Bipartisan U.S. Senators Push for Distributed Wind | December 29th, 2014
by Nick Blitterswyk, CEO, UGE International
A group of Senators recently urged the US Department of Energy to continue funding programs for the domestic distributed wind energy industry. The bipartisan group, led by Sen. Al Franken, wrote a letter highlighting the clear potential for distributed wind power to “contribute many gigawatts of electricity similar to other renewable technologies.”
Reactions have been mixed, and that’s understandable. The distributed wind industry has faced a good deal of critique (some of which is warranted).
Nevertheless, the Senators are correct: Distributed wind is a useful technology, with useful applications, and stands to benefit from the increasingly attractive economic conditions for distributed generation.
When distributed energy took off over the last five years, small wind got caught flat-footed. The reason was primarily because it hadn’t reached a level of maturity where it could take advantage of the changing tide. As a result, there were several cases of companies manipulating incentives and hawking shoddy products on unsuspecting customers (and lest this become an anti-China argument, virtually all such products came from US and European companies).
One of the better known examples was DyoCore, which made lofty claims about the power of its SolAir turbine in order to game California’s Emerging Renewables Program. California actually received so many complaints about the company that it cancelled the entire program.
Early failures like these were possible because standards and certifications hadn’t yet been established in the distributed wind industry. And though the DyoCores of the world eventually failed, these early companies and their stories damaged the reputation of even the best small wind products on the market, greatly holding back the industry.
2011 was when the wind started to come out of the industry’s sails (and yes, pun intended). The economy had tanked, and solar prices were gaining economies of scale, making small wind expensive by comparison in a market where customers were holding their wallets more tightly.
But just like with solar, distributed wind has continued to evolve and innovate
The technology and business models have continued to advance, the industry has consolidated, and as the senators noted in their letter, the distributed wind power industry is at the threshold of rapid commercialization.
The future of small wind: Worth investing in
Economic conditions are increasingly attractive for all distributed generation. In just a few short years, distributed wind has changed dramatically. There are fewer players, and the standards are much tougher as the SWCC, in the US, and comparable certification programs around the world, have reached maturation.
The technology has advanced — and has a wide variety of applications. You’re not going to find distributed wind atop 20% of rooftops, like you will already with solar in Australia, but you will find that the modern technologies from the companies that remain in the industry — the strongest, best run ones with the best technology, and with better economies of scale — will start gaining a resurgence.
Distributed wind has particularly great potential in applications such as:
Farms: A 10kW or larger turbine can be installed in windy locations and produce energy at a rate less than that available from the grid, or in farms in remote regions with difficulty accessing the grid.
Northern and Southern regions, from Scandinavia to Patagonia: There are limitations to solar resources during the winter months at the poles, but wind is a great resource in most of these areas.
Hybrid installations: Particularly in off-grid situations, a mix of energy sources adds resiliency and lowers the cost of energy.
This list also doesn’t include the many forward-thinking businesses and consumers who want to support and benefit from the technological advancements in the industry, and who have also been a key customer base for distributed wind turbines.
The small wind industry began its life far too dependent on incentives and government funding. But limiting or eliminating development of the industry would be a huge mistake. R&D has developed the technology significantly in the past several years, and with certifications and standards in place, as well as new business models that remove financial barriers and mitigate performance risks, there’s additional efficiencies to explore.
The US has a strong advantage in the field, and the DOE’s support will be essential for distributed wind to “cross the chasm” and find its footing amidst Cleantech 2.0 — an era with much promise for new business models and advanced distributed generation. A group of senators understands this — I hope the rest of the industry will follow suit.
About the Author: Nick Blitterswyk is the CEO and founder of UGE International, a leading developer of distributed renewable energy solutions for business and government, with projects in over 90 countries, including several for Fortune 1,000 companies.
Air pollution has a very real cost to our civilization via increased healthcare costs, premature deaths, lowered productivity, environmental degradation with resultant lowered crop yields, increased water consumption and higher taxation.
