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Since my last post from the Solar Power International 2008 conference in San Diego, large amounts of the bailout bill have been distributed, Obama has taken office, and the automakers have their bailout as well. “Change” is coming in many forms. In San Diego, we experienced a surge of exuberance around the passing of the solar investment tax credit (ITC) as the logjam of pent-up deals began to move forward. But now, having a couple months for the market to digest what has happened and for people to realize what all these changes mean, a very different renewable energy world is emerging.
I’ve had a lot of queries since October about how significantly the financial crisis has crippled alternative energy – specifically, tax equity-based solar projects. Certainly, albeit temporary, declining costs for petroleum-based energy further raises questions about the timing to move to renewable energy. The industry momentum that was building has undoubtedly faltered.
That said, the financial crisis hasn’t been all bad. It has, in some ways, supported the business model for companies like Tioga. For some time, people were predicting Power Purchase Agreements (PPAs), a third-party project finance mechanism, to represent 50% to 80% of the commercial solar market and a recent Alta Terra survey shows this number now over 70% for 2008. The financial crisis has helped this along because more than ever, companies want to hold onto their capital to help ride out this financial storm and save money where they can. One way to do that and go green is through a solar PPA that allows them to trade a portion of their current utility bill for a potentially lower one via solar, without the burden of additional debt or capital outlay. And, despite the plummeting costs of oil and natural gas (which never seems to translate into lower utility prices nearly as quickly as they went up), it only serves to demonstrate the hedge value a PPA offers against volatility in energy prices.
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Call me cynical (and you’d be right), but I think that humans as a species have a couple of basic tenancies. We want life to be better and want to do less to make it so. In other words, we want more comfort and convenience at less cost. That is why we live in a consumer based society with disposable products. We also focus almost entirely on short term gain vs. long term gain. There are obviously exceptions to these rules – like our friends the Mennonites – but in general I think this holds true.
So here comes the million dollar question. If the above is true then how do we solve the environmental problem since it is a long term problem (vs. short term) and most of the solutions come at a higher cost and less convenience. Even a simple tasks like recycling takes time and energy (vs. throwing everything in the trash can) and has no immediate reward (only long term). With all this said I do also think that people want to do the right thing. However wanting something is less powerful than doing and the act of doing is governed by the aforementioned rules.
The solution is incentive. A fantastic case study in RecycleBank’s approach to recycling demonstrates this point. Recyclebank simply pays people to recycle. Prior to recyclebank recycling rates in Philly were under 30%, after recycle bank they were above 80%. Amazing.
TerraCycle (my company) runs brigade programs where millions of Americans sign up to collect waste (from Oreo wrappers to Stonyfield yogurt cups). Currently we donate $0.02 to $0.06 per unit of waste collected to the charity of the collectors choice. So here is my question: do we need to be giving out $0.02 to $0.06 per unit of waste? Over 1 million Americans are now sending specific non-recyclable waste to TerraCycle, postage paid, with the contribution to the charity of their choice. What will it take for you to collect your packaging waste and send it to TerraCycle (or another company), rather than sending it to an landfill? Is $0.02 or $0.06 not enough?
The latest challenge from the talented crew at Architecture For Humanity is hot off the press. This time the focus is on how to revolutionize education worldwide by building the classroom of the future. A lofty goal, perhaps, but exactly what we have come to expect from the small team dedicated to revolutionizing architecture the world over. So what exactly drives the people behind the accolades and successful projects? What is it like to be in the midst of an architectural revolution? Definitely interesting, but not half as crazy as you might think. Click to continue reading »
Motorola recently launched what they claim to be first ever carbon neutral phone at the Consumer Electrics Show in Las Vegas. Additionally, the plastics used in the phone’s exterior are made from recycled water bottles. Enter the MOTO™ W233 Renew. The company signed up with Carbonfund.org to offset the carbon produced during the manufacturing process of the handset. Distribution and operating activities are also offset. Motorola invests in the Carbonfund’s program of renewable energy and reforestation investments.
When you take a close look at the phone you will see that the Carbonfund investment is not a free ticket to environmental utopia because the press buttons and the robust exterior are entirely made of the kinds of metals that still will need recycling at the end of the phone’s life. But, having said that, knowing that the plastics are 100% made of recycled bottles is hopeful, especially when competitors like Nokia and Samsung are using bioplastics made from food crops. The Carbonfund also awarded Motorola with its CarbonFree® Product Certification after an extensive product life-cycle assessment.
