Our series of entries around Renewable Energy Financing Forum sponsored by ACORE in NY continues. The afternoon session was kicked off by US Secretary of Energy, Samuel (Sam) Bodman.

Mr. Bodman will never be accused of being a captivating speaker, but he did have information to share including 3 announcements relating to solar energy:

• A $2.5M grant to 13 cities to improve solar infrastructure
• $30M in grants for photovoltaic process research over the next 3 years
• Up to 10 incubation projects at US universities around PV research with matching private funds totaling up to $27M

Secretary Bodman repeatedly referenced his, and the administration’s belief, that government should be a supporter of renewable energy and private industry should lead and that government should provide a “stable policy framework” in which this support should occur.

The afternoon rounded out with sessions on wind and high profile deals. Following the same format as our earlier post, here are some salient points that stood out from the sessions:

• Wind is the second fastest electricity generation technology behind natural gas
• British Petroleum has entered the wind space in a big way growing from 30MW in late 2005 to over 15GW in development at present
• BP sees a global installed wind base of 125GW within 5 years
• Suzlon, an Indian turbine manufacturer, sees a $186B global wind opportunity
• Venture investment in energy was $2.4B in 2006. Q1 2007, $903M
• M&A activity for renewable energy was $41B in 2006, YTD 2007 it’s $43B
• IPO for renewable energy totaled $7.3B in market cap in 2006 and is $2.2B in 2007, however, $5.1B has been filed for 2007

The networking and reception functions were very productive with over 700 attendees of various types at the conference. There is a good mix of investors, technology providers, support services and developers at this conference. Earlier, we referenced that there was no overlap between this conference and the geothermal funding conference, that was not accurate. Representatives are here from Glitnir Bank (Arni Magnusson) and US Geothermal. Other than that, people wise, there is no overlap. Firm-wise, many of the same support services and a few of the same funding companies are in attendance.

From Renewable Energy Access:

By a vote of 15-5, the U.S. Senate Finance Committee approved an updated package of energy tax incentives yesterday, which contains a five- year extension of the tax credit for the production of electricity from wind, geothermal, biomass and other renewable energy resources.

Read more…

As a project developer, this would be welcome news indeed if it becomes law. Today at REFF, US Secretary of Energy Sam Bodman, repeatedly stated “Government needs to support private industry in renewables with a stable and secure policy” which included predictable production tax credits.

Another great talk at the GEA Geothermal Financing workshop was given by Tom Fair of Sierra Pacific Resources. Tom reviewed what investor owned utilities (IOUs) were looking for when selecting independent power producers (specifically for renewable electricity, but there seemed to be nothing particular that would make it different for non-renewable IPPs either.)

One surprising fact Tom stated was that up to 40% of awarded power purchase agreements to renewable IPPs fail. As the power companies face renewable portfolio standards in their service areas, this failure rate exposes the IOUs to risks they’re not willing to accept. From the IOUs’ perspective, when they book megawatts to be delivered, they’re expecting that the megawatts will be there. In the renewable space, that has often not been the case.

In fact, Tom’s talk really could be labeled “get power purchase contracts by lowering the IOUs risk and delivering what you promise.” This is an important and basic lesson: don’t sign up if you can’t deliver.

As you may have heard, today, May 15th is the national gas boycott day. It’s a great attention ploy and maybe even an interesting symbol of protest. But in the end, all it will do is defer sales until later in the week.

What’s required to really move prices? A change in behavior. If each driver in the US would do the following things over the next year, it could reduce fuel demand by as much as 10%.

The easiest actions you can take to increase your fuel efficiency by 10%:

• Drive the speed limit, the faster you go, the more fuel you burn (and your ticket risk goes down) this yields around 5% fuel efficiency
• Remove unnecessary items from your car, each 100 lbs of weight removed can add up to 2% fuel efficiency
• Don’t idle your car unnecesarily, for any delay longer than a stop light, switch the ignition off
• Whenever you make a trip, combine multiple segments into one eliminating the need for mulitple trips
• Take it easy, hot rod starts and fast braking can decrease fuel efficiency by as much as 33%.

