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Congress Is on the Verge of Passing Multi-Year Extensions for Solar and Wind Tax Credits

Lawmakers reached a compromise as part of a spending package. Will there be enough votes to pass it this week?

by Stephen Lacey
December 16, 2015
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House Republicans unveiled legislation late Tuesday night that included multi-year extensions of tax credits for solar and wind.

The credit extensions were attached to a broad set of spending measures as part of a negotiation with Democrats over lifting the ban on exports of U.S. crude oil.

Rhone Resch, president of the Solar Energy Industries Association, predicted in November that solar tax credits would likely be added to any deal around lifting the oil export ban. He called it “our best opportunity.”

“Democrats are saying, ‘We need to get something for it,’ and the White House is chiming in too,” said Resch.

This month, Republicans demanded an end to the 40-year-old ban as part of a legislative tax and spending package that would fund the government through next fall.

Although many Democrats oppose ending the ban, they saw it as an opportunity to demand extensions of the Investment Tax Credit (ITC) for solar and the Production Tax Credit (PTC) for wind.

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Yesterday afternoon, Democratic leaders said they would only support the Republican proposal if renewable energy credits were added to a tax or spending bill.

“We have 2 paths: 1. Pair oil export ban with policies to reduce carbon emissions; 2. Pass gov’t funding without oil/renewables,” tweeted Senator Harry Reid yesterday afternoon.

In 1975, Congress made it illegal for domestic drillers to ship crude out of the country. The export ban was designed to protect America from volatile oil prices in the wake of the Arab Oil Embargo. As U.S. production dwindled over the proceeding years, the policy was not contested.

Today, America is a leading producer of crude — and drillers argue they should be able to export oil as an incentive to expand production.

Some see the tradeoff as a good deal.

“An oil-exports-for-renewables-tax-credits deal looks likely to be a win-win. Removing the oil export ban is good policy. Supporting zero-carbon energy innovation, including through appropriate deployment subsidies, is good policy,” wrote Michael Levi, a senior fellow at the Council on Foreign Relations, in a recent analysis of the deal.

Last night, House Speaker Paul Ryan unveiled an omnibus spending bill that would lift the ban, while also extending solar and wind tax credits for two years.

The PTC — a 10-year, 2.3-cent per kilowatt-hour credit — would be extended through 2020. After December of 2016, the credit would be cut each year until it fully expired in 2020.

The ITC — a 30 percent credit for utility, commercial and rooftop solar installations — would get phased down through 2022. The credit would stay at 30 percent through 2019, and then fall to 26 percent in 2020. It would drop to 22 percent in 2021 and 10 percent in 2022. The bill also offers a commence-construction clause that would extend the credit to any project in development before 2024.

“The extension to the federal ITC is without question a game-changer for U.S. solar’s growth trajectory. Between now and 2020, the U.S. solar market is poised to see a number of new geographies open up with a 30% ITC, within both distributed and utility-scale solar,” said Cory Honeyman, a senior solar analyst at GTM Research.

The House and Senate will likely vote on the package Thursday night or Friday morning.

Although Democrats have signaled their willingness to support the deal, House Speaker Nancy Pelosi told Bloomberg that broad agreement wasn’t guaranteed — even with strong extensions of renewable energy credits.

Opponents see lifting the ban as a massive subsidy to oil producers and an environmental risk. In an op-ed this week, climate activist Bill McKibben explained why so many progressive environmentalists opposed a change to the law.

“What makes the plan to lift the ban especially galling is that the administration and congressional Democrats insist they’re getting a reasonable deal because the Republicans will concede tax breaks for solar and wind producers in return. But the logic of the Paris accords — with their theoretical commitment to a world that will warm just 1.5 or 2 degrees — means that we don’t get to keep making this kind of tradeoff,” wrote McKibben.

Speaker Ryan assured reporters that he would get the votes to pass the package.

“I am not going to predict how the vote count will go down,” Ryan said this morning during a press event. “Look, in negotiations like this, you win some, you lose some. Democrats won some, they lost some, we won some, we lost some. At the end of the day, we are going to get this done.”

ITC Cliff

The potential loss of solar capacity is about equal to the total amount currently installed

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What will happen if the federal investment tax credit (ITC) so many solar developers depend on isn’t extended?

“If the investment tax credit is not extended, we see it as a disruption, not a death for the industry,” said Maddy Yozwiak, U.S. Power and RECs analyst  and co-author of the recently-released report, “How extending the investment tax credit would affect US solar build,” from Bloomberg New Energy Finance (BNEF).

“It will be a disruption that will take years to recover from, but the recovery is there. Long-term costs continue to improve,” Yozwiak added. “That doesn’t go away, even without the ITC.”

