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Week of July 26, 2004

Review previous issues at http://www.wapa.gov/es/nhnewsback.htm. Responsibility for the factual accuracy of each press release rests entirely with the individuals or organizations identified on the release.

Green Power

Green-e Certified Electricity Grew By 68%

Sales of Green-e certified electricity grew by 68 percent in 2003 topping 3.2 Billion kWh. This is according to un-audited preliminary verification results for Green-e renewable electricity sales in 2003. TRC sales accounted for the majority of the growth. The official audited 2003 results and report will be available on the Green-e Web site in the fall. For more information, please contact Jennifer Martin, verification Manager. Source: CRS, 7/23/2004.

Office Depot Buys Green Power

Office Depot, a national seller of office products with 867 retail stores in 44 states, announced that it has entered into an agreement with Pittsburgh-based Strategic Energy to purchase green power for 12 of its California retail stores and warehouses. Under the two-year contract, the company will buy approximately 12 million kWh of electricity annually, generated from landfill gas. Source: Green Power Marketing Monthly Update - June 2004.

Fort Collins Lowers Wind Premium by 60%

Fort Collins Utilities has lowered the premium charged for its 'Wind Power Program' to 1.0¢/kWh from 2.5¢/kWh. The lower premium, guaranteed for 2004 and 2005, resulted from a decision to purchase wind energy certificates from the new, 144-MW Pleasant Valley Wind Energy Facility located in southwest Wyoming. The utility is purchasing about 5 percent of the project output.

Fort Collins customers can choose to buy $5 or $10 blocks of wind energy, or have their total energy use supplied with wind-the average residential customer would pay an extra $7 per month to meet their entire electricity needs with wind energy. In 2003, the Fort Collins City Council approved a goal to increase the City's percentage energy contribution from renewable energy sources (in addition to existing large hydro) to 2 percent by the end of 2004 and to 15 percent by the year 2017. Source: Green Power Marketing Monthly Update - June 2004.

Whole Foods Increases Wind Energy Purchases

Whole Foods Market, a natural and organic foods supermarket chain, announced that it is purchasing wind energy certificates for 10 percent of the electricity used at its 28 stores and facilities in the North Atlantic Region, covering Massachusetts, Rhode Island, Connecticut, New York, and New Jersey. Under an agreement with Community Energy Inc., the company will purchase 5.2 million kWh of wind energy annually generated from new wind energy projects located in the Eastern United States. Combined with an earlier wind energy purchase for its Mid-Atlantic stores, Whole Foods is now buying a total of 11.2 million kWh of wind energy annually for 54 stores in the East. Later this year, the two companies plan to launch an in-store educational campaign to inform Whole Foods customers about the benefits of wind energy and how to purchase wind energy for their homes. Source: Green Power Marketing Monthly Update - June 2004.


For more information: http://www.eere.energy.gov/greenpower/home.shtml

Renewable Energy Technologies

Wind-Power Plan Gains Board's OK

One month after a state panel told a Pilger, Neb., farmer he probably couldn't sell electricity from a private wind generator, the winds shifted Friday. In a 4-1 vote, the Nebraska Power Review Board ruled that while the farmer's proposal probably didn't precisely fit state rules, it should be approved because the state is encouraging such renewable energy projects.

"The letter of the law is probably not met, but the spirit of the law is," said Tim Texel, executive director and general counsel of the Power Review Board. Last month, farmer Dave Tobias asked the board to allow him to sell excess electricity—about $5 worth in a good month, he estimated—to his local rural power company.

While anyone can erect a wind generator for personal use, selling electricity and hooking into the state power grid requires approval by the Power Board. The case presented several legal issues, and board members said Tobias' $40,000 project probably didn't meet a state standard that new generating facilities be the most economical possible.

While a requested legal opinion from the Nebraska Attorney General's Office was not ready by Friday's meeting, Texel said the board ruled that the Tobias project would have no impact on ratepayers, and thus it met the spirit of the law. He said the board may have to review the vote depending on what the legal opinion concludes. The Legislature, Texel said, still needs to update statutes that pertain to such experimental, private projects. Source: Omaha World - Herald, 719/2004 via Energy Central, 7/20/2004.