Easy suggestions to increase your fuel efficiency by 10%

• Make sure your tires are properly inflated, wheels balanced, and aligned this will yield around 3% fuel efficiency
• Ensure your car has a clean air filter which could yield up to 5% fuel efficiency
• Keep your car “tuned up” which will yield up to 4% fuel efficiency
• Use the right grade of motor oil, this will yield up to 2% fuel efficiency

More suggestions to increase your fuel efficiency by 10%

• If you must commute, carpool or take public transport
• Buy a more fuel efficient car, a 10mpg difference could save as much as $3,000 per year in fuel
• Avoid “rush hour” travel
• Telecommute to work

Obviously, these suggestions range in cost and effort from essentially zero (change your driving behavior and remove excess weight) to very expensive (buy a more fuel efficient car.) We publish all of them so you can select the actions you want to take to actually change the fuel comsumption over time rather than simply boycotting gas purchase for a day. Not everyone can do everything on this list, but everyone can do some combination of these items to total a 10% reduction. Let’s focus our effort on these pragmatic actions and we’ll see an impact on the price of gas, save yourself money, and oh by the way, we’ll reduce our greenhouse emissions as a bonus.

Over the weekend, another article cautioning on the evils of wind power, bird kills, made it into wide circulation. This is not a new issue and it’s not an issue easily solved as it pits two natural groups of allies against one another over a single issue. Generally speaking, people promoting the growth and use of renewable electricity generation are doing so not only out of the desire for profit but also to lessen the impact of electricity generation on the environment as a whole. And generally speaking, people working to protect the bird populations are doing so out of a sense that it is our responsibility to protect the environment and particularly those residents of the environment who don’t have a voice in the process, like plants and animals.

The key to recognize is that both groups have the same goal in common, these groups are not natural enemies. But, through the years wind operators and bird conservation groups seem to have lost sight of their basic shared mission.

Let’s be honest with ourselves over this particular tradeoff (avian death vs. wind turbines.) First, we need to acknowledge that the hunger for electric power is not going to slacken, it increases each year. Over the past 14 years according to Electric Power Monthly data, demand has increased over 30%. The demand for electric power has grown faster than renewable electricity generation can be installed and operated, so over that same period, while the gross amount of renewable power is much larger, the relative percentage share of renewable power is about the same and in some areas a little less. What does the heavy lifting for the grid? In order, coal (~50%), nuclear (~20%), natural gas (~17%), hydroelectric (~6%), and everything else (~7%.)

Since coal is the largest portion of the generation portfolio, let’s look at the impact of generating a megawatt hour. Emissions of around 1,000kg of carbon dioxide and around 15kg of sulphlur oxides, nitrogen oxides, and other trace contaminents like mercury. A megawatt of wind power by contrast is zero emission (yes, there were emissions accrued during manufacturing, transport, and construction but there no different than the coal plant had – so let’s not cloud the issue with that extraneous information.)

So in the end, we’re talking about trading off the negative environmental impacts of non-renewable generation vs. the health and well being of birds. The negative environmental impacts of non-renewable power generation affects all species on the planet. The turbines affect birds, not all birds, some birds. Not wholesale killing, an occasional bird death. When viewed through this lens, the answer should be obvious. Build as much renewable generation as we can because that will help the overall ecosystem and benefit all species, including birds. However, we should take measures to minimize the avian impact where possible. Ultimately, there needs to be a partnership between the avian conservation groups and the wind operators where cooperation is routine to serve a joint goal: minimize avian impact while promoting and growing renewable energy. No one relishes the thought of a Golden Eagle death at the hands of a wind turbine.

One item that has always been a curiosity for me on this issue is the singling out of wind turbines. Cellular telephone network towers, radio towers, buildings, and cars all kill these birds in large numbers too. I don’t see any campaigns to attack these structures; it only seems to be wind turbines that attract attention. It’s clear, cooperation, not conflict between the groups is necessary. Who knows, perhaps what is learned in minimizing avian impact for turbines could be used on other structures?

A final word on this, minimizing avian impact does not mean zero avian impact. The societal and environmental benefit of renewable power is worth making tradeoffs and clearly, this is one of them.