Clean Energy Initiative

When it comes to passing Transportation Bill or insisting on the Keystone XL Pipeline, Senate Republicans are refraining from sinking the transportation bill by insisting it be included in final passage. Several key GOP members huddled on Tuesday afternoon to discuss the issue.  Congressman Upton said the meeting was a starting point for establishing a cogent strategy for Keystone supporters. "We were talking about the highway bill, starting discussions to see what we can figure out," Upton said. "Keystone is a priority for the House, period. So we're going to do all that we can to get it included as part of the package. But it's difficult to say how things are going to work out until we really start talking. And that's what we've gone to do." 

The Energy Department’s loan guarantee program (code word Solyndra) will be back in the cross-hairs of Capitol Hill Republicans on Wednesday.  A House Oversight and Government Reform Committee panel will convene a hearing with a title that advertises the lawmakers’ questions: “The Obama Administration’s Green Energy Gamble: What Have All The Taxpayer Subsidies Achieved?”  It will feature top execs from several green-energy companies — such as BrightSource Energy and Abound Solar that have hit financial headwinds ranging from layoffs to a canceled IPO.  Solyndra, the loaded mantra of Republicans, willl be used to launch wider attacks on White House green-energy programs.   “This administration’s Department of Energy continues to make reckless bets with taxpayer funds followed by deceptive claims about the program’s effects on job creation, or lack thereof. This hearing will explain what recipients of billions of dollars of taxpayer funds are doing with the money and the risks associated with DOE’s irresponsible gamble,” said a spokeswoman for Issa.

The USDA has announced that rural electric cooperative utilities in 10 states will receive loans to install smart grid technologies and make improvements to generation and transmission facilities. Examples of funding include a $102.8 million guaranteed loan to the Jackson Electric Membership Corporation in Jefferson, Georgia, to build and improve over 850 miles of distribution line and make other system improvements. The loan also includes $7.2 million in smart grid projects. 

Jim Hansen, a noted NASA Physicist and climatologist, has heretofore refrained from direct cause and effect of climate change.  However, in a peer-reviewed paper, which has been submitted to a leading Scientific Journal and made available to Time.com, Hansen indicates that may be changing. According to the paper Hansen states that scientists can now state “with a high degree of confidence” that some extremely high temperatures are in fact caused by global warming, simply because they occur much more frequently than they used to.  In the paper, the authors show that extreme outliers of more than three standard deviations above the mean temperature covered between six and thirteen percent of the globe during the years 2003 to 2008. If they were normally distributed and similar to the climactic record, that should have been just a 0.1-to-0.2 percent frequency of an extreme heat event.

The Guardian reported on Tuesday that several conservative groups met earlier this year to coordinate a campaign to turn public opinion against wind power. A confidential memo distributed at the meeting outlined a PR strategy that would, among other things, use media outlets including Fox News and the Wall Street Journal to disseminate anti-wind messaging. The goal of the media campaign is to provide "cover" for elected officials to vote against wind power.  The strategy document calls for a national PR campaign aimed at causing 'subversion … so that it effectively because so bad that no one wants to admit in public they are for it'.  Fox New has claimed that wind energy "doesn't work," calling it "pointless" and "the Ted Bundy of bird killers." And the Wall Street Journal is doing its part, calling for the elimination of a key tax incentive for wind in an editorial published earlier this week.  Even Rupert Murdoch, the media mogul behind both News Corp. outlets, is joining the conservative war on wind. Murdoch took to Twitter last month to lambaste wind development in the UK, complainingthat the "English spring countryside [is] about to be wrecked by uneconomic ugly bird killing windmills." Speaking of asthetics, I will let you be the judge - the coal plant to the left or the wind turbine to the right.

Solar, wind and thermal represent about 1.5% of U.S. energy consumption.  According Oil Price - solar is the more realistic for consumers.  The Administration's investment in renewable projects such as the May 4th unveiling of the utility scale plant in Nevada is a boast to the solar industry.  Solar leasing, with no upfront costs, is a breakthrough for solar.  Sunrun Company has installed $1 million in solar power leasing systems since 2010.   Consumers seem not to be  looking at solar in terms of its costs in comparison to coal, rather, they are looking at the costs of installation as compared with the monthly utility bills that come in the mail. To this end, the solar system leasing program stands to make significant gains.

