Green Tech

The American Wind Energy Association is holding its annual conference in Chicago this week but many of its attendees' thoughts are in Washington, D.C.

Wind industry executives said on a media conference call on Wednesday that a national renewable electricity standard (RES) that would require power generation from wind, solar, geothermal, and biomass is necessary to significantly expand the U.S. wind industry.

On Tuesday, governors from industrial-heavy Midwestern states--Michigan, Iowa, Wisconsin, Illinois, Ohio--and the chairman of the Federal Energy Regulatory Commission spoke on another media conference call and also called for a national RES, which they said would bring several economic benefits.

(Credit: National Renewable Energy Laboratory)

Wind power has grown rapidly around the world over the past four years and supplies enough electricity for 7 million average U.S. homes. But wind still contributes a tiny percentage of the total power generation in the U.S. Installed capacity of wind power, which was 8,500 megawatts last year, is expected to slow this year, in large part because of the recession.

But the bigger concern is whether the U.S. industry can dig roots in the U.S. and grow over the long term, said industry executives. The U.S. Department of Energy last year published a study that found that the U.S. could get 20 percent of its electricity from wind by 2030. That target is doable but only with a long-term policy, executives said on Wednesday.

"Investors are nervous because they have seen the stop-go nature of government policies," said retired general and former presidential candidate Wesley Clark who is now on the boards of wind energy companies and an investment bank. "We know that a RES is necessary. The question is: is it sufficient. But it's too early to say because we don't know what's in it."

Many states have renewable energy mandates, but the House and Senate are both considering bills that would establish a national standard. The House bill calls for utilities to get 6 percent of its electricity from wind, solar, biomass, or geothermal by 2012 and 25 percent by 2025.

The RES would serve to bulk up demand for wind energy and lead to an influx of investment in the U.S., which would touch an entire supply chain of companies because wind turbine manufacturers and developers prefer to source components locally.

"We want to be the state that goes from the rust belt to the green belt," said Michigan Gov. Jennifer Granholm on Tuesday's panel. "We have 700 auto suppliers that could be doing wind components...We have companies making light-weight composite materials for autos--they could be doing the same in wind."

Stronger demand for wind energy would also drive technical innovation and greater efficiency in manufacturing, said Victor Abate, vice president for renewables at GE Energy on Wednesday Investments in research and development ultimately leads to lower cost of delivered electricity, added Ditlev Engel, president and CEO of Danish wind company Vestas Wind Systems, during the same panel.

"Basically nothing has been spent on R&D and yet we have been able to get to the level where we are," said Engel, adding that the lack of long-term policy has kept Vestas from making larger investments in the U.S. "The key question is how much further can we bring costs down."

Engel noted that wind is one renewable energy source that does not use water, an advantage it has over other renewable energy sources.

Feasible?
In addition to a national mandate, wind executives and government officials said that getting a substantial portion of electricity from wind will require more transmission lines and an extension to the tax credit for wind developers

"We simply cannot believe we can incrementally continue to develop new renewable energy without building up our entire grid into a strong grid," FERC Chairman Join Wellinghoff said on Tuesday.

The recovery plan passed earlier this year forestalled a dramatic slowdown in wind with loan guarantees and an extension to the tax incentives for wind farm developers. But those incentives will expire at the end of next year. "There's a lot of waiting and seeing what's going to happen," Clark said.

Detractors of renewable energy subsidies argue that these policies are only necessary because renewable energy is more expensive. Another political barrier to getting a national RES passed is that different regions of the U.S., notably the southeast U.S., do not have good wind and solar resources.

On the question of cost, Michael Polsky, CEO of wind energy developer Invenergy, said on Wednesday that installing new wind capacity is less than building a new coal or nuclear power plant. "When compared to nuclear and coal, wind is one of the least costly sources of energy especially if you consider the environmental benefits," said Polsky. "It's very, very competitive."

Natural gas power plants do deliver cheaper electricity but gas prices are lower because of the recession and are likely to go up, he said. Wind also helps achieve national goals of lowering imports of fossil fuels, lowering carbon emissions, and economic development, executives said.

