Local Renewable Energy or Utility Co. Who’s Your Energy Daddy?

by John Farrell.

Photo Credit: Michael Kappel
Photo by Michael Kappel

For now it remains large, investor-owned utilities, and ostensibly locally-focused rural cooperatives and municipal utilities. But the energy landscape of today gives me uncomfortable reminders of the Athenian tragedy by Sophocles – the Oedipus tale.

John Farrell, ILSR’s Director of Democratic Energy, gave this panel presentation at the 23rd annual conference of the Society for Environmental Journalists in Chattanooga, TN, on Oct. 4, 2013.

For those who don’t recall their college or high school English class, that’s the tale of the man who grows up to murder his father the king and marry his mother.  And in this 21st century version, the utilities are the king and Little Oedipus is represented by rooftop solar panels, wind turbines, and other ways that utility customers can produce their own energy. I won’t speculate who is the mother.

Earlier this year, the Edison Electric Institute (the daddy’s club of the investor-owned utilities) released a report suggesting that Oedipus has grown up and his daddy may not be prepared for the climax of this play. It’s summarized in two headlines from the clean energy press this summer. In Grist: “solar panels could destroy U.S. utilities” and in GreenTechMedia, “adapt or die.”

The problem is that customer power generation from local renewable energy reduces utility sales.*

(I asterisk this statement because there’s a robust debate about whether this distributed renewable energy brings other benefits to the grid not reflected on the balance sheet – for more information, read up on Minnesota’s value of solar process.) But if your utility (or state regulatory regime) has built its business model around growing energy sales, this creates what some are calling a utility death spiral. Falling energy sales force utilities to raise rates, which further enhances the attractiveness of generating your own energy from solar.

It explains why the chair of the Federal Energy Regulatory Commission, Jon Wellinghoff, recently said: “solar is going to overtake everything.”

So Oedipus a growing threat, and the utility daddy is trying desperately to stave off the storybook conclusion.

The problem is that the energy daddies grew up in a very different era.  In the early days of the electric system, you needed big capital to build big power plants and big power lines to bring energy to big cities. We gave them monopolies to facilitate that infrastructure development. And for decades, it worked.

But in the next 10 years, electricity from rooftop solar energy will be competitive – without subsidies – with utility energy prices in almost every state. The overlay of renewable energy standards and incentives for distributed renewable energy illustrates how the public interest, the energy model, and the economics have changed.

The way utilities respond will determine whether this Oedipus tale ends like the play. In Arizona, Wisconsin, and many other states, utilities are trying to gut the basic policies allowing people to generate their own energy. In some places, they are successful.  But a recent story from Georgia should give them pause – a “Green Tea Coalition” of environmentalists and tea party activists successfully lobbied the public utility commission to require the state’s biggest utility, Georgia Power, to launch a large distributed solar program.

Utilities that try to maintain the status quo, to remain the energy daddy, are going to have a hard time. Their customers will fight them for the right to self-generate, especially if it costs less than utility power, and these local energy producers will also be energy voters.

What we need is to have the utility become the facilitator rather than the ruler, the kindly elder sibling rather than an energy daddy. Because even as utility customers look to their own options for electricity generation, they will still need the utility network…

1)  to help them use their rooftop solar to power their electric vehicle.
2)  to finance high-efficiency appliances, efficient lighting, insulation and other strategies to cut their energy use and energy bills.
3)  to use existing on-demand energy sources (like natural gas) and future ones (like batteries) to keep power delivery smooth and high quality as the grid transitions to primarily renewable energy.

This won’t be easy. For one, utilities have a lot of money sunk into power plant and transmission infrastructure that may or may not be useful in this new era. For another, the regulatory system doesn’t necessarily reward this facilitation role rather than energy sales. But there’s no real alternative, because people are not likely to accept, nor should they, giving up this opportunity to have more control over their energy future.

Photo Credit: Michael Kappel

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This article, Who’s Your Energy Daddy?, is syndicated from Clean Technica and is posted here with permission.

About the Author

John Farrell directs the Energy Self-Reliant States and Communities program at ILSR and he focuses on energy policy developments that best expand the benefits of local ownership and dispersed generation of renewable energy. His latest paper, Democratizing the Electricity System, describes how to blast the roadblocks to distributed renewable energy generation, and how such small-scale renewable energy projects are the key to the biggest strides in renewable energy development.

