Community Renewable Energy
For decades, the conventional wisdom about developing energy projects in the U.S. has been that “big” always meant cheaper, and therefore better, projects. This produced what has become our modern centralized electric power system fueled primarily by coal, natural gas and nuclear power.
In the mid-to late 1990s, however, the electric power industry began to hear concerns, particularly from the environmental community, about the negative environmental consequences of a system based too heavily on these types of power. As a result, a second wave of thinking arose that called not just for producing the cheapest power at any cost, but also for finding ways to produce cleaner energy from renewable sources such as the wind, sun, biomass, water and geothermal heat — and to do so on a scale large enough to become a significant portion of utilities energy portfolios.
» Source: RenewableEnergyAccess.com
Although the shift toward large-scale renewable energy has already begun to make a positive difference, today the U.S. finds itself on the verge of another new wave of thinking that incorporates the lessons of the past, but goes beyond merely addressing cost and environmental concerns and seeking maximum output. This new model, which is gradually and quietly rolling into communities across the country, is the distributed “community renewables” model, in which new power projects are smaller and tightly integrated with local communities and local resources in a way that the economics become more favorable and communities are able to participate directly in some of the benefits.
There are three characteristics that distinguish distributed community renewables from the “cheaper at any cost” and the “mega-renewable deployment” mindsets.
1. Increased Community Participation. Unlike a project developed, financed and controlled exclusively by an external developer, community energy projects actively seek to involve local communities as much as realistically possible. This can be done by using fuel from local feedstocks or natural resources; hiring local contractors for construction, administration, management and maintenance roles; giving the local community members an opportunity to invest and share directly in the project’s financial benefits (particularly on the back end); creating additional tax revenue for the local governments, and even, in some cases, selling the power produced to local individuals and businesses.
2. Smaller-Scale Projects. Project size is driven primarily by federal, state, and local tax incentives; the proximity and availability of natural resources; and the ability to transmit power to customers. Given these constraints, the optimal size for most of these projects is usually relatively small, between 5- and 6-megawatts (at least in the Pacific Northwest). With the existing transportation and distribution infrastructure and the lack of an economically viable long-term energy storage technology, most projects end up either selling their power to utilities under the Public Utility Regulatory Policies Act of 1978 at the avoided cost rates, or at retail rates under net metering. Some developers are also beginning to explore innovative ways to sell their projects’ power to the local communities themselves or on the open market.
3. Additional Societal Benefits. Finally, community renewables projects create a wide range of social benefits that transcend the economics of a particular project. These include decreased dependence on foreign natural gas and oil, a power infrastructure that is far less subject to large-scale disruption or terrorism because of its distributed and diverse nature, local control of generation facilities, creation of much needed high-quality jobs in rural areas, and a supplemental revenue stream for agricultural community members that allows them to maintain their rural lifestyle. Additionally, this approach has demonstrated an uncanny ability to bring together people from very different backgrounds — Republicans and Democrats, urban and rural residents, businesses and environmentalists — for a common cause.
Utilities and large-scale commercial developers also are beginning to recognize the wisdom of this approach as complementary to their own efforts, because it often helps familiarize local communities with the benefits of renewable projects and ends up making it easier to get their larger projects sited in the future. Some even like the model so much that they are considering building some of these types of projects themselves as a way to replace aging facilities in difficult-to-reach rural areas.
As exciting as all this sounds, the reality is that the distributed community renewables market is still in its nascent stage. To date, most of the projects that have been completed are community wind projects in the Midwest (particularly Minnesota) and small-scale biofuel facilities. Although the model appears to be taking root, spreading to more states and beginning to include other types of renewables, there is still considerable need for education, particularly for potential investors who are not from the energy industry.
One thing is for sure: when done right, investment in community renewables can be highly profitable for investors. This is because they offer:
– Higher risk-adjusted return than virtually any other investment. Under the community renewables model, equity investors with the right tax profile are sought by community developers and are asked to write a check only when most of the risk is out of the project (i.e., the project actually starts producing and selling power). It is not uncommon for investors to receive after-tax returns of 12 to 15% for five to 10 years.
– Sustainable long-term business models. Smaller projects tend to be better able than mega-projects to match capital expenditures to local resources and feedstocks and demand. Smaller-scale projects often have the luxury of using only the highest-quality resources and bearing less risk, because the amount of power they sell is low relative to the total amount used in the surrounding area.
– Increased operational efficiencies. As people who have experience in the renewables industry shift their attention toward smaller-scale projects, they are able to apply their knowledge to squeeze out savings from operations that keeps the variable, and in some cases even the capital, costs to a minimum.
The community renewables projects breaking ground today are just the beginning. As the full value of carbon emissions savings become a tradable commodity, and as new storage and interconnection technologies become available, the distributed community renewables energy model has the opportunity to become an increasingly significant piece of broader efforts moving us toward clean energy and a healthier society.
Here’s how to stop the construction of coal fired power plants in the US.
Everyone write this letter:
To my electric power company,
I draw the line here. This is my commitment. My future power will be generated by sustainable and safe technology. I am considering no longer purchasing power from your company. I am considering installing my own power generation equipment. I am considering helping others build and install their own windmills and solar panels. And I am even considering supporting, or even helping start local alternative energy companies all over the country.
It doesn’t have to be this way. You can do the right thing – and build alternative power generators instead of coal fired power plants. Personally, I’d rather not be bothered with having to generate my own power. But I will not continue to support a system that perpetuates the production of tons of deadly pollution, strip mining ecocide, and Global warming devastation.
