes that would damage such an important sector," a source told Reuters. "Any cut in feed-in tariffs will be modest -- not anywhere near as high (as) some are suggesting."

The FDP and the CDU business wing want reforms to the Renewable Energy Act (EEG). They have talked of cutting state-mandated feed-in tariffs, which utilities pay for CO2-free energy, by some 30 percent.

That has hit share prices of German companies such as Q-Cells, Solarworld, and Conergy.

The coalition source said any cut agreed would be far less than that -- most likely in a range somewhere around 15 percent.

The FDP and their allies have demanded steeper cuts to the scheme that requires power consumers to subsidize green energy through higher electricity bills. The EEG adds about 3 percent to monthly power bills, or 9 billion euros per year.

But CDU leaders in states with photovoltaic industries -- Saxony, Thuringia, Saxony-Anhalt, Bavaria and Baden-Wuerttemberg -- have blocked steeper cuts in past reforms. The source said those states were again aligned against any radical cuts.

"Germany is a world leader in photovoltaic and you can't go out and destroy that industry," the coalition source said. "We're not going to allow anyone to run roughshod. There's scope for a correction and we'll agree to explore a modest reduction."

The photovoltaic industry in Germany has continued growing strongly despite the economic crisis of the last year, he added.

"It's not only big companies but many smaller installation and electric companies that depend on the solar industry," he said. "It's essential that lawmakers remain a reliable partner."

He said he was sure key CDU leaders "could not agree" to any demand for a 30-percent cut as some have called for. He declined to specify what would be acceptable but hinted a reduction in the feed-in tariff of about 15 percent could win broader backing.

Utilities are now obligated to pay 43 cents per kilowatt for 20 years for photovoltaic for systems installed in 2009. That rate has been falling by roughly 8 percent per year and is scheduled to drop by 9 percent in 2010 to 39 cents per kilowatt.

Returns on investment have nevertheless soared in recent years as costs for photovoltaic systems declined at a much steeper rate. There are 280,000 jobs in Germany's renewable energy sector, including 80,000 in photovoltaic.

The photovoltaic industry has boomed since the EEG was created in 2000. More than half the world's photovoltaic energy is produced in Germany.

(Reporting by Erik Kirschbaum; editing by Simon Jessop)

By JOHN KERRY and LINDSEY GRAHAM

http://www.nytimes.com/2009/10/11/opinion/11kerrygraham.html

Washington

CONVENTIONAL wisdom suggests that the prospect of Congress
passing a comprehensive climate change bill soon is rapidly
approaching zero. The divisions in our country on how to deal
with climate change are deep. Many Democrats insist on tough new
standards for curtailing the carbon emissions that cause global
warming. Many Republicans remain concerned about the cost to
Americans relative to the environmental benefit and are adamant
about breaking our addiction to foreign sources of oil.

However, we refuse to accept the argument that the United States
cannot lead the world in addressing global climate change. We
are also convinced that we have found both a framework for
climate legislation to pass Congress and the blueprint for a
clean-energy future that will revitalize our economy, protect
current jobs and create new ones, safeguard our national
security and reduce pollution.

Our partnership represents a fresh attempt to find consensus
that adheres to our core principles and leads to both a climate
change solution and energy independence. It begins now, not
months from now — with a road to 60 votes in the Senate.

It’s true that we come from different parts of the country
and represent different constituencies and that we supported
different presidential candidates in 2008. We even have
different accents. But we speak with one voice in saying that
the best way to make America stronger is to work together to
address an urgent crisis facing the world.

This process requires honest give-and-take and genuine
bipartisanship. In that spirit, we have come together to put
forward proposals that address legitimate concerns among
Democrats and Republicans and the other constituencies with
stakes in this legislation. We’re looking for a new
beginning, informed by the work of our colleagues and
legislation that is already before Congress.

First, we agree that climate change is real and threatens our
economy and national security. That is why we are advocating
aggressive reductions in our emissions of the carbon gases that
cause climate change. We will minimize the impact on major
emitters through a market-based system that will provide both
flexibility and time for big polluters to come into compliance
without hindering global competitiveness or driving more jobs
overseas.

