Energy Lawyer Blog

"These grants will help America's businesses launch clean energy projects, putting Americans back to work in good construction and manufacturing jobs. The initiative will help double our renewable energy capacity over the next few years and make sure America leads the world in creating the clean energy economy of the future." With these words, US Department of Energy Secretary Steven Chu today announced that the American Recovery and Reinvestment Act (ARRA) had completed its first round of funding. The amount for this first round totaled $502 million and was awarded to programs throughout the nation. Although no projects in California were funded with this first round, the ARRA program is designed to support approximately 5000 renewable energy production facilities in the United States.

The program provides cash assistance in lieu of the Investment Tax Credit (ITC) to energy production companies. The first round of funding that was announced today will, according to the Obama administration, create approximately 2,000 jobs in the renewable energy industry. Most of the job creation will be in the construction and manufacturing sector. The purpose of the program is to provide upfront capital for companies in the renewable energy industry.

The Obama administration intends to help companies move forward with projects that could not have been realized due to a lack of direct funding.

Pacific Gas and Electric Company (PG&E) announced earlier this year that it has entered in seven power purchase agreements for a total of 1,130 MW of solar power with BrightSource Energy, Inc. This announcement illustrates the positive effects of the California Renewable Portfolio Standard (RPS).

The California RPS requires utilities in California to increase their procurement from renewable energy sources by at least 1% of their annual electricity sales until a goal of 20% is reached by 2010. It is one of the nation's most ambitious goals. An executive order signed by California Governor Schwarzenegger establishes an even more ambitious goal of 33% by 2020.

The new agreements that PG&E has entered into are expected to deliver enough solar power to offset the consumption of about 530,000 average homes. This example demonstrates that RPSs can be an excellent tool to increase the chair of renewable energy in the State's energy mix. While California has been one of the nations role models in the RPS-arena many states are lacking similar standards.

On August 1, 2009 the California Green Building Code (CalGreen Code) went into effect. This code was adopted by the California Building Standards Commissions last year and is the first of its kind in the nation. The code aims to standardize practices for reducing the immense environmental impact of buildings and building related energy consumption in many ways.

The CalGreen Code requires the energy performance to exceed the 2007 California Energy Code by at least 15%. Equipment and appliances used must be EnergyStar rated. The energy systems that are installed need to be monitored in a way that allows to show hourly, daily, monthly and annual energy consumption and these records must be retained for a period of up to 2 years. In addition, at least 1% of the electric power for the building must be generated through on-site renewable energy sources. The code also addresses the water consumption issues. Outdoor water consumption must be reduced by 50% and indoor consumption must be reduced by 20%. Besides cutting electricity and water consumption, the code requires builders to use less resource -intensive building materials.

The new CalGreen Code applies to State-owned buildings, low-rise buildings, schools, historic buildings and hospitals. The application of the code is voluntary at this point. However, it is part of California Governor Arnold Schwarzenegger's initiative as a step towards more advanced green building standards. The code will become mandatory in 2010.

It remains to be seen whether the California code will have an effect on similar legislation in other states.

In 2008, only 1.28% of the electricity generated in the United States was produced by wind turbines. This number, which was released by the American Wind Energy Association, compares to significantly higher numbers in European countries. Denmark's share of wind energy in the national energy mix is 20%. Energy produced by wind turbines is responsible for 9% of the electricity produced in Spain and 7% in Portugal and Germany.

Two U.S. Representatives from Minnesota (Collin Peterson and Tim Waltz) introduced a bill that has the potential to increase the wind energy share in the U.S. energy mix. The bill would make changes to the Renewable Energy Production Tax Credit (PTC). The PTC has been one of the most important tools for wind power project developers in the past. The bill would make the PTC even more valuable for new wind power project developments in California.

Continue reading "California Renewable Energy Project Developers Hope for Adoption of new Bill" »

While lots of European countries have made excellent experiences with the introduction of feed-in-tariffs (FiT) such a system has not been developed on a federal level in the U.S. However, several states (among them California) have thought about the benefits of a feed-in tariff option for renewable energy. The CPUC announced recently that it will invite international experts from Germany and Spain - the two countries leading the way with their feed-in tariff models in Europe - and experts from the U.S. and other countries for a panel discussion.