For now, the ITC is a 30% tax credit, but that is slated to change at the end of 2016, when it would drop to 10% for business investments in solar, and nothing for residential solar projects.

With that policy change, BNEF calculated that  the US can expect about 73 GW of solar PV to come online by year-end 2022. Build rates will fall from “an average of 8 GW per year from 2014-16 to 6 GW per year from 2017-22.”

The solar industry is lobbying hard for a five-year extension of the 30% business and personal ITC. If congress puts it in place by mid-2016, that would boost average build rates to about 10 GW per year from 2017-2022, the analysis concluded, amounting to an installed capacity of over 95 GW.

Given the success of the ITC and the value of solar, Yozwiak said, the real question “is whether it is worth causing the change after 2016, and havingdisruption at the scale we forecast it.”

Standard Solar CEO Tony Clifford agreed.

“There are going to be changes in 2017, likely very dramatic changes,”  Clifford said. “But we shouldn’t spend time arguing about how big this cliff will be. We should be working to make sure we don’t go over it.”

Solar facility that could power 500 Marin homes

By Janis Mara, Marin IJ

20140621__MIJ-SOLAR-0622~1

 

 

 

 

 

 

 

 

 

Roy Phillips, president of REP Energy, leads a tour of an abandoned quarry on June 9 in Novato. His company, REP Energy, wants to build a solar energy facility at the site near the McIsaac Dairy west of Novato. The quarry, no longer in use, was mined for the mineral serpentine, a source of asbestos. (Frankie Frost — Marin Independent Journal)

A proposed solar facility just outside Novato that could generate enough electricity to power more than 500 Marin homes is up for approval at the Marin Planning Commission meeting Monday.

Located on the isolated grounds of a former rock quarry, the solar farm would have 4,272 solar panels up to 6 and a half feet high on 11.5 acres of the 952-acre quarry. The $6 million project would generate 1.98 megawatts of electricity, delivered to Marin Clean Energy via nearby power lines.

The quarry was once mined for serpentine rock, which contains asbestos. Quarry operations shut down in 1990.

Installations like the solar project “are a good way to use formerly disturbed locations” like the quarry, said Andrew Campbell, the executive director of the Energy Institute at Haas, a research and teaching facility at the University of California at Berkeley.

Campbell said the proposed location also was beneficial because it is close to the people who would use the energy.

“Having the generation close to an area where consumers are also has benefits, since some power is lost when it is transmitted over long distances,” the executive director said.

The site is west of the city of Novato, east of Stafford Lake and about a mile north of Novato Boulevard. It is not visible from the road. County staff has recommended that the permit be granted, with some qualifications.

Crawford Cooley and Beverly Potter, who own the former quarry, would lease the land to San Rafael-based Danlin Solar, along with San Rafael-based REP Energy. Those two companies would own and build the solar installation.

“That’s a pretty typical arrangement,” Campbell said.

“Solar is a green energy source, no doubt about it. There is no pollution or greenhouse gas emitted at the place where you are generating the power,” the executive director said.

“This would be quite a win if it happened. The people who are very concerned about seeing beautiful agricultural land taken up with solar panels have a valid point. You’d hate to lose a lot of natural Marin. That makes this an ideal project because it’s sitting in an abandoned quarry essentially on bare rock,” said Bob Spofford, vice president of Sustainable San Rafael.

“Solar is in some ways the most ideal of all alternative energy because it doesn’t make noise, it doesn’t pollute, it produces power close to the time when it’s most needed, and it does not harm wildlife,” said Spofford.

Addressing Spofford’s last point, “Photovoltaic panels definitely do not kill birds,” said Michael D. McGehee, a Stanford University associate professor and a senior fellow at the university’s Precourt Institute for Energy. McGehee teaches classes on solar cells. Wind turbines such as the ones at Altamont do pose a danger to avian life, perhaps causing some to confuse the effects of this alternative energy source with those of solar, McGehee said.

No letters of opposition to the project had been received by the staff by Friday.

The state Office of Mines Reclamation and the Department of Public works oversaw the reclamation of the land since the 1990s, according to the county staff report. The project is exempt from the California Environmental Quality Act because it will not cause environmental impacts, the staff report said.

“My job is to work with clients to help them avoid environmental impacts,” said Dana Riggs, a project biologist with San Rafael-based WRA Environmental Consultants. “We planned it (the project) in a manner to avoid impacts on sensitive resources including species and habitat,” Riggs said.

If the permit is granted, construction could begin as early as mid-August and wrap up by November, according to Frank Gobar of Danlin Solar.

California Feed-in Tariff for Poor Communities Passes Assembly

May 31, 2012

By Paul Gipe

A bill to create feed-in tariffs for the poor and the disadvantaged passed the California Assembly on 30 May 2012.

