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GEMC GMMSCA Fall Conference

GEMC GMMSCA Fall Conference. A Growing Trend: Customers Installing Renewable Generation Nelson Hawk Chairman EnerVision, Inc. Atlanta, GA nelson.hawk@enervision-inc.com 888-999-8840 November 5, 2009. Who is EnerVision?. Management, engineering and technical analysis consulting firm

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GEMC GMMSCA Fall Conference

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  1. GEMC GMMSCA Fall Conference A Growing Trend: Customers Installing Renewable Generation Nelson Hawk Chairman EnerVision, Inc. Atlanta, GA nelson.hawk@enervision-inc.com 888-999-8840 November 5, 2009

  2. Who is EnerVision? • Management, engineering and technical analysis consulting firm • Since 1998, an independent employee-owned company • Primarily serving electric cooperatives in more than 30 states • Alternative energy technical advisor • Program development/support • Renewable resources/green power • Energy efficiency (EE), demand side management (DSM) and demand response (DR) • Program/technology evaluations • Cost-effectiveness analysis • PURPA standards expertise • Energy audits • Surveys

  3. Today’s Discussion – Overview • Key Distributed Generation Renewable Resources – Solar/Wind • National Trends • North Carolina Activities • Florida Activities • Georgia Activities • Interconnection & Net Metering • Conclusions

  4. 1. Key Distributed Generation Renewable Resources Key Issue: Climate change – carbon constraints

  5. 1. Key Distributed Generation Renewable Resources What constitutes renewable energy resources/ green power?

  6. 1. Key Distributed Generation Renewable Resources • Renewable Energy Resources – Solar Solar Thermal Water Heating (Currently Not Certified as Green Power) Thin Film Solar Photovoltaics

  7. 1. Key Distributed Generation Renewable Resources • Renewable Energy Resources – Wind Small Wind Turbines

  8. 2. National TrendsOverall

  9. 2. National TrendsOverallCommercial Customer/Community Focus • Major “green” business initiatives • Cities/communities adopting climate change initiatives • Coordinated universities/colleges networks

  10. 2. National TrendsOverallGreen Energy Jobs • State governments focusing on creation/retention of clean technology/renewable “green collar” energy jobs • Consideration of carbon reduction strategies with industry recruitment • More environmental considerations • Focus on clean/green businesses

  11. 2. National TrendsOverall • Renewable Energy Resources – Tags/Certificates (RECs) (Primarily in RPS states) • Green tag – 1 MWh measureable equivalent of environmental attributes • White tag – 1 MWh measureable equivalent of energy efficiency savings • Tracking efforts – developed/being created • Trading markets – exist/growing

  12. 2. National TrendsSolar PV Installations Interstate Renewable Energy Council – 6/23/09

  13. 2. National TrendsSolar PV Installations Interstate Renewable Energy Council – 6/23/09

  14. 2. National TrendsSolar PV Installations Interstate Renewable Energy Council – 6/23/09

  15. 2. National TrendsSolar PV Installations Interstate Renewable Energy Council – 6/23/09

  16. 2. National TrendsSolar PV Installations Interstate Renewable Energy Council – 6/23/09

  17. 2. National TrendsSolar PV Costs • Before tax credits/incentives, average costs declined 30% from 1998 to 2008 • $10.80/watt to $7.50/watt • Current costs vary by state • Lowest: AZ, CA, NJ: $7.3/watt • Highest: PA, OH: $9.9/watt • Average net installed costs • $5.4/watt for residential • $4.2/watt for commercial • Residential costs less than commercial • Thin-film costs less than crystalline systems Tracking the Sun II, October 2009, Lawrence Berkeley National Laboratory

  18. 2. National TrendsSolar PV Federal Incentives • Personal Investment Tax Credit (ITC) • 30% of installed costs – no cap • Installed from 2009 through 2016 • Cash in lieu of tax credits • 30% of installed costs – no cap • Installed 2009 or 2010 • Special FHA and VA options • FHA loans up to $8,000 • VA loans up to $6,000

