Obama Administration Launches $130M Building Efficiency Effort
The Obama Administration announced on February 12 a multi-agency initiative to spur regional economic growth while making buildings more energy efficient.
Seven federal agencies issued a combined Funding Opportunity Announcement (FOA) of up to $129.7 million over five years to create a regional research center. The center will develop new building efficiency technologies and work with local partners to implement them in local buildings. DOE is providing up to $22 million in the first year, and as much as $100 million over the next four years.
The agencies are working together to leverage funding and resources to promote regional growth through an Energy Regional Innovation Cluster (E-RIC) that’s centered on an Energy Innovation Hub. The hub, one of three funded by Congress in fiscal year 2010, is focused on developing new technologies to improve the design of energy-efficient building systems.
The E-RIC will be based at a university, DOE national laboratory, nonprofit organization, or private firm. The entity will partner with local or state government officials, drawing on the expertise of local architects, builders, and manufacturers.
In addition to DOE, the agencies participating include the U.S. Department of Commerce’s Economic Development Administration and Commerce’s National Institute of Standards and Technology; the Small Business Administration; the National Science Foundation; and the U.S. Departments of Labor and Education. They will work together to leverage this funding with regional sources.
Because buildings account for nearly 40% percent of U.S. energy consumption and carbon emissions, this initiative is designed to provide an array of benefits, which include reducing energy use, lowering utility bills, and decreasing carbon emissions. See the DOE press release, the Energy Regional Innovation Cluster Web site, and the FOA (PDF 786 KB).
16 Tribes Earn Bonding Authority for Renewable Energy Facilities
The U.S. Department of Treasury announced on February 11 it has allocated $1 billion in Tribal Economic Development Bonds to 76 tribes under the Recovery Act.
Tribes will be able to issue low-interest bonds to finance a variety of projects, including renewable energy projects and manufacturing facilities. Over $250 million of the total is allocated to 16 tribes, located in seven states, which intend to use at least a portion to finance renewable energy projects.
At least $86 million will finance renewable energy facilities, including nearly $11 million for a renewable energy manufacturing facility on the tribal lands of the Agua Caliente Band of Cahuilla Indians, located in southern California. The Pueblo of Acoma, located in New Mexico, plan to issue nearly $7 million in Tribal Economic Development Bonds to develop and construct a 15 MW wind farm. See the Treasury press release and the complete list of awardees (PDF 11 KB).
SMUD Receives Huge Response for Feed-in-Tariff
The Sacramento Municipal Utility District (SMUD) feed-in tariff (FIT) for renewable or combined heat and power generating facilities exceeded its 100 MW allotment through requests by five applicants for solar PV.
The applicants are commercial entities: Belectric, Inc.; Globall Connect; McClellan Park; Recurrent Energy; and SunPower Corporation.
The program, approved in September 2009, is designed to remove barriers to interconnection with the utility by providing standard rates and contract conditions that make it easier for SMUD and its power-generating customers to do business.
For example, for contracts signed in 2010, SMUD customers with PV systems will be paid on average $0.0968 per kilowatt-hour (kWh) for a 10-year contract, $0.1040 per kWh for a 15-year contract, and $0.1107 per kWh for a 20-year contract. Applications must include $1,400 for the Interconnection Review Fee and a deposit of $20 per kilowatt, and each system is limited to 5 MW in capacity. See the SMUD press release (PDF 85 KB) and Feed-In Tariff Web page.
FITs, which are widely used in Europe, face regulatory constraints in the US. However, according to a January 2010 report from DOE’s National Renewable Energy Lab (NREL), the path for states seeking to provide legal FITs is tricky, but possible.
The report, "Renewable Energy Prices in State-Level Feed-in Tariffs: Federal Law Constraints and Possible Solutions," concludes that states can offer feed-in tariffs, but need to create them in such a way as to meet federal requirements under the Public Utility Regulatory Policies Act of 1978 and the Federal Power Act of 1935.
The report describes several ways for states to create incentives for renewable energy. One suggestion is for payments based on cost of generation, in keeping with federal limits, but then adding incentives on top of that cost through subsidies, Renewable Energy Credits, or state tax credits. The report notes that given the legal uncertainties, state regulatory groups should consider getting advice from appropriate federal agencies. See the NREL report (PDF 1.37 MB).
