Comment

Comment by Roy R on August 30, 2008 at 8:34pm

BEFORE THE FLORIDA PUBLIC SERVICE COMMISSION

IN RE: Establishment of Rule on Renewable DOCKET NO. 080503-EI
Portfolio Standard. Filed: August 20, 2008
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COMMENTS OF THE FLORIDA ALLIANCE FOR RENEWABLE ENERGY

The Florida Alliance For Renewable Energy (FARE) files its comments on the Commission’s proposed Rules 25-17.400, 25-17.410, and 25-17.420 and states as follows:

On July 13, 2007, Governor Crist signed a suite of executive orders to reduce Florida’s greenhouse gas emissions, increase energy efficiency, and remove market barriers for renewable energy technologies such as solar and wind energy. Since the executive orders were signed, Florida has stepped onto the world stage as a major marketplace for advanced energy technologies. It is not at clear that the PSC ruling fulfills the objectives laid out by the Governor.


Summary


We are confident that the PSC and their staff are well informed on the issues of renewable energy policies including the problems associated with RECs versus the benefits of other policies such as Feed-In Tariffs (known as Renewable Energy Payments or “REPs”). Consequently, we are deeply concerned about the direction Florida will be heading with regard to the future of the renewable energy industry in Florida, as set out in this draft ruling.

We do not believe that the RECs policies will achieve the renewable objectives set out by the Governor, nor do we believe that the RECs are a fair and equitable policy allowing equal opportunity to develop renewable resources; nor are the best value for ratepayers – in fact study after study have shown that RECs are the most expensive policy option for ratepayers. They contrast especially poorly when compared side by side with REPs.

The real concern for the long term growth of the renewable energy industry in Florida is that the REC program will benefit a few large out of state companies at the expense of many small and mid-sized companies already operating in Florida, their future growth, and their employees. RECs are complex, opaque, administratively burdensome and unpredictable. Few organisations have the capability to fully assess the risks associated with RECs.

We believe that under a REC policy, market concentration and an oligopoly of REC providers will develop from out of state companies with experience of both lobbying for and drafting RECs policies in other states and then operating under the mechanisms that have been implemented. Indigenous Florida renewable companies do not have this learning curve advantage and will be disadvantaged accordingly.

We do not believe that Florida legislators or ratepayers want a renewable program like RECs that actually discriminate against existing Florida renewable companies.

Internationally, utility Feed-In Payments (known as REPs in the US) have become the incentive of choice for increasing the uptake of solar and other renewable energy technologies, being implemented in over 45 countries around the world. This proven policy option is gaining ground because it takes the state's fiscal role off the table. Indeed, many of the recent calls to Solar Energy Industry Associations like FlaSEIA and Mid-SEIA, for REP policies, have come from businesses concerned about REC dependent markets.

A REP — which most people know as the mechanism that started Germany's solar boom — offers anyone with a solar system (or any renewable energy system) a fixed payment for the electricity generated by that system. The incentive is designed to provide the system owner a “reasonable rate of return.” Instead of relying on the state, utility companies provide the incentives by charging all ratepayers the extra cost borne by purchasing renewable energy. REPs provide long-term stability, which in turn reduces capital costs and allows for a much more diverse group of companies and individuals to invest in renewable. REPs are a simple, stable, inclusive approach to developing renewables in Florida that does not pick technology winners.

We urge the PSC to revise its ruling and replace the RECs policy with a renewable energy payment program.

Concerns with Draft Ruling and RECs

The House Energy Bill required the PSC to investigate the best polices for the deployment of renewable energy, taking into account: analysis of the technical and economic viability, fuel diversity, investment in Florida, lessening the states 98% dependency on imported fossil fuels.