Eastwood Unveils Sun-Link PV Module Mounting System

Larkspur, CA-based Eastwood Energy recently introduced its new Sun-Link flat-roof photovoltaic module mounting system. According to the company, he system can be arrayed at tilt angles of five, 10, 15 and 20 degrees, and can be used with most existing PV modules. Additionally, Eastwood Energy noted that Sun-Link features a variety of anchoring and ballasting options to accommodate different roof types. Source: EIN Renewable Energy Today, 7/7/2004.

Large Wind Power Plants Proposed for Wisconsin and Nevada

Wind energy companies are continuing to plan for the future, as large wind power plants are under development in Wisconsin and Nevada. In Wisconsin, Invenergy Wind LLC is planning to build a 60-megawatt wind power plant near Brownsville, about 60 miles northwest of Milwaukee. Wisconsin Public Power Inc. and Madison Gas and Electric have teamed up to buy all the power from the new facility for the first 20 years of operation. Called the Forward Energy Center, the new wind plant is expected to begin operating in August 2005. See the press releases from WPPI and MGE.

In Nevada, Navitas Energy has submitted a proposal to the Bureau of Land Management Winnemucca Field Office to build an 80-megawatt wind power plant in the Dry Hills, about 22 miles northeast of Winnemucca in the north-central part of the state. Called the Getchell Wind Farm, the facility will consist of 40 wind turbines, each two megawatts in capacity. Although the BLM is just starting the environmental review process for the proposed wind plant, Navitas intends to begin construction in late spring of 2005, with commercial operation starting six to nine months later. See the press release from the BLM Winnemucca Field Office. Source: EERE Network News, 07/21/04

NIST Building Integrated PV Program

NIST's Building Integrated PV program consists of short-term testing to characterize the electrical performance of
BIPV panels that utilize various cell technologies, modeling to predict the annual energy prediction of the panels, and long-term performance monitoring of the panels under real-world conditions. Joint efforts will be undertaken
to improve the accuracy of predictive models. Source: SEPA Bi-Weekly News, 7/26/2004.

A Second Boom for Geothermal?

The geothermal industry experienced explosive growth from 1981 to 1990. During this nine-year period, 1,786 MW of new geothermal generation came on-line, representing 70 percent of the current installed U.S. geothermal generation capacity. Recent legislative and economic incentives are increasing the opportunity for new geothermal power projects in the coming years. Several factors triggered the rapid development of the 1980s:

A growing number of states have passed Renewable Portfolio Standards legislation to increase development of renewable energy. RPS legislation requires local utilities to obtain a defined percentage of their electric supply portfolio from renewable sources. In California, the current RPS legislation (AB 1078) mandates that investor owned utilities supply 20 percent of their load from renewable sources by 2017. Efforts are underway to advance this date to 2010. California, Nevada, New Mexico and Idaho - all states with significant potential for geothermal development - have RPS mandates. Interestingly, the Federal government has been unable to implement legislation to support a Federal RPS.

While the existing RPS legislation, like the PURPA legislation of the 1970s, sets a goal for the development of renewable energy, it does not provide the mechanism to achieve that goal. While the utilities have been mandated to increase the use of renewable energy, they have not been given directives on how to deal with the increased cost of this power. Some utilities in the western U.S. have issued Requests for Proposal from renewable generators for long- term power supply contracts from new projects, but have stipulated that renewable energy cannot cost them more than non-renewable energy. Additionally, utilities have been reluctant to finalize these contracts due to the higher cost of power contained in these bids when compared to more conventional power generation technology.

This situation could be mitigated with the passage of a Federal Production Tax Credit. Current legislation being considered in Congress would provide for a 10-year PTC valued at $0.018/kWh for all new renewable projects on-line by January 2007. The impact of previous production tax credits for wind projects is well known. Wind energy, for example, has sustained a 30 percent growth rate since the FfC was first passed in 1992.