  19. 2. National TrendsSolar PV Policies Interstate Renewable Energy Council – 6/23/09

  20. 2. National TrendsSolar PV Policies Interstate Renewable Energy Council – 6/23/09

  21. 2. National TrendsSolar PV Policies Interstate Renewable Energy Council – 6/23/09

  22. 2. National TrendsSolar PV Policies Interstate Renewable Energy Council – 6/23/09

  23. 2. National TrendsSolar PV Policies Interstate Renewable Energy Council – 6/23/09

  24. 2. National TrendsSolar PV Future • PV module prices falling • Growing national residential market • More installations • More markets • Larger installations • Focused in specific states • Ties to Smart Grid • “Community Projects” growing

  25. 2. National TrendsSmall Wind Installations Small Wind Turbine Global Market Study: 2009

  26. 2. National TrendsSmall Wind Installations Small Wind Turbine Global Market Study: 2009

  27. 2. National TrendsSmall Wind Installations Small Wind Turbine Global Market Study: 2009

  28. 2. National TrendsSmall Wind Installations Small Wind Turbine Global Market Study: 2009

  29. 2. National TrendsSmall Wind Costs • Before tax/incentives, average costs are: • $3 – $5/watt of capacity • 10¢ – 15¢/kWh produced • Costs vary widely – key factors: • Availability/quality of state incentives/rebates • Average wind speed • Utility net metering policies • O&M costs (1¢ – 5¢/kWh) • Insurance/permitting/financing costs

  30. 2. National TrendsSmall Wind – Federal Incentives • Personal Investment Tax Credit (ITC) • 30% of installed costs – no cap • From 2009 through 2016 • Cash in lieu of tax credits • 30% of installed costs – no cap • Installed 2009 or 2010

  31. 2. National TrendsSmall Wind Policies • Increase the availability and size of state financial incentives • Streamline zoning ordinances at the local or state level • Standardize grid interconnection rules and procedures • Implement or improve state/utility net metering policies

  32. 2. National TrendsSmall Wind Future • Module prices falling • Growing national residential market • More installations • More markets • Larger installations • Focused in specific states • Ties to Smart Grid • “Community Projects” growing • Appalachian Regional Commission (ARC)

  33. 3. North Carolina ActivitiesSolar • Renewable and Energy Efficiency Portfolio Standard (REPS – Senate Bill 3 – 2007) • Co-op requirements (% of North Carolina Retail Sales)

  34. 3. North Carolina ActivitiesSolar PV • Duke Energy N.C. Solar PV Distribution Generation Program • $50 million/about 1,300 sites/10 MWs total • Duke Energy owns and maintains solar PV • Home, business and industry sites • Roof and/or ground installations • Phase 1 – Initial installations by 12/2009 • Phase 2 – 25 kW to 1 MW installations • Phase 3 – Residential sites completed by 12/2010

  35. 3. North Carolina ActivitiesSolar/Wind State Incentives • Solar • Renewable Energy Tax Credit – 35% up to $10,500 • Property Tax Abatement – 80% of appraised value • Revolving Loan Program – no more than 8% interest • Wind • Renewable Energy Tax Credit – 35% up to $10,500

  36. 3. North Carolina ActivitiesWind • Lead State Agency – NC State Energy Office • UNC Study – 2009 – Wind Potential for Legislature • Appalachian State University (ASU) – Boone, NC • Dr. Dennis Scanlon • Small wind demos/training available • Coastal Wind – 2009 • Duke installing 3 demo turbines • UNC studying/analyzing/reporting

  37. 3. North Carolina ActivitiesWind • Mountain Wind Challenges • Ridge Law of 1983 – for elevations greater than 3,000 ft. above sea level, no towers/structures allowed above 35 feet high • New restrictive laws proposed in NC State Senate – 2009 • “Community Wind” activities growing • Ties to Smart Grid

  38. 4. Florida ActivitiesSolar PV • Gainesville Regional Utilities (GRU) – Feed-in Tariff (FIT) • GRU wants more solar diversity • 32¢/kWh for 20 years – customer solar PV • 4 MW/year cap • Grid – connected requirement • Now installed – 4.7+ MWs • 3 year waiting list backlog • Less than $1/month average customer impact