While the PSC in this ruling has clearly looked at and considered RECs, it does not appear that any analysis or study has been done on other policies that allow utilities to “procure” renewable energy as was instructed by both legislatures. Other policies, such as REPs or production based incentives have been proven to achieve much more significant investment, and with it jobs, than REC policies. Furthermore all of the most widely published studies from the European Union to Nicholas Stern [UK Economist] to Summit Blue’s analysis in New Jersey have all concluded that RECs are a high cost option for deploying renewables.

It would appear remiss of the PSC to enter into draft rules without having considered these policies in detail.

Has the PSC undertaken a review of policies outside the US which account for the majority of the worlds renewables. The US now has only 8% of the world’s solar capacity – whereas Germany has over 50%. Germany installed 1100MW of solar capacity in 2007 versus 20MW in New Jersey (a comparable REC market).

Did the PSC undertake a direct study of the Germany REP policies that are now in place in 45 countries and most recently were introduced in Switzerland after a 2 year review that included analysis of mandated quota REC systems?

Were field trips undertaken by the PSC and staff to Germany and other REP countries to review first hand the success of these REP policies and contrast them with the failure of REC policies in states that have implemented them already?

RECs are poor value for ratepayers and restrict renewable deployment

There appears to be recognition amongst many European countries with short-term tradable REC markets that REPs may be a more efficient way to achieve rapid deployment of renewables as cost effectively as possible. In the Stern Review on the Economics of Climate Change, Sir Nicholas Stern noted that both standard offer contract pricing and renewable portfolio standards have proved effective at spurring renewable development “but existing experience favors price-based support mechanisms. Comparisons between deployment support through tradable quotas and feed-in tariff price support suggest that feed-in mechanisms achieve larger deployment at lower costs”. A paper entitled Feed-In Systems in Germany, Spain and Slovenia: A Comparison stated that “Feed-in tariffs have been successful in triggering a considerable increase of [renewable energy] technologies in almost all the countries in which they have been introduced and where their effectiveness was not significantly hampered by major barriers (administrative barriers, grid access, etc.).”
The analysis by Summit Blue Consulting for the New Jersey Board of Public Utilities on how to most cost-effectively transition the New Jersey solar market from rebates to market-based incentives showed that the feed in tariff policy (15-year full tariff) would be more cost-effective for ratepayers than renewable energy credits (SREC only). The SREC policy cost 57% more than the feed in tariff 15 year contract. The SREC was the most expensive policy mechanism out of 7 policies that were reviewed, and therefore the least value for money for ratepayers.

Exhibit x. Ratepayer Impacts ($ millions)
from Different Renewable Energy Policies in New Jersey





Any banker can explain why that is, in one word - “risk”. RECs are more risky than long term fixed price contracts. The PSC ruling appears to ignore the concept of risk capital. RECs with fluctuating prices, no certainty about contracts or grid access will be priced accordingly. Equity costs in the renewable energy power sector currently run at from 8 -15% versus half this cost for debt financing. Creating a policy instrument that encourages significant leverage is therefore a key litmus test for two reasons:

 Cost of capital is much lower
 Availability of equity is more constrained than debt

RECs fail this litmus test: as they typically result in less than 30% debt financing, versus 80-90% on REP renewable programs in Europe, and consequently more equity per MWs of renewable capacity means less renewable projects

Why is the PSC embarking on a policy mechanism that many independent consultants have concluded is the “least” ratepayer friendly policy.


RECs are a poor return on jobs compared to REPs

First Solar, one of the leading solar manufacturers in the world recently announced a major new manufacturing plant in Germany – why; because Germany has a robust domestic solar market driven by REPs. The poor experience of REC markets has not resulting in a single new manufacturing plant being built in those states.

The REC programs in place in the US have largely failed to stimulate the renewable jobs that legislatures and voters want. RECs encourage utility scale projects like the FPL announced projects in Florida. Utility scale projects generate many less jobs per MWs of capacity than smaller scale commercial or residential projects do; they also can be built by sub contractors resulting in no permanent jobs in Florida.

