GreenTech Opportunities Blog

Undermining the Critics of Wind Power

Thu, 02 Sep 2010 18:13:00 GMT

Undermining the Critics of Wind Power

"A slew of recent studies," energy writer Robert Bryce wrote in a recent Wall Street Journal essay, "show that wind-generated electricity likely won't result in any reduction in carbon emissions -- or that they'll be so small as to be almost meaningless."

Bryce said he believes nuclear energy and natural gas, not renewables, are the energies of the future because they are scalable and available 24/7. Economic studies and recent investment patterns demonstrate that new nuclear is much more costly than wind. The volatility of natural gas pricesmakes its value uncertain against wind's pre-contracted long-term price.

In the WSJ piece and in the interview, Bryce relied heavily on "How Less Became More; Wind, Power and Unintended Consequences in the Colorado Energy Market," a study carried out by Bentek Energy LLC that was funded by the Independent Petroleum Association of the Mountain States (IPAMS). But Xcel Energy, a major utility in Colorado that has launched 1,300 megawatts of wind and is planning 700 megawatts more in the next five years, completely dismissed the IPAMS study.

"Wind is not perfect," Frank Prager, Xcel's Environmental Policy Vice President, wrote in the Denver Post. "Wind turbines generate electricity only when wind blows," he went on, explaining how utilities manage wind's variability. "Generally, we prefer to ramp gas-fired plants. If we ramp coal-fired units, the plant's efficiency may decline, causing its emission rate to increase for short periods."

But, Prager wrote, the Bentek study "implies that small, short-term emission increases associated with ramping result in significant increases in the total emissions. This is simply wrong. Since 2007, we have added hundreds of megawatts of wind generation, and our overall emissions have declined."

GreenTech Opinion

Robert Bryce has been attracting considerable attention in the U.S. mainstream media with his attacks on the economics and effectiveness of wind power. However, as the above article makes clear, Mr. Bryce is twisting facts and choosing to focus on one or two clearly biased studies. Even the studies’ own authors (Dave Corbus at NREL in Denver, Colorado) refute Bryce: “But nobody that I know that understands the grid is going to say that it [wind] doesn't reduce emissions."

Read the full article at this link:

http://www.greentechmedia.com/articles/read/undermining-the-critics-of-wind-power

Why Conservatives Are Bad on Energy: It’s All About the Costs

Tue, 31 Aug 2010 22:35:00 GMT

Why Conservatives Are Bad on Energy: It’s All About the Costs

“[H]ere is what every freshman at the University of Chicago knows: There is a difference between cost and price. Solar relies on price supports from the government. Fair enough -- though its price is falling even faster than fossil fuel prices are rising.

But if Friedman were going to compare the costs of competing forms of energy, he also would have wanted to know the cost of "ordinary energy." This is something the self-proclaimed conservative opponents of solar refuse to do. But huge companies including Walmart, IBM, Target and Los Gatos Tomatoes have figured it out. And last year, so did the National Academy of Sciences. It produced a report on the Hidden Costs of Energy that documented how coal was making people sick to the tune of $63 billion a year.

And considering that oil and natural gas had so many tax breaks and subsidies that were so interwoven into their price structures for so long, it is hard to say exactly how many tens of billions these energy producers received courtesy of the U.S. Taxpayer. Just a few weeks ago, the International Energy Agency said that worldwide, fossil fuels receive $550 billion in subsidies a year -- 12 times what alternatives such as wind and solar get.”

GreenTech Opinion

An excellent and pointed article from Greentech Media. These arguments need to be made over and over and over until people really understand what the energy debate is all about. The author concludes: “When you compare the real costs of solar with the fully loaded real costs of coal and oil and natural gas and nuclear power -- apples to apples, solar is cheaper. That's not conservative. Or liberal. That comes from an ideology older and more reliable than both of those put together: Arithmetic.”

Click below to read the full article:

http://www.greentechmedia.com/articles/read/why-conservatives-are-bad-on-energy-its-all-about-the-costs

Fossil Fuel Subsidies Are 12 Times Support for Renewables, Study Shows

Wed, 04 Aug 2010 21:20:00 GMT

Fossil Fuel Subsidies Are 12 Times Support for Renewables, Study Shows

“Global subsidies for fossil fuels dwarf support given to renewable energy sources such as wind and solar power and biofuels, Bloomberg New Energy Finance said.