The PTC for all new renewable generation has been passed by the Senate and is expected to be passed by the House and signed by the President in 2004. This legislation should provide the economic incentives, when coupled with long-term, iixed-price contracts for the sale of the power, to stimulate the development of additional geolhermal power projects throughout the west. Although geothermal exploration activities have been almost nonexistent for the last decade, approximately 2,500 MW of additional capacity could be developed from known resources in the vicinity of producing fields at The Geysers, Imperial Valley, Coso, Steamboat Springs, Dixie Valley and numerous other locations. This development would require significant drilling and testing, which would be stimulated by the passage of the PTC. Identified new projects also exist at Glass Mountain and the Imperial Valley in California and in Idaho, Utah, New Mexico and Oregon. Development of this capacity would essentially double the amount of geothermal capacity currently online in the U.S. and would likely stimulate exploration for more, as yet unidentified, projects. Source: Power Engineering, 7/19/2004 via Energy Central, 7/20/2004.

PECO Grants $232,000 to PHA for Solar Energy

PECO Energy has provided the Philadelphia Housing Authority with a grant of $232,100 for installation of photovoltaic solar energy systems at 22 homes in the Grays Ferry Estates under construction in South Philadelphia and the Lucien E. Blackwell Homes in West Philadelphia. The grant is part of a $500,000 PECO commitment to support solar power installation in low-income housing in Philadelphia.

The company's initial grant—$88,000 to the Norris Square Civic Association in December 2002—supported the installation of eight systems in the 100 block of W. Norris Street in North Philadelphia. The grant is made available through PECO's Universal Services program, which provides usage reduction and utility financial assistance to more than 125,000 low-income households throughout the company's service area.

"We are pleased to partner with the Housing Authority to provide low cost electricity for the residents of the Grays Ferry Estates and support a positive community development in our city," said PECO President Denis O'Brien. "This is an example of the many PECO outreach programs in the region to assist low-income residents to better manage and afford their energy costs."

The Grays Ferry Estates, an affordable housing development, are being built on the site of the former Tasker Homes in South Philadelphia near the Schuylkill Expressway. Eighteen of the 22 solar energy units will be installed there on south-facing homes on Mifflin Street. The remaining four units will be installed at the Blackwell Homes, formerly the Mill Creek Homes, at 46th Street and Fairmount Avenue in West Philadelphia.

"We are very excited about using solar power to make energy more affordable for our clients, and we hope to work with PECO to fit additional homes with solar energy systems in the future," said Carl Greene, PHA executive director. The Housing Authority estimates that residents using the solar systems will save from $400 to $500 yearly in energy costs, or as much as 25 percent of their energy costs each year. Six 185-watt solar panels will be mounted on each roof and connected to the home's electrical system. Each installation is expected to produce 1,630 kilowatt-hours of usable electricity in a year.

Based in Philadelphia, PECO Energy is an electric and natural gas utility subsidiary of Exelon Corporation. PECO serves 1.5 million electric and 460,000 natural gas customers in southeastern Pennsylvania. In 2003, its sales exceeded 36,753 gigawatt hours of electricity and 88.2 billion cubic feet of natural gas to residential, business and institutional customers. For more information contact Michael Wood, PECO at 215-841-5555; or Kirk Dorn, PHA at 215-684-4112. Source: PECO Energy Release, 7/22/2004.

Sierra Pacific to Acquire Geothermal Power From ORNI 7

ORMAT Nevada, Inc. subsidiary ORNI 7 will supply 20 megawatts of renewable energy to Sierra Pacific Power Company under a recently signed agreement. The geothermal power will be generated at ORNI 7's Galena Geothermal 1 facility in Steamboat, NV. ORNI 7 is expected to begin supplying the energy to Sierra Pacific by 2006. Contact: Faye Andersen, Sierra Pacific, phone 775-834-4822. Source: EIN Renewable Energy Today, 7/7/2004.

Novato, CA, USA: Prevalent Power Secures California Solar Schools Contract

Prevalent Power, one of California's fastest growing providers of large-scale solar power systems, today announced that it had secured contracts to supply and install 180 kilowatts of solar photovoltaic power systems for six California public schools.

Prevalent Power helped the schools to secure approximately 80 percent of project financing through the California Energy Commission's Solar Schools rebate incentive program. In addition to saving money on the school's energy bills, the PV systems provide an invaluable teaching tool that will be integrated into each school's science and energy curriculum.