Although the Southeastern United States does not have the same excellent wind resources as the Western U.S., those states can meet renewable energy targets with biomass, said Don Furman, the president of AWEA and a senior vice president at Iberdrola Renewables.

WASHINGTON--House Democrats rebuffed Republican attempts to include more loan guarantees for nuclear and clean coal technologies into the so-called stimulus package, along with Republican efforts to make the energy sections more market-oriented.

By a largely partisan vote of 34 to 17, the House Energy and Commerce Committee ultimately approved the energy portion of the American Recovery and Reinvestment Act, which spends about $25 billion on renewable energy, energy efficiency, and electricity transmission. (See our related story about the broadband portions of the bill.)

The legislation creates a loan guarantee program for renewable energy systems, and the committee on Thursday voted to extend the loan program to specifically apply to hydropower, as well as commercially viable "leading edge biofuel projects."

Rep. Jay Inslee (D-Wash.) had specific praise for the company Sapphire and its work producing algae-based gasoline, which he said will be commercially viable "any place with saltwater and sunshine."

However, the committee rejected an amendment to extend the loan guarantees further to apply to "zero emissions energy"--which would make nuclear and clean coal power eligible for the loans.

"This is a job stimulus bill, and there are literally 100,000 jobs that could be added if we increase our nuclear portfolio," argued Rep. Fred Upton (R-Mich.), who introduced the amendment.

The committee also rejected a Republican amendment to make carbon capture technologies eligible for loan guarantees.

Democrats insisted the amendments were inappropriate given that another portion of the stimulus package allocates $2.4 billion specifically for carbon capture and that using taxpayers' money for nuclear power would not create immediate economic stimulus.

"No amount of incentives will change the fact that no nuclear projects are ready," said Committee Chair Henry Waxman (D-Calif.).

Rep. Anna Eshoo (D-Calif.) also pointed out that $10 billion in loan guarantees were offered to the nuclear industry last year.

Republicans and Democrats were also divided over the proposal to decouple energy rates from usage. The purpose of decoupling, Democrats said, is to enable energy companies to promote energy efficiency without facing the threat of lower revenues.

Inslee called it "the single most effective thing for creating jobs in energy efficiency and giving people an opportunity to lower their (energy) costs in the long run."

California's energy efficiency improved remarkably, in comparison with the rest of the country's, after the state adopted decoupling 20 years ago, Inslee pointed out.

Republicans were unconvinced and unsuccessfully tried to change that portion of the bill.

"I think this is the most anti-consumer vote any of us could make," said Greg Walden (R-Ore.). "This is the reverse of an incentive system."

Amyris Biotechnologies on Wednesday announced the opening of a pilot facility in Emeryville, Calif., that turns sugar cane into diesel fuel through genetically designed microbes.

The company is at the forefront of a commercial movement to use biotechnology to convert plants into fuels that resemble petroleum-based hydrocarbons.

Amyris' technique is to genetically engineer a yeast that can metabolize sugar into the desired molecules. Its first effort was to develop a malaria vaccine, which it continues to do, and it has since developed a focus on renewable fuels.

(Credit: Amyris Fuels)

"We're engineering the yeast, reprogramming it from making alcohols to making hydrocarbons," CEO John Melo said. "We started with E. coli (bacteria), which is what many other companies are doing, but we moved to yeast because we discovered that it was more scalable."

The company has also modified yeasts to produce chemicals; a sugar-derived jet fuel is planned for in about three years as well.

Through a partnership, Amyris plans are to produce biodiesel from sugar cane at commercial scale in Brazil by the middle of 2010. Brazil is one of the world's largest producers of ethanol, using sugar cane as a feedstock.

Amyris' biodiesel can be blended at up to 50 percent concentration with petroleum diesel, higher than most biodiesel today, which means that it can be pumped through existing pipelines. Environmentally, Amyris' "renewable diesel" has lower carbon emissions than petrodiesel and burns cleaner, Melo said.

Amyris has set up a distribution subsidiary and intends to sell its biodiesel to fleet operators, such as Wal-Mart Stores and FedEx.

Melo said the economic slowdown has forced the company to shelve its plans to go public next year.

It does expect to raise some form of capital in the next two years, either through venture funding or strategic partners, he said. The company expects revenue to increase rapidly next year, to more than $100 million, he added.