Governments last year gave $43 billion to $46 billion of support to renewable energy through tax credits, guaranteed electricity prices known as feed-in tariffs and alternative energy credits, the London-based research group said today in a statement. That compares with the $557 billion that the International Energy Agency last month said was spent to subsidize fossil fuels in 2008.”

GreenTech Opinion

After reports earlier this year on massive fossil fuel subsidies from organizations such as the International Monetary Fund, this Bloomberg report is simply confirmation of the challenges faced by renewable energy sources on world markets. When will developed and developing countries phase out these subsidies? The fact that they are actually discussing the issue is a start, but it’s time fossil fuel subsidies were cut completely.

Read the full article at this link:http://www.bloomberg.com/news/2010-07-29/fossil-fuel-subsidies-are-12-times-support-for-renewables-study-shows.html

U.S.: Solar PV now cheaper than nuclear energy, says new report

Fri, 30 Jul 2010 17:13:00 GMT

U.S.: Solar PV now cheaper than nuclear energy, says new report

“Electricity generated from new solar photovoltaics (PV) installations is now cheaper than electricity from proposed new nuclear plants, in what has been dubbed a historic crossover. This has prompted calls for Governor Perdue, the General Assembly, the Energy Policy Council and the N. C. Utilities Commission to "investigate these matters and see for themselves that a very important turning point has been reached". It also states: "... solar electricity is fully expected to be cost-competitive without subsidies within the decade."

“A new report, titled Solar and Nuclear Costs - The Historic Crossover, by the former chancellor of U.S.-based Duke University and emeritus chair of its economics department Dr. John O. Blackburn, and Sam Cunningham, a masters candidate at the university’s Nicholas School for the Environment, states that in the past year, the lines have crossed in North Carolina due to falling costs of solar PV systems and rising projected costs of new nuclear plants. "This new development has profound implications for North Carolina’s energy and economic future. Each and every stakeholder in North Carolina’s energy sector - citizens, elected officials, solar power installers and manufacturers, and electric utilities - should recognize this watershed moment."

GreenTech Opinion:

As Solar PV costs continue to drop, new conventional power plants will become more expensive to build than solar PV plants. As this report points out, new nuclear power plants are the first to be rendered uncompetitive by solar PV. We will likely reach a point in the coming decade where new natural gas and coal power plants are also made uncompetitive by solar PV. The question is: are the large electricity utilities ready to face up to economic reality and make the switch?

One last point about solar PV and nuclear, made earlier this year by the founder of US solar PV company Sunpower: "a small field crew can install power equivalent to a large nuke plant in the time it takes a nuke plant to get a permit"

Read the full article at the link below:

http://www.pv-magazine.com/news/details/beitrag/us--solar-pv-now-cheaper-than-nuclear-energy--says-new-report-_100000628/

China Becomes World's Biggest Energy Consumer

Wed, 28 Jul 2010 18:25:00 GMT

China Becomes World's Biggest Energy Consumer

“Powered by years of rapid economic growth, China is now the world's biggest energy consumer, knocking the U.S. off a perch it held for more than a century, according to new data from the International Energy Agency.

China devoured a total of 2,252 million tons of oil equivalent last year, or about 4% more than the U.S., which burned through 2,170 million tons of oil equivalent. The oil-equivalent metric represents all forms of energy consumed, including crude oil, nuclear, coal, natural gas and renewable sources such as hydropower.

The U.S. is still by far the biggest energy consumer per capita.”

GreenTech Opinion:

Three points need to be made about this milestone:

1) The U.S. is still the world’s number one consumer of oil, where it makes up 40% of total energy use. In China, coal absolutely trumps oil as the number one source of energy, with coal covering almost 80% of its energy needs (oil in China represents just under 20% of total energy use).