Strengthening Renewable Energy Innovation – Corporations, Venture Capitalists, and Government Working Together
By Jim Hurd, Director, GreenScience Exchange
The United States is at a critical crossroads in its energy policy and the Obama administration is promising to completely reshape our energy objectives.
We’re in a global race to develop renewable energy technologies – to compete with leading countries in Europe and with dynamic initiatives in China and Asia. New York Times columnist Tom Friedman makes this clear in his newest book, Hot, Flat and Crowded, as he warns that the US must be a leader in “ET” or Energy Technologies – the next multi-hundred billion dollar creation of global wealth.
To compete, the US has to be strong in each of the four stages of the energy innovation ecosystem:
1) Research; 2) Development; 3) Commercialization; and 4) Scale-Up and Job Creation
In the last stage of “scale up and job creation,” we will see extensive green projects in the economic stimulus package. These will create jobs through the building of wind, solar and other renewable energy projects. But another critical place for the incoming administration to focus funding is that first stage of the energy technology continuum – research.
In the debate about climate change, politicians will likely become polarized between cap-and-trade supporters and carbon tax proponents. There’s no precedent for a carbon tax, but it’s definitely a viable alternative to carbon trading.
Last week, Exxon Mobil Corp.’s chief executive officer Rex Tillerson said he’s in favor of taxing carbon dioxide emissions. “[It's] a more direct and transparent approach,” Tillerson said, comparing the tax to trading carbon. Aside from Tillerson, proponents of a carbon tax include Al Gore and Ralph Nader.
The magic words associated with the carbon tax debate are “revenue neutral.” That means the government lowers other taxes in order to generate the carbon tax. In addition to what seems to be consumer central thinking, the carbon tax is supposedly easy to implement on short notice. Proponents also say a new tax is efficient and relatively fraud proof.
Reading the news yesterday morning, I came across a quote from Michael Morris, the CEO of American Electric Power, in regards to President Obama’s goal of doubling renewable energy in three years. Morris said that as a practical matter, Obama’s target is too ambitious.
Interestingly enough, American Electric Power Co. is the largest U.S. producer of electricity from coal. Of course, Morris was quick to note that he was not anti-wind or anti-solar, but rather wasn’t sure we could double our renewable energy so quickly.
Details of President Obama and Vice President Biden’s ‘New Energy for America’ plan were released last week, another clear indication that the newly elected administration views energy policy as a means of quickly and decisively addressing issues as diverse as recession, employment, energy and national security, climate change and environmental degradation.
Looking to enact both short and longer term remedies centered on spurring development and use of renewable energy and enhancing energy conservation and efficiency, the plan’s aims include:
– investing $150 billion over the next 10 years to stimulate private clean energy investments that could create as many as 5 million new jobs;
– saving more oil than we import from the Middle East and Venezuela in a decade;
– putting 1 million plug-in electric hybrid vehicles on the road by 2015, along with efforts assuring that they are manufactured in the US;
– ensuring that 10% of power comes from renewable sources by 2012, and 25% by 2025;
– and implementing a national cap and trade system with a target of reducing greenhouse gas emissions 80% by 2020.
Supermarket chains in the UK are exploiting every conceivable opportunity to outsmart their competition. Hyper-inflating green credentials to win customers’ favor is part of the game. That’s why it’s easy to be skeptical about the efforts by Tesco superstores. Arriving at a typical Tesco shop, customers are greeted by overly jovial texts on billboards. The phrase “Helping You Spend Less” complements equally vague messages about the environment. But the shop’s management is working to clean up their act, embarking on a crusade to offer customers products that actually lower their carbon footprint. Tesco is even beginning to think about the “greenness” of the very shelves on which these products are placed.
Earlier this month the “greenest ever” Tesco outlet was opened in Manchester. The new store is, in fact, a progressive example of sustainability in many aspects of superstore retailing.