The “Solar for All” bill, AB 1990, passed the House by a vote of 49 to 27 and was reported to the Senate.

The move is the first significant action on feed-in tariffs in California during this legislative session. It is also the first time in North America that advocates for the poor and disadvantaged have called for equal opportunity to develop renewable energy through the use of feed-in tariffs.

Introduced by Paul Fong (D-Cupertino), the bill would create feed-in tariffs for 375 MW of small-scale renewable generation that would be specifically designed for disadvantaged communities.

The bill is sponsored by the California Environmental Justice Alliance (CEJA).

CEJA’s bill has received support from some 70 non-governmental organizations that includes a who’s who of the California environmental and social justice community, including Sierra Club California, Union of Concerned Scientists, Natural Resources Defense Council, Asian Pacific Environmental Network (APEN), and Environment California.

Though CEJA dubs the legislation “Solar for All”, the bill itself calls for “clean energy contracts” from all “eligible renewable energy resources” in California.

  • Project size cap: 500 kW
  • Program cap: 375 MW by 2020 at a “regular annual pace”
  • Term: minimum of 20 years
  • Program launch: 2014
  • Tariffs: “sufficient to stimulate the market” in low-income communities, create a diverse range of project sizes and achieve the environmental justice objectives
  • Reporting: annual
  • Administration and Rate Setting: Public Utility Commission (PUC) & local public utilities
  • Cost recovery: ratepayers
  • Cost cap: 0.375% of forecast retails sales in 2020
  • “Eligible” Technologies: Solar Thermal Electric, Photovoltaics, Landfill Gas, Wind, Biomass, Geothermal Electric, Municipal Solid Waste, Energy Storage, Anaerobic Digestion, Small Hydroelectric, Tidal Energy, Wave Energy, Ocean Thermal, Biodiesel, Fuel Cells using Renewable Fuels

It is not clear whether AB 1990 directs the PUC to set tariffs in two bands for those living in disadvantaged communities who can use federal tax subsidies and those who cannot. The bill only notes that the PUC is to take this into account during its deliberations.

AB 1990 contains a potentially onerous provision requiring that each renewable generator be “inspected” by a licensed contractor every two years.

Though utilities are obligated to provide “expedited interconnection,” they are exempted from the act’s requirements if they claim the grid is “inadequate”, that the generator doesn’t meet the utility’s interconnection requirement, or that the “aggregate of all small-scale renewable generating facilities on a distribution circuit would adversely impact utility operation and load restoration efforts of the distribution system”

Despite these limitations, the introduction alone of AB 1990 by CEJA should put to rest concerns that feed-in tariffs are a regressive form of taxation that penalize the poor. Rather, environmental justice organizers see feed-in tariffs as a more equitable policy tool than existing California programs for developing renewable energy.

CEJA: Solar for All Passes Assembly

AB 1990 Bill Status

AB 1990 Bill History

AB 1990

California Watch: Solar rooftops sought in poor communities

What’s New on Feed-in Tariffs

  • California Feed-in Tariff for Poor Communities Passes Assembly–A bill to create feed-in tariffs for the poor and the disadvantaged passed the California Assembly on 30 May 2012. The “Solar for All” bill, AB 1990, passed the House by a vote of 49 to 27 and was reported to the Senate. . .
  • Canadian Auto Workers: WTO Called Upon to Dismiss Japan, EU Challenge to Ontario Renewable Energy Policy–Canadian NGOs and labour unions, including the CAW, have sent an amicus curiae submission to the World Trade Organization (WTO) prior to a May 15 hearing into Japan’s and the European Union’s joint attack on the Ontario Green Energy Act. . .
  • Japan Times: Leveling the field for renewables–The government has drawn up a design for Japan’s feed-in tariff system to promote the generation of electricity through renewable energy sources. In a nutshell, it has decided the prices at which the nation’s major power companies buy such electricity and the duration of contracts. In principle they must buy all such energy. It is hoped that this system, expected to take effect in July, will help expand the generation and use of renewable energy, and accelerate advances in related technologies. Electricity fees may rise. The government should fully explain the need for the system and how it will work. . .
  • Karl-Friedrich Lenz’s analysis of Japan’s Feed-in Tariffs–The second fundamental flaw is the fact that the proposal doesn’t distinguish between onshore and offshore wind. That difference has a rather large influence on cost. Therefore, German law pays 8.93 cents for onshore and 15 cents for offshore wind. . .
  • Chronicle Herald: Nova Scotia Plans to Tap into Tidal Energy with FITs–Energy Minister Charlie Parker said his department will ask the province’s Utility and Review Board later this year to begin the process of setting a rate, or feed-in tariff, for the companies working on development projects in the Bay of Fundy. . .
  • Anglican Diocese of Oxford: Solar Feed-in Tariff put on a “predictable, certain and sustainable footing”–Churches exploring solar pv should note that buildings with an Energy Performance Certificate rating of less than D will get a reduced tariff rate. Calls have previously been made to examine possible exemptions from this and the national Church of England Shrinking the Footprint campaign has been responding to the consultation and having discussions with DECC with particular emphasis on the issues for churches in achieving an A – D rated Energy Performance Certificate. It is, however, possible to wire panels on one building into another which is easier to upgrade e.g panels on a church roof wired into a church hall. . .
  • Malaysian Reserve: RE industry may see change in feed-in-tariff, says SEDA–The Sustainable Energy Development Authority (SEDA) is looking at adjusting the feed-in-tariff (FiT) for renewable energy (RE) before it calls for the next round of quote in July/ August 2012 as there is an imbalance in the RE resource mix. At a recent talk on renewable energy updates, SEDA chief executive officer Badriyah Abdul Malek highlighted that almost half of the installed capacity for RE being generated, since the beginning of the FiT on Dec 1, 2011, was using solar energy which could be a “wrong signal” for the market. . .
  • Vermont Ups Feed-in Tariff Program Cap Slightly–Vermont’s Democratic Governor Peter Shumlin signed a bill into law 18 May 2012 that slightly increases the cap on the state’s Standard Offer Contract program. Senate Bill 214 extends the small existing 50 MW program by a modest amount. . .
  • Saudi Arabia Launches Massive Renewable Program with Hybrid FITs–While North America continues to dawdle on the road to the renewable revolution, the conservative, oil-rich Kingdom of Saudi Arabia has proposed one of the most sweeping and massive moves to renewable energy on the planet. . .