The panel discussion on feed-in tariffs will be held on August 27, 2009. International experts will discuss about their experiences with different feed-in tariff models and will talk about how to possible advance the development of renewable energy through the introduction of these models. The discussion will give an overview of the global solar markets and will also shed some light on California's role in facilitating wholesale renewable distributed generation.

The CPUC invites everyone who is interested in the issue to join the panel discussions from 1-2:30 PM at the CPUC Auditorium, 505 Van Ness Ave., San Francisco, CA.

Continue reading "California Public Utility Commission (CPUC) Panel on Feed-in Tariffs in San Francisco" »

A memorandum of understanding was signed by the United States and China today. The memorandum describes the newly established partnership between the two countries on important energy related issues like climate change and the environment.

U.S. Secretary of Energy Steven Chu stresses the importance of the memorandum by stating that "Both of our countries understand the importance of clean energy for our economies and for our security. Both of us understand the imperative of fighting climate change. What the U.S. and China do in the coming decades will help shape the fate of the world. [ . . . ] Today's agreement should send a clear signal that the United States and China are ready to work together on clean energy and climate change."

The memorandum could be the start of a new cooperation between the two biggest polluters in the world. Both countries will have ongoing conversations on the different measures the countries are implementing to reduce greenhouse gas emissions. In the memorandum both countries committed to reaching an agreement that addresses both climate and energy matters. The U.S. and China pledged to cooperate in confronting climate change, advancing energy efficiency, renewable energy, smart grid technologies and other energy technology related issues.

The memorandum is widely seen as part of the negotiations between the countries leading up to the United Nations Climate Change Conference in Copenhagen in December of this year.

Today the U.S. Department of Energy and the U.S. Department of the Treasury announced that it accepts applications for grants in lieu of investment tax credits (ITCs) or production tax credits (PTCs) not only for applicants in California but throughout the United States. With this announcement, the government is implementing section 1603 of the American Recovery and Investment Act of 2009 (ARRA) better known as the stimulus bill.

This provision allows applicants to claim a grant instead of ITCs and PTCs for certain renewable energy production facilities. With the direct payments ARRA aims at developing new jobs in the renewable energy sector as a means of helping the economy recover while advancing green energy development at the same time.

Renewable energy facilities that qualify for ITCs and PTCs are eligible for the ARRA grants. By allowing an immediate cash flow in form of a reimbursement of a portion of the renewable property expense instead of a tax credit, the ARRA acknowledges the lack of available financing for green energy projects. By accepting grants applicants forgo future tax credits which in the past covered parts of the cost for renewable energy projects.

Continue reading "Applications for California Project Grants in Lieu of ITCs and PTCs are Being Accepted " »

A new study on wind power potential world-wide indicates that previous estimates were inaccurate and that much more wind power may be available in California, the U.S. and the rest of the world. The study was published in the Proceedings of the National Academy of Sciences of the United States of America. A team of Harvard researchers evaluated data from meteorological stations from all over the world. The team estimated that the world wind power potential may be 40 times greater than the total current world power consumption. Previous studies have estimated the potential to be 7 times higher.

The study was widely cited in blogs and other publications. The New York Times Green, Inc. Blog also reported on the study.

For the United States the researchers found that there is potential to accommodate as much as 16 times the total current demand for power in the contiguous U.S. The findings of the researchers are significant since the U.S. Department of Energy released an estimate in 2008 concluding that wind power may not be able to provide more than 1/5 of the total U.S. electricity demand by the year of 2030.

An announcement made by U.S. Department of Energy (DOE) Secretary Steven Chu is good news for the Wind Energy Industry in California. Chu revealed that 28 new wind energy projects across the country will receive up to $13.8 million in funding for wind energy turbine research and testing and transmission analysis, planning, and assessments. Chu identified wind energy as a critical factor in President Obama's plan to spur job growth by supporting clean energy projects.

On the same day as the announcement the DOE released the 2008 Wind Technologies Market Report. This report shows that the U.S wind energy industry is growing at a fast pace. The Market Report identifies the U.S. wind power market as the fastest growing wind power market for the fourth year in a row. Wind power remains the second largest new resource added to the grid (wind power contributed 42 percent of all new U.S. electrical generation capacity in 2008). There were more than 8,400 domestic manufacturing jobs added to the in the wind sector in California and the rest of the country last year.