It's pretty difficult to find free money these days. With the economy ailing and venture capital money as scare as a Republican sighting in Silicon Valley, it's pretty remarkable that the Clean Tech Open is offering $100,000 prize packages to six clean-tech start-ups.

To be clear, the founders and CEOs of these companies had to work a bit for their money. Forty-three finalists were selected across six categories and put through a mini-business school course load on how to run a company, how to raise money, and how to get a product out of the laboratory and into the marketplace.

The 3rd annual Clean Tech Open Awards Gala held Thursday evening in San Francisco honored the six winners who showed the most promise to launch a viable, clean energy solution. And yes, that prize is pretty sweet: $50,000 in cash and an additional $50,000 worth of business tools like legal and accounting services, public relations consulting, office space and other goodies that are considered part of the "start-up in a box" package.

Here are the six categories and their respective winners:

• Air, Water & Waste Award: Over the Moon Diapers

• Energy Efficiency Award: Viridis Earth

• Green Building Award: BottleStone

• Renewables Award: Focal Point Energy

• Smart Power Award: Power Assure

• Transportation Award: ElectraDrive

CAMBRIDGE, Mass.--The fledgling ocean energy industry is awash in ideas for making electricity from moving water but it is still reaching for a toehold in the commercial world.

Greentech Media last week released a summary of an ocean energy report that forecasts great potential for wave and tidal energy.

Click on the image to see a photo gallery of different wave and tidal energy machines.

(Credit: Ocean Power Delivery)

Ocean power--a resource often located near large population centers--could ultimately generate 25 percent of today's total electricity usage, said report co-author Travis Bradford, president of the Prometheus Institute for Sustainable Development.

In the next six years, electricity production from the ocean could swell from just 10 megawatts now to 1 gigawatt a year, a $500 million market.

Before ocean power becomes an economic reality, however, there are huge hurdles to overcome, including too many competing turbine designs, lengthy environmental permitting, costly installation, and, in many cases, a harsh working environment at sea.

Research in ocean energy is active, with most of it done in the U.K. There are a number of pilot projects in the works which, if completed, would total 650 megawatts of electricity production. That's roughly the size of one coal or natural gas power plant.

But charting the course from prototype to grid-connected generator has proven tricky, according to a number of speakers at an event last week hosted by the UK Trade and Investment initiative, Flagship Ventures, and Greentech Media.

"The challenges have been greater and the timelines have all slipped. It hasn't been an easy ride so far," said Andrew Mill, CEO of the U.K.'s New and Renewable Energy Center (NaREC). "Most of the devices to date haven't actually reached the water."

Many wave power machines are designed to capture the energy of the wave's motions through a bobbing buoy-like device. Another approach is a Pelamis wave generator, now being tested in Scotland and in Portugal, which transfers the motion of surface waves to a hydraulic pump connected to a generator.

Tidal power typically uses underwater spinning blades to turn a generator, similar to how a wind turbine works. Because water is far more dense than air, spinning blades can potentially be more productive than off-shore wind turbines for the same amount of space.

In addition to being renewable, another key advantage of ocean power is that it's reliable and predictable, said Daniel Englander, an analyst at Greentech Media.

Although they can't generate power on-demand like a coal-fired plant, the tides and wave movements are well understood, giving planners a good idea of energy production over the course of year.

Because it's an immature industry, ocean power is more expensive than other renewables. In the coming years, the costs are projected to go down to about the range of wind and solar today, according to Greentech Media. "But the fact that you know when the generator is going to spin gives you a lot more value," Englander said.

Wind circa 1980?
Many people consider ocean energy to be roughly at the same stage that wind power was at in early 1980s: there were a number of competing turbine and blade designs, and the cost of wind power was far higher than it is now.

As the number of ocean generator types consolidates and components become standardized--as has happened in wind power--the costs of ocean power devices should go down.

The visible portion of an underwater turbine that captures tidal energy in Port MacKenzie Inlet in Alaska.

(Credit: Ocean Renewable Power)

There has been about $500 million invested in ocean power since 2001, mostly in the form of government research and some venture capital, according to Greentech Media. That's tiny compared to wind or solar; several solar start-ups have individually raised more than that in the past year.