Cellulosic Ethanol Facilities Sprout Up in Four States
A shift in biofuel production to cellulosic biofuels is underway as both demonstration and commercial-scale power plants are opening or moving closer to completion.
In the commercial arena, Poet, the largest U.S. producer of ethanol, is planning construction this year of Project Liberty, a cellulosic ethanol plant in Emmetsburg, Iowa, that will use corn cobs from local farms to produce 25 million gallons a year of ethanol. The plant will be co-located with Poet’s corn grain ethanol plant and should start commercial operations in 2011. DOE has provided $80 million in funding for the facility, and in late January, the Iowa Department of Economic Development approved a $5.25 million grant, bringing Iowa’s total contribution to $20 million.
Poet’s pilot-scale plant in Scotland, South Dakota, is producing cellulosic ethanol at a rate of about 20,000 gallons per year and has successfully driven the cost down from $4.13 per gallon to $2.35 per gallon, as the company aims for a commercial cost below $2 per gallon. See the Poet press releases on the Iowa grant and the cost reductions.
Meanwhile, Abengoa Bioenergy is planning to develop the nation’s first commercial-scale hybrid cellulosic ethanol and power plant in Stevens County, Kansas. The $550 million facility is expected to produce 15 million gallons of ethanol annually using corn stover, wheat straw, and switchgrass as feedstock. In January, Abengoa signed an agreement to sell 75 MW of power from the facility to Mid-Kansas Electric Company.
The new cellulosic ethanol facilities will be essential to meet the newly revised Renewable Fuel Standard, which sets a federal requirement for the sale of 6.5 million gallons of cellulosic ethanol over the course of this year. That requirement will ramp up to 16 billion gallons by 2022. See the Abengoa Bioenergy press release and the article from the EERE Network News on the Renewable Fuel Standard.
Two demonstration-scale plants have recently started up. Last October, Coskata Inc., a developer of biofuels, announced the launch of their semi-commercial cellulosic ethanol facility located in Madison, Pennsylvania. Coskata’s facility will produce ethanol from numerous feedstocks, including wood biomass, agricultural waste, sustainable energy crops, and construction waste.
And on January 29, DuPont Danisco Cellulosic Ethanol LLC and University of Tennessee/Genera Energy celebrated the grand opening of their first cellulosic ethanol demonstration plant, which converts both agricultural residue and bioenergy crops into ethanol. The facility, located in Vonore, Tennessee, has the capacity to produce 250,000 gallons a year from corn cobs and switchgrass. The company intends to achieve commercial production by 2012. See the press releases from Coskata and DDCE.
Global Investments in Clean Energy Fell Less than Expected in 2009
Worldwide investment in clean energy totaled $145 billion in 2009, down 6.5% from the record 2008 figure of $155 billion, according to market research firm Bloomberg New Energy Finance. The largest global investment was $92 billion, spent on building assets such as wind farms, solar parks, and biofuel plants.
Their report credits a boom in China’s wind development for a 25% spending increase in that region, compared to a 25% drop in the Americas. China spent $21.8 billion on wind farms, a 27% increase over 2008, and nearly doubled spending on solar projects, reaching $1.9 billion in 2009.
Globally, such asset financing was down 5% from 2008, while investments in public clean energy companies dropped 5%, at $13.1 billion. Venture capital and private equity funds fell 44% in 2009, dropping to $6.6 billion. See the Bloomberg press release (PDF 23 KB).
The findings on VC investments are backed up by the Cleantech Group – preliminary 2009 results for clean tech VC investments in North America, Europe, China, and India totaled $5.6 billion in 557 deals, down from $8.4 billion in 567 deals recorded in 2008.
Looking at just the US, consulting firm Ernst & Young found a similar trend – VC investments in 2009 fell 50% to $2.6 billion. There was a shift toward less capital-intensive energy efficiency technologies, which resulted in many deals but less total investment.
The Cleantech Group notes that four of the five largest funding rounds in 2009 were for U.S.-based companies: thin-film solar company Solyndra raised $198 million; advanced battery developer A123 Systems raised $100 million; Silver Spring Networks, a smart grid company, raised $100 million; and fuel-efficient automaker V-Vehicle raised $100 million. See the press releases from the CleanTech Group and Ernst & Young.
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EREE Network News is a weekly publication of the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE).
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