However, air pollution is only one cost associated with fossil fuel use.
There are three main costs associated with energy
The retail price that you pay at the gas pump or on your utility bill for example (which is paid by consumers)
The subsidy cost that governments pay energy producers and utility companies (which is ultimately paid by taxpayers)
The externality cost of each type of energy (which is paid by taxpayers, by increased prices for consumers, and the impact on, or the cost to, the environment)
Externality cost in Europe and the U.S.A.
A recent report from the European Environment Agency (EEA) states that high air pollution levels (one type of externality) in the EU cost society €189 billion every year and it’s a number that increases every year. (That’s $235 billion when converted to U.S. dollars)
To put that number in some kind of context, the cost of the air pollution externality in the EU annually, is equal to the annual GDP of Finland.
Let’s state that even more clearly. The amount of taxation paid by EU taxpayers every year to pay for airborne fossil fuel damage is equal to Finland’s entire annual economic output!
It’s getting worse, not better, notwithstanding recent renewable energy programs and incentives. Even the admirable German Energiewende program is barely making an impact when we look at the overall EU air quality index.
Of the 30 biggest facilities it identified as causing the most damage, 26 were power plants, mainly fueled by coal in Germany and eastern Europe. — Barbara Lewis (Reuters)
Each stage in the life cycle of coal—extraction, transport, processing, and combustion—generates a waste stream and carries multiple hazards for health and the environment. These costs are external to the coal industry and thus are often considered as “externalities.”
We estimate that the life cycle effects of coal and the waste stream generated are costing the U.S. public a third to over one-half of a trillion dollars annually.
Many of these so-called externalities are, moreover, cumulative.
Accounting for the damages conservatively doubles to triples the price of electricity from coal per kWh generated, making wind, solar, and other forms of non fossil fuel power generation, along with investments in efficiency and electricity conservation methods, economically competitive.
We focus on Appalachia, though coal is mined in other regions of the United States and is burned throughout the world.” — Full Cost Accounting for the Life Cycle of Coal by Dr. Paul Epstein, the Director of Harvard Medical School Center for Health and the Global Environment, and eleven other co-authors
The report also notes that electricity rates would need to rise by another .09 to .27 cents per kilowatt hour in the U.S. to cover the externality cost of American coal-fired electricity production.
The externality cost for solar or wind power plants is zero, just for the record
Dr. Epstein and his team notes: “Coal burning produces one and a half times the CO2 emissions of oil combustion and twice that from burning natural gas (for an equal amount of energy produced).”
There’s the argument to switch from coal to natural gas right there
Also in the Harvard report in regards to the intrinsic inefficiency of coal:
Energy specialist Amory Lovins estimates that after mining, processing, transporting and burning coal, and transmitting the electricity, only about 3% of the energy in the coal is used in incandescent light bulbs.
…In the United States in 2005, coal produced 50% of the nation’s electricity but 81% of the CO2 emissions.
For 2030, coal is projected to produce 53% of U.S. power and 85% of the U.S. CO2 emissions from electricity generation.
None of these figures includes the additional life cycle greenhouse gas (GHG) emissions from coal, including methane from coal mines, emissions from coal transport, other GHG emissions (e.g., particulates or black carbon), and carbon and nitrous oxide (N2O) emissions from land transformation in the case of MTR coal mining.” — Full Cost Accounting for the Life Cycle of Coal report
It’s not like this information is secret. All European, American, and Asian policymakers now know about the externality costs of coal vs. renewable energy. It’s just that until recently everyone thought that the cost of switching to renewable energy, was higher than the cost of fossil externalities.
It’s not only an economic problem, it’s also a health problem
Air pollution impacts human health, resulting in extra healthcare costs, lost productivity, and fewer work days. Other impacts are reduced crop yields and building damage.
Particulate matter and ground-level ozone are two of the main pollutants that come from coal.
90% or more of Europeans living in cities are exposed to harmful air pollution. Bulgaria and Poland have some of the worst pollution of the European countries.
