Download - DG - Energy Security
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Energy Security through Distributed Generation
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THE UNITED STATES IS AT GRAVE RISK TO BOTH “MALIGNANT” AND “MALEVOLENT” DISRUPTIONS TO THE GRID AND THAT THREAT CAN BE ADDRESSED THROUGH DISTRIBUTED RENEWABLE GENERATION WHICH CAN SIMULTANEOUSLY REDUCE THE IMPORTANCE OF OIL TO THE IGNOMINIOUS FALL FROM GRACE OF SALT.
– R. JAMES WOOLSEY, FORMER CIA DIRECTOR
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Over 50% increase in electricity prices during the last decade
Source: Energy Information Administration
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Rate Increases Expected to Continue
Source: Bradenton Herald
Source: South Florida Sun-Sentinel
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Add the Concern for the Environment and National Security
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• Wind• Solar Thermal• Hydro• Biomass• Geothermal• Waste to Fuel
• Ocean Gradient
• Tidal Power
• Hybrid Systems• Fuel Cell
• Solar Photovoltaics
Distributed Generation
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Floridians Need a Sustainable Energy Policy
• 2006 - SB8888 Created a solar rebate program
• Rebates jumpstarted industry for two years
• Funding fell short• Industry pulled back• Renewable energy
rollercoaster• This discourages
investment
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What attracts debt investments?
• Long Term Fixed price contracts.
• Investment Grade Backing.
• Stability and Security.
Source: Good Energies
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What gets financed
• Fixed, long term contracts
• Low default risk• Dedicated funding
source• Policy makers who
“get it”
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"There's enormous potential for new jobs and reduced carbon pollution just by implementing existing technologies like energy efficiency and wind energy, but we also need to develop transformative new solutions. As a scientist, I remain optimistic that these breakthroughs are within our reach, and investments like these are an important part of achieving them."
Steven Chu Ph. D. Secretary Dept. of Energy
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PRODUCTION BASED INCENTIVES
What is the solution?
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What are PBIs
• Allows consumers to generate electricity for a profit
• Payments based upon energy produced • Allows anyone to sell Renewable Energy
to the grid• Utilities will buy renewable electricity at a
fair price for a fixed period of time• Includes all sources of renewable energy
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From Centralized Production and Delivery by Utilities
Utility
Homes Schools Business Church
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To Distributed Production
Utility
Homes Schools Business Church
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25 MWSolar Farm
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“Solar on Every Rooftop and Widespread Renewables”
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Why PBIs?
• Quickest way to increase the use of renewable energy by consumers
• Proven least cost to rate payers for rapid renewable energy transition
• Increased energy production significantly for the states/countries where adopted
• Slowed the increase in energy costs by replacing fossil fuel
* Above facts from National Renewable Laboratory reports, EPIA reports & World Future Council
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Benefits
CommunityCommunity
Job Creation Boom of local and foreign investment
Creates local wealth
Stabilize Energy Costs
InvestorsInvestors
Simplicity
Guaranteed Revenue Stream
Predictable Returns
Renewables Enhance Property Values
Environment/Environment/SecuritySecurity
Reduce dependence on foreign oil
Improve national security
Protect our health
Global Warming
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Everyone can participate. The average American can become an entrepreneur by selling the electricity that they produce.
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Common Concerns
A New A New ParadigmParadigm
• Centralized vs. Distributed Production• Opens market
• Individual producers get paid vs. utility• Imagine the possibilities
CostCost• PBIs increase cost to ratepayers• PBIs 1% vs. 3% annual increase in fossil fuels
• Renewable more expensive than fossil• Hidden costs of fossil fuels
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Source: BMU, 2008, NREL 2009
Total Jobs in RE Sector (2007)
0
50
100
150
200
250
300
Ge
rma
ny
Sp
ain
UK
Ita
lyTot
al J
obs
in R
E S
ecto
r ('0
00)
N/A
Germany & Spain use a FIT Model while UK & Italy use a REC Model
Total Generation from Biomass Sources (2006)
0
20
40
60
80
100
120
140G
erm
an
y
Sp
ain
UK
Ita
ly
To
tal G
en
era
tio
n (
TW
h)
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Total Generation from Wind Power (2006)
0
5
10
15
20
25
30
35
Ge
rma
ny
Sp
ain
UK
Ita
ly
To
tal G
en
era
tio
n (
TW
h)
Source: BMU, 2008, NREL 2009
Germany & Spain use a FIT Model while UK & Italy use a REC Model
Total Installed Solar PV Capacity (2006)
0
500
1000
1500
2000
2500
3000
3500
Ge
rma
ny
Sp
ain
UK
Ita
ly
Ins
talle
d C
ap
ac
ity
(M
W)
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Who benefits from a PBI policy?
Individuals and residents Small businesses Commercial Developers Finance Community Industry & Trade Associations Solar producers Renewable energy producers Climate Groups Electricians Local Governments Municipalities Churches and houses of worship Green Building Industry Environmental organizations Communities with common areas Condo organizations Farms & Ranches Individuals who can produce renewable energy 67 counties and over 175 cities in Florida.
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WHY NO PBIs?
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Expected Profit/kWh for Onshore Wind 2006
0
1
2
3
4
5
6
7
8
Ge
rma
ny
Sp
ain
UK
Ita
ly
Ex
pe
cte
d P
rofi
t (E
uro
ce
nts
/kW
h)
Germany & Spain use a FIT Model while UK & Italy use a REC Model
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“Solar on Every Rooftop and Widespread Renewables”