The solar PV systems, which range in size from 20 to 30 kW each, provide a large portion of the electric power needed to run the schools. Because approximately 80 percent of the project cost is paid for by the Solar Schools program, the systems typically pay for themselves in less than 5 years through energy cost savings. Prevalent Power further helped many of its school clients secure CEC energy efficiency loans that cover the remaining 20 percent project cost at highly advantageous terms. The schools that applied to both the Solar Schools program and loan programs simultaneously will actually save money because the loan payments will be less than what they would otherwise pay the utility for the energy produced by the PV systems.

The CEC and the California Power Authority established the Solar Schools Program to provide a higher level of funding for public and charter schools towards the installation of photovoltaic generating systems. Funded jointly by the CEC's Emerging Renewables Program and the Attorney General's Alternative Energy Retrofit Account, the Solar Schools program offers schools rebates that are twice the amount of those currently offered to homeowners.

In addition, the program's maximum system size cap of 30kW is 3-times the 10kW cap for the homeowner program. But saving money on energy is only half the benefit that schools will achieve under the Solar Schools program. The program requires that schools establish a curriculum tie-in plan to educate students on the benefits of solar energy and energy conservation. Prevalent Power provided schools with a turnkey tie-in plan to meet the curriculum requirements easily and effectively.

The centerpiece of the curriculum tie-in is a Web-enabled data-acquisition and monitoring system called PV2Web from Fat Spaniel Technologies. PV2Web enables students, teachers and school administrators to monitor real-time and historical data about the PV system's performance over the school's existing computer network and on the Internet. By providing interactive access to system data, PV2Web serves as a robust platform for students to perform experiments and to learn more about the benefits of solar energy and energy conservation.

"We're extraordinarily pleased to be a part of this program," said Arno Harris, Prevalent Power's chief executive officer. "Saving money for California schools is of vital importance, particularly given the state's budget difficulties. The additional opportunity to help schools teach students-tomorrow's voters, policymakers and taxpayers-about the benefits of solar energy and energy conservation is more icing on the cake."

The PV system components are to be supplied by RWE SCHOTT Solar, a leading manufacturer and distributor of solar modules and PV systems. As part of the projects, RSS will provide 1,296 165 Watt (SAPC-165) solar PV modules and 7 Xantrex PV-series utility-interactive inverters as well as the necessary mounting hardware for the modules. Prevalent Power expects to complete the systems by the fall of 2004. Source: SolarNBuzz e-newsletter via IREC/MSR E-Newsletter, July 23, 2004

Nevada Geothermal Announces Private Placement Offering

Nevada Geothermal Power, Inc. will offer up to 1.5 million units at 50 cents Canadian (about 38 cents) in a private placement. The units will include one common share and a non-transferable share purchase warrant. The company expects to earn more than $1 million if all the warrants are exercised. Proceeds from the offering will be used to help Nevada Geothermal locate new property as well as continue activities at its existing geothermal facilities. Source: EIN Renewable Energy Today, 7/19/2004.

Progress Begins on 400 MW Wind Farm

Kingman, Arizona - May 13, 2004 The Western Wind Energy Corporation announced the formal launch of the 400 MW Kingman wind power project located 42 line miles southeast of the Hoover Dam in Arizona. The company began formal engineering, feasibility and environmental assessment of the Kingman Project and will be making a formal presentation to the Phoenix office of the Western Area Power Administration on June 2, 2004.

The project proponent is Steve Mendoza P.E., Executive Vice-President and Chief Engineer of Western Wind Energy Corporation. Mendoza has been an early advocate of wind energy working together with hydro generation, with the latter serving to firm up wind energy's intermittent nature.

The company's Kingman Project consists of 22,000+ acres of Federal land applications, 8,300 acres of long term (30 years) private land leases and 440 acres of fee simple land owned by the company. The company has further applied for 400 MW of interconnection and wheeling (transmission) with WAPA.