An estimated 400,000 premature deaths in European cities were linked to air pollution in 2011. — CleanTechnica
Externality cost in China
Remember the Beijing Olympics where the city’s industry and commercial business were shut down to allow visitors and athletes to breathe clean air during their stay (and Wow!) look at their clear blue sky for the first time in decades. Great for tourists! Bad for Beijing business and industry, with the exception of the tourism industry (for one month) of course.
The Common Language Project reported in 2008 that premature deaths in China resulting from fossil fuel air pollution were surpassing 400,000 per year.
China faces a number of serious environmental issues caused by overpopulation and rapid industrial growth. Water pollution and a resulting shortage of drinking water is one such issue, as is air pollution caused by an over-reliance on coal as fuel. It has been estimated that 410,000 Chinese die as a result of pollution each year. —clpmag.org
The die is cast since it is becoming common knowledge that renewable energy merely requires a small subsidy to assist with power plant construction and grid harmonization — while fossil fuels continue to require truly massive and ongoing subsidies to continue operations.
Want to add up the total costs (direct economic subsidy and externality cost subsidy) of fossil fuels?
Add the $600 billion global fossil fuel subsidy to the to the $2 trillion dollars of global externality cost and you arrive at (approx) $2.5 trillion dollars per year. Then there is the more than 1 million premature deaths globally caused by air pollution. All of that is subsidized by the world’s taxpayers.
Compare that to the total costs of renewable energy. Well, for starters, the economic subsidy dollar amount for renewable energy is much less (about $100 billion per year globally) and there are no externality costs.
No deaths. No illness. No direct or related productivity loss due to a host of fossil fuel related issues (oil spills, coal car derailment, river contamination, explosions in pipelines or factories) for just a very few examples.
The fossil fuel industry is a very mature industry, it has found ways to do more with ever-fewer employees, and it gets more subsidy dollars than any other economic segment on the planet.
By comparison, the renewable energy industry is a new segment, one that requires many thousands of workers and it gets only relative handfuls of subsidy dollars. And, no externalities.
It becomes clearer every day that high-carbon fossil must be displaced by renewable energy
No longer is it some arcane moral argument that we should switch to renewables for the good of the Earth; Fossil fuel is proving to be a major factor in human illness/premature deaths, it sends our money abroad to purchase energy instead of keeping our money in our own countries, and the wholly-taxpayer-funded subsidy cost of fossil is out of control and getting worse with each passing year.
The time for dithering is past. It’s time to make the switch to renewable energy, and to start, we need to remove the worst polluting power plants from the grid (and at the very least, replace them with natural gas powered plants) or even better, replace them with hybrid wind and solar power plants.
To accomplish this, governments need to begin diverting some of the tens of billions of dollars annually paid to the fossil fuel industry to the renewable energy industry.
Germany’s Energiewende program was (and still is) an admirable first step. Once Germany has completed it’s energy transition away from oil, coal and nuclear — having replaced all of that generation capacity with renewable energy and natural gas, only then can it be hailed a complete success — and German leaders should go down in history as being instrumental in changing the world’s 21st century energy paradigm.
Dank an unsere deutschen Freunde! (With thanks to our German friends!)
If only every nation would sign-on to matching or exceeding the ongoing German example, we wouldn’t have 1 million premature deaths globally due to fossil fuel burning, we wouldn’t have almost 2 trillion dollars of externality cost, we wouldn’t need $600 billion dollars of direct subsidies for fossil fuel producers — and we would all live in a healthier environment, and our plant, animal, and aquatic life would return to their normally thriving state.
Taxes would reflect the global $2.5 trillion drop in combined fossil fuel subsidy and fossil fuel externality costs, employment stats would improve, productivity would increase, the tourism industry would receive a boost, and enjoyment of life for individuals would rebound.
It’s a truism in the energy industry that all energy is subsidized, of that there is no doubt. Even renewable energy receives tiny amounts of subsidy, relative to fossil.
But it is now apparent that over the past 100 years, getting ‘the best (energy) bang for the buck’ has been our nemesis. The energy world that we once knew, is about to change.
