(Photo by Duke Energy via Creative Commons)
By Adam James
I have a confession to make. I am one of those folks who consistently write on wonky energy things without ever taking the time to write out simple explanations of the basic concepts or why they matter.
So, this piece will give a brief description of what electricity capacity markets are and how they work.
Todd Foley is the Senior VP of Policy and Government Relations for the American Council On Renewable Energy, based in Washington D.C.
By Todd Foley
The American entrepreneurial spirit is an incredibly strong force in the domestic and global marketplace. And when markets allow businesses – small and large – to compete, grow, and innovate on an equal and fair playing field, all Americans benefit.
Since 1987, many conventional energy sources have taken advantage of Master Limited Partnerships (MLPs), a business structure that is traded like a corporate stock but is taxed as a partnership, avoiding double taxation. However, renewables have been excluded from utilizing the MLP market that exceeds $400 billion in capital investments.
It’s time to allow renewable energy access to this important market tool, which has spurred tremendous investment in the nation’s energy infrastructure.
It is true there is a serious need for renewable energy policies at the federal and state levels that create long-term market certainty, boost distributed generation, and spur the growth of all renewables. The existing tax credits and CLEAN contracts, or feed-in tariffs, have been successful and remain vitally important. But that hardly means MLPs are a “lousy policy for renewables,” as John Farrell wrote in a May 31 commentary published on Midwest Energy News.
John Farrell directs the Energy Self-Reliant States and Communities program at the Institute for Local Self-Reliance
Cross-posted from the Institute for Local Self-Reliance
By John Farrell
If you follow the renewable energy industry and haven’t been sleeping, then you’ve probably heard about one of the few pieces of federal legislation purported to help clean energy that’s actually moving: expanding Master Limited Partnerships (MLPs) to cover wind and solar energy. (H.R.1696)
This is not a good thing.
MLPs originated in 1986, when Congress decided that to allow certain businesses (oil and gas pipelines) to avoid paying corporate income tax. These partnerships function a lot like publicly traded corporations, with publicly traded stock, but don’t pay income taxes.
Most folks who’ve touted expanding MLPs to include renewable energy projects see this move as “leveling the playing field.” And it will, allowing big energy corporations to avoid paying taxes on their renewable energy projects just like they do for pipelines.
But that’s not the worst. Several years after the MLP was created, the federal agency responsible for setting the prices to use these oil and gas pipelines (the Federal Energy Regulatory Commission) allowed the not-paying-corporate-income-tax companies to charge rates for access as though they DID pay the corporate income tax. Including this phantom tax payment in rates amounted to a 75% increase in after-tax profits for pipeline companies.
This policy wasn’t even set in a public forum (such as a docket with public hearings), but through a shadow “policy statement” released after private meetings with the oil and gas industry (and after a federal judge had previously struck down the absurd notion that users of pipelines should have to pay phantom taxes).
Ann Alexander is a Chicago-based senior attorney for the Natural Resources Defense Council.
Cross-posted from NRDC Switchboard
By Ann Alexander
We’ve been saying it till we’re blue in the face: fracking is not only already legal in Illinois but has now started up. And we’ve just confirmed new evidence of this fracking, thanks to a Freedom of Information Act request to the Illinois Department of Natural Resources.
What does this mean for Illinoisans? It means we need basic protections in place – yesterday – to limit environmental harm and give people a say in what could be happening right now in their communities. We need meaningful citizen participation in decision-making and enforcement, as well as rules governing how fracking is conducted.
And that’s why, if the moratorium is voted down despite our relentless efforts over the past year, we’d better put in place a law that gives people a fighting chance at protecting themselves. That is what NRDC has been working for, and what the regulatory bill will provide.
As for the proof of fracking starting up, take a look at this “well completion report” for a frack job performed last year. The report indicates that the Campbell Energy “Salem H-1” well in White County was a horizontal frack that used a total of 640,151 gallons of fluid. If that’s not high-volume horizontal fracking, then there’s no such thing.
Michael Vickerman is program and policy director of RENEW Wisconsin.
By Michael Vickerman
Though equipped with a license to operate for an additional 20 years, the Kewaunee nuclear power station rode into the sunset this week, having generated its final kilowatt-hour.
Dominion Resources, the Virginia-based company that owns the 550 MW facility along Lake Michigan, plans to spend nearly $1 billion to decommission the facility and transform the acreage back to its former status as farm fields. The process could take as long as 60 years.
It’s more than a little odd to see a 39-year-old nuclear plant taken offline in a state that’s replete with middle-aged fossil units. But in this story, age and fuel type matter less than the extremely unfavorable market structure confronting an independently owned baseload plant in the Upper Midwest, especially one lacking a power purchase agreement.
Craig Lewis is the executive director of the Clean Coalition, which advocates for clean local energy.
By Craig Lewis
Iowa is no stranger to wind power. In 2012, the state generated nearly a quarter of its total electricity from wind, and Iowa ranks third nationally — trailing only Texas and California — in installed wind capacity.
With such significant renewable power generation already online in Iowa, forward-thinking state legislators have turned their attention to maximizing the local economic benefits of Iowa’s enviable renewable resources. The result is SF 372 — a bill, currently navigating the Iowa Senate, to transform the state’s energy economy by empowering Iowans to build and own community-scale wind projects.