The big issue facing Congress as they return from their weeklong recess is to convene a conference committee this Tuesday in hopes of developing a consensus on transportation policy.  Center to the bill will be the Keystone XL oil sands pipeline.  The House version of the transportation and infrastructure bill approves the pipeline to bring Canadian oil sands to Gulf Coast refineries, but  the Senate’s plan omits the provision.  There will be much jockeying by lobbyists and special interest groups for the pipeline to make the final cut.  Speaker John Boehner (R-Ohio) on Friday called for Keystone’s approval.  Developer TransCanada Corp. formally reapplied for a federal cross-border permit Friday, which in turn revived industry and GOP calls for the White House to approve the project.  Even with that,  advocates face a tough climb getting mandatory Keystone approval into a final transportation bill.

Democrats outnumber Republicans 8-6 among the Senate negotiators. Among those Democrats, only Sen. Max Baucus (Mont.) has voted in favor of including Keystone in the bill, but he has signaled that he’s unlikely to insist on the provision.  As I've often pointed out, environmentalists bitterly oppose the pipeline due to greenhouse gas emissions from extracting and burning oil sands, forest damage from the massive projects in Alberta and fears of spills along the pipeline route. 

Expect lots and lots of partisian posturing.  As my friend and Texas colleague, Billy Moore has points out, the one problem with the transportation bill conference is that few members have experience ironing out the difference between the two chambers.  Congress used to conduct about 75 conference committees a year and Tuesday's highway conference is only the 6th conference committee in 17 months.  Except for the fact that Congress would like to produce one legislative accomplishment before the election, the prospects of this passing are slim. 

The economic vitality of the solar industry is in question these days.  Two major solar firms tell a tale of a still nascent industry struggling to maintain economic stability amid rapidly changing  innovations in solar technology:  First Solar and Brightsource

Actually things have been going fine until  three things happened:  One, the fracking of natural gas lowered the cost of natural gas below any renewable source.  Two, the Republicans in Congress have completely eroded  tax subsidies for renewables.  Three, China has made solar manufacturing a centerpiece of its economic agenda, sending a tide of cheap photovoltaic panels to American shores dropping the price for panlels by 75%.

First Solar, once among the industry’s biggest and strongest companies just reported a big quarterly loss of $449 million in the first quarter.  In addition they are going through a massive restructuring announced last month that will eliminate 30 percent of the company’s workforce and plan to close their plant in Germany.   First Solar named James Hughes asCEO, replacing interim chief and company founder Mike Ahearn.  Things move quickly in the innovation world and in the previous quarter,  the company earned $115 million, or $1.33 per share.

At issue is that First Solar, along with other makers of solar panels, is struggling to adjust to a dramatic plunge in panel prices. As I wrote a couple of weeks ago, the boom in the construction of solar panel factories, especially in Asia, coincided with lower demand in Europe created a glut of panels and sent prices tumbling. European demand fell because cash-strapped governments there reduced renewable energy subsidies.  Unfortunately for First Solar, their enormous cost advantage over the competition has eroded. First Solar became the biggest solar company in the world, both by market valuation and panel sales, selling solar panels made with a thin film that were far cheaper to produce than those made from crystalline silicon. Though a thin-film panel is less efficient in turning the sun’s rays into electricity than a crystalline silicon panel, a solar farm with thousands of First Solar’s thin-films could produce the same of amount electricity at a lower total cost.  Now, the cost of the raw material for crystalline silicon panels has plummeted, making it easier for these more -efficient panels, mostly made in China, to compete with First Solar’s thin film on price.

Brightsource Energy - an investor in solar thermal energy, a technology that powers homes and businesses around the clock. (Traditional photovoltaic solar panels transmit power only when the sun is shining.) is also having some troubles  Although there still was no solution to make solar thermal power as cheap as wind turbines or photovoltaics, that was OK because Brightsource had major buyer lined up: the state of California, which has passed laws requiring it to cut greenhouse-gas emissions by ambitious amounts. Brightsource, was planning to go public in early April, but cancelled this offering citing adverse market conditions.  The company says they are still in a position of strength and their $2.2 billion plant in California’s Mojave Desert is fully funded, thanks to investments from NRG Energy and Google and a $1.375 billion federal loan guarantee  Still, BrightSource’s future looks much dimmer than it did just a few weeks ago.