You haven’t fooled me, with your “clean” coal stories. I know that 90% of the coal fired power plants in America’s immediate plans for construction are not even close to clean – and that nobody has yet to build even one truly “clean” coal power plant.
You haven’t fooled me with your “cheap” coal stories. Once we build all of these coal fired power plants, and commit to decades of coal dependency, it’s obvious the price of coal will go up – and in fact, there’s a substantial risk of Enron style price gouging.
You also haven’t fooled me with your “cheaper than alternative energy” stories. We taxpayers are stuck with the bills for all of the subsidies and tax breaks that make coal fired power plants appear cheaper. If our government had any common sense, coal would be heavily taxed and alternative energy would be subsidized. Someday soon, this will happen, and coal won’t be so cheap anymore. But most importantly, no matter how cheap coal may appear on your ledgers, we all know that coal is far more expensive to everyone and every thing on Earth in the long run.
Much more than your bottom line is at stake – but your bottom line is at stake. Your decision to build coal fired or alternative power generators will determine my, and many others’ decision to purchase power from you. Please, make the right decision. And don’t try to fool me with nuclear power until you’ve figured how not to generate nuclear waste.
Thank you,
Address __________________________________
_____________________________
City, State, Zip _____________________________
What we have here:
is the greatest opportunity ever in history –
and it only involves you writing a couple of letters.
We have an opportunity to avert the worst cluster of disasters humanity has ever witnessed – Global warming and mass ecocide. That’s right, we can make a difference. We must at least try. This is critically important. Our efforts might even avert what could possibly end up being the last straw for our civilization. Let’s face it, every civilization before us has collapsed. Our odds aren’t that good. Are we next? It’s starting to look like it. Will it happen soon? I don’t believe that it has too.
Maybe I’m wrong. Maybe it won’t be the worst disaster in human history. But, all indicators are that global warming is really bad – and if it gets as bad as some scientists predict, it could lead to mass extinctions (an article in National Geographic suggests as many as a million species). Let me remind you that humanity is not above being one of those species slated for extinction.
So… we’ve barely recorded a rise in the Earth’s temperature, and we get hurricane Katrina – and all the others, including a big typhoon in China just a few of months ago (that wreaked more havoc than Katrina).
In the Oceans, increased hurricane severity isn’t the only sign. Seventy percent of the Oceans’ coral is sick, dying, or dead. Red tides and dead zones have popped up from out of no where. The worse things get, the less we seem able to do.
So, just how bad does it have to get before we notice and take action?
Allow me to speculate for a moment; but if we can heat the atmosphere, and we can heat the oceans, maybe we can heat our Earth’s crust too. If so, maybe even the Tsunami of 2004 was avoidable. If so… expect more. If not, our planet is likely way too near a total Environmental collapse for any of us to feel comfortable the status quo.
I think most of us already know that burning coal for power has been very bad for the environment. We also know that it is an avoidable process. Neither wind, solar, geothermal, wave, or tidal generators produce any greenhouse gases. And, alternative power generators have no equivalent of the smoking trains or barges that deliver coal – and the smoking bulldozers, loaders, and trucks that mine coal. In spite of what the coal companies try to tell us, the technology for alternative energy is available here and now. There are existing examples of all of these alternative power generation methods, making a profit, somewhere on the planet. I have listed some of them on my blog… and no, I haven’t listed allegedly “clean” coal.
Even if the coal power industry built only “clean” coal plants – and they have yet to build even one, there is still this matter of strip mining ecocide . Or, as Discover magazine quotes a local from the Appalachian coal mining area; “Even if you could get marshmallows to come out of a power plant’s smokestacks, you can’t wash the blood off coal.”
But what can we do?… We can assert ourselves. The most important thing Americans can do now is let our power companies know how unhappy we are that they intend to build more coal fired power plants. We are the customers. We make the decisions. And we’ve decided that this is a bad idea.
The time is now. The opportunity may be passing us by. Because; after they’ve started construction – once they’ve spent real money, it will be ten times harder to stop them.
Actually, up until now; I’ve been a little lazy myself. I would rather pay a reasonable bill and turn on a switch to get my power. But, this is losing its appeal to me. I don’t want to be responsible for Global warming, pollution, and destructive mining practices. If they continue to build coal fired power plants, I won’t buy any of their power. I’ll put up my own windmills and solar panels. And I’ll store the energy, either in flywheels or generate hydrogen… I really don’t want to bother, but I will. And there are probably millions of others, maybe even you, who feel the same way.
The problem for the power companies is that they don’t know what our tipping point is. They don’t know when we’ll decide that we’ve had enough. They don’t know how close they are to driving us away as customers. We need to let them know – before they spend billions of dollars on out-dated, polluting, water wasting power plants – that we won’t buy power from.
Write you local power company, and let them know where you stand. Many of the people within that company want to build alternative energy generators. Give them a stronger voice.
Imagine, just writing a letter could change history. This is your opportunity to change the power companies’ minds, and maybe even save our civilization. Together, we have far more influence than you ever thought possible. Tell others. E-mail your friends. Notify organizations that you think might care. Post it on your blog, website, MySpace, or YouTube – whatever. But, do it now. This opportunity won’t last long.
Just think, if enough people write their power companies, we could force them to stop the construction of all the coal fired power plants in the US – and significantly slow Global warming.
Rick Spilsbury noshootfoot.blogspot.com