Extracts from NATTA's journal
Renew, issue 147 Jan-Feb 2004

13. World Developments US energy - it’s not all bad news

Although the USA may be ignoring Kyoto and be pushing fossil and nuclear power, it is also pushing renewables quite strongly. Last summer, the U.S. Senate  passed the U.S. Energy Bill  (see Renew 145)  and it has now completed its passage through Congress.  More in Renew 147. But amongst other less savoury policies, it requires electric suppliers to produce 10% of their electricity from renewables by 2020.  Moreover, in some states renewables are already doing very well independently. For example, Southern California Edison (SCE) drew on renewable energy resources for 23% of its power last June and 22% of its power in May, meeting the state’s 20% renewable requirement 14 years early. Around 150 independent power producers now supply the utility with more than 13 billion kilowatt-hours of electricity each year.

Fourteen US states now have renewable portfolio standard (RPS) rules requiring that a certain percentage the state’s electricity come from renewable energy sources. California enacted its law in September 2002.  See the DSIRE Web site at: http://www.dsireusa.org.

The California Energy Commission (CEC) has claimed that the state will have no problem meeting its 20% RPS standard by 2017. According to the CEC, the 20-percent standard could be largely achieved by projects that have already been proposed, such as a 185MW geothermal power plant, which, if built, will be the largest US  geothermal plant.

 See: www.energy.ca.gov/releases/index.hm

Meanwhile New York has provided $14.5 million to support 36 distributed generation and combined heat and power (CHP) projects and the New Jersey Board of Public Utilities (BPU) announced an award of $2.7 million to 10 renewable energy businesses, to explore wave energy, develop a variety of solar energy technologies, investigate means of producing hydrogen from renewable energy sources, and produce power from that hydrogen using fuel cells. The grants will also go toward efforts to assist local government officials in buying green power and to assist energy service companies in providing renewable energy services.                    www.bpu.state.nj.us/home/news.shtml?46- 03

Finally, US Energy Spencer Abraham has announced that the Department of Energy  Office of Energy Efficiency and Renewable Energy is making $2.2 million available to seven Native American tribes to support the development of renewable energy resources on tribal lands.

 Sources : Electricnet/EERE Newsletter.

 25-Year US Strategic Plan

The US Department of Energy has produced a far-reaching 25-year plan spelling out a general vision as well as specific technologies and projects it hopes to develop in the next 25 years. The plan is committed to clean coal and nuclear, but also supports renewable energy and energy efficiency, with the underlying principle that a diversity of energy sources can help provide stability and guard against price spikes. The strategic plan’s specific goals related to renewables and efficiency over the next 25 years include:

• Between 2003 and 2008, weatherize approx. 771,000 homes of low-income families.
• By 2010, bring down the cost of the hydrogen equivalent of a gallon of gas to $1.50.
• By 2010, accomplish FreedomCAR technical milestones established with industry partners.
• By 2012, develop and demonstrate technologies that can reduce emissions more than 70 metric tons of carbon (MMTCE) and equivalent green house gases (and 117 MMTCE by 2020).
• By 2015, evaluate policy instruments that foster the delivery of commercial quantities of hydrogen based on the economic success for hydrogen research and development.
• By 2015, develop technologies that allow a decision by industry to commercialize fuel-cell vehicles and hydrogen infrastructure.
• By 2025, have renewable energy sources (excluding hydropower) reach 12.0 quadrillion Btu (quads), nearly double the energy production of  6.46 quads in the year 2000.
• By 2025, develop and demonstrate technologies to bring systems that generate both heat and power within 90 percent efficiency.
• By 2025, have solid-state lighting reduce energy demand for lighting  by one-fifth compared to that of 2000.

The Strategic Plan is at: http://strategicplan.doe.gov/Draft%20SP.pdf

US wind opposition split

The wind farm proposed off the coast from Cape Cod, one of the richer areas in the US eastern sea board, had until recently been opposed by, amongst others, the famed broadcaster Walter Cronkite- once called  ‘the most trusted man in America’.  However he has apparently had a change of heart.