Farrell also authored the landmark report Energy Self-Reliant States, which serves as the definitive energy atlas for the United States, detailing the state-by-state renewable electricity generation potential. Farrell regularly provides discussion and analysis of distributed renewable energy policy on his blog, Energy Self-Reliant States (energyselfreliantstates.org), and articles are regularly syndicated on Grist and Renewable Energy World. John Farrell can also be found on Twitter @johnffarrell, or at jfarrell@ilsr.org.

Renewable Energy Provided 99% Of All New Electricity Capacity In October

by Guest Contributor The SUN DAY Campaign.

 

 

Image Credit: Solar panel, wind turbine & globe via Shutterstock

Washington, D.C. – According to the latest “Energy Infrastructure Update” report from the Federal Energy Regulatory Commission’s Office of Energy Projects, solar, biomass, and wind “units” provided 694 MW of new electrical generating capacity last month or 99.3% of all new generation placed in-service (the balance of 5 MW was provided by oil.) Twelve new solar units accounted for 504 MW or 72.1% of all new electrical generating capacity in October 2013 followed by four biomass units (124 MW – 17.7%) and two wind units (66 MW – 9.4%).

For the first ten months of 2013, renewable energy sources (i.e., biomass, geothermal, hydropower, solar, wind) have accounted for nearly a third (32.8%) of all new electrical generating capacity. That is more than that provided thus far this year by coal (1,543 MW – 12.5%), oil (36 MW – 0.3%), and nuclear power (0 MW – 0.0%) combined. Solar alone comprises 20.5% of new generating capacity (2,528 MW) thus far this year – more than doubling its 2012 total (1,257 MW). However, natural gas has dominated 2013 thus far with 6,625 MW of new capacity (53.7%).

For the first ten months of 2013, compared to the same period in 2012, new capacity from all sources has declined by 27.5% (from 17,008 MW to 12,327 MW).

Renewable sources now account for nearly 16% of total installed U.S. operating generating capacity: water – 8.30%, wind – 5.21%, biomass – 1.32%, solar – 0.59%, and geothermal steam – 0.33%.* This is more than nuclear (9.22%) and oil (4.06%) combined.

A second new federal study, the latest issue of “Electric Power Monthly” by the U.S. Energy Information Administration (with data through September 30, 2013), notes that renewable energy sources accounted for 12.95% net electrical generation for the first three-quarters of 2013 (hydropower – 6.90%, wind – 4.03%, wood + biomass – 1.40%, geothermal – 0.41%, solar – 0.21%). This represents an increase of 5.22% compared to the same period in 2012 with non-hydro renewables combined growing by 15.9% (solar – 91.9%, wind – 21.7%, geothermal – 1.2%, wood + biomass – 0.4%). By comparison electrical generation from all sources (i.e., including fossil fuels and nuclear power) dipped by 0.8%.

“As the threats posed by climate change grow increasingly more dire, renewable energy sources have clearly become a viable alternative to fossil fuels as well as nuclear power,” said Ken Bossong, Executive Director of the SUN DAY Campaign. “Accordingly, efforts by some at the state and national levels to roll back support for these sources are clearly misguided.”

The Federal Energy Regulatory Commission released its most recent 5-page “Energy Infrastructure Update,” with data through October 31, 2013, on November 20, 2013. See the tables titled “New Generation In-Service (New Build and Expansion)” and “Total Installed Operating Generating Capacity” at http://www.ferc.gov/legal/staff-reports/2013/oct-energy-infrastructure.pdf.

The U.S. Energy Information Administration released its most recent “Electric Power Monthly” with data through September 30, 2013 on November 20, 2013; see: http://www.eia.gov/electricity/monthly. The relevant charts are Tables 1.1, 1.1.A, ES1.A, and ES1.B.

* Note that generating capacity is not the same as actual generation. As stated, actual net electrical generation from renewable energy sources in the United States now totals nearly 13%.
The SUN DAY Campaign is a non-profit research and educational organization founded in 1993 to promote sustainable energy technologies as cost-effective alternatives to nuclear power and fossil fuels.

Image Credit: Solar panel, wind turbine & globe via Shutterstock

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This article, Renewable Energy Provided 99% Of All New Electricity Capacity In October, is syndicated from Clean Technica and is posted here with permission.

About the Author

Guest Contributor is many, many people all at once. In other words, we publish a number of guest posts from experts in a large variety of fields. This is our contributor account for those special people. 😀