2) This leads to the related point: the reason for China’s massive coal consumption lies in the simple fact that the country has taken on the role as the world’s manufacturing centre. A full 33% of China’s energy requirements are taken up by the manufacturing of products for the consumers of the developed world, in Europe and North America. As Gregor Macdonald states: “China’s coal consumption is merely our own power consumption, offshored.”

3) Finally, China is responding to this by investing more in renewable energy development than any other country in the world in 2009. One of the companies we cover is involved in this development. If you’d like to learn more about this company, please contact us.

Read the full article here: http://online.wsj.com/article/SB10001424052748703720504575376712353150310.html?mod=djemalertNEWS

Al Korelin of the Korelin Economics Report Chats About Green Technologies With Peter Cox

Thu, 15 Jul 2010 20:30:00 GMT

Is It Energy's Turn Now?

Tue, 29 Jun 2010 17:08:00 GMT

Is it Energy's Turn Now - A blog about Energy and the Environment

“With the overhaul of financial regulation nearing completion, some Democrats are hoping that Congress can turn to the next big legislative challenge – energy and climate change. There is no consensus yet what such legislation should include, but there is strong determination on the part of the White House and Democratic leaders in Congress to try to move something – anything – before Congress leaves town in August.”

“President Obama hoped to give the matter a boost this week by calling a bipartisan group of senators to the White House for a pep talk, but he canceled at the last minute to deal with a crisis in his military leadership in Afghanistan. The president is now planning to host the energy meeting on Tuesday.”

“The House, as usual, is one step ahead of the Senate, having already passed a major climate change bill including a broad cap and trade program designed to reduce emissions of heat-trapping gases last spring.”

GreenTech Opinion: We mentioned the slow progress of a Senate Climate and Energy Bill in our April issue. Although events have conspired to slow the Bill’s process even further in the meantime, signs have emerged this past week that we may yet see some positive movement by the summer’s end. We’ll end with a quote from Senator Kerry, “we’re determined to bring a bill to the floor of the Senate that we think is reasonable, makes sense, and that will help Americans be able to grab a hold of the future and not leave it to China and India and Brazil and other countries that are moving much faster than we are.” Here’s hoping…

Read the full blog post here:

http://green.blogs.nytimes.com/2010/06/25/is-it-energys-turn-now/

Major Poll finds Strong Public Support for Global Warming Action

Fri, 25 Jun 2010 17:02:00 GMT

Major Poll finds Strong Public Support for Global Warming Action

“The latest Wall Street Journal-NBC Poll found overwhelming support for comprehensive clean energy legislation that includes carbon pollution reductions. It also registered that cleaning up the BP oil disaster and energy reform is the number two priority of Americans. Finally, it registered another drop in support for the expansion of offshore oil drilling.”

GreenTech Opinion:

As Jon Stewart’s Daily Show so hilariously pointed out a few weeks ago, 8 presidents since Nixon have vowed to reduce the U.S. addiction to oil. Not one of the 8 presidents succeeded. One wonders if the Gulf of Mexico disaster is finally galvanising U.S. public opinion to the point where the political will becomes strong enough to affect real change. The latest polls show that the public support may finally be there.

Read the full article at the below link:

http://climateprogress.org/2010/06/24/nbc-poll-public-support-global-warming-action-cost-of-energy/

GreenTech Opportunites Editor, Lawrence Roulston, on BNN's Commodities Report: Coal Stock Analysis

Thu, 24 Jun 2010 18:29:00 GMT

Coal Stock Analysis Interview with BNN

Lawrence Roulston is interviewed on Business News Network's Commodities Report about the announcement from Environment Minister Jim Prentice that Canada will begin phasing out its coal fired power generation.

Click here to watch the interview

Intersolar 2010: Dispatches from Munich

Thu, 10 Jun 2010 18:30:00 GMT

Intersolar 2010: Dispatches from Munich

The world's largest solar trade fair kicked off in Munich this Monday with a day-long conference centered around developments in key markets, namely Germany, Italy, France, the U.K. (whose place on this list is questionable), the U.S., and perhaps most interestingly, India.

Click below for a sampling of data and chatter from participants and speakers.
http://www.greentechmedia.com/articles/read/intersolar-2010-dispatches-from-munich/

Global Energy Efficiency Sees Growth in 2010 A new study finds optimism and expansion in commercial energy efficiency across the globe.