The report's authors predict that venture capitalists will be investing in ocean power as they seek new green-technology areas.

Big energy companies have dabbled in ocean power as well. General Electric purchased a stake in Pelamis Wave Power, while Chevron and Shell have invested in ocean companies through their venture capital arms, Englander said.

One positive sign is that ocean power appears to be developing quicker than wind, said John Cote, a vice president at General Electric's financial services arm.

"The wind industry, their Valley of Death (from product prototype to commercialization) was much longer," Cote said. "The development of standards is happening much quicker in the marine industry."

Tough sailing
But despite the optimism, life on the water is tough, according to executives at ocean power companies.

With almost no infrastructure around the industry, companies need to build a lot of their own equipment. To install and test devices, they have to hire expensive vessels, typically used for offshore drilling.

Ocean Renewable Power is testing two of its horizontal turbine design tidal machines in Maine and Alaska. It's working on a new design that uses composite materials instead of steel, which it hopes to finish by the end of year and test extensively next year.

While working in freezing temperatures and 30-mile-per-hour winds in the Bay of Fundy off the Maine coast, it found that "everything that can go wrong, will go wrong," said Ocean Renewable Power CEO Chris Sauer.

Most of the failures were related to weather and marine conditions and equipment problems. "As a start-up, we have to make our own instrumentation systems put together on the cheap," he said.

Wavebob's wave-power machine. Bobbing devices that convert wave motion to electricity are one of the most common designs.

(Credit: Wavebob)

New York City's East River, meanwhile, is the test site for another tidal power installation being led Verdant Power, which makes underwater turbines that get energy from changing currents.

In the space of three weeks, all six turbines being tested failed the same way--a mechanical problem in the connections point between the blade and hubs, said Ronald Smith, Verdant Power's CEO.

But the biggest hurdles with the project has been environmental concerns, he said

Regulators want to make sure that fish, or other marine life, will not be killed in the blades. The company has equipped its devices with acoustic and other sonar devices to gather data for regulators, Smith said.

Another big potential cost for ocean power devices is operations and maintenance. Simply getting vessels--and staff--to service machines can be expensive, making the "survivability" of ocean energy gear a top priority.

Executives at the panel predicted that ocean power installations in the future will be several units, rather than one large device. For example, Ocean Renewable Power's 250-kilowatt modules can be stacked on top of them other, so if one machine fails, the entire operation isn't taken offline.

Even relatively successful companies--like Wavebob, which is set to build a 250-megawatt ocean power installation in Ireland--are doing software simulations, environmental reviews, and additional engineering to increase the odds of success.

"We're stopping on the edge of commercialization and taking two steps backward," Derek Robertson, the general manager of the company's North American business. "We're investing in detailed operations and systems engineering process to retire risk."

The massive U.S. financial bailout plan, signed into law Friday afternoon, renews existing tax credits for renewable energy and includes rebates for plug-in hybrid drivers.

Representatives from the wind and solar industries have lobbied for months to extend the credits to ensure continued growth. Without the supports in place, they warned business would stall, resulting in thousands of lost jobs.

In addition to the renewable energy "extenders," the law boosts subsidies to invest in non-conventional fossil fuels--so-called dirty fuels, such as making liquid fuel from coal or sand and rock. Also included are breaks to develop technologies to burn coal more cleanly and to sequester carbon dioxide emissions from coal plants underground.

Important to the clean-tech industry is $800 million in available bonds for renewable energy generation facilities from renewable sources, such as biomass and geothermal.

The biggest impact in renewable energy will be in solar, for both residential customers and larger businesses. For solar, the law:

• Extends for eight years the 30 percent tax credit for solar residential and commercial solar installations.

• Eliminates the $2,000 cap on that tax credit for solar electric panels installed after the end of this year.

• Allows utilities to benefit from these tax credits.

These changes make solar a far more attractive investment, particularly for consumers in states with good sun and supportive state policies.

Research firm New Energy Finance, in a note to clients on Saturday, said that the payback time for a typical solar panel installation will go from from 10 years to 7 years in California and from 15 years to 12 years in Florida.