Nuclear Power, Japan, Feed-in Tariffs, and the Rapid Development of Renewables

  • Andrew Dewit: A Crossroads for Japan: Revive Nuclear or Go Green?–May 5 marked the shutdown of the last of Japan’s 50 viable nuclear reactors, with poor prospects for any restarts before the summer. The central government, the nuclear industry, most big business associations, and many international observers seem convinced that this will invite chaos through escalating fossil fuel costs and the risk of blackouts. But polls suggest a growing segment of the Japanese population see things differently. . .
  • Mainichi: Atomic Energy panel members call for independent probe into secret meetings–Some members of a Japan Atomic Energy Commission (JAEC) panel working out new nuclear energy policy have called for a third-party probe into revelations that business operators in favor of the nuclear fuel cycle project were invited to secret meetings before an assessment was altered to help promote the project. . .
  • Guardian: Only renewables – not nuclear – could be too cheap to meter–Germany’s long support for wind and solar energy is delivering zero-cost electricity at times. In contrast, the UK’s new energy policy seeks to underwrite the rising cost of nuclear. . .

 

What’s New on Solar Energy

 

What’s New on Community Power

  • Renewable Energy Tour to Germany & the World Wind Energy Conference 2012–The Ontario Sustainable Energy Association is leading a tour to renewable energy sites in Germany June 30 to July 8 including participation in the World Wind Energy Association Conference in Bonn, and visits to a biogas plant, a wind turbine manufacture, community-owned wind turbines, a leading research institute on grid integration, and a solar power plant. . .
  • Aaron Bartley: Community Power vs. the Kochs–In Germany, where the stranglehold of corporate energy has been loosened, renewables now comprise 20 percent, of national energy production, thanks to national policies such as feed-in tariffs which guarantee a stable price for power produced by wind, solar and geothermal systems. More than half of German energy is now produced in decentralized sites like homes, farms and community co-ops. This trend toward distributed generation conflicts directly with the corporate energy paradigm of centralized control. The German model shows that national policies can have a transformative impact that both increases overall renewable energy production while placing ownership in the hands of farmers, small businesses and homeowners. . .
  • Mount Alexander Community Wind–Mount Alexander Community Wind is a community driven project seeking to establish a locally owned and operated wind plant to supply a significant portion of the energy needs of our Shire. Clean renewable energy will be generated to replace energy derived from burning non-renewable coal. . .

 

What’s New on Wind Energy


This feed-in tariff news update is sponsored by the , An Environmental Trust, and the David Blittersdorf Family Foundation in cooperation with the Institute for Local Self-Reliance. The views expressed are those of Paul Gipe and are not necessarily those of the sponsors.



JCM Capital Launches $10,000,000 Solar Development Capital Fund for FIT Projects in Ontario, Canada

TORONTO, Apr 24, 2012 (BUSINESS WIRE) — JCM Capital (JCM) announced today that they have launched a $10 million solar development capital fund that will invest in early-stage photovoltaic (PV) projects installed on large commercial and industrial buildings across Ontario, leveraging the Province’s Feed-in-Tariff (FIT) program. The aim of the fund is to target application-ready projects to be submitted into the upcoming Ontario Power Authority’s (OPA) application window, and as such, assist with early-stage development costs such as FIT application fees, structural engineering assessments, FIT security deposits and grid connection impact assessment (CIA) costs. The fund will also invest in Ontario-based FIT contracted projects that have not yet reached commercial operation.