Several countries have seen a remarkable job return on their renewable policy programs. Direct jobs result from the use of local skilled workers in the development, manufacture, construction, installation and operation and maintenance of renewable generation. Manufacturing centers for solar thermal and solar PV components should be established in-state, as Germany has done, to maximize this benefit. Much of the financing can be done locally as well, stimulating jobs in banking. As of 2007, Germany has created 250,000 direct jobs across the whole renewable energy sector as a result of its significant growth of renewables. To date, Germany has employed nearly 50,000 in the solar industry alone.

These jobs were created by a feed in tariff or REP program NOT RECs.

RECs discriminate against distributed generation and Resource Diversity

RECs fail to take into account the benefits of distributed generation – delivery of renewable power at the point of consumption. The program design typically does not differentiate between different scales of projects – there is a one size fits all REC price – this clearly ignores the societal benefits and cost savings from distributed generation.

RECs with long-term contracts could reduce investment risk for developers and promote more renewables than RECs which rely solely on short-term markets. However, RECs still discourage smaller developers with greater transaction costs (such as legal costs) relative to larger developers , newer technologies relative to more mature technologies, and applications and locations which cost more to develop relative to applications and locations which cost less to develop.

RECs and Power Purchase Agreements

The ruling appears to focus solely on centralized generation by requiring PPAs. However, since most counterparties are reluctant to enter into a PPA unless the project size is 10MW or greater, PPAs will just put more barriers in the way of renewable energy.
Conversely, REPs appear to be more successful in allowing entry by smaller developers because they address both distributed and centralized generation and the tariffs obviate the need to negotiate power purchase contracts with a utility. REPs allow a wide range of resource sizes, applications and locations to develop simultaneously – which helps to explain the development rates that have been observed in Germany.

A key element to this is prioritizing renewable access to the transmission grid ahead of other non-renewable projects; transmission access should be monitored by the PSC and a mandate should require access to be provided within 60 days for projects below a maximum threshold (typically 20-50MW).

RECS – Poor Track Record especially for Solar

Let’s take the example of New Jersey and Maryland where REC programs have been operating.

New Jersey once had a vital and growing solar industry, developing thousands of new high paying jobs. Maryland in 2007 followed suite by passing legislation intended to create a market for both small and large solar companies. Under each of these states’ newly adopted REC-based incentive programs, these small to mid-sized companies quickly learned that REC policies are incapable of delivering adequate financial incentives for their client base.

RECs are seen by some larger companies as a low cost, market based policy that allow for broad based participation. However, there is evidence to show that REC based policies can be the most expensive incentive mechanism, requiring significantly more involvement and administration from the state. Additionally, the floating market mechanism feature of the REC is extremely volatile requiring that companies have large financial resources to navigate and master the complex nature of the commodity to truly benefit from this type of policy.


As Ted Middleton, President of a mid-sized, Maryland based solar company explained, “The ratepayer base thus foots the highest bill possible to fund ‘Big-Box’ style installations, and the little guys (farms, auto dealers) get a much lower cash benefit relative to each REC produced because they have little market leverage with remaining REC purchasers.” “The small systems just got completely left off the table,” says Middleton. “The state just said, '[The REC program is] too difficult, too risky for us to do, so we're not going to touch them.'”

“In New Jersey there's a lot of concern that the residential sector, while it may not be completely shut out, is in big trouble,” says Lyle Rawlings, secretary of the Mid-Atlantic Solar Energy Industries Association. “We need to do better at creating a system where small businesses and small projects can play the game. That's not the case right now.”

The current draft of the RPS with RECs appears primarily designed for only one or two large companies, in the same way that in Maryland one solar company was able to corner the market in solar RECs and contracted with a leading utility to supply it with 60% of the market. Pete DeNapoli of SolarWorld, a leading solar manufacturer says “Sure, the state of Florida will meet the RPS goals, but the bottom line is that the Governor’s goal of creating a vibrant renewable energy industry with thousands of new, high paying jobs will not be realized,” Pete adds. “With Feed-In Payment incentives, you get it all.”