 Cronkite, who has a house on Martha’s Vineyard, stopped short of backing the wind farm outright. But he commented ‘As an ardent environmentalist I have been uneasy about my strong statement that did not include my belief that wind power must be harnessed’. 

His U-turn forced the campaign against the farm to scrap radio and television advertisements starring the broadcaster... It also marked a dramatic reversal of the position he voiced in a newspaper column only days earlier, in which he wrote: “Since I won’t like the look of that vast field of towers; and I won’t like their interference with glorious sailing in the Sound; and I will worry about the wildlife, including porpoises and whales and several birds of endangered species on their annual migrations; I’m opposed to the project”.  Senator Kennedy, whose family have taken holidays at their compound at Hyannis Port for decades, is now the farm’s most prominent foe.

Small is Better

Responding to last years power blackout in the USA, Amory Lovins from the Rocky Mountain Institute pointed out that  ‘throughout electricity’s first century, power plants were costlier but less reliable than the grid, so ever-bigger power plants backed each other up through the grid. But new power plants are now cheaper and more reliable than the grid, so delivering reliable and affordable power now means generating it at or near the customers.  Central thermal power stations stopped getting more efficient in the 1960’s. They stopped getting cheaper in the 1980’s, and stopped getting bought in the 1990’s: Now utility orders are back to Victorian levels. Yet public policy continues to favour central plants and big transmission lines. 

Transmission is still centrally planned, and needn’t compete fairly with its cheaper alternatives. Our problem isn’t too few power lines; it’s obsolete rules, rewarding perpetuation of an inherently vulnerable grid. Letting all options compete fairly- whether they save or produce energy, no matter how big they are, what kind they are, or who owns them- would gradually and profitably build a power system as resilient as the Internet. Then major failures, instead of being inevitable by design, would become impossible by design’.

EU Emission Trading- global

The European Commission has adopted a new initiative to combat climate change globally via a new emission trading system linking up with the EU’s internal carbon trading system which is set to start in 2005.  The proposal for a new Directive will allow European companies to carry out emissions-curbing projects around the world and convert the credits earned into emissions allowances under the European Union emissions trading scheme. The proposal builds on the Kyoto Accords market-based flexible mechanisms (‘Joint Implementation’ and the ‘Clean Development Mechanism’)  Their aim is to reach the global emissions reduction targets in a cost-effective way while transferring advanced technology to other industrialised and developing countries.

Meanwhile, even before any scheme exists, 90,000 EU forward trade carbon allowances  have been sold, at an average price of 9 Euro per tonne of CO2. The trade, brokered by New York based Evolution Markets, covers allowances spread over 2005, 2006 and 2007 vintages, from an undisclosed seller in Central Europe. In an earlier trade of 150,000 tonnes, for the same vintage allowance, also brokered by Evolution Markets, the average price paid was Euro 5.5  6.5/tonne. Before that there have been two  small speculative  one tonne trades. 

The EU emissions market is due to begin formally in Jan. 2005. As part of the process, some 14,000 industrial installations in the EU will be allocated a limited number of emission allowances, each representing one tonne of CO2, which they will be allowed to buy and sell between themselves. The allocation process is not due to be completed until March 2004.  And, there are worries that agreement will not be reached in time for the 2005 start.

Sources: EU, Environmental Finance

Renewables around the world

* Greening Adelaide  The South Australian government has been supporting work on sustainable urban devlopment. Herbie Girardet, from the UK Schumacher Society, has been working for them on a report on Greening Adelaide. The report ‘Creating a  Sustainable Adelaide’ is available at www.planning.sa.gov.au/csa/report.pdf

* The German and Danish wind programmes have slowed. Although still moving ahead, perhaps inevitably, the leaders, Germany, have not managed to sustain the very rapid expansion (to 13GW) of the last couple of years, and Denmark, which now gets 21% of its electricity from wind, is facing political changes which have cut support for new projects. But the laggard, the UK, is at last showing some signs of movement, with nearly 600MW of wind capacity now installed, including new projects in Wales, once almost a no-go zone for wind. Belgium is also moving ahead, with agreement on a new 36 turbine wind farm in a dock area of Antwerp.