The Rolling Stone Magazine featured an interview with President Obama in their May issue.  During the interview, President Obama made several references to energy and climate issues.  He pointed out that“getting rid of the Environmental Protection Agency” was the “centerpiece” of the House Republicans’ economic development agenda,   The President also emphasized the steps the Administration has taken to regulate greenhouse gas (GHG) emissions “within the constraints of this Congress,” but said “we have a lot more work to do.”  He vowed that over the next six months “I will be very clear in voicing my belief that we’re going to have to deal with climate change in a serious way.”   When quizzed about the Keystone XL pipeline, the President stated, "The reason that Keystone got so much attention is not because that particular pipeline is a make-or-break issue for climate change, but because those who have looked at the science of climate change are scared and concerned about a general lack of sufficient movement to deal with the problem".  He went on to say, "Within the constraints of this Congress, we've tried to do a whole range of things, administratively, that are making a difference – doubling fuel-efficiency standards on cars is going to take a whole lot of carbon out of our atmosphere. We're going to continue to push on energy efficiency, and renewable energy standards, and the promotion of green energy. But there is no doubt that we have a lot more work to do."

On May 17, the Commerce Department will announce a determination on a second round of tariffs on Chinese-made silicon-based photovoltaic cells.  The Commerce Department's May 17 ruling, in response to allegations of dumping by the U.S. unit of a German solar panel maker, Oregon based Solarworld , could fundamentally alter the solar landscape in the United States. Dumping occurs when a firm or industry sells its products below cost to capture the market. If more tariffs are applied, they probably will be much higher than the relatively light first round announced in March, which ran from 2.6 percent to 4.7 percent.

Our Clean Energy Initiative had a panel on the tariff issue, Chinese Tariffs: Smart Policy or Proctionism? with Lewis Leibowitx, of Hogan Lovells,  Elizabeth Drake of Stewart and Stewart and William Morin of Applied Materials.  Some believe that applying more tariffs might may kill jobs because the vast majority of positions in the sector aren't on the assembly line. Instead, up to of 70 percent of U.S. solar employment is in installation, sales, and distribution, and firms that hire those workers argue that solar cells must get significantly cheaper to stay competitive with other energy sources.  According to our friend, John Smirnow, VP of Trade at Solar Energy Industries Association, "Installation is where all the jobs are.There are 5,600 firms in the healthy, vibrant, and growing solar-services sector."  Pro tariff advocates say protecting a solar manufacturing base is crucial to the nation's energy security.  

I want to take this opportunity to thank all of you who have helped to make our Clean Energy Solution Series such a brilliant success.  Interior Secretary Ken Salazar’s speech last Thursday on the Department of the Interior’s energy initiatives marked the 10th in our series that began last summer.  Your participation is important to this success and, I’d love to hear suggestions and ideas  for speakers or subject matter for future events. Please contact me at 202-384-1216 or cgiesen@ndn.org.  Check out the following list of our remarkable speakers and panels:

Wireless Technology-Wireless Technology: New Technologies and the Electric Grid

• Nick Sinai -White House Director of Smart Grid
• Kurt Yeager – Galvin Electricity Initiative
• Hassane Bouhia – Verizon 
• Stewart Kantor – CEO, Full Spectrum

Rooftop Solar: The Speed of Solar: Tremendous Progress of Rooftop Solar Technology

• Danny Kennedy – CEO, Sungevity
• Rachel Tronstein –  DOE  EERE
• Andrea Luecke - Solar Foundation

FERC Order 1000: Transmission Policy Reform: What does this mean for Renewables?

• Joe Kelliher – NextERA Energy and former FERC Commissioner
• Nina Plaushin –ITC Holdings
• Tom Vinson – American Wind Energy Association
• Bill White – Energy Future Coalition

Wind and Renewable Tax Credits:  Economic Ramifications of Wind and the Relevance of Tax Credits

• Markian Melnyk – Atlantic Wind Connection
• Laura Haynes- Senator Tom Carper 
• Rob Gramlich - American Wind Energy Association 

Electric Vehicles:  Promise and Progress of Electric Vehicles

• Barbara Tyran –Electric Power Research Institute
• Miles Keogh – National Association of Regulatory Utility Commissioners
• Kyle Davis – Mid America Corporation
• Genevieve Cullen –Electric Drive Transportation 
• Mary Beth Stanek – General Motors

Gina McCarthy – Asst. Administrator for Toxic Emissions and Radiation, Environmental Protection Agency

• EPA Regulations on Utilities

DOI Chinese Tariffs: Solar Tariffs: Smart Policy or Protectionism?