FARE Preferred Policy – Renewable Energy Procurement through Renewable Energy Payments (“REPs)

As stated previously, we believe legislators intended the PSC to review policies that allow procurement of renewable power by utilities from 3rd party producers. It would appear remiss of the PSC to enter into draft rules without having considered these policies in detail.
Had the PSC undertaken a comprehensive review of policies outside the US which account for the majority of the worlds renewables, they would have seen that there is one clear policy winner.

The US now has only 8% of the world’s solar capacity – whereas Germany has over 50% - it also has ~ 20GW of wind capacity and one of the largest biomass industries. These all developed under a REP mechanism.

REP Policy
For the purposes of this filing, we define REPs as a set of renewable technology-specific fixed payments that electricity companies make to renewable energy generators based on renewable energy generation costs and a reasonable profit. Some countries, such as Spain and Slovenia, offer renewable energy generators an alternate calculation for their fixed payments – a premium on top of the spot market price for electricity. However, we do not view this as approach as best practice because it could 1) enable windfall profits due to the break of the link between payments and real generation costs and 2) increase investor risk due to the volatility in the price of electricity.
REP contract pricing is implemented through a charge added by the utility to consumers’ electric bills in proportion to their consumption. REPs provides set prices for renewable resources and leaves it to markets to provide the appropriate quantity of resources at those prices. Payments are guaranteed over a long time period (i.e., 20 years) to provide price certainty and market stability and thus reduce the initial investment risk for renewable energy developers. Best practice standard offer contract pricing policy designs have payment levels that are specific to the resource type and with further price differentiation by size and other important criteria (such as for stand alone vs. building integrated applications for solar PV). These payments generally accompany policies which require utilities to prioritize interconnection of renewable generation and procure a certain amount of renewable energy as part of their total resource portfolio.
The structure that Germany implemented is frequently referred to as a best practice and is being leveraged by other European countries such as Italy for solar PV as well as states that have recently proposed REPs such as Switzerland, France, Spain, India, California, Wisconsin and Ontario.

To summarize, Germany’s best practice design provides payments that:

• Prioritize grid access to renewable producers within 60 days
• adequately reflect generation costs and profit;
• are guaranteed for a long period of time (i.e., 10 or more years);
• are sustained over time once the generator is approved for admission into the program;
• decline each year for new generators that are being admitted into the program (this is referred to as tariff degression);
• differ by renewable resource (often depending on the stage of development that the technology is in); and
• are differentiated within each renewable resource to achieve specific goals (such as promotion of smaller installations, or building-integrated solar PV).


As of early 2007, approximately 70% of the countries in the European Union had some form of standard offer contract pricing. In comparison, approximately 20% had adopted renewable portfolio standards with RECs. Italy is the only European country to have both RECs and standard offer contract pricing.
However, Germany’s success with REPs has garnered recent interest by US states and European countries that have previously adopted RECs (such as the UK) as well as states and countries who have adopted neither to date. US states have acknowledged serious downsides associated with renewable portfolio standards implemented through RECs. New Jersey was one of the first states to note challenges associated with the development of renewable energy under renewable portfolio standards, such as the persistence of investment risk and price volatility. , Also, without specific set-asides for more expensive technologies, development has not occurred at a rapid rate.
Exhibit 1. Overview of Policies
to Promote Renewable Energy Development
Policy Name Definition Pros Cons Current Applications
Renewable Portfolio Standards (RPS) A policy to require utilities in the state to procure a certain amount or percentage of their load via renewable resources and to allow market mechanisms to determine prices. A best practice RPS should incorporate fixed long term contracts via RFPs and should have multiple markets for different resources especially for PV and clean distributed generation.. Provides certainty with regard to quantity Pricing can vary from year to year or from project to project to a large extent AZ, CA, CO, CT, DC, DE, HI, IA, IL, MA, MD, ME, MN, MO, MT, NC, ND, NH, NJ, NM, NV, NY, OH, OR, PA, RI, SD, TX, UT, VA, VT, WA, WI, Belgium , Italy, Poland, Romania, Sweden, United Kingdom
REPs (known in Europe as Feed-In Tariffs) A set of fixed, long-term incentive payments made to renewable energy generators Provides certainty with regard to pricing Quantity depends largely on adequate pricing In Place: CA, NJ, WA, Ontario, Austria, Bulgaria, Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Ireland, Italy, Lithuania, Luxembourg, Netherlands, Portugal, Slovenia, Slovakia, Spain, Switzerland
Proposed: IL, MI, MN, RI