Western Wind Energy Corporation said that considering the chronic water shortages facing the Colorado River system and the associated decline in power generation, the company's 400 MW Kingman Project offers a valuable and much needed energy resource supplement to the region's renewable energy needs. There are five transmission lines that pass through the company's properties and these pathways will allow them to market its valued renewable energy to the Arizona, Nevada and California markets.

The company's Kingman Project will be built in stages and will be financed through tax partnerships. These partnerships allow capital funding for the Project's engineering, equipment, procurement and construction; provide a steady income stream to Western Wind. Western Wind Energy Corporation said they are the first and currently, the only public company to have executed a power purchase agreement with a regulated Arizona utility. Source: Ecologic Investor Inc., 7/26/2004

Aspen Skiing Co. Unveils Renewable-Power Plant at Snowmass

The Colorado Governor's Office of Energy Management and Conservation and Aspen Skiing Company, among other supporters, has unveiled a 115 kW micro-hydroelectric power plant at Snowmass Ski Area. By using existing renewable energy sources, this will save the resort thousands of dollars in annual energy costs. Other supporters of this project include Holy Cross Energy, the turbine manufacturer, Canyon Industries, the Town of Snowmass Village, the Community Office for Resource Efficiency and the StEPP Foundation.

The micro-hydro power plant uses the existing snowmaking system's underground pipes to channel spring runoff through a turbine, generating electricity. The expelled water is returned to the stream. This system will run from May through August, when the snowpack causes the runoff to be at the highest levels.

The plant should generate 250,000 kilowatt hours of energy annually, which is comparable to powering 40 average-size homes per year and preventing a half-million pounds of carbon dioxide from being emitted. Another benefit from this renewable energy source is that ASC will sell power to Holy Cross Energy, earning around $15,000 each year. If this micro-hydro plant proves successful, ASC would replicate it at its other four mountains, providing the potential to power 400 homes.

"This project would not have been possible without overwhelming support from our partners. Now, it's a successful, transferable and eventually profitable example of on-slope renewables for the whole ski industry," said Auden Schendler of Aspen Skiing Company. Source: GreenBiz.com, 7/26/2004.


For more information on Renewable Resources go to: http://www.repartners.org

Outreach, Education, Reports & Studies

Interconnection and Net Metering News from IREC

The Interstate Renewable Energy Council provides a summary of the latest interconnection news in their Going Solar and the U.S. Department of Energy’s Million Solar Roofs E-Newsletters. IREC also produces an Interconnection Newsletter. Source: IREC/MSR E-Newsletter, July 23, 2004.

IREC Produces Updated Net Metering, Interconnection Tables

The Interstate Renewable Energy Council recently completed revisions to its state-by-state net metering and interconnection tables(pdf). The net metering table includes detailed information on state and utility policies, including system capacity limits, total capacity limits, eligible technologies and the treatment of net excess generation. IREC's updated table of interconnection rules(pdf) contains information on state and utility policies for non-net-metered distributed generation, including the status of rule development, application costs, system size limits, additional insurance requirements and screening processes for interconnection studies. Source: SEPA Bi-Weekly News, 7/26/2004.


For more information on Educational Resources go to: http://www.repartners.org

News from Washington

Congress Leaves Corporate/Energy Tax Bill Work for September

The fate of the $19.4 billion energy tax package remained unclear last night as Congress adjourned for its six-week summer recess without having made any progress on corporate tax bill conference negotiations.
The conference, which some lawmakers had hoped to start this week, was put off amid political wrangling over an extension of the child tax credit and other tax breaks, uncertainty surrounding whether the House or Senate would lead conference negotiations, and GOP fears that starting the conference before the recess would allow House Democrats to force uncomfortable votes on conferee instructions when Congress returns.

But with Wednesday's collapse of child tax credit extension negotiations and continued disagreement between Senate Finance Committee Chairman Chuck Grassley (R-Iowa) and House Ways and Means Committee Chairman Bill Thomas (R-Calif.) over who will lead the conference and under what conditions it will take place, lawmakers will leave the heavy lifting to after Labor Day and the political conventions.

However, industry lobbyists say that staff of the Joint Committee on Taxation will be busy putting together side-by-side comparisons of the House and Senate versions of the legislation, and that some staffers from both sides of the Capitol have been working to narrow the scope of the negotiations so work can start as soon as Congress returns to Washington.