Tue, 08 Jun 2010 21:08:00 GMT

Global Energy Efficiency Sees Growth in 2010

A new study finds optimism and expansion in commercial energy efficiency across the globe.

"While energy management is important in every country, some emerging economies outstripped Europe and the U.S. when it came to how high they ranked.

Existing legislation understandably ranked very differently by country in terms of influence. It was most important for Europeans, coming in as the third most important reason for energy efficiency, as Europe leads in energy and climate legislation.

Comparatively, legislation ranked seventh in the U.S and Canada, eighth in China and fifth in India.

About two-thirds of global respondents expect energy prices to creep up in 2010.

Of those who thought energy prices were increasing, most thought they would increase by about 9 percent.

Most decision-makers thought energy or carbon legislation is likely within the next two years.

Chinese and Indian business leaders are the most likely to expect legislation, with 97 and 95 percent respectively saying it was at least somewhat likely, compared with 75 percent of those in the U.S.

About 40 percent of respondents globally think climate change legislation will be at least a slightly greater risk than opportunity.

China, followed by Europe, championed a dose of optimism, with 22 and 19 percent respectively saying that legislation was at least more of an opportunity than a risk.

No surprise, building efficiency is the top priority for those looking to shrink their carbon footprint, with 34 percent saying energy efficiency was their top strategy.

The second most popular method to reduce emissions was onsite renewable energy, yet 18 percent of respondents said there was no prioritization amongst different energy efficient strategies.

Nearly 30 percent did not know or had not prioritized their carbon strategy, and an earlier survey of just North American businesses by Johnson Controls found that figure was closer to 40 percent.

China and India are leading in putting money where their mouths are, with nearly all of the respondents from the two countries saying they have planned operating expenditures for energy efficiency investments, compared to 73 percent in the U.S.

Companies are largely considering renewable technologies, with solar electric topping the choices at 50 percent of respondents considering incorporating it into existing or new construction. Solar thermal was just behind at 42 percent, followed by wind at 26 percent.

And what to expect moving forward? As energy costs are expected to climb, corporate leaders think that PV and lighting technologies will see the most improvement in performance-to-price, with smart building technologies and electric vehicles coming in third and fourth."

Click here to read the full article: http://www.greentechmedia.com/articles/read/global-energy-efficiency-sees-growth-in-2010/

Wholesale Distributed Generation Will Deliver California’s Clean Energy Future

Tue, 01 Jun 2010 22:09:00 GMT

Wholesale Distributed Generation Will Deliver California’s Clean Energy Future

“WDG [wholesale distributed generation] delivers the most cost-effective renewable energy for California ratepayers. A CPUC [California Public Utility Commission] study that is being revised to reflect the current pricing of solar is expected to show that WDG is a better deal for ratepayers than the large central station projects that require transmission build-outs and suffer the inefficiencies of transporting energy over long distances. Hence, WDG is California's best hope for achieving its renewable energy goals cost-effectively and in a timely fashion. In addition, WDG can begin delivering tremendous economic dividends for California in the form of immediate job creation and increased tax revenue.”

“Since mid-2009, four WDG FITs have been implemented in North America: in Gainesville, Florida, the Province of Ontario, the state of Vermont, and the Sacramento Municipal Utility District (SMUD). These four FIT markets are either deploying renewables far faster than any other region in North America or are staged to do so soon.”

Read the full article below:

http://www.greentechmedia.com/articles/read/wholesale-distributed-generation-will-deliver-californias-clean-energy-futu

Weekend Viewing: Renewable Energy Solution of the Month - Wind

Fri, 28 May 2010 18:42:00 GMT

Weekend Viewing:

Renewable Energy Solution of the Month - Wind

Interview with the Energy Report - Peter Cox: Green Energy Finding Its Legs

Tue, 25 May 2010 20:16:00 GMT

Peter Cox: Green Energy Finding Its Legs
Source: Brian Sylvester and Karen Roche of The Energy Report 05/25/2010

"Green" energy is clearly here for the long haul. People everywhere are demanding new forms of clean energy, while governments decide how to deliver it and companies seek ways to satisfy the need. The Energy Report talked with GreenTech Opportunities Analyst Peter Cox about recent developments in the nascent sector and the investment opportunities they're creating. Cox offers his exclusive take on what's ahead and how to jump on what's coming down the pike.

