NREL's Renewable Energy Analytic Studies Network (REASN)


	Economic Valuation of a Geothermal Production Tax Credit The United States (U.S.) geothermal industry has a 45-year history. However, by the mid-1990s, the market for new geothermal power plants began to disappear because the high power prices paid under many PURPA contracts switched to a lower price based on an avoided cost calculation that reflected the low fossil fuel-prices of the early 1990s. One potentially attractive incentive for the geothermal industry is the Production Tax Credit (PTC). The current PTC, which was enacted as part of the Energy Policy Act of 1992 provides an inflation-adjusted 1.5 cent per kilowatt-hour (kWh) federal tax credit for electricity produced from wind and closed-loop biomass resources. This report focuses on the project-level financial impacts of the proposed PTC expansion to geothermal power plants. [Feature Archive]


	Are Renewables the Answer to Electricity Price Volatility? The recent streamlining of the permit process for new powerplants in California has led to a great deal of new generating capacity coming online to meet the increased demand for electricity. According to the California Energy Commission, plants with a capacity totaling 5,942 MW are under construction, with 1,734 MW coming online this summer. While this may in part reduce the rolling blackouts, volatile price fluctuations may continue. Natural gas turbines are a large source of electricity generation in California, and the marginal price of electricity is determined by the cost of natural gas fired turbines. The volatility in electricity prices result to a large extent from fluctuations in natural gas prices, as well as high demand for electricity, and limited hydroelectric supply...