The world didn’t come to an end when air travel began to replace rail travel in the 1950’s. Now almost everyone travels by air, and only few travel by train. And what about the railway investors didn’t they lose their money when the age of rail tapered-off? No, they simply moved their money to the new transportation mode and made as much or more money in the airline business.
Likewise, the world will not come to an end now that renewable energy is beginning to displace coal and oil. Investors will simply reallocate their money and make as much or more money in renewable energy.
Germany, a thriving economic powerhouse under the Chancellorship of Angela Merkel, is also a renewable energy superstar and a country that is loaded with potential.
Lately, the Germans have taken a break from aggressively adding renewable energy to their grid by ending a lucrative feed-in-tariff (FiT) subsidy program that ramped-up the adoption of solar, wind and biomass installations across the country.
Not that these so-called ‘lucrative’ subsidies approached anywhere near what fossil fuel and nuclear power plant operators receive and have received since the postwar period began, as all energy in Germany (like most countries) is heavily subsidized by taxpayers but only the (much smaller) renewable energy subsidies get the headlines. Go figure.
Chancellor Angela Merkel made the courageous decision to accelerate the shutdown Germany’s nuclear power plants in the aftermath of the Fukushima disaster in 2011 after stress tests of German nuclear power plants showed safety concerns existed within their nuclear fleet. She ushered in meaningful FiT subsidies to speed the German Energiewende program towards its goal of transition to renewable energy and greater energy efficiency — which had received only sporadic subsidies prior to Merkel.
Snapshot of the German Energiewende program
A popular Germany-only program to move towards a highly industrialized, sustainable green economy
Full phase-out of nuclear energy by 2022
80-95% reduction in greenhouse gases by 2050
Minimum of 80% renewables in the power sector
50% increase in energy efficiency by 2050
Germany’s utility companies haven’t seen change like this since WWII. After a century of serving conventionally-generated electrical power to a captive electricity market — approximately 1/3 of all German electricity is now generated via renewable energy if you include nuclear, biomass and hydro-power. That’s historic change by any standard.
Although solar panel outputs are lower during the winter months, over the late spring and summer of 2014 renewable energy generated more than 75% of total demand on many of those days. Not bad, for 5 years of relatively minor renewable energy subsidy euros provided by a (now ended) Feed-in-Tariff!
Another benefit of the switch to renewable energy was the added billions of euros of economic activity generated annually by European solar panel and wind manufacturing companies like Vestas, SolarWorld, Siemens, ABB, and the jobs created for hundreds of SME renewable energy installation companies in the country.
Exports of German solar panels and wind turbines went through the stratosphere — once Germany proved to the world that solar and wind could replace lost nuclear power generation capacity at a much lower cost than building new, multi-billion euro, nuclear or coal-fired power plants with their massive footprint on the land and their obscene water usage levels.
For Germany, installing their own solar, wind and biomass power plants proved to the world that large-scale renewable energy could add huge capacity to a nation’s electrical grid and that different types of renewable energy could work together to balance the over-hyped ‘intermittency problem’ of renewable energy.
It turns out that in Germany, during the long, hot days of summer when solar panels are putting out their maximum power the wind actually tapers off, but at night the wind blows at a very reliable rate. Karmic bonus! That about covers the summer months.
During the winter months in Germany, the wind blows day and night, adding significant amounts of reliable power to the national grid.
And now, all of that renewable energy capacity is operating without FiT subsidy — quite unlike the coal, nuclear, and oil and gas power generation in the country which require huge and ongoing subsidies every day of the year to continue operations. That’s every day since 1946, meine Freunde!
Also a factor with coal-fired power plants are the massive healthcare spending to combat the adverse health effects of fossil fuel burning/air pollution on humans and animals, on the agriculture sector. And the hugely expensive security infrastructure necessary to preclude theft of nuclear materials and nuclear related terror attacks.