• Lewis Leibowitz – Hogan Lovells, LLC
• Elizabeth Drake – Stewart & Stewart, LLC
• William Morin – Applied Materials 

Consumers: Their Critical Rule in Shaping The Future of Energy Use.

• Michael Sachse – Vice President, Regulatory Affairs, Opower
• John Ashford – The Hawthorn Group
• Cliff Majersik – Institute for Market Transformation  

Ken Salazar:  Secretary of the United States Department of Interior 

•  Interior's All of the Above Energy Strategy

American Electric Power (AEP) President Nick Akins spoke to the Chamber of Commerce last Wednesday.  He  warned that natural-gas prices, which are hovering around $2 per 1,000 cubic feet, could surge and undercut the current rational behind increased reliance on natural gas.  Poining out the past volatility in the price of natural gas, I quote Akins, “Betting on just one fuel to power our energy fuel isn’t smart.  Whether that volatility has changed permanently remains to be seen." Coal makes up a major portion of American Electric Power's (AEP) generating capacity, but low natural-gas prices and new EPA air pollution regulations have driven AEP to diversify its fuel mix.  AEP has said it will retire more than 5,000 megawatts of coal-fired power, switching to natural gas and other fuel sources.

The American Society of Civil Engineer  (ASCE) released their latest report on the current state of the United States electric grid system.  This special report described the nation’s electrical grid as a patchwork system that ultimately will break down unless roughly $673 billion is invested in it by 2020.  A staggering piece of information from an organization that is not prone to exaggeration.  However, some believe that fixing our grid system is a possibility.   The Honorable Curt Hebert, Jr., a highly thought of former FERC Chair, states the good news is that private capital is available for investment in electrical infrastructure.  He says the money is sitting on the sidelines because we haven’t inspired anybody to get out there and build this infrastructure in a way that they might believe there’d be a return on their investment. 

United States Department of Interior Secretary Ken Salazer outlined the DOI’s energy strategy to a packed room at a luncheon held Wednesday, April 25 at NDN/New Policy Institute. Click here to watch the video of Salazar's speech. 

Under the Obama Administration, Secretary Salazar and the DOI have made remarkable progress through their 'all-of-the-above' approach to energy over the last three years.  The United States' gas production is at an all-time high and oil production has increased by 13% during the first three years of this Administration.  Correspondingly, America’s dependence on foreign oil has decreased every year since Obama took office.  In 2008, we had a net import of 57%, but with Obama's energy policies in place, by 2011, our net import was 45%, the lowest level in16 years.

Secretary Salazar pointed out that DOI has made significant strides in promoting renewable energy technologies on federal lands.  Since 2009, DOI has authorized 29 utility scale solar, wind and geothermal projects and, if built, will provide 6,5000 MW of clean power for 2.3 million homes. 

This speech by Secretary Salazar was the 10th in the Clean Energy Initiative’s Solution Series to showcase the leaders, companies, ideas and policies who are hastening our transition to a cleaner, safer and more distributed energy paradigm of the 21st century.

President Clinton, in a speech to the Sustainability Conference was optimistic on the continued investment and commercial development of clean renewable energy.  He  o sees upgrades as a way to create jobs and boost the economy, has made a cause of retrofitting buildings to conserve energy through his Clinton Climate Initiative and President Obama’s Better Building Challenge, which promotes public and private investment in energy efficiency projects.this is a process that will not happen overnight.  

Senate Energy and Natural Resources Committee Chairman Jeff Bingaman (D-N.M.) is trying to build support for a proposal that requires power companies to supply escalating amounts of electricity from low-carbon sources. Bingaman, in his final year in the Senate, has acknowledged that the White House-backed plan is extremely unlikely to pass in 2012, but hopes to lay a foundation for future action.  He will hold a hearing next month on this topic.