The bill, called the "Jumpstart our Business Strength" Act, is considered "must-pass" this year because it repeals the Foreign Services Corporation/Extraterritorial Income Act, a law the World Trade Organization declared illegal. That led European nations this spring to impose tariffs on U.S. goods that rise by 1 percent each month.

The tariffs started at the 5 percent level in March, have since risen to 9 percent and can top out at 17 percent next April. The bill has attracted a series of tax provisions considered essential to the industry groups who would benefit, including various sectors of the energy industry as well as tobacco growers and a host of other elements of corporate America.

It is unclear what the effect of a conference delay to September will mean for the bill. The rising tariffs provide an incentive for quick action on the part of Congress, but lobbyists speculate that Democrats in a tight presidential campaign may not want to give President Bush a Rose Garden bill-signing ceremony on something called the "JOBS Act" before the November election. For that reason, many observers say the bill probably would have to wait until a post-election lame duck session for final passage.

Still, Capitol Hill aides and lobbyists yesterday said the conventional wisdom is that Thomas will likely chair the corporate tax bill conference, which could have implications for the energy tax provisions that were credited for helping get the original bill out of the Senate in May.

The Senate version of the bill contains $19.4 billion in tax breaks aimed at oil and gas, coal, nuclear, renewable energy companies and energy efficiency programs. The House only supported extenders for oil and gas and wind energy production tax credits but included nuclear import-related measures targeted at the industry's need for steam generators and reactor vessel heads for nuclear power plants. While lobbyists insist the Senate energy package is essential to final passage of a corporate tax agreement, they contend the chances of its staying intact are better if Grassley heads the conference. Source: Mary O'Driscoll, Environment and Energy Daily, 7/23/2004.

Tax Bill, RE Provisions Move Toward Conference

After weeks of partisan haggling, U.S. Senate Republican and Democratic leaders have reached an agreement allowing the start of negotiations between the House of Representatives and Senate on a final version of corporate tax legislation (S.1637 / H.R.4520) that contain some vitally important measures for the renewable energy industries. Source: SEPA Bi-Weekly News, 7/26/2004.

House Fully Funds Renewable Energy Program

The country’s ethanol, solar and wind industries are a step closer to getting a boost after the House of Representatives recently voted for an amendment to fully fund the successful USDA Renewable Energy and Energy Efficiency Program as part of the agriculture appropriations bill. The bill later passed the House.

Rep. Marcy Kaptur (D-OH) and Rep. Stephanie Herseth (D-SD) sponsored an amendment on the floor of the House to boost funding for the program by $8 million. The amendment raised funding for the program to a total of $23 million – the maximum authorized under the 2002 Farm Bill.

“This is money not going to a government agency. It is going directly to farmers to bring up a new source of power in our Nation, new sources of power based in agriculture,” said Kaptur, the ranking member on the House Appropriations Agriculture Subcommittee.

“This legislation not only helps existing agriculture entities increase their energy efficiency, it helps provide startup funds for new renewable energy projects like ethanol plants and wind farms,” added Herseth.

Prior to the vote, the Renewable Fuels Association joined 37 renewable energy and environmental organizations urging the House to support the Kaptur/Herseth amendment. In a letter to House members, the organizations wrote: “The program creates ‘win-win’ solutions by fostering rural economic development and generating clean and efficient energy production and use for communities, rural businesses, farmers and ranchers across our country.”

Others signing the letter included the Union of Concerned Scientists, Renewable Energy Action Project, Environmental Law and Policy Center, Environmental and Energy Study Institute, Bluewater Network, and Alliance to Save Energy. Last year, USDA awarded a total of 113 grants to program applicants in 24 states. These grants totaled $21.2 million nationwide. Source: RFA Ethanol Report, 7/22/2004.