A Comparison of Strengths and Weaknesses of Renewable Energy Payments and RECs
The exhibit below summarizes the strengths and weaknesses of REPs and RECs. The discussion of advantages and disadvantages is organized into following key characteristics: resource development and cost.
Exhibit 2. The Strengths and Weaknesses of REPs
and RECs with Regard to Resource Development

Characteristics REPS RECs
Provides Investment Certainty/
Price Certainty (also known as static efficiency) The price is certain with REPS. Pricing is clearly defined for the current year, as well as for future years. Less price certainty than with REPS. The purchase price of RECs change annually according to the level of the annual goals, as well as the definition of eligible resources and the availability of eligible resources.
Provides Supply Certainty Less supply certainty than with an RPS. There are no firm goals for supply. Also, there are no entities held responsible for not developing enough renewable resources, and no monetary penalty for under-achievement relative to development expectations. The only way to achieve greater supply is to modify the price. The supply is specified with an RPS, but compliance needs to be enforced in order for supply to be certain. Penalties for non-compliance help to ensure that the goal is met if the level of penalties is high. Additionally, supply goals can be set by resource to ensure a certain amount of development for a particular resource and/or type of resource (i.e., solar PV, distributed generation).
Allows for Resource Diversity Technology
Allows for faster development of resources that are not least cost due to differentiation of payment levels by resource.
RPSs without resource-specific goals tend to encourage the least cost technologies and maximize the development of these technologies.
Size
Allows for development of smaller-sized resources by differentiating the payment level for these resources. This levels the playing field for smaller resources with greater transaction costs.
Most RPSs do not have goals that are broken out by resource size. As a result, higher transaction costs for smaller resources make it easier for larger sized resources to offer lower pricing.
Application
Allows for development of different applications by differentiating the payment level for these applications. This encourages a greater variety of applications and the development of each application can be tailored based on policy goals.
Most RPSs do not have goals that are broken out by application (i.e., stand alone vs. building-integrated solar). As a result, the least cost application of the resource will be the one that is most commonly developed, despite the fact that other applications may be desired.
Location
Likely to drive more local development than an RPS. As REPS is likely to apply to states rather than regions, the majority of the benefits of renewable development remain in-state.
Likely to drive more out-of-state or regional development than REPS. Out-of-state and/or regional trading is often an integral component of an RPS. However, a state can design its RPS to promote in-state resources, thereby stimulating the local economy.

The Relationship between Project Financing, Profitability and Achievement of Development Goals

Renewable investment requires management of risk and uncertainty with regard to bank financing as well as project profitability. A paper entitled “Prices Versus Quantities: Choosing Policies for Promoting the Development of Renewable Energy” by Phillippe Menanteau provides the following more detailed explanation of the motivation developers need in order to participate in renewable energy markets projects:
“On the supply side, a supplier wishing to enter the market must be able to anticipate future prices and make his project ‘bankable’ in order to secure a loan to enable him to invest in new production capacity…. Project developers see [fixed prices] as ensuring a safe investment with better predictability and a stable incentives framework, as well as by the lower transaction costs for each project”.
The higher development levels that have been observed with REPs are likely due to the reduced risk and uncertainty relative to other policy options.

