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Commonwealth Wind? Not Common Yet!. Virginia Onshore Wind…..Changing Direction. Don Giecek October 16, 2013. www.timmons.com. U.S. Wind Power Snapshot. 1. Wind provided 43% US capacity additions in 2012 Iowa 25%, South Dakota 24%, Kansas 20%

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  1. Commonwealth Wind?Not Common Yet! Virginia Onshore Wind…..Changing Direction Don Giecek October 16, 2013 www.timmons.com

  2. U.S. Wind Power Snapshot 1. Wind provided 43% US capacity additions in 2012 • Iowa 25%, South Dakota 24%, Kansas 20% • Long term PPA’s signed in 2011/2012 averaged $0.04 per kWh • MAKE Consulting predicting 85% decrease in US capacity additions for 2013 www.timmons.com

  3. Wind Power In Virginia 2007-2013 1. 2007 reregulation initiated RPS Goal • PJM queue reached approximately 900MW in 2010 • PJM queue now @ 258MW (4 projects) • Projects have been withdrawn from the queue in Accomack, Northampton, Botetourt, Roanoke, Wise • DEQ’s PBR creates predictable permitting • RPS GOAL is not an economic driver, counts pre-existing facilities, stimulates no VA jobs • Why don’t local ordinances require 2X setbacks from telephone poles? www.timmons.com

  4. CHANGING DIRECTION You don’t need a weatherman to know which way the wind blows

  5. Distributed (Community Scale) Wind Market- U.S. • Behind the meter OR grid connected • Direct reduction of utility bills OR hedge against volatile fossil fuel costs • Water supply, water treatment, military sites, telecommunication facilities, remote homes • Cumulative distributed capacity 812MW • 2012 new capacity 138MW www.timmons.com

  6. Envisioning a Community Scale Market in Virginia 1. Wastewater treatment, schools, military, manufacturing • Large loads behind the meter, reducing demand charges • EPA Green Power Top 50 • Willing to pay premium for green attributes • Whole Foods, Wal-Mart, Unilever, Apple, Lockheed Martin • Renewable Generation Pilot participants (existing program illustrates demand) www.timmons.com

  7. Existing VA Policies Affecting Community Wind • 5 MW and below PBR fast track permitting • DEQ Clean Water Revolving Loan Fund (VRA) • DMME Revolving Loan Fund (VRA) • Agricultural Net Metering (capped at 500kw) www.timmons.com

  8. Foundation Windpower/Anheuser BuschCase Study 1. 1.5MW GE turbine behind the meter CA installation • 6 mps wind, 25% capacity factor • Assumption- @ $70mwh= $4,564,000 revenue over 20 year period (not counting REC’s) • Anheuser Busch planning second turbine installation www.timmons.com

  9. 3 Steps to Jumpstart VA Distributed Wind Market • Raise PPA pilot project ceiling to 5MW • Installed costs + maintenance do not achieve desired rate of return with VA wind resource and 1MW project ceiling • Current limitation does not represent consistent public policy and acts as a barrier to development 2. State facilities to evaluate distributed opportunities (all renewables) • By legislation or executive order • Iowa Transferrable Tax Credit (NOT a grant) • 1.5 cents per kWh, no cost to utilities • Applied towards state personal or business income tax, financial institutions tax

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