CEO of JCM, Christian Wray stated that despite the recent changes to the Province’s Green Energy Program, the fund will ensure that necessary capital is available for quality projects that meet the requirements of the revised FIT 2.0 program. “JCM has and will continue to support the small to mid-size solar market in Ontario with the belief that our investment in distributed solar power generation will provide the maximum benefit to all stakeholders. The fund creates a unique solution for local PV development companies that have few options when funding early-stage projects that require significant risk capital.” Wray also noted that JCM has a strong track record in working with solar developers in Ontario and looks forward to partnering with and supporting other experienced developers as the program continues.

To date JCM has successfully deployed over $5 million of development capital, enabling the advancement of an initial 20MW commercial rooftop solar portfolio. When completed, the aggregate construction costs of this initial portfolio will exceed $80 million and will offset approximately 20,000 tons of harmful C02 from being released into the earth’s atmosphere – the equivalent of planting 2 million trees or removing 60,000 cars from the road.

The fund will also help create further jobs in accordance with the Province’s Green Energy Act initiative.

For more information, please visit www.jcmcapital.ca

About JCM Capital (JCM)

JCM Capital is a financial advisory company that focuses primarily on financing and the co-development of solar energy projects in Ontario, Canada. The Company provides commercial solar energy developers early-stage development capital and/or equity financing solutions for ‘construction-ready’ and operational solar projects while offering strategic and project management support. Current portfolios include rooftop and ground-mounted projects spanning from Southwestern to Eastern Ontario. The Company is looking to expand it’s reach through the cultivation of new partnerships and associations.

SOURCE: JCM Capital

Defense Department releases energy conservation roadmap

By Lisa Daniel
American Forces Press Service

 

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Department of Defense Seal.
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WASHINGTON (3/12/12) – The Defense Department Friday released an implementation plan for cutting energy consumption in military operations

Officials released a strategy in June outlining the need for energy conservation in military operations. In the plan released, Defense Secretary Leon E. Panetta reiterates that the department must do its part to reduce U.S. fuel consumption not only to save money, but also to have less reliance on foreign oil and to improve security for U.S. forces who transport fuel into battle spaces.

“Energy security means a reliable, secure and affordable supply of energy for military missions, today and in the future,” the secretary said.

The implementation plan outlines a three-part strategy of reducing the demand for energy, securing diverse options beyond fossil fuels, and building energy security considerations into all military planning.

“This is a question of making sure the whole department is executing this strategy and using energy to support military operations better and interoperable and in a way that supports the whole department better,” said Sharon E. Burke, assistant secretary of defense for operational energy plans and programs.

The plan creates a Defense Operational Energy Board to oversee the department’s progress. Military services and DOD agencies are to report to the board on their energy consumption last year and projected consumption for the next five years, the plan says. The board will work with the services and agencies on actions needed to improve their consumption baselines.

The services have reported goals for:

  • The Army to have 16 “Net Zero” installations by 2020 and 25 by 2030 — installations that do not use more energy or water than they produce and reduce waste by recycling;
  • The Navy to reduce fuel consumption afloat by 15 percent by 2020;
  • The Air Force to increase aviation energy efficiency by 10 percent by 2020; and
  • The Marine Corps to increase energy efficiency on the battlefield by 50 percent by 2025, and, as a result, reduce daily fuel consumption per Marine by 50 percent in the same time.

The combatant commands will then report to the board on how they guide their forces to improve energy performance and efficiency, such as the ability to field fuel quickly and the use of alternative energy technologies.

The board is to develop department-wide energy performance metrics in consultation with the DOD components and based on consumption baselines.

The assistant secretary of defense for research and engineering is to assess the department’s gaps in energy science and technology and report recommendations to the board.

The plan also calls for:

  • Improving operational energy security at fixed installations;
  • Promoting the development of alternative fuels;
  • Incorporating energy security considerations into requirements and acquisitions; and
  • Adapting policy, doctrine, military education and combatant command activities to support reduced demand of energy.

“Even though the strategy and implementation plan is new,” Burke said, “the department has been making progress for some time in using less energy – more fight for less fuel. We haven’t been standing still on this.”

Soldiers and Marines have reduced their energy consumption in Afghanistan by using solar rechargeable batteries, solar microgrids, more efficient tents and better fixed shelters, Burke said.