The Energy Report: The April issue of your newsletter, GreenTech Opportunities, says that while the broader markets have rebounded, the green energy sector's performance over the past year has been muted. What are some signs that renewable energy is now a legitimate investment sector?

Peter Cox: One, wind is now the number one source of new electricity-generation installations in both Europe and the U.S. and has been for the last year or two. That's including coal, natural gas and so on. The second is that wind energy is now so cheap that residential customers in Germany and Texas are receiving rebates on their utility bills because such a large proportion of their power is coming from wind.

TER: How is wind energy faring in relation to other energy sources?

PC: Wind is the one renewable energy source that, currently, is competing directly with coal and natural gas for electricity from new power installations. Wind and natural gas combined accounted for about 80% of new capacity added to the U.S. electrical grid.

TER: Does that mean the best opportunities for investing in renewable energy are in wind?

PC: The problem with wind energy in the U.S. now is that you have a tax credit, which is renewed every couple of years, but developers aren't able to plan three, four or five years in advance because they don't know if that 1.5 cent-per-kilowatt-hour tax credit is going to be renewed. If you look at U.S. wind installations in the last few years, there are these huge booms and then these crazy busts where you're installing 4,000 megawatts (MW) at one point and less than 500MW a few quarters later. The U.S. government lacks a long-term policy supporting wind energy in terms of small direct subsidies and integrating wind into the grid. Due to the current confusion, U.S. wind power installations for 2010 look to be less than the 10,000 MW installed last year.

TER: If the "green" energy sector needs subsidies to exist, how viable is it?

PC: Let's start with a bit of history. The first treasury secretary of the U.S., Alexander Hamilton, wrote about the importance of supporting nascent industries. That holds true today. These new sources of energy are competing with energy sources that have been around for 120 years. These are economically and politically entrenched industries. The traditional energy sources still receive large subsidies. According to the White House's Office of Management and Budget, the U.S. could save up to $36 billion between now and 2020 by reducing subsidies to oil and gas. Between 2002 and 2008, the U.S. coal industry received about $17 billion in subsidies. Wind, solar and geothermal are not competing on a level playing field. As long as you have the traditional sources of energy receiving vast subsidies, it's difficult to make the point that wind, solar and geothermal shouldn't receive subsidies as well.

TER: Tell us about some changes in the renewable energy sector during the last few decades.

PC: In the last 30 years, thanks to support in Europe and a huge buildout of these technologies, we've seen costs drop dramatically. In the early 1980s, wind cost about $0.30 per kilowatt hour. With good location and current technology, we can now get to about $0.07 per kilowatt hour. Solar power in the early 1980s cost $2 to $3 per kilowatt hour. In parts of Arizona, California and the sunniest parts of Spain, solar from photovoltaics (PV) can now cost $0.18 per kilowatt hour. The drop in costs is only going to continue as far as we can see. And those figures are unsubsidized—that is the pure cost of that electricity. I think that is a very strong argument to become interested in these industries because they are already at the point, or very close to the point, of being competitive with traditional sources of energy. To put those figures in perspective, residential electricity rates in California average $0.16–$0.18 per kilowatt hour. Average electricity rates in Europe are even higher, in the $0.20–$0.25 range.

TER: With subsidies, could renewable energy be even cheaper than existing sources?

PC: Yes, perhaps in the longer term. We're already at the point where wind is cheaper than coal and natural gas, as consumers in Germany and Texas are finding out thanks to their rebates. In the early to middle part of this decade, we will see solar become very competitive in a significant portion of the U.S. grid. The same goes for Europe.

TER: Is that due to advances in technology?