While the rest of Europe (with the exception of notables like Norway, Sweden and Luxembourg) wallowed in recession or near-recession since 2008, the German economic powerhouse not only set global export records year-on-year, it bailed-out numerous other EU economies like Greece, Spain, Portugal, Italy and others, and began an unprecedented domestic renewable energy program. And now, Germany is an electricity net exporter.
That’s heady stuff, even for this industrious nation of 82 million.
Where to next?
Not only has Germany added many TeraWatt hours (TWh) of clean, renewable energy to its electrical grid to replace lost nuclear power generation, it is now an electricity net exporter — raking in millions of euros per year at present — and make that an electricity exporting superpower if they ever decide to revive their now defunct Feed-in-Tariff subsidy for renewable energy.
Replacing coal with renewable energy in Germany:
If Germany revived the previous FiT regime for 5 years, *all brown coal electrical power generation* could be eliminated within 10 years.
If Germany revived the previous FiT regime for 10 years, *all brown coal and black coal electrical power generation* could be eliminated within 10 years.
Replacing coal with renewable energy in Germany would save millions of Germans, Polish, Swiss, Austrians and others living downwind of German smokestacks from breathing toxic coal-fired air pollution. Think of the health care savings and the taxes involved to support this. Some people believe that the health care savings alone could far exceed the cost of any FiT subsidy.
Not only that, but as a result of leaving coal behind, historic buildings, concrete bridges and roadways would require less maintenance to repair the spalling caused by the acid rain from coal burning. Additionally, Germany would save the millions of litres of water consumed annually by the coal industry.
Replacing coal with renewable energy in Germany would create thousands more jobs for solar, wind, and biomass manufacturing and construction, the agriculture sector would begin to show ever-improving crop outputs and importantly, leave clean air to breathe for tourists, expats and German citizens!
A note about (renewable energy) Hybrid power plants
An energy policy stroke of genius for Germany could come in the form of a new subsidy (a FiT or other type of subsidy) that could be offered to promote the installation of Hybrid power plants — whereby 30% of electricity generated at a given power plant site would come from solar and the balance could come from any combination of wind, biomass, or hydro-electric generation. (30% solar + 70% various renewable = 100% of total per site output)
As long as all of the electrical power generation at such a site is of the renewable energy variety and it all works to balance the intermittency of solar power, then it should receive automatic approval for the (hereby proposed) Energiewende Hybrid Power Plant subsidy.
When all the different types of renewable energy work in complementary fashion on the same site, energy synergy (the holy grail of the renewable energy industry) will be attained.
More jobs, billions of euros worth of electricity exports to the European countries bordering Germany, lower health care spending, less environmental damage and better agricultural outputs — all at a lower subsidy level than coal and nuclear have enjoyed every year since 1946 — are precisely why Germans should renew their commitment to renewable energy.
Seriously, what’s not to like?
Bonus energy graphic shows the various kinds of energy extant in Germany at the end of 2014.
Wealth Distribution in America is not what you think it is!
Watch this 6-minute video to see just how wrong our perceptions are about how the total wealth of the United States is shared between all these different socio-economic groups of people. “The Poor” and “The Middle Class” and “The Rich” are compared to “The Wealthy” in this video. What you will see is mind-blowing.
The total wealth of the United States (in 2009) was 54 Trillion dollars. Let’s see how it’s distributed, shall we?
After having watched the video, were you as speechless as us?
Many people in this 21st century would be surprised to hear they are deeply immersed (and some would say, horribly stuck) in 20th century thought, a century where for ninety of those hundred years, the endless game of nation-state vs. nation-state was played, and often played with brutality. Nation against nation, democracy competing with communism and authoritarianism, freedom vs. repression and ‘the West’ against ‘the East’, or occasionally, ‘North’ against ‘South’ — these were the headlines of a turbulent century.
All these battles were fought diligently, usually for valid reasons (but not always) by nation-states, their citizens, and soldiers, all over the world from about 1914 onwards.