Finally. Change. Along with the new President comes a bright and contemporary perspective on how to tackle climate change. So what can we expect from the fresh-faced Obama and his team of scientifically renowned advisors? Hopefully decisive action, and a lot of it. This week in ClimatePULSE we take a look at the recently published (January 15th) US Climate Action Partnership’s (USCAP) “Blueprint for Legislative Action.” A self-described “detailed framework for legislation to address climate change”. So, is the US Climate Action Partnership Blueprint the answer to our prayers for an economically sustainable approach to solving our climate concerns?Click to continue reading »
News Break: Obama Clears Path to Allow California Emissions Waiver and Set Standards for Improved Fuel Efficiency
President Barack Obama today signed a presidential memorandum directing the Environmental Protection Agency, now under the direction of Lisa Jackson, to reconsider the Bush-era refusal to grant a waiver to California and at least seventeen other states allowing them to set their own standards regulating greenhouse gas emissions from cars and trucks.
Despite former EPA administrator Stephen Johnson initially agreeing with staff recommendations to approve the waiver, he ultimately declined to grant it at the apparent urging of the Bush/Cheney White House. The ongoing intransigence led to Republican California Governor Arnold Schwarzenegger to sue the Bush administration. Numerous Congressional hearings attempted – and generally failed – to force Johnson to explain his reasoning and to what extend communications from the White House and vice president Dick Cheney’s office influenced Johnson’s decision
A second presidential memoranda signed by Obama directs Transportation Secretary Ray Lahood to establish rules implementing a 2007 law the requires a 40% improvement in gas mileage for cars and light trucks by 2020. The Bush administration had failed to make any progress in writing regulation to comply with the law
Obama’s memorandum orders temporary regulations be in place by March to give automakers time to retool for vehicles sold in the 2011 model year. Final standards beyond that will be set in a separate process later this year taking into account “legal, scientific, and technological issues”.
Obama stands ready to make good on his promise to aggressively move forward on environmental issues.
As pleased and thrilled as I was to have been in Washington last week to witness Obama’s inauguration, I am even more thrilled to see him take charge on these issues. Too much time has already been wasted.
"We have so much time, and so little to do! Strike that, reverse it."
That’s just one of Wonka’s many famous quotes in the classic 1971 film. And, if you think about it, the aphorism applies whether discussing chocolate factory tours or White House agendas.
Indeed, Barack Obama has much to do, and even less time to do it in. New policies need to be enacted that counter our current economic problems.
But before he can get to that, Mr. Obama is striking and reversing some unsavory remnants of the Bush administration’s climate policy–or lack thereof.
Whether it’s undoing what’s been done or paving a new way forward, there seems to a green tinge on most of what’s gone on in Washington since last Tuesday.
Pay careful attention, and you can see the seeds of a new energy and climate future being sewn.Click to continue reading »
by Adam Wiskind: The 2006 California Solar Initiative and the Greenhouse Gas Emissions Bill (Senate Bill 1 and Assembly Bill 32) set goals to increase solar generated electricity and reduce greenhouse gas emissions in California. The new laws have prompted the California Legislature and the Public Utility Commission (CPUC) to remove regulatory obstacles for commercial building owners to implement energy efficiency measures and install solar energy infrastructure. One of the changes extends favorable tax treatment for solar installations and allows alternative energy providers to continue to forge valuable agreements with building owners. Together the government’s recent efforts have revealed the significant opportunities for building owners to attract tenants, reduce costs, and generate cash flows in an otherwise tight real estate market. This article outlines the recent regulatory changes and the opportunities they provide for building owners.
In September 2007 the CPUC approved an agreement to allow electrical sub-metering of commercial tenants. Prior to this decision, building owners were prohibited from charging tenants based on a tenant’s actual electricity usage. Instead, electricity bills were generally allocated on a square footage basis. A tenant who used a lot of energy might pay the same as another tenant that managed to operate more efficiently. With the new rule in place tenants can receive price signals and information about their energy usage and costs which may encourage them to participate in energy efficiency and load management programs. Building owners win in two ways. The more accurate billing allows owners to anticipate and pass on costs to tenants and it allows owners to maintain good relations with tenants who think they are being overcharged, which can happen when billing is estimated on a square foot basis. While both building owners and tenants must consent to sub-metering, an effective agreement can open discussions between parties on how to leverage alternative energy technology or behavioral change to lower overall energy bills.