PC: The efficiency of solar cells has gone up 1% or 0.5% each year. Real world efficiencies for the highest-quality mono-crystalline solar PV modules are now around 18.5%. The price of the polysilicon—the main ingredient in most solar PV panels—went from about $350 per kilogram (kg) in 2008 to about $50/kg last year. There's a huge oversupply of polysilicon. And manufacturing advances have continued.

TER: Your newsletter said that Chinese solar panel manufacturers are even looking to build plants in the U.S. and Ontario.

PC: Part of that is because you have states and Canadian provinces with solar PV support programs that require a certain portion of solar PV panels to be manufactured in the U.S. More and more solar companies are looking at previous manufacturing hubs like Michigan to retool factories for these new forms of energy. At the same time, Linamar Corporation (TSX:LNR), an auto parts manufacturer in Canada, sees a $4 billion annual market for manufacturing wind turbine components and replacement parts. It's already being done in Europe because of the huge market that's been established there. The U.S. wind industry installed about 10,000 MW of new generating capacity last year. When it comes to solar and geothermal, the growth is there but their overall contribution to energy supply isn't huge. However, four gigawatts (4 GW) of solar PV were installed in Germany in 2009. As this growth continues, traditional manufacturing hubs may well see new companies refurbishing old factories.

TER: You talked before about subsidies for renewable energy, which was a significant part of President Obama's election platform. What's the likelihood that the energy bill gets passed?

PC: Obama has said, just like he did with the healthcare bill, that this is one of the key points of his mandate. I believe in some form or another it will get passed. How will it affect the green sector? There will be some form of a cap-and-trade program initiated. This will put a price on the carbon dioxide (C02) emitted by coal and natural gas energy utilities, allowing renewable energy developers a certain confidence when it comes to selling energy from a wind farm or solar farm to PG&E (Pacific Gas and Electric Co.) or SCE (Southern California Edison) or any of the other large utilities.

TER: How will consumers benefit?

PC: The energy bill in the U.S. would ensure that two-thirds of carbon-credit revenue would go back into the pocket of the consumer. Coal and natural gas would become somewhat more expensive as users start paying for the C02 that they emit with municipal utilities and so on. However, as wind will likely play the largest role in new renewable-electricity installations across the country, there is a good chance that consumers in other parts of the U.S. will enjoy the same rebates as their fellow citizens in Texas.

TER: Give us an overview of how this cap-and-trade system would work.

PC: The U.S. already has a functional cap-and-trade system in the Regional Greenhouse Gas Initiative (RGGI)—North America's first and only functional cap-and-trade program. It starts with the utilities. They get a carbon emissions cap placed on their power plants. If you go above this limit, you have to buy some extra credits on this trading platform. If, through energy efficiency advances or if, for example, you shut down a coal power plant and move your production over to something renewable, then you can actually sell these credits. That is, if you are under your annual cap.

TER: The energy bill would essentially take the RGGI model and make it national?

PC: Yes, but there would probably be some changes. The RGGI has an open auction so the companies compete with themselves at the beginning when the credits are given out, so the value of those CO2 credits is higher. In Europe, the credits are just handed out to the power plant operators (in the form of gifts). It undermines the program. We have yet to find out exactly what form the national program would take. The most-effective approach would mirror what you have in the RGGI.

TER: Wouldn't that form of auctioning credits allow larger, more-profitable carbon polluters to buy the credits at the expense of smaller, potentially more efficient but not as profitable, companies? Wouldn't you see some companies going out of business because they have no carbon tax credits?

PC: The first part of the program would be to put a cap on the level of emissions per operator. If those efficient small companies are already below their cap, they'll have an advantage because they can sell those CO2 credits. It is certainly a complicated process to determine which companies and which power plant operators get what cap; some utilities, such as SMUD in Sacramento, have already worked very hard over the past decade to improve its operations. It is hoped that this will be taken into account when the caps are implemented.

TER: What body quantifies the emissions?

PC: In the case of the RGGI, the various state governments have a role in measuring and quantifying who is emitting what. To get more specific about it, the RGGI CO2 Allowance Tracking System (RGGI COATS) is the platform that records and tracks data for each state's C02 Budget Trading Program. Then they determine a limit. It's not an easy process. There is certainly a lot of thought that goes into setting cap limits on emissions.