As discussed above, power and/or RECs associated with renewable energy projects under renewable portfolio standards in deregulated states have been sold though short-term contracts (especially in the Northeast). The use of short-term contracts is a significant barrier for new renewable projects with high capital costs. Renewable portfolio standards could require the use of long-term contracts just as practiced in the regulated states and some deregulated states. This would reduce uncertainty about profitability which would lead to reduced project financing costs. However, the bi-lateral, long-term contract pricing under renewable portfolio standards would likely remain private. REPs that determine and publicly provide the current as well as future payment levels for different renewable projects provide clearer, more stable signals to project developers. Profits are known upfront with REPs. Ensuring a reasonable level of profit can drive manufacturer efficiency and innovation because funds can consistently be made available for further research and development.
The Impact of the Use of Out-of-State Resources
A renewable portfolio standard is better equipped to meet some of the state’s renewable energy development goals using out-of-state renewable energy resources. The main reason for developing and/or purchasing power from out-of state resources is that they can be more cost-effective than in-state resources. Conversely, in states where in-state resources are more costly than out-of-state resources, REPs are more effective at promoting development of these in-state resources. Given the fact that Florida has in-state resources that may cost more to develop than resources in other states, careful consideration needs to be given to the use of out-of-state resources as this may compromise the state’s ability to meet goals related to jobs and stimulation of local manufacturing.


Exhibit x. The Strengths and Weaknesses of Standard Offer Contract Pricing
and Renewable Portfolio Standards with Regard to Cost

Characteristics REPS RPS
Administrative
Costs It is overall less time consuming to implement than an RPS, as setting the prices in the first year and any degression over time are the main components that need to be established. Pricing differentiation beyond resource, resource size, and resource application is less time consuming. Generally more time consuming to implement than REPS, as the following needs to be established; quotas, geographic eligibility, REC trading rules, methods and verification, alternative compliance payments and procedures. As a result, there are administrative limits to the number of development goals (i.e., markets) that can be established and maintained.
Investment Costs Lower than RPS since banks can lower the interest rate for loans due to greater price certainty. Higher than REPS due to lesser price certainty.
Bill Impact Certainty Less certainty around ratepayers' electric bill impacts than with an RPS. This is due to the fact that the proportion of development via each resource is unknown. However, REPS tends to ensure more homogenous costs over time and avoids sudden price spikes. Greater certainty of ratepayers' electric bill impacts as compared to REPS. An RPS has a set development goals for each resource. However, this is only true if the price of these resources do not change greatly from year to year.
Short-Term Cost Minimization Geographic Participation/Eligibility
Since REPS applies to in-state resources only, the cost of the resource is directly tied to in-state development costs. When in-state resources are limited and/or costly, the overall cost impacts could be high.
Costs could be lower as compared to REPS in the short-term as many RPS policies grant eligibility to out-of-state resources that are lower cost than in-state resources. Trading with other states or regions enables the use of lower cost renewable resources to meet requirements.
Overpayment Minimization
Due to the high level of price differentiation and degression that can be implemented, REPSs may be better than RPSs at preventing overpayment to solar applications with lower costs than others.
As it is more time consuming to implement different goals for different types of solar applications, for example, less expensive solar applications could realize windfall profits under an RPS.
Fosters Innovation to Minimize Long-Term Costs Costs could be lower as compared to an RPS in the longer-term. Since REPS is sometimes set up to decrease the prices received by new installations each year, manufacturers have the incentive to reduce costs quickly. Costs could be higher as compared to REPS in the longer-term. While there will be competition between developers for business, there is little incentive for manufacturers to bring down the cost of new technology quickly.