Wind industry subsidies, called a production tax credit, were extended for one year, a policy which doesn't disrupt ongoing wind projects but falls short of the long-term footing the industry was seeking.

New Energy Finance called the wind power extension a "good patch" but not enough to spur manufacturers to expand capacity.

The existing production tax credit for large-scale geothermal and biomass projects were extended for two years.

For small wind turbines under 100 kilowatts, the federal government will now give a tax credit of up to $4,000 for the next eight years.

Residential geothermal heat pumps have a $2,000 tax credit. And credits for marine power systems were extended eight years as well.

In a statement, Rhone Resch, the president of the Solar Energy Industry Association (SEIA), said that "this bill is a major step in our long journey toward energy independence and ensures that solar energy will be a significant part of America's energy future."

He said that by 2016, solar energy will be the least expensive source of electricity for consumers.

"By passing this bill, Congress has finally given the solar energy industry 'policy certainty' that will attract investment, expand manufacturing, and lower the cost of solar energy to consumers," Roger Efird, SEIA chairman and president of Suntech America, said in a statement.

Similarly, the American Wind Energy Association on Friday put out a statement lauding politicians for maintaining a policy in place. Previous, renewable energy tax credits have lapsed and delayed growth of the industry.

Transportation and efficiency
The law will give drivers of plug-in hybrid vehicles a tax credit between $2,500 and $7,500, depending on the capacity of the battery. Larger vehicles, such as trucks, have larger credits.

"The new tax credits for plug-in cars are higher than either presidential candidate has proposed. Now automakers and car buyers will no longer see higher up-front costs as a showstopper," Felix Kramer, founder, the California Cars Initiative, said in a statement. "And with this legislation, we'll also get more wind and solar energy that will make plug-in cars drive cleaner every year they're on the road."

Also in the fuels arena, the law extends the alternative fuels tax credits and extends for one year the existing $1 per gallon credit for biodiesel and renewable diesel production. That's good news for biodiesel producers, some of which are struggling because of rising feedstock prices.

Energy efficiency gets a nod as well with measures, such as rebates for appliances and bonds available to building operators that decrease building energy usage by 20 percent.

"Overall, the legislation's passage represents good news for clean energy projects and firms which, like the rest of the economy, rely on access to capital from banks and other financial institutions," New Energy Finance said in its note.

Updated on October 4 6:30 a.m. PDT with more details and analyst comments.

Hopes for renewable energy may not be a pipe dream after all.

After nearly a year of squabbling, the U.S. Senate voted Tuesday to extend solar tax credits for the next eight years and also remove the $2,000 cap on residential projects.

(Credit: CNET News)

What with all the political bickering, I was betting this wouldn't ever get done before the November elections. But the hired help in Washington provided a pleasant surprise for a change. The bill, which includes an allowance for utilities to make use of the commercial credit, now goes to the House of Representatives for approval before everyone clears out of town next week. The current tax credit was set to expire at year's end.

Doubtless there will be some ready to dun the agreement as yet another handout to an interest group. On the surface, that's true. But after the government's recent series of bailouts including--drum roll, please--Bear Stearns, Freddie Mac, Fannie Mae, AIG, and the $700 billion or so the Treasury Department wants to buy illiquid mortgage-linked securities--this one should mollify the critics, according to Barry Cinnamon, CEO of Akeena Solar.

"I don't think anybody is going to look at $17 billion over 10 years going to renewable energy as a handout when you put it in the perspective of $1 trillion going to failed banks in a one-year period," said Cinnamon. He added that while he did hear the handout argument a couple of years ago, he's not encountering that line of argument, what with crude oil prices hovering north of $100 a barrel.

Cinnamon and other solar industry executives have argued that the industry is still too young and too fragile to be weaned off the investment tax credit (ITC) just yet. Solar energy lobbyists released a study by Navigant Consulting claiming that 440,000 permanent jobs and $232 billion in investment would be supported by 2016 with an eight-year extension of the ITC.

However, that argument wasn't persuading enough Senators to pledge their support to the investment tax extension. In fact, when Congress passed the 2007 energy bill, the solar industry got shut out. The ongoing debate had a lot to do with accounting. While Democrats wanted to pay for them by taking away tax credits from the oil industry, the Republicans held firm.