In terms of the success against such social ills as world war, small hot wars, the Cold War, fascism, tribal wars, poor governance and even poorer economics, plus a low global standard of health care, we have come far in the past 100 years.
The problem is, some just don’t realize how far we have come and are still ‘fighting the last war’ to use a military euphemism.
The last war is well and truly over. Unfortunately, some have utterly missed that, profound as it is.
Illogically, many of these people are still holding positions of power, many of them from the baby-boom generation, that for now at least, continue to call the shots for the rest of the world.
A world of change has occurred, and yet many of those holding either political office or powerful unelected positions are completely blind to it, as their hatred for their former enemies burns so bright.
In the West, for just one example, most citizens are pleased that Vladimir Putin is running Russia. We all know that Russia is experiencing the problems associated with a former Soviet-era economy, but that they are recovering nicely from it. We also know that they are dealing with incredibly rapid economic growth – which is a great problem to have! If your country must have a major problem to deal with, that’s the one to have.
And many people in the West and around the world, socialize with Russians every day, online, in the workplace or at universities around the world. Everyone is getting along just fine, thank you.
Спасибо, очень понравилось! (Which is Russian for, “Thank you, very much!”)
But are Western political office holders or powerful unelected leaders happy about any of that? For the most part, NOT! And therein, lies a tantalizing clue about what ails the geopolitical world in this century.
The people in (elected and unelected) positions of power in the West today are the same generation that taught us to fear, hate, and fight, the Soviet Union at all costs (one of those costs being lessened Western civil liberties from the onset of the Cold War right up to the present day) — and the fact that the Soviet Union no longer exists and communism in modern-day Russia is about as important as it is here (it’s not) does not decrease their deeply-held hatred of our former enemy.
The better the Russian economy does, the more they hate Russia. The more Russian citizens smile on TV, the more they castigate Vlad Putin. As Russia became the 13th most powerful economy in the world, some in the West were tearing their hair out. Russia is on-track to become the 10th most powerful economy in the world within the next decade. Can’t wait to see the contorted faces then!
And it is getting increasingly difficult for certain Western news outlets to show recent pictures or videos taken in and around Moscow, without the many Mercedes Benz and BMW cars and SUV’s driven by ordinary Russian citizens ‘crapping up the frame’ – thereby contradicting the verbal op/ed piece.
No! All those Mercedes and BMW’s are NOT driven by “filthy rich Russian oligarchs with ‘dirty money’ or high ranking KGB officers that hate Fox News… er… America.”
That was LAST century.
The real story, in case you missed it, is that it is no longer about nation-state against nation-state (although, some people are desperately trying to make it ‘still that’), nor is it even, democracy against practically all other forms of government (although, some people are desperately trying to make it ‘still that’), nor is about some well-intentioned fight against horrible social ills such as apartheid, which is mostly won at this point (although, some people are desperately trying to make it ‘still that’).
What it is about, is that 98% of the world’s citizens want their governments to stop fighting the last war, to cease with the old hatreds and prejudices and get on with clearing a path for citizens, so that they can progress — financially, socially, and for those who want it, spiritually.
Feudalism was replaced with something better (from the point-of-view of 98% of the world population back in the day) which manifested itself as freedom and democracy in half the world, while the other half endured communism, which was still a lot better than feudalism, for most citizens. The governance systems in use in the 21st century are mostly democratic ones — and the ones that aren’t, are reforming at different speeds towards democracy anyway — whether we bomb them or not.
Our representative governments must begin to focus on what democracy was originally created to achieve. Can anyone even remember what this was, this far out from democracy’s beginnings? In general terms, it was to bring freedom, the rule of law, education, economic prosperity, and the pursuit of pleasure to the vast majority of citizens (the 98%) living within that voluntary state of governance.
But truth be told at this point, citizens around the world would settle for this generation of powerful elected and unelected people stuck in their 20th century mindsets, just getting out of citizens’ way and letting individuals and families solve their own issues and get to their goals, themselves. A new generation will soon take the reins.
In the meantime, try not to blow up the world with your 20th century thinking. Thanks.