Industry Sustains Huge Blow with Demise of Property Assessed Clean Energy Bonds

Before federal home lending agencies shut down PACE programs in 23 states, the simple yet brilliant mechanism had promised to revolutionize financing of distributed renewable generation and energy efficiency measures. Hundreds of local governments were preparing to issue PACE bonds to finance retrofits, upgrades and installations by homeowners or small businesses-with the debts being repaid over 20 years by annual assessments on property tax bills. The originators of PACE knew that the idea was vulnerable, but expected the concerns of mortgage lenders to be met. The only hope may be legislation introduced by California Democrat Congressman Mike Thompson.

Transition to Crops Required for Biopower to Reach Its Potential

Driven by state renewable energy standards and federal tax credits, electrical generation from biomass will grow by nearly 400% between now and 2020, then double again by 2035 to produce 5.5% of electrical generation, according to federal energy estimates. To accomplish that level of growth, the supply of biomass fuel will have to grow dramatically, including supplies of purpose-grown energy crops that have been too expensive in North America. In Europe, where greenhouse gas emission caps have put a premium on biomass power, miscanthus, willow, switchgrass and other crops have become viable fuels for power generation, but in the United States and Canada, with no carbon caps and more abundant conventional energy supplies, energy crops for power generation have yet to pencil out. Plant breeders, farm implement vendors and natural resource agencies are exploring approaches and concepts to make willow, poplar, switchgrass, sorghum, miscanthus and other plant species viable.

Nexterra Leads Emerging Biomass-to-Syngas Segment

Another twist on the biomass power story is gasification, in which woody material or other biomass is converted to syngas then combusted for heat and/or power. This technology can achieve more efficient energy conversion than combustion, extract higher value from the fuel and meet urban air quality standards more easily than wood-burning facilities. Commercialization has been held back by high costs and lack of proven reliability and longevity. Like many alternative energy technologies, the cost and reliability picture is improving, and one company that has taken a leading position is Nexterra (Vancouver). Majority-owned by $2.7 billion private equity outfit ARC Financial Corp. (Calgary), Nexterra has several projects under its belt and has announced several deals, including a 20 MWt heating plant for the U.S. Department of Energy's Oak Ridge National Laboratory.

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Market Obstacles Remain in Combined Heat and Power

CHP sharply increases energy efficiency and reduces carbon dioxide emissions over conventional power and heating systems, and it can also ease peak power loads and increase reliability on congested distribution networks. But CHP gets little respect from the public and policymakers. State and federal support for CHP is weak compared to that for renewables. Yet within energy and climate change circles, CHP is regarded as a high-performing star and a vitally important part of the USA's and the world's energy future. In a December 2008 report, the Department of Energy's Oak Ridge National Laboratory credited 3,300 CHP projects with saving 1.9 Quadrillion Btus of fuel and 248 million metric tons of carbon dioxide emissions annually. With policies that encourage investment in CHP, the technology could grow from 12% of generation to 20% by 2030, saving 5.3 Quads annually and reducing CO2 emissions by more than 800 million tons a year.

Hydropower the Big Fish in Renewables Stream

Source of about 19% of worldwide electricity production, hydropower with dam storage is the only renewable power technology that can follow load. Hydro's responsiveness can enable grid operators to incorporate more intermittent wind and solar energy, while pumped storage hydro projects can store off-peak power for generation during peak demand periods. Large hydro projects supply enormous quantities of electricity: the world's largest hydroelectric dam, the Three Gorges Dam in China, has generation capacity of 22.5 GW. In the United States in 2008, there was about 98 GW of hydropower capacity, 77.7 GW conventional and about 20.4 GW of pumped storage facilities. Aside from emerging hydrokinetic technologies, the main opportunity for new hydro capacity lies in installing powerhouses on existing non-powered dams and up-rating existing dam powerhouses with new more efficient turbines.

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