A couple of recent developments helped break the logjam. One was the willingness of congressional Democrats to go along with an offshore-drilling proposal. The other was a statement from the White House that it would not oppose extending the tax credits.

"The great thing about this bill is that it's going to allow people throughout the country to benefit," said Cinnamon. "It will be as much for people in Peoria as it will be for people living in Pleasanton."

The GSMA, a trade group representing more than 750 GSM mobile operators across 218 countries, has launched a plan to help mobile operators in developing markets go green.

The organization announced Thursday the Green Power for Mobile initiative, which will help the industry use renewable energy sources, such as solar, wind, and biofuels to power 118,000 new and existing mobile base stations in developing countries by 2012. The initiative is backed by 25 mobile operators and will provide expertise and guidelines for operators deploying low-energy base stations or base stations that use renewable energy.

The vast majority of mobile base stations in rural areas that are not powered by the regular electrical grid are powered by generators that use diesel fuel. If the GSMA can achieve its goal of powering 118,000 base stations with renewable fuel, the program will save up to 2.5 billion liters of diesel fuel per year and cut carbon emissions by 6.3 million tonnnes, the group said in its press release.

A comprehensive study conducted by the GSMA found that only 1,500 base stations worldwide are powered by renewable energy today. The group blames expensive equipment and lack of expertise for such low penetration. But as fuel prices rise, mobile operators will turn to greener technologies. In fact, the GSMA's research suggests that operators who go green could recoup their costs in about 24 months.

The GSMA has already been working with a few companies on renewable base station projects. For example, it's working with Digicel to use wind and solar energy to power 17 new base stations on the Pacific island of Vanuatu. It also worked with Ericsson to help Idea Cellular use waste cooking oil to help power more than 350 base stations in parts of India. The base stations run on a blend made up of 80 percent diesel fuel and 20 percent waste cooking oil.

Southern California Edison is leading the way as utilities become the solar industry's largest customers, according to a report Wednesday by the Solar Electric Power Association, whose members include solar tech companies and more than 300 utilities.

The utility is ahead of its counterparts in both overall solar energy capacity per megawatt and per customer, the study found (PDF). Further north, Pacific Gas & Electric is in front in terms of overall solar capacity and megawatts per customer.

The nonprofit solar association compiled the rankings from data collected from 50 utilities this spring. It projected growth in U.S. solar electricity, particularly photovoltaics, to expand to 600 megawatts in 2012 from 150 megawatts last year.

Southern California Edison came out on top largely due to its interest in large, concentrating solar thermal projects, such as a 245-megawatt agreement with eSolar. And it's working to build 250 megawatts of solar panels across 65 million square feet of rooftops.

eSolar is among the companies working on large-scale installations with Southern California Edison.

(Credit: eSolar)

However, concentrating solar thermal projects under way by other electricity providers could dethrone the Southern California utility from its top spot, the report predicted.

Golden State utilities may be the earliest solar adopters, but others in the West, Midwest and Mid-Atlantic regions are also increasingly embracing renewables, according to the study.

In its forecast, 4,600 megawatts of concentrating solar systems will be planned nationwide within the next eight years, at least 600 megawatts of which won't come from sprawling solar farms.

For instance, initiatives to encourage solar adoption by homeowners and businesses are coming from Duke Energy, Long Island Power Authority, San Diego Gas & Electric, and Southern California Edison.

State renewable energy portfolio standards will help to advance adoption of big solar installations, but progress will stall if federal tax credits, which are set to expire at the end of the year, aren't extended, said the report's author, Mike Taylor, in a conference call.

"We're hitting some new momentum with new business models, but this tax credit uncertainty is potentially holding things back and creating some friction in the system," added Taylor, the association's research director. "A lot of utilities are waiting in the wings to see what's happening. Some are jumping ahead of the game because they want to be the first movers."

By his group's estimation, other states making inroads with solar power include Arizona, Colorado, Hawaii, Illinois, Nevada, New Jersey, New York, Texas, Washington, and Wisconsin.

The West may be the best place for utility-scale solar now, but other regions are catching up, according to the report.

(Credit: Solar Electric Power Association)