Competition and Costs over the Life of the Policy

A renewable portfolio standard “encourages competition among renewable developers to meet the targets in a least-cost fashion”. However, due to the lack of a firm payment structure that provides insight into future payments, there is less of a longer-term price signal to developers. In years where there is lower supply of renewable resources paired with high demand and prices remain high, there is less motivation for developers to consult with manufacturers about bringing the costs of these resources down. Several studies comparing the potential costs of renewable portfolio standards to standard offer contract pricing have suggest that renewable portfolio standards provide greater opportunity for collusion amongst larger players who want to the keep the prices of renewable resources high. , This is not a concern with standard offer contract pricing because payments are determined by the PSC.

With REPs, developers know their payments in the first year. They also have a general idea of what their payments will be 3-5 years out. REPs sends a clear, predictable, long-term price signal, and a degression structure motivates developers and subsequently manufacturers to reduce costs because they know that the payments will be lower in future years than what they are in the first year. , Also, clear signals can enable manufacturers to better allocate funding to research and development in order to lower capital costs. In other words, competition amongst manufacturers to quickly bring down the cost of their products may be more desirable than competition amongst developers. Since REPs are better positioned to provide price signals that will reach manufacturers, REPs will result in lower costs over the life of the policy compared to RECs.

Comment by Getulio Bastos on August 28, 2008 at 1:35pm

Gentlemen,

This is a letter I just sent to Congressman Ron Klein of West Palm Beach and Florida Senator Bill Nelson. I suggest that all of our members do something similar to provoke some reaction from our politicians.

Mr. Bill Nelson,

Florida is one of the worst hit states in the Real Estate crisis. Our tourism industry is being hit tremendously by the gasoline price hikes. And our state is one of the least served with alternative forms of energy. But we can do something about it and one of the things we can do is to facilitate the creation of an infrastructure to sell, install conversion kits in our cars and distribute natural gas within our region.

There are entrepreneurs interested in creating this infrastructure, but the major obstacle is EPA, which has no scientific reason to keep their antique regulations for the conversion of our cars to use natural gas in our roads. There are no technology barriers at all.

It would save our taxpayers a lot of money in the near future while providing for a new source of employment for thousands of Floridians in a brand new industry. In training of new mechanics, installation of conversion kits, installation of natural gas filling stations, distribution of natural gas across the state and maintenance of it all.

There’s a Bill going through Congress now, entitled “THE DRIVE AMERICA ON NATURAL GAS ACT OF 2008” introduced by Senator James Inhofe of Oklahoma.

If you need to research more about it, please visit www.push.pickensplan.com. Please, click here if you want to see the reactions to my discussion Brazil is 100% oil independent. Why aren't we?.

While there you can also see several pictures and videos related to the usage of natural gas as a vehicle propulsion energy both in Brazil and the US.

As a citizen I urge you to support this Bill to pass and provide easier means for our people to expend less on their cars while creating a new industry for the state of Florida.

Your voter,

Getulio Bastos

Click here to send your message to Senator Bill Nelson
Click here to send your message to Congressman Ron Klein
...

Comment by Roy R on August 25, 2008 at 6:40am

Solar Monopolies in Florida! The REC Wrecking Ball – Coming to a State Near You


Florida’s electric utility system is a regulated monopoly. Now, with passage of the Florida Energy Bill this week, legislators in Tallahassee have set a course, that unless rectified, will most probably extend similar monopolies into the fastest growing energy markets – renewables and solar, and in doing so decimate the existing Florida solar industry in favor of larger Wall Street backed multinationals. It seems inconceivable that once policymakers and legislators fully comprehend the implications of the direction that they are heading in, that any true Floridian will actually support this – but stranger things have happened. Now is the time to speak out.