Also, the Army is using generators at its forward operating bases that are 20 percent more efficient, and become even more efficient by being wired together. The Navy, too, has made good progress by incorporating energy considerations into its acquisitions process, she said.

Less demand for energy and more conservation lessen the risk to troops to transport fuel through battle zones, she said.

“When you’re focused on the fight, the most important thing is that the energy be there — and that’s how it should be,” Burke said. “But people also are beginning to understand there is a cost to using and moving that much fuel.”

Stateside, Fort Bliss, Texas, and Fort Carson, Colo., as well as the Oregon National Guard, are showing progress toward the Army’s Net Zero goal, the plan released today says.

“There’s a lot of good things going on, and a lot more needs to happen,” Burke said. The department’s energy conservation effort, she added, is both a challenge and an opportunity.

“Energy … shapes our missions, and we can shape it,” she said.
As part of the implementation plan, Panetta wrote that the rising global demand for energy, changing geopolitics and new threats will make the cost and availability of energy even less certain in the future.

“Energy security is an imperative – our economic well-being and international interests depend on it,” he said.

US military sets its sights on solar to sideline fossil fuels

By:  Cheryl Kaften

The U.S. Department of Defense (DOD) moved ahead this week with its plans to mete out “more fight for less fuel”. With support from the White House, the Pentagon intends to reduce reliance on fossil fuels by building next-generation combat vehicles, making energy storage safer and more effective, and increasing the deployment of renewable energy across America’s Armed Forces to three gigawatts (GW) by 2025.

US flag

The DOD is said to be making one of the largest commitments to clean energy in history.

Flickr/Jeff Kubina

“We haven’t been standing still on this,” commented Sharon E. Burke, assistant secretary of defense for Operational Energy Plans and Programs. Already, Burke said, the Army’s ground troops and the Marines have reduced their energy consumption at the tactical edge in Afghanistan by using solar rechargeable batteries, solar microgrids, more efficient tents, and better fixed shelters. The Navy also is incorporating energy considerations into its acquisitions process, she said.

Less demand for energy and more conservation reduce the risk to troops who transport fuel through battle zones, explained Burke. “When you’re focused on the fight, the most important thing is that the energy be there … But people also are beginning to understand there is a cost to using and moving that much fuel.”

Last June, DOD officials released a strategy outlining the need for energy conservation in military operations. The plan calls for a Defense Operational Energy Board to oversee the department’s progress. Military services and DOD agencies are to report to the board on their energy consumption during 2011 and on their projected consumption for the next five years, the plan says. The board will work with the services and agencies on actions needed to improve their consumption baselines.

Fast-forward to renewable energy

According to a statement from the White House on April 11, the DOD is making one of the largest commitments to clean energy in history, by developing a goal to deploy three GW of renewable energy, including solar, wind, biomass, and geothermal, on Army, Navy, and Air Force installations by 2025. That would be enough power to meet the needs of 750,000 homes.

According to White House Press Secretary Jay Carney, “This effort furthers the commitment President Obama made during the State of the Union (Address) to develop one gigawatt of renewable energy on Navy installations by 2020. The Air Force goal of obtaining 1 gigawatt by 2016 and the Army goal of obtaining 1 gigawatt by 2025 support the broader DOD goal to meet 25 percent of its energy needs with renewable energy by 2025.”

Together with emerging microgrid and storage technologies, reliable, local sources of renewable power will be used increase the energy security of U.S. military installations. To meet these goals at no additional cost to the taxpayer, DOD will leverage private sector financing through authorities such as power purchase agreements, enhanced use leasing, utility energy savings contracts, and energy savings performance contracts.

Testing new technologies

In brief, among the other energy conservation initiatives launched by the DOD and the White House this week are the following:

  • New lab for next-generation vehicles: On April 11, the Army opened a 30,000-square-foot research facility, called the Ground Systems Power and Energy Lab (GSPEL), at Detroit Arsenal that will develop cutting-edge energy technologies for the next generation of combat vehicles.
  • Green Warrior Convoy: As part of required road tests of technologies developed at the GSPEL, the Army will launch a Green Warrior Convoy of vehicles in 2013. The convoy—which will make stops at schools, community facilities, and military bases— will test and demonstrate the Army’s advanced vehicle power and technology including fuel cells, hybrid systems, battery technologies and alternative fuels.
  • Energy storage competition: Through its Advanced Research Projects Agency– Energy (ARPA-E), the Department of Energy will fund a $30 million research competition that will engage America’s brightest scientists, engineers, and entrepreneurs in improving the capability of energy storage devices, including batteries. ARPA-E’s new “Advanced Management and Protection of Energy-storage Devices” (AMPED) program will promote the development of next-generation energy storage sensing and control technologies, including enhancing the performance of hybrid energy storage modules being developed by the DOD for war-fighting equipment.
  • Biuofuel development: As part of his Blueprint for a Secure Energy Future, President Obama has challenged the Departments of Navy, Energy, and Agriculture to partner with private industry to accelerate the commercialization of drop-in biofuels for military and commercial use. The three departments have developed a plan to spur private industry and financiers to construct or retrofit multiple integrated biorefineries—capable of producing millions of gallons of fuel annually from domestic feedstocks at a competitive price.

