Day 3 - Renewable Energy World Conference Morning - Mega Session

Hello once again from the Renewable Energy World Conference in Austin, Texas. Today was the last day, and i attending the last event of the conference, the Mega Session on Post-Stimulus Finance of Renewable Energy Projects. Pretty interesting stuff. As usual, you can see my summary or the morning session below. Got some work to do in the afternoon, and then I am back to Stanford bubble for the time being.

Day 3 – Megasession on Post-Stimulus Policy and Finance

Ken Bruder – GM at Bloomberg - New Energy Finance in North America

1. Green Stimulus – One Year Later
   1. From supply constrained environment (manufacture controlled) to buyer constrained market (consumer controlled)
   2. U.S. has the biggest clean tech package at $66 billion dollars, > China
   3. Money has not really hit the ground until now
   4. Stimulus is going to cause an oversupply of wind equipment
      1. Ironically, most of new supply growth will not be with U.S. companies
   5. Spot price of solar has declined dramatically
   6. Asia has taken the lead in financing for clean tech projects
   7. Solyndra and A123 helped dramatically by DOE loans as part of the stimulus package
   8. Renewables remain uncompetitive with fossil fuels
   9. Supply of renewable is there, need to focus on the demand side of renewable energy

Edwin Feo - Partner - Milbank Tweed Hadley & McCloy LLP

1. Post-Stimulus Finance
   1. Treasury Grant Program – About $2 billion has gone to renewable energy projects
      1. Construction has to start by 2010 to be eligible
      2. Banks would advance 95% against the size of the grant
   2. What’s Next? – HR4599 – Renewable Energy Expansion Act of 2010
      1. Refundable tax credit for projects starting by 2012
   3. What about 2010?
      1. Amount of debt/loans to go up
      2. Terms of loans will improve for borrowers
      3. More open to small projects
      4. Possible extension of the grant

Tina Neal – Senior Vice President - PiperJaffray

1. Determining Financial Feasibility - Cash Flow Management, Collateral, Management, Fundamentals, Mitigating Risk
2. Where we are now
   1. Liquidity is still a concern
   2. Project sizes are smaller – from 50Mà25M
   3. Reliance on subsidies , mood is still cautionary
3. Where we are going
   1. Higher interest rates on loans
   2. Development of markets needs to replace government subsidies

Martin Lebovits - Senior Funding Manager – Illinois Finance Authority

1. Illinois Energy Finance Initiative
   1. Illinois Finance Authority – access to capital they need for growth for various industries
   2. The Solution to Capital
      1. $3 Billion of loan guarantees for project finance
      2. Eliminates the risk of refinancing
      3. Secured by obligation of the State of Illinois
      4. Provide forms to help projects quickly work through financing
      5. Not a requirement that project participate in DOE loan guarantee program
   3. New Applications
      1. Can be applied to energy infrastructure, retrofit existing structures
      2. Can also be applied to energy efficiency improvements

Mike Taylor – Director Research and Education – Solar Electric Power Association

1. Financing
   1. 400Mw installed solar in 2009, 1200Mw with 90,000 systems cumulative total
   2. 20% solar by 2030, 38Gw/yr needed
      1. Need $15-30 billion in financing yearly
   3. Commercial systems are third party owned and financed
   4. PACE – municipal financing for solar energy
   5.  

Day 2 – Renewable Energy World Conference Afternoon Session – Wind Track

So, the afternoon session just finished up and was pretty educational for me. I did not really know that much about all of the concerns that wind farms must face. Litigation issues, non-existent yet existent noise issues raised by land owners, lack of transmission capacity, etc. I have summarized what I heard today below. That's all on the docket for today. Have one more session tomorrow along with a MEGA SESSION, or at least that is what it is humorously being called. Then its back to sunny California. Check back again tomorrow for more from the Renewable Energy World Conference in Austin, Texas.

Zeina El-Azzi – Clipper Wind – Director of Business Development

1. Clipper Wind has designed its own wind turbine – promo stuff
2. Development of Wind Farm
   1. Identify the wind resource, proximity to transmission lines, secure land
      1. Need to invest in transmission lines as some are 30-50 years old
      2. Land leasers need to better explain what exactly a wind farm entails
   2. Get financing, establish power purchaser, permits, wind turbine supply
      1. Takes 12-24 months to actually get the wind turbines
3. Market Conditions
   1. New turbine orders dried up do to recession – scarceness of credit
   2. As nat gas goes down in price, wind power becomes less attractive
   3. Overall electricity demand among larger industrial companies is down 20%.
   4. PPAs not as popular as prices are low

Christina Calabrese – Horizon Wind Energy

1. Wind Power Siting Overview – General Responsible Development
   1. Phases
      1. Takes 2-5 years for development
      2. Construction – 6 months -1 year
      3. Operation – 20 years or more
      4. Decommissioning – 6 months
   2. Wildlife Issues
      1. Habitat fragmentation
      2. Attempt to map habitats beforehand
      3. Look at a 2 mile buffer for sensitive species
   3. Cultural Resources
      1. Must be aware of historical structures, archaeological resources and tribal considerations
   4. Visual Issues
      1. NIMBY
      2. Visual simulations are needed to show area