For more information on legislative activities go to: http://www.repartners.org


State Activities, Marketing & Market Research

WREGIS Stakeholders Update

The final report from the WREGIS Operational Rules Committee - WREGIS Interim Operating Rules: Functional Requirements has been released, and can be found on the WREGIS Web site, documents page. This report is a revision to the ORC report released on May 4, 2004. During May and June, the ORC developed recommendations for the Tier 2 issues identified in the May report, and these recommendations are included in the attached report. This report, as with the May report, incorporates WREGIS Working Group review comments. If you have any questions about the contents of this report, or its development, please contact me or either of the ORC co-chairs, Steven Kelly and Brock John. Source: Matthew Lehman, CRS, 7/22/2004.

Natural Gas Costs Could Continue to Rise

Natural gas demand could yield to shrinking gas reserves, high prices and regulatory hurdles that remain because of environmental concerns. Moreover, a new study by the gas industry says that a lag in the construction of vital infrastructure such as pipelines and storage facilities will cost U.S. consumers more than $200 billion by 2020.

Natural gas, of course, had been labeled the “fuel of choice” after the Clean Air Act amendments of 1990 had been signed by the elder President Bush. While about 90 percent of the new power generation is to be fueled with natural gas, producers and developers have had a difficult time winning new permits to drill and to lay pipe in the ground. That's pushed such prices higher as well as contributed to the reliance on other fuel sources such as coal.

The most immediate question is whether the optimistic calculations as to the demand for natural gas can hold. Today, the industry must produce 6 trillion cubic feet per year of new natural gas just to keep pace with current needs because supplies are being depleted by about 29 percent per year. That goal is increasingly difficult to achieve as the wells are more costly to drill.

The lack of supply puts upward pressure on prices. In its "Accelerated Depletion: Impacts on Domestic Oil and Natural Gas" study released in 2001, the Energy Information Administration said that if the original 30 tcf demand projection is to reach fruition, then the price of gas would have to remain less than $3.25 per MMBtu. It also said that producers would need to maintain high levels of drilling and have access to basins off the Florida coast and in the Rocky Mountains. Gas prices are projected to be around $6 per MMBtu for the foreseeable future-a prediction that casts the 30 tcf prediction in doubt.

In fact, the new study by the INGAA Foundation says that the prices would rise from the base case price of $5.65 per MMBtu between 2005 and 2020 to $6.43 per MMBtu if construction projects were delayed by two or more years. This would be because of increased bottlenecks, it says. It furthermore says that U.S. industry would suffer from higher prices and that job losses would occur.
To meet a growth demand of 2 percent per year until 2020, the foundation says that roughly $61 billion of investment in natural gas pipelines and storage facilities is necessary, both in the United States and Canada. About $19 billion of that would be needed just to replace aging pipelines. The report goes on to say that the industry must build more than 45,000 miles of pipelines in North America, as well as at least 10 new liquefied natural gas terminals.

“Much of the growth of the gas market over the next 20 years must be sustained by development of currently untapped supplies from areas that are generally more remote from the consuming markets in North America,” says that report.

Reprinted with permission from UtiliPoint International IssueAlert. Further reproduction or distribution is prohibited without permission. Source: UtiliPoint's daily IssueAlert, Ken Silverstein, Director, Energy Industry Analysis, 7/22/2004.

Governor’s Task Force Recommends Boosting Use of Renewable Energy

A governor’s task force has recommended the state increase its use of renewable energy over the next decade as a way to help satisfy its growing demand for energy. Gov. Jim Doyle formed the task force last year to devise ways to reduce dependence on energy produced outside Wisconsin and help utility customers save money. The task force approved a set of recommendations Tuesday that includes increasing the state’s use of renewable energy to 10 percent of its total electrical usage by 2015.

Currently, renewable energy accounts for around 3 percent to 4 percent of the state’s energy usage, said Lee Cullen, the task force’s chairman. “We need to make an increased commitment to energy efficiency and renewables,” Cullen said. “They are resources that reduce dependence on fossil fuels, they save rate payers money and they’re better for the environment.”

The task force also recommended:
“If a number is set as the appropriate level in a fiscal year, the task force is saying (the Legislature) should not change the funding,” Cullen said. He said the task force recommended the money go into a non-lapsable trust fund and be administered by a third-party agent. The task force did not determine how much the recommendations would cost to implement, said Cullen, who is an attorney for Customers First!, a coalition that represents businesses, consumer groups and municipalities on utility issues.