Carney emphasized that the plans outlined this week in support of fossil fuel independence are part of the administration’s broader goals for the nation. “These new steps build on President Obama’s unwavering commitment to energy security for America’s warfighters, and to a sustained, comprehensive strategy to ensure a secure energy future for all Americans.”

Hanwha Solar opens North American R&D center

By:  Becky Stuart

Korea-based Hanwha Solar has opened a new R&D center in Santa Clara, California. The goal is to develop next generation photovoltaic concepts, with a focus on efficiency and low cost.

Hanwha Solar ribbon cutting Santa clara R&D Facility

The new facility will first focus on thin silicon substrates, in particular, increasing efficiencies.

Hanwha Solar

The company has invested $14 million in the new, 30,000 square foot facility, 60 percent of which has been devoted to lab space.

The facility has been “built with room for expansion in mind,” said Hanwha in a statement released. It added that Silicon Valley was chosen, due to its being an “epicenter” of clean R&D technology. A total of 30 people will be employed there, thus bringing its U.S. workforce to 77.

The first project will focus on thin silicon substrates, in particular, increasing efficiencies. Chris Eberspacher, chief technology officer, Hanwha Solar, will oversee the work. “The lab is engineering methods of applying a thinner layer of silicon, which will make the panel less expensive while not compromising effectiveness and energy efficiency,” explained the company.

Hee Cheul Kim, president of Hanwha Solar, commented, “It is critical for a global company like Hanwha Solar to have a strong presence in California, because it is the epicenter of clean technology R&D. The investment being made in solar is a reflection of the confidence the Hanwha Group has in clean energy as a long term growth engine.”

Overall, the company says it has invested $50 million in the U.S. over the past two years, through partnerships with businesses like OneRoof Energy, Crystal Solar, Solar Monkey and 1366 Technologies. “Hanwha Solar will continue to increase the company’s footprint in the region over the coming years, making additional investments and increasing employment,” continued the statement.

Developing technology

In related news, Hanwha, well-known for its solar and chemical operations, exhibited its solar technology for the first time at the International Green Energy Exhibition in Daegu, South Korea, this March. Hanwha TechM used the event to showcase its newly developed equipment, which includes wire saws and a module production line. Next year, the company will head to the U.S. and Europe to tout its products at such shows as the SPI and Intersolar.

Jun-Suk Byun, manager of the sales team for the machine tool division told pv magazine that the company is beginning to focus its efforts on the upstream business. While the equipment is still in the early phase of development – “a baby” – he is confident that mass production on the module line, of which there is currently one in operation, will be reached in the next two years. Furthermore, he states that the equipment is cheaper than the competitors’, like Centrotherm.

With regard to its wire saws, which use diamond wire technology, they are said to be helping to both lower costs, by around 15 percent, and increase quality. Jun-Suk Byun adds that diamond wire technology is better than slurry, for instance, as there are fewer associated environmental problems.

Although Hanwha TechM is currently working on the production technology in Korea, it does intend to establish a manufacturing base in China in the future.
He says that the company is also looking to develop its own string technology. In terms of its key sales markets, China is sitting at number one, followed by Taiwan.

Can Ontario require ‘domestic content’ for FIT eligibility?

By:  Cheryl Kaften

Just how important is “home advantage” to players in the renewable energy sector? It could be a game changer, according to Japan and the European Union, both of which have brought complaints against Canada for violating the rules of fair competition.

80MW Sarnia Solar photovoltaic thin film Ontario project

Nothing in the renewable energy industry has challenged the scale of the iPhone to date. However, Corning Glass represents proof positive that, yes, it matters where the components are manufactured.

First Solar

Specifically, Japan and the EU have protested to the World Trade Organization (WTO) in Geneva that the Canadian Province of Ontario is breaching international convention by stipulating that new solar and wind facilities must be built with a certain amount of domestically manufactured components. For example, solar arrays must be 60 percent “Made in Ontario” in order to participate in the province’s feed-in-tariff (FIT) scheme.

Both nations claim Ontario is discriminating against its global trade partners and giving preferential treatment to local providers. The two cases in all likelihood will lead to a landmark ruling on the legitimacy of “domestic content requirements” in international commerce.

To grasp the implications of insisting on largely domestic-made products, consider how much U.S. manufacturers would gain by the passage of a 60 percent domestic content regulation applying to the components of the Apple iPhone alone, which today is manufactured chiefly in China.