Virtually all of Iowa’s existing renewable power capacity comes from massive and remote wind projects that are owned by multinational utility corporations. While some farmers have been able to earn a bit of revenue by allowing the development of big wind farms on their land, most have had no pathway to participate in Iowa’s burgeoning renewable energy economy.
SF 372 is the first step to change this unfortunate situation by shifting wind energy production – and the associated economic benefits – to Iowa’s farmers through the adoption of a statewide Clean Local Energy Accessible Now (CLEAN) Program.
Cross-posted from NRDC Switchboard
By Anthony Swift
On Friday afternoon, Exxon’s Pegasus pipeline ruptured, spilling between 80,000 and 420,000 gallons of tar sands diluted bitumen in a suburban neighborhood in Mayflower, Arkansas.
In 2010, a similar tar sands diluted bitumen spill into Michigan’s Kalamazoo River watershed demonstrated that diluted bitumen spills were significantly more challenging to clean up and damaging to the environment, particularly water bodies, than conventional crude. Moreover, tar sands diluted bitumen pipelines typically operate at significantly higher temperatures than conventional crude pipelines, increasing their risk of rupture due to external corrosion and other factors.
While details regarding the cause of the rupture and the magnitude of the spill are still coming in, the Mayflower tar sands spill is yet another demonstration of the risks that tar sands pipelines pose to the communities and sensitive water resources they cross. At about a tenth of the full capacity of the Keystone XL tar sands pipelines, the 90,000 bpd Pegasus pipeline rupture offers us a small sample of the risk that tar sands pipelines pose to American communities.
Michael Vickerman, program and policy director of RENEW Wisconsin.
By Michael Vickerman
Only in Wisconsin will you find lawmakers who treat renewable energy as though it were radioactive.
A legislator from Brown County, Rep. Andre Jacque, has introduced a bill (AB 34) to incorporate nuclear energy within Wisconsin’s 14-year-old renewable electricity standard.
The bill defines the terms under which utilities could apply the output from in-state nuclear power plants toward their existing 10 percent requirement, which would be renamed the Advanced and Renewable Portfolio Standard (ARPS). Right now, Wisconsin has three operating nuclear reactors at two locations five miles apart along Lake Michigan.
Two of the three nuclear power stations–Point Beach units 1 and 2–are located within Rep. Jacque’s district. The adjoining district contains the other nuclear unit , the 560-MW Kewaunee Nuclear Power Plant owned by Dominion Resources, a Virginia-based utility holding company. Late in 2012, Dominion announced that it would shut down and decommission Kewaunee this spring, while cutting the plant’s 650-person workforce in half.
(Photo by EnergyTomorrow via Creative Commons)
By Henry Henderson
The Illinois Chamber of Commerce last week released a pretty, remarkably rosy sounding report, speculating on the potential impacts that fracking might have on Illinois’ economy.
It is, as I say, remarkable stuff. “Natural gas development could create more than 45,000 jobs” according to the “first comprehensive look at Illinois jobs” that could be created when fracking comes.
Having a look at the report, I was disappointed to find that it’s not really all that comprehensive. Or persuasive. If you happen to consider the facts….
Right off the bat, on page two, there is a long list of what the report doesn’t cover, which includes “any environmental impacts, costs, or benefits,” along with costs of ramping up and down of drilling in impacted areas or potential impacts of volatile natural gas prices to employers or to electricity bills).
That eliminates pretty much every issue currently under discussion in the contentious national debate over fracking (which is the controversial practice of injecting vast quantities of water, sand and undisclosed chemicals deep into the ground at high pressure to crack open little pockets of oil and natural gas trapped in shale rock formations). And by my reckoning, that also eliminates this report from being a particularly realistic evaluation. So, the “comprehensive look” is by its own description, narrow and divorced from any really meaningful context.
Michael Vickerman, program and policy director of RENEW Wisconsin.
Starting next January, the price of purchasing renewable energy voluntarily through monthly utility bills will spike to all-time highs, thanks to recent decisions rendered by the Public Service Commission of Wisconsin (PSCW) on two popular “green pricing” programs.
The thousands of Madison Gas & Electric (MGE) customers participating in the utility’s Green Power Tomorrow program will see their premiums jump from 2.5 cents/kWh to 4 cents/kWh. That’s an increase of 60 percent. To translate this into dollars and cents, an average MGE customer consuming 500 kWh of electricity per month and subscribing at the 100 percent level will pay $90 more in 2013 for the same amount of renewable kWh sold this year.
Residential customers of Milwaukee-based We Energies (WE) will see an even larger percentage increase next year. In that utility’s rate case, the PSCW jacked up the premium paid by Energy for Tomorrow subscribers by nearly 73 percent, from 1.39 cents to 2.4 cents/kWh. Energy for Tomorrow has more than 20,000 subscribers.
Back in 1999, the year both programs were launched, MGE and WE customers paid an extra 3.33 cents and 2.04 cents/kWh, respectively, for the renewable energy they sponsored. Come January 1st, MGE and WE will likely share the dubious distinction of being the only utilities in the country offering renewable energy at a higher rate than they did in the 1990’s. So much for progress.
ComEd rate increase to hit smaller households hardest • TransCanada doesn't plan to use most advanced leak-detection technology for Keystone XL • The politics behind Illinois' new fracking law • Minnesota country approves frac sand mining ordinances