The task force plans to issue a final report in September. Doyle said he would review the report and consider implementing the recommendations through regulatory, administrative or legislative changes. The 25-member task force included representatives from business, labor, consumer and environmental groups. Source: Press-Gazette and The Associated Press, 7/21/2004 via Daily Power Report, 7/22/2004.


For more information on marketing and research go to: http://www.nrel.gov/analysis/emaa/index.html

Grants, RFPs & Other Funding News

DOE and USDA Award $25 Million for Biomass Initiative

DOE and the U.S. Department of Agriculture announced last week the selection of 22 projects that will advance their joint Biomass Research and Development Initiative. DOE will award more than $12 million to nine projects, and the USDA will award more than $13 million to 13 projects, for a total of nearly $25.5 million in government awards. Nearly all of the DOE-funded projects relate to gasification technologies, although one project is aimed at producing new chemical products from biomass. The USDA-funded projects address a variety of technologies, including studies of feedstock supplies and treatment options; testing a new technology for ethanol production; using liquid fuels derived from biomass to power a fuel cell; developing a small-scale, biomass-fired gas turbine; and producing high-purity hydrogen from farm animal wastes. Including the cost sharing of the private-sector partners, the total value of the projects is nearly $38 million. See the DOE press release, and for the complete details about the awards, see the 47-page compilation of project proposals (PDF 194 KB). Download Acrobat Reader. Source: EERE Network News, 07/21/04

Grant Solicitation for PIER Program Wind Energy

The California Energy Commission has released a new grant solicitation through its Public Interest Energy Research Program. This targeted solicitation supports the demonstration of prototype and new turbine technologies useful for expanding wind generation into low wind speed resource areas (Class 3 at 10m). The Program Opportunity Notice for this solicitation is available on our contracts page. The deadline for submitting proposals is September 7, 2004, at 4 p.m. A Pre-Proposal meeting will be held. The anticipated date for the meeting is August 12, 2004. Source: CEC Release, 7/22/2004.

Zero Energy New Homes for California

The PIER Program is targeting research in the area of Zero Energy New Homes for California. ZENH brings together energy efficient building design and technologies along with electricity generation from solar PVs to reduce peak electricity use to nearly zero in new homes. The PIER Program will be releasing a targeted solicitation with the intention of developing and demonstrating California optimized new zero energy home designs, business models, and public/private partnerships. The Renewable Energy Program administers the Emerging Renewables Program which provides financial incentives for emerging technologies, including small wind systems and PVs. The PIER ZENH solicitation will serve as the pilot program for the development of innovative PV business models. Additionally, staff and technical consultants are conducting research and analysis of various policy options for California to consider in expanding the market penetration of PVs. Source: CEC Release, 7/22/2004.

DOE/USDA Biomass Research and Development Grants Announced

The Department of Energy and the Department of Agriculture recently announced the selection of 22 projects that will receive over $25 million for the Biomass Research and Development Initiative. The funds will be used for biomass research, development and demonstration projects. The Biomass R&D Act of 2000 and the 2002 Farm Bill set the framework for interagency cooperation and joint solicitations.

The joint grant program is part of the Bush Administration's effort to increase America's energy independence through the development of additional renewable energy resources from the agricultural and forestry sectors. New processing facilities resulting from this increased demand will help stimulate rural communities and economies.

“The projects announced today will move us closer to our goal of establishing biorefineries that produce power, fuels, chemicals and other valuable products,” said Secretary of Energy Spencer Abraham. Agriculture Secretary Ann Veneman added: “Developing alternative energy sources that reduce pollution and increase energy security is an important part of the Administration's overall energy policy. These grants will help develop additional renewable energy resources and expand markets for agricultural products." Source: RFA Ethanol Report, 7/22/2004.


For more information on funding solicitations go to: http://www.repartners.org/grants.htm

This news item comes to you as a service of Western's Renewable Resources Program.

Western Area Power Administration, 12155 W. Alameda Parkway, Lakewood, Colorado, 80228-8213,
Phone: 720-962-7423; Fax: 720-962-7427; E-message: Randy Manion.