  39. 4. Florida ActivitiesSolar/Wind Incentives • Solar • Sales tax exemption • Property tax exemption – 100% if installed after 1/2009 • Solar PV State Rebate Program – $4/watt, $20,000 max payment – residential • PV system > 2kW • Wind • Property tax exemption – 100% if installed after 1/2009

  40. 4. Florida ActivitiesSolar PV Example • Barry Moline Story – solar photovoltaic system – 5 kW • $30,000 installed • $20,000 state payment • $9,000 federal tax credit • $1,000 personal investment • $960/year (average & initial) savings • Contractor promised $1,920 annual savings • 1.1 year payback • Maintenance costs in future… • Inverter, diminished production efficiency

  41. 5. Georgia Activities Green Power EMC/GEMC Efforts – Solar/Small Wind • Sun Power for Schools Program – 25 demonstrations online • 400 kW solar public relations project(s) cap (fulfilled) • Relation of EMC member projects to Green Power EMC • No common standards on interconnection and net metering from Green Power EMC – up to individual Georgia EMCS

  42. 5. Georgia Activities Green Power EMC/GEMC Efforts – Solar/Small Wind • Potential Wind Power for Schools Program • 2 small 1.9 kW (Skystream) wind turbines – approximately $32,000 each • 25 kW solar demo at Smarr (Suniva) • Grant application submitted to GEFA • Member of Georgia Wind Working Group (GWWG) • “Community Wind” Projects – under consideration in both mountain and coastal regions • Appalachian Regional Commission (ARC) – strong wind supporter

  43. 5. Georgia Activities Georgia Power Company (GPC) Status – Solar/Small Wind • Green Energy Program – solar • Solar PV demos – 1 MW cap fulfilled – August 2009 • GPC rate 18.31¢/kWh • Exploring Downtown Atlanta solar PV projects • Conflict with 3rd party solar vendors • Wind • No small wind activities

  44. 5. Georgia ActivitiesGeorgia State Incentives Summary • HB 670 – 2008 – Clean Energy Property Tax Credit - $2.5 million annually • HB 473 – 2009 – Clean Energy Property Rebate - $4.495 million (through ARRA stimulus funds) • Non-residential only • GEFA Renewable Energy Grants - $4 million (through ARRA stimulus funds) • Minimum grant – $250,000/project • Announce winners – late November 2009

  45. 5. Georgia ActivitiesSolar/Wind State Incentives 2008 Georgia Clean Energy Tax Incentive Law (House Bill 670) • Effective July 1, 2008 • Total Tax Incentive Cap: $2.5 Million annually • Tax Incentive Sunset: December 31, 2012

  46. 5. Georgia ActivitiesSolar/Wind State Incentives 2008 Georgia Clean Energy Tax Incentive Law (House Bill 670) Administered by GEFA, Georgia Department of Revenue and Georgia Forestry Commission

  47. 5. Georgia ActivitiesSolar/Wind State Incentives • 2009 Clean Energy Property Rebate Program (House Bill 473) • Commercial, non-profits, and schools • 35% of equipment costs up to $500,000 • $4.495 million program budget • Funding source – ARRA stimulus funds • No other state tax credits allowed • Federal credits allowed • New rules completed October 2009

  48. 6. Interconnection & Net MeteringInterconnection Status

  49. 6. Interconnection & Net MeteringInterconnection Definitions • Customer’s generation physically ties to customers’ electrical equipment/systems • Customer’s generation physically ties to utility grid/system – • Adds complexity to the installation • Safety concerns • Technical/reliability concerns • Customer concerns • Cost concerns

  50. 6. Interconnection & Net MeteringUtility Perspective • Safety: • No injuries/backfeed to distribution system concerns • Reliability: • Neighbor customer effects • Local system operations • Potential system impacts – voltage levels, overloads, harmonics, etc. • Rate equity for all customers: • Costs and benefits to customers/avoid shifting costs

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