Second, while we invest in renewable energy sources like wind
and solar, we must also take advantage of nuclear power, our
single largest contributor of emissions-free power. Nuclear
power needs to be a core component of electricity generation if
we are to meet our emission reduction targets. We need to
jettison cumbersome regulations that have stalled the
construction of nuclear plants in favor of a streamlined permit
system that maintains vigorous safeguards while allowing
utilities to secure financing for more plants. We must also do
more to encourage serious investment in research and development
to find solutions to our nuclear waste problem.

Third, climate change legislation is an opportunity to get
serious about breaking our dependence on foreign oil. For too
long, we have ignored potential energy sources off our coasts
and underground. Even as we increase renewable electricity
generation, we must recognize that for the foreseeable future we
will continue to burn fossil fuels. To meet our environmental
goals, we must do this as cleanly as possible. The United States
should aim to become the Saudi Arabia of clean coal. For this
reason, we need to provide new financial incentives for
companies that develop carbon capture and sequestration
technology.

In addition, we are committed to seeking compromise on
additional onshore and offshore oil and gas exploration —
work that was started by a bipartisan group in the Senate last
Congress. Any exploration must be conducted in an
environmentally sensitive manner and protect the rights and
interests of our coastal states.

Fourth, we cannot sacrifice another job to competitors overseas.
China and India are among the many countries investing heavily
in clean-energy technologies that will produce millions of jobs.
There is no reason we should surrender our marketplace to
countries that do not accept environmental standards. For this
reason, we should consider a border tax on items produced in
countries that avoid these standards. This is consistent with
our obligations under the World Trade Organization and creates
strong incentives for other countries to adopt tough
environmental protections.

Finally, we will develop a mechanism to protect businesses
— and ultimately consumers — from increases in
energy prices. The central element is the establishment of a
floor and a ceiling for the cost of emission allowances. This
will also safeguard important industries while they make the
investments necessary to join the clean-energy era. We recognize
there will be short-term transition costs associated with any
climate change legislation, costs that can be eased. But we also
believe strongly that the long-term gain will be enormous.

Even climate change skeptics should recognize that reducing our
dependence on foreign oil and increasing our energy efficiency
strengthens our national security. Both of us served in the
military. We know that sending nearly $800 million a day to
sometimes-hostile oil-producing countries threatens our
security. In the same way, many scientists warn that failing to
reduce greenhouse gas emissions will lead to global instability
and poverty that could put our nation at risk.

Failure to act comes with another cost. If Congress does not
pass legislation dealing with climate change, the administration
will use the Environmental Protection Agency to impose new
regulations. Imposed regulations are likely to be tougher and
they certainly will not include the job protections and
investment incentives we are proposing.

The message to those who have stalled for years is clear:
killing a Senate bill is not success; indeed, given the threat
of agency regulation, those who have been content to make the
legislative process grind to a halt would later come running to
Congress in a panic to secure the kinds of incentives and
investments we can pass today. Industry needs the certainty that
comes with Congressional action.

We are confident that a legitimate bipartisan effort can put
America back in the lead again and can empower our negotiators
to sit down at the table in Copenhagen in December and insist
that the rest of the world join us in producing a new
international agreement on global warming. That way, we will
pass on to future generations a strong economy, a clean
environment and an energy-independent nation.

John Kerry is a Democratic senator from Massachusetts. Lindsey
Graham is a Republican senator from South Carolina.

October 7, 2009

by John Blau, European Contributor
Berlin, Germany [RenewableEnergyWorld.com]

Germany's newly elected government could hinder the expansion of renewable energy in the country with its plans to extend the lifetime of nuclear reactors, warns the German Renewable Energy Federation (Bundesverband Erneuerbare Energie - BEE).

“A lifetime extension of the nuclear plants would slow, if not completely halt, the expansion of renewable energy in Germany,” said BEE spokesman Daniel Kluge. “There’s a simple reason for this: We have more and more renewable energy companies generating and delivering more and more electricity. So letting nuclear reactors stay on the grid longer will only lead to congestion, with too many companies generating too much electricity.” Kluge and others in the industry worry that renewable energy upstarts could be the ones bumped aside.