TER: How can investors make money on a cap-and-trade system?

PC: The company currently responsible for the RGGI auction program is World Energy Solutions, Inc. (NASDAQ:XWES; TSX:XWE). Based in Boston, World Energy runs the RGGI auctions and the platform for trading—and it's the only North American company that already has the system set up and the experience to run both the auction and trading programs.

TER: How does WES make money?

PC: They get a percentage of each auction. Three percent of each auction goes to them because they provide the platform for the government and the power plant operators.

TER: What are some other companies that you're following?

PC: One of the companies we're following is Catch the Wind, Ltd. (TSX.V:CTW.S). It is based in the U.S. and has a specific technology called "The Vindicator," which is able to measure the wind 200–300 yards out in front of the turbine. This allows the turbine to change its alignment to the wind and gain about 10% extra generation, because it is ready for the wind that's going to hit it rather than reacting after the fact. Other wind measurement devices are placed behind the turbine or behind the blades, so the turbine is always adjusting to what's already happened rather than to what is going to happen. The technology is based on that used in the military. It is currently being tested, but it has been proven in certain locations in Nebraska and Canada.

TER: Is this game-changing technology?

PC: It has the potential to make wind power in slightly less-favorable locations more competitive with current electricity prices, as well as providing all wind farm operators with increased revenues. There are certainly locations around the world where wind still isn't competitive because the wind isn't quite as strong or it's farther away from the grid. This technology would allow these locations to become more favorable for wind farm development. For current operators, it would allow 10% extra annual gains on electricity generation. For anyone operating in the utility sector, with its very tight margins, this is a significant advantage.

TER: Which offers the most investment upside at this point—solar, geothermal or wind?

PC: I see wind and solar as the most promising, both in the sheer technical potential of both industries and the tremendous advances made in just the last few years. I think geothermal definitely has its place and will play a larger role. It is limited by the locations that are available to developers. You can't just place a geothermal plant in any location and hope you're going to get the required energy. You have to find certain areas like Nevada or Iceland that have the geological potential of generating energy. So I continue to see wind and solar as the two main players on renewable energy's world stage.

TER: Are there any specific advances in either wind- or solar-power generation?

PC: There's going to be more development in the solar thermal side, or the concentrated solar power side, which is what you're seeing in Arizona and California. This involves heating up a liquid (such as molten salt), generating steam at 600⁰ to 700⁰ Celsius and, just like in a natural gas or coal thermal power plant, you would generate electricity. Plants are already operating in California and Spain, but this is probably going to be one of the fastest-growing sectors in the next few years.

TER: What are some renewable energy trends going on right now?

PC: Some utilities are investigating various storage solutions, as they see solar and wind power becoming larger parts of their installed capacity. But is it going to be various batteries? Is it going to be capacitors? Is it going to be compressed air or pumped hydro? A few examples of this exist in Germany, such as the Waldeck plant.

TER: So, is this a case of determining the industry standard?

PC: It's partly that. It's also about whether the storage technology provides power for 15 minutes or more than 15 hours. Certain storage technologies will be more effective in providing really short-term power boosts, whereas others will be able to provide power over a longer period. It's a question of what's going to be required. How are those technologies going to work together? It's truly in the research and development phase. For instance, UCSD (University of California in San Diego) is just now closing contracts on new energy storage technologies. It wants to replace diesel generators that are outside the labs and install new energy storage capability.

TER: Natural gas is considered a viable clean-energy alternative. We produce substantial amounts here in North America. Given the well-publicized glut of natural gas, is there an investment opportunity in this sector right now?

PC: I would raise some questions about that glut. There are reports from oil and gas analysts saying these claims of natural gas reserves from shale gas will not turn out to be what people are expecting. When we look at what's happened in the Barnett Shale in Texas, which is the oldest shale gas development in the U.S., companies were claiming these wells would last for 30–40 years. What we're seeing is more like seven to eight years. The depletion rate is much faster and much higher than what we've seen in traditional natural gas wells.

TER: Does that mean you don't see an investment opportunity in natural gas?