Jeremy Fielding – Lynn Tillotson Pinker Cox

1. Abilene – 3 week jury trial over operation of wind farm by Nextera Energy
   1. 13 land owners complained – turbines are spoiling the views and too loud
   2. Presented jury with multiple sound levels
   3. Cost $2 million in litigation costs
2. Ways to avoid problems with wind farm build outs
   1. Hire a PR firm to get out in front of public accusations
   2. Town hall meetings for transparency
   3. Worked with schools, 4^th and 5^th graders
   4. Hire local workers
   5. Keep turbines ½ mile away from residencies
   6. Bury the power lines
   7. Complaint hotline for maintenance issues
3. Ways to convince hard to get landowners
   1. Noise easement
   2. Royalty agreement
   3. Buy their property

Larry Flowers – NREL, Wind Powering America

1. Wind Energy: Market and Stakeholder Acceptance
   1. Texas has caught up to California in wind development
   2. 311,155 Mw of wind energy in queued projects
   3. Measure wind progress in three columns, installed capacity, WWG effectiveness, policy environment
   4. 20% wind by 2030 would give $60 billion to rural communities in economic development
   5. Save approximately 4 trillion gallons of water from not having to cool power plants
   6. On a positive trajectory for wind installations to reach 20% by 2030
   7. Wind for schools project
      1. Getting wind projects into elementary schools
      2. Educating college graduates to respond to community needs

Day 2 - Renewable Energy World Conference Morning Session - Solar Track

Day 2 started off with a great group of speakers in the Solar Track where case studies and the future of solar energy were discussed. The summary of the speakers I just finished listening to is below.

Dr. Andre Szykier – MAPS Capital - http://www.mapscapital.com/index.html

1. Aerial Imaging for Solar Photovoltaic Assessment
   1. 80% less than on site visual inspection
   2. Automated imaging algorithms eliminates 90% of manual effort in analyzing solar potential
   3. Possible Due to improved algorithms and camera technology
      1. From 3 meter resolution to 25cm resolution
   4. Total cost of project is being shifted to the labor component as tech and material costs decline
      1. 92-98% accurate in area calculations
      2. 97-99% accurate in power calculations
   5. Steps for measurement
      1. Define roof
         1. Composition
      2. Define perimeters
         1. Edge detection
         2. Trees can affect edge measurement and definition
      3. 1. Feature sub areas
      4. Define Obstructions
      5. Define Sub area
         1. Solar orientation, pitch, angle
      6. Images also require partitioning, in other words, crop out individual buildings to make measurements more accurate
   6. Possibly going to survey 16 counties in California
   7. Tech is extendable to water conservation, fire prevention, and urban land uses
   8. Demo
      1. Took approximate 30 seconds to capture all roof surfaces
      2. Calculate potential solar power capacity

Richard Ulam – ABB Solar Initiative, Abb Inc. - http://www.abb.com/

1. Typical PV Plant – Panels hooked up in series, to inverter, to grid
2. ABB PV Plant – optimization system allows for direct control of HVDC in the field
   1. Dawn, twilight, cloudiness, visualization system software
3. Reduces overall costs of solar
4. Incremental Cost of optimization system – useful for 20Mw or greater projects

Dr. Michael Gostein – CTO Atonometrics - http://www.nrel.gov/rredc/pvwatts/

1. Performance Analysis of Photovoltaic Installations in Solar American City
   1. Analyzed PV monitoring data from 280 installations from 2005-2008, courtesy of Austin Energy
      1. Most commercial systems, <4Kw
   2. Compare PV output to NREL PVWatts calculator
      1. Hopefully identify trends for positive results, those that produced negative results
   3. Performance ratio and Average performance ration computed over time
   4. Assumptions
      1. Relied on PVWatts for solar irradiance data
   5. Performance Distribution
      1. Largely a bell curve shifted to the right, or skewed to the left if you know statistics
   6. Showing performance data for different panel manufacturer ratios
      1. 1. Accounted for 39 of sites
         2. About 90% of these systems installed by same solar installer
         3. Module series is no longer qualified for use in rebate program
         4. Installer is no longer performing installations
      2. For the 11 other manufactures, bell curve around 1
      3. Most systems are performing as expected

Mike Keesee – Project Manager EECR&D – Impacts of High Penetration Photovoltaic’s on SMUD’s Local Distribution System

1. 795-home community will have 600 SolarSmart Homes with 2Kw PV systems
   1. Analyze reverse power flow impacts on grid
2. Voltage is not an issue
3. 15% rule – prove that DG does not go over 15%, otherwise, developers need to conduct study
4. Different peak hours between houses built just to code and those with solar panels
   1. Solar greatly reduces peak demand, where energy is most valuable
5. Hard to get data from transformers, as there is data loss due to high temperatures
6. So far, PV systems have not adversely affected voltage regulation
   1. Trying to determine what % actually is, may not be 15%
   2. Q/A – Batteries are essentially a waste of money compared to making house more efficient.