Not only an overabundance of electricity could undermine the growth of renewable energy, according to BEE, but also the investment strategies of Germany’s big energy companies, which, if given a choice between investing in next-generation green technologies or generating still more profits from amortized nuclear plants, could favor the latter.

Big German energy companies, such as E.ON and RWE, have been investing in wind turbines, most recently in huge offshore wind parks, but have been less enthusiastic about solar energy. Currently, renewable energy accounts for around 15 percent of the electricity generated in Germany, with more than 50 percent still coming from coal.

If the country’s energy giants are allowed to keep their amortized nuclear plants on the grid longer, they stand to make big profits. The state bank WestLB estimates that E.ON, for instance, could earn an extra €8.6 billion [US $12.6 billion] if its reactors were extended an additional eight years. Germany still has 17 nuclear reactors delivering power to its nationwide electricity grid. Several of them are scheduled to be shut down over the next few years.

German energy utilities have long voiced their opposition to a law, passed in 2002 under former Social Democratic (SPD) Chancellor Gerhard Schröder, that ended the construction of new nuclear power plants and required all plants to be shut down by the early 2020s.

Last Tuesday, Jürgen Grossman, chief executive officer of RWE, called for extending reactor lifetimes. “I think one should use (energy) facilities as long as they are safe,” he said on the German public television station ARD. “Nuclear energy is part of…an energy mix. I think it is necessary to talk about extending the lifetimes of all reactors.”

Those remarks came just two days after the general election, which ended a complex coalition government of liberals and conservatives and gave right-of-center Chancellor Angela Merkel an additional four years to govern. RWE is a member of Germany’s Big Four energy producers, including E.ON, EnBW and Vattenfall, all known supporters of the Christian Democratic Union (CDU), its sister party the Christian Social Union (CSU) and their preferred coalition partner, the equally pro-business Federal Democratic Party (FDP).

In the run-up to the election, the parties made their position clear on nuclear energy: It is — and will remain for some time — an essential part of a balanced energy mix. In a television interview following the election, Chancellor Merkel referred to nuclear energy as “a transition technology,” which Germany will require for “a certain time.” Rumors floating around Berlin put the nuclear lifetime extension at between eight and 10 years.

While most renewable energy companies in Germany are worried about the impact of an extension, some energy experts believe it could benefit the sector. One way, according to Claudia Kemfert, an energy expert at the German Institute of Economic Research (Deutsches Institut für Wirtschaftsforschung - DIW), would be for a chunk of the additional profits to go into a special fund or foundation that, in turn, would allocate money to areas such as energy research and infrastructure expansion. Kemfert warns that an extension of the lifetime for nuclear energy “must be connected to certain conditions” such as a fund and how it is allocated. “There has to be a commitment to a sustainable energy strategy,” she said.

Not everyone buys that argument, however. In particular, BEE points out that Germany’s big electricity producers and grid operators are mandated by law to invest in maintaining and expanding infrastructure. “They already collect enough money for their infrastructure obligations,” Kluge said. “And they don’t even spend all of that.”

Kluge argues that Germany’s renewable energy sector doesn’t need additional money but rather a continued commitment to the country’s Renewable Energy Law (Erneuerbare-Energien-Gesetz or EEG). Under the EEG, grid operators must pay a government-set feed-in tariff to companies supplying energy to the grid from renewable sources.

Kluge believes that while the government will look closely at the tariffs for wind, solar and other renewable energy sources, and make necessary changes based on market developments, it plans no substantial changes. German lawmakers across the board, he adds, view renewable energy not only as a means to reduce the country’s reliance on foreign oil and, ultimately, nuclear power, but also as a job machine. Today, more than 280,000 people are employed in the sector. Earlier this year, outgoing SPD Environment Minister Sigmar Gabriel predicted the sector could have as many as 500,000 by 2020.

“I don’t expect the government to change the Renewable Energy Law,” DIW’s Kemfert said. “The only issue that is really disputed is the feed-in tariff for solar, which many argue is too high. I can imagine the new government will seek a market-oriented feed-in tariff.”

John Blau is a U.S. journalist based in Germany. He specializes in business, technology and environmental reporting and also produces extensive industry research. John has written extensively about environmental issues in Germany.

Original story HERE.