Since the launch of the iPhone in 2007, Corning Glass has manufactured the scratchproof face of the phone out of a factory in Kentucky. Not only has Corning created jobs and profits by becoming a domestic supplier to California-based Apple, but, after the iPhone became a success, Corning received a flood of orders from other companies hoping to imitate Apple’s designs. Its glass sales have grown to more than US$700 million annually, and it has employed about 1,000 Americans to support the emerging market.

Nothing in the renewable energy industry has challenged the scale of the iPhone to date. However, Corning Glass represents proof positive that, yes, it matters where the components are manufactured.

Imports on the outs?

Japan and the EU claim that Canada is in violation of three international trade agreements, because:

  • Ontario’s domestic content regulations accord “less favorable treatment to imported equipment” and are “being applied so as to afford protection to Ontario production of such equipment” (General Agreement on Tariffs and Trade [GATT]: Art. III:4, III:5, XXIII:1);
  • Ontario’s domestic content stipulations appear to be trade-related investment measures that are inconsistent with the provisions of Article III of the GATT 1994 (Trade-Related Investment Measures [TRIMs]: Art. 2.1); and
  • A subsidy had been granted … that would confer a benefit, “contingent [on] the use of domestic over imported goods” (Subsidies and Countervailing Measures: Art. 3.1(b), 3.2, 1.1).

Tensions – and world interest – ran high when the two nations faced off with Canada for oral arguments on March 27 and 28 in Geneva. The key issues to be considered: Was Canada liable to the world court for the independent actions of its province, Ontario?; Were the content requirements of the FIT Program a barrier to fair trade?; and Did Ontario discriminate in favor of domestic goods with subsidies designed to promote production in the province, rather than designed to advance the renewable energy industry?

Canada responded with a rationale that was geared to render all three questions moot. It characterized the FIT scheme as a form of “government procurement, designed to ensure the affordable generation of clean energy in Ontario” – and, by doing so, attempted to shield the FIT and its domestic content mandate from both the GATT and TRIMs provisions. (Government procurement is also exempt from the WTO Subsidies and Countervailing Measures agreement, provided that it does not confer a benefit.)

And although governmental purchases are covered under another WTO pact – the plurilateral Government Procurement Agreement – Canada argued that the GPA represents a purely national commitment. Therefore, Ontario was under no obligation to grant access to its energy procurement market.

However, Tokyo and Brussels insisted that the program provides a subsidy. “The defining aspect of FIT contracts is that they ensure renewable energy generators payments in excess of those that they would [otherwise] receive,” argued the Japanese Member, adding, “That excess is best confirmed by examining the difference between the FIT rates and HOEP [Hourly Ontario Energy Price], as HOEP represents the entire rate” on the open market.

Ottawa was quick to eliminate any associated wiggle room. The Canadian Member characterized the HOEP as “an inappropriate benchmark” and opined that “the focus of any benefit analysis must be on the recipients of the benefit – wind and solar energy producers – not consumers.”

Court of public opinion

Industry reaction to the WTO hearing has been mixed. David Robinson, president of Senergy Solar Corp., LLC, based in Haverton, Pennsylvania, supported Canada’s mandate for domestic content. He told pv magazine, “I wish that the U.S. government would impose the same sort of content requirements here. Then, we would have solar companies moving here, instead of up north to Canada.”

Stephen Morgan, CEO of American Clean Energy, a Saddle Brook, New Jersey-based firm that designs and builds photovolatic arrays, came out against the content requirements. He commented to pv magazine, “The use of content restrictions has nothing to do with promotion of environmentally sustainable energy; rather it is about … subsidizing job creation in a non-transparent manner through otherwise higher-than-necessary alternative energy costs.”

By contrast, Matthew Ayres, managing director of Sydney, Australia-based Growth and Innovation Asia-Pacific, advised a more measured approach, telling pv magazine, “A strong bias toward import may reduce the domestic capability base. A strong domestic focus may limit the use of new (international) technology and skills. So, we are left with a prudent balance that respects the domestic economy, the ability to build a sustainable domestic capability in renewable energy; then bringing the best skills and technology to the table in a way that expands the market in a structured and staged manner.”

Getting the proper FIT

There are now more than 35 FIT programs worldwide. Will this case have repercussions for any other feed-in tariffs currently in place?  That’s unlikely, unless they invoke a domestic content clause. Canada’s Province of Nova Scotia, for example, has its own FIT scheme, but has not been named in any complaint.

How the case plays out remains to be seen. By the end of April, the parties must submit written rebuttals to the panel, which will then schedule a second oral hearing. A ruling on the case is not expected until late October 2012.

Watch out for the May edition of pv magazine, which will discuss the issue in more detail.