PC: When it comes to renewable energy developers in the U.S., their contracts are tied to the electricity price that comes from natural gas power plants. One of the companies we're following, Magma Energy Corp. (TSX:MXY), has seen its stock price drop, because natural gas has plummeted. The price of natural gas is down 35%–40% in just the last year. The same goes for wind energy developers in the U.S. Those developers that already have power contracts in place for functioning wind farms have seen the same in their stock prices. They've all been dragged down by the price of natural gas. I don't feel that's going to be a long-term situation. I think that might actually change during the summer. As the price of natural gas starts to go back up, we'll see the same response in some of these renewable energy developers.

TER: Does that mean you like Magma?

PC: Yes, I do. They're now exploring possibilities in Chile. Chile has recently come out with a policy that favors the development of renewable energy—solar, wind and geothermal. Magma is exploring in a country that favors developing new sources of energy. And CEO Ross Beaty has an excellent track record of building companies. We see Magma as a company that should provide investors with significant returns. I think the stock has just been beaten down because of the natural gas price; but I don't see that continuing for much longer. That combined with new exploration in Nevada and Chile should provide investors with some good opportunities.

TER: Another consolidation play is Acro Energy Technologies Corp. (TSX.V: ART), which is consolidating solar installations. What's your view on Acro?

PC: We haven't looked at the installation sector yet. I think Acro has a relatively good position in California, but they're not a Top 10 when it comes to installers—most of which are the utilities. I think the solar installation business will be very interesting, as more and more states begin to introduce solar PV programs, whether it's California, New Jersey or others. The ability of individual homeowners to put a solar PV panel on their roof is rather limited. California has the California Solar Initiative, which aims to install about 1,700 million megawatts by 2016. This support program enables residential homeowners and commercial businesses to install solar PV on their roofs by providing a subsidy toward the installation.

The past decade has seen tremendous growth in certain renewable energy technologies, with both solar and wind experiencing average annual installation rates around the world in the 30%-plus range. We're confident that as costs continue to decline, these installation rates will continue. In addition, we're following the emerging electricity-storage sector closely and are looking to introduce a few of the leading storage companies in the future. We're well aware of the challenges the clean energy sector faces but remain confident that the coming decade will present investors with impressive opportunities. This sector truly deserves the attention of investors.

TER: This has been great, Peter. Thanks so much for talking with us today.

Peter Cox, analyst at GreenTech Opportunities, brings a great deal of hands-on experience in the industry as well as an international perspective. Upon graduating from the University of British Columbia, Peter moved to Germany to pursue a career in that country's emerging sustainable energy industry. During this time, he completed an MBA in Energy and Environmental Management from the University of Twente in the Netherlands. Following his degree, he remained with the local energy company (Stadtwerke Hannover in Germany) to continue development of a biogas project, which is now in production based in part on Peter's thesis research. His work in Germany included experience in other aspects of green energy, such as Europe's most energy-efficient building standard, the Passiv Haus, and work on solar photovoltaic projects.

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DISCLOSURE:
1) Brian Sylvester and Karen Roche of The Gold Report conducted this interview. They personally and/or their families own shares of the following companies mentioned in this interview: None.
2) The following companies mentioned in the interview are sponsors of The Energy Report or The Gold Report: Acro Energy.
3) Peter Cox: I personally and/or my family own shares of the following companies mentioned in this interview: World Energy Solutions, Catch the Wind and Magma Energy. I personally and/or my family are paid by the following companies: None.

Renewables Watch

Wed, 19 May 2010 17:18:00 GMT

Renewables Watch

“The daily Renewables Watch provides important information about actual renewable production within the ISO grid as California moves towards a 33 percent renewable generation portfolio. The information provided is as accurate as can be delivered in a daily format. It is unverified raw data and is not intended to be used as the basis for operational or financial decisions.”

GreenTech Opinion

For those who wonder how much renewable energy is already contributing to certain grids in developed countries, the California Independent System Operator provides a daily review of the actual renewable electricity production taking place in the State. This is unbiased, unfiltered information. It will be interesting to see how this develops as California looks to achieve 33% renewable electricity generation by 2020.

View the full article here:

http://www.caiso.com/green/renewableswatch.html

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