* Renewable Hawaii, a subsidiary of Hawaiian Electric Company, has initial approval to invest up to $10m in renewable energy projects on the islands of Maui, Molokai, and Lanai. It previously requested proposals for projects on the island of Oahu and received eight proposals that include biomass, ocean, solar, and wind energy projects. The company plans to issue a request for proposals for projects on the Big Island of Hawaii later soon. See  http://www.renewablehawaii.com.

* A joint Israel-US conference on renewable energy sources held in Jerusalem  last year featured  the first ever demonstration of a commercial hydrogen fuel cell in Israel. The ‘Energy Independence of Democracies in the 21st Century’ conference, which was sponsored by, among others, the US Department of Energy, the American Jewish Congress, and the Ministry of National Infrastructure, focused on developing renewable energy resources to enable national energy independence.

* According to the Worldwatch Insititute, global wind energy  use has more than tripled since 1998 and provides enough electricity to meet the residential needs of 35 million people- more than equivalent to the numberof households in California or Spain. And Solar cells are now only nine years behind wind energy in terms of installed capacity, with yearly growth rates averaging almost 24% since 1998.  Annual production of PV systems has grown 150% in the past three years, while the production of wind turbines has increased by 78%. Sales of wind turbines generated roughly $7 billion in 2002, and support about 100,000 jobs.

*As of October 2003 2.2 million Dutch households had signed up to green energy schemes, around 33% of the total households. 

COP 9- Kyoto stalled

The ninth meeting of the Conference of Parties to the UN Framework Climate Change Convention was held in Milan in December. All eyes were on Russia, who, with the USA out of the picture, held the key to the final ratification of the Kyoto accord. It didn’t help that, at the opening of the World Climate Change Conference in Oct, President Putin joked that some people though that global warming might be a good thing for Russia, although he did say that he didn’t agree and that he wanted Russia to support the accord.

In fact this should be very attractive to them. Given that its Kyoto greenhouse gas emission requirement (with the base year set at 1990) is actually well above what its economy is now producing, Russia can bank emission credits without having to make any actual reductions, at least for a while, so you would think it would be keen to sign up- even if other countries might not be so happy with this ‘hot air’  trading.  Russia sees it essentially as a form of aid. Longer term however, there would be pressure to make real reductions, especially as the economy grows. Fortunately, it seems there is plenty of potential for carbon reductions. Its not just that the Russian economy is so energy inefficient, providing a lot of opportunities for savings- there is also a very large renewable potential.  Indeed, a recent report suggested that Russia could become a world leader for renewables- its renewable energy resources are usually underestimated. This was the conclusion reached by the International Energy Agency  in a new report entitled ‘Russia’s potential renewable energy resources’. The report describes Russia’s potential for exploiting biomass, water resources, wind energy, solar energy and geothermal resources as large. ‘If Russia could use its huge scientific expertise to create a domestic market for renewable energy, it could eventually provide serious international competition in this area’.  It also mentioned that Russia is situated next to several ‘energy-hungry’ countries which are seeking to improve their environment and increase the current level of energy security. If Russia could provide a commercial market for renewable energy, over the coming decades it could come to supply electricity not only for itself but for Europe and China as well.’ 

See: http://www.iea.org/techno/renew/re-nmc.pdf

In the event though, Russia backed off, arguing that although it wanted to sign, in its present form the Kyoto accord would place ‘significant limitations on economic growth in Russia’.  This puts Kyoto on hold. Hopefully it’s just a temporary delay. Even so, Joint Implementation and Clean Development Mechanism projects, and associated emission trading arrangements, may now not be ready for start up during the commitment period 2008-2012. It also makes it hard to start negotiations on the second commitment phase, post 2012.