Buried in the Florida House and Senate Energy bill is language that would allow the state electricity Regulator, the Public Service Commission, to introduce policies known as renewable energy credits (or RECs) as a way to stimulate solar and other renewable energy electricity production. RECs are basically bought by utilities from renewable producers and certify that the utilities have acquired a unit of renewable energy, and as such can be used as a mechanism to force utilities to meet certain renewable targets. The problem is that there is growing evidence from other states that have introduced RECs, that these policies are radioactive. Maryland, introduced RECs earlier this year. Even before the policy was signed by the Governor, the largest utility announced it had signed a multi-year transaction to buy solar RECs from SunEdison, a major international solar company. That deal gave the 2 companies a 30% share of the market for 2008 and 60% for 2009 – a quasi monopoly. This crowds out the existing local solar industry since it leaves them with only 40% of the market to participate in. Job losses will follow.

New Jersey has an ill thought out solar RECs policy as well. Smaller residential solar companies are in decline and shedding people. Says Lyle Rawlings, CEO of a large NJ solar integrator “the market is in collapse right now, with projects being canceled and many of the solar businesses that grew under the rebate program now hanging on by their fingernails. The REC market literally is not working, except for a handful of companies who have been able to get long-term REC contracts - we know that the market concentration is very unhealthy, and we think it’s an improper way to deliver a solar incentive program”. Furthermore NJ will be missing its RPS target primarily because of these issues. So based on recent market evidence RECs are a wrecking ball for local renewable companies.

The problem stems from the fact that utilities retain the power to decide who they buy RECs from, and utilities quite naturally won’t want the hassle of buying small quantities of RECs bilaterally from household solar systems or small commercial providers – they would much prefer to deal with one or 2 large aggregators of the RECs doing the largest commercial renewable projects, so they arrange bilateral deals direct with them. Whats wrong with this?

Since the utilities prefer to buy in bulk they will pay more for these aggregated RECs – typically up to 80-90c in the $, whereas for residential or small commercial RECs the value is 50c or less (this is the figure the State of Maryland has proposed should they become the default residential aggregator). Consequently while the RECs incentive covers 70% or so of the build out cost of the larger commercial projects, thus providing a massive contribution to the companies least in need of it, they only provide 30% of the cost of the small systems that are the life blood to the local solar integrators. This leads to a curtain call for the local industry all done with rate payer and tax payer money that has effectively been laundered to the benefit of the larger commercial REC suppliers. And funnily enough who is supplying the policy language for the legislatures and PUCs? The answer is the very same solar companies that will benefit from them!

There are already strong indications in Florida that these same out of state large solar companies are lining up multi year contracts with Florida utilities in excess of 100MW that could sop up a majority of the RECs that would become available to the solar industry – leaving next to nothing for the local solar integrators to compete for.

As Ted Middleton, Managing Member of a Maryland solar company explained, “The ratepayer base thus foots the highest bill possible to fund Wal-Mart installations, and the little guys (houses) get a much lower cash benefit relative to each REC produced because they have little market leverage with remaining REC purchasers”

Florida legislators have just voted to approve renewable policies such as these – thankfully the energy bill both requires the PSC in Florida to fine tune these policies and then seek reaffirmation from the legislature in 2009. Maybe in the intervening months, the Governor’s office and Florida policy makers including the PSC should ask smaller NJ and Maryland solar companies as well as the Florida SEIA companies if they think these REC policies are working. They will likely hear a resounding NO!

“Unfortunately, the language that passed through the legislatures favors a REC based policy. Without any change, for the foreseeable future anyway, Florida could end up with renewable energy policy primarily designed for only one or two large companies, just like what has happened in Maryland and New Jersey,” comments Pete DeNapoli, FlaSEIA Director. “Sure, the state of Florida will meet the RPS goals, but the bottom line is that the Governor’s goal of creating a vibrant renewable energy industry with thousands of new, high paying jobs will not be realized,” Pete adds. “With Production Based Incentive or Feed-In Tariffs, you get it all.”

What legislators and policy makers instead need to do is look at the highly successful renewable policies that have been in place in Europe for years and resulted in both the rapid deployment of renewable electricity projects, a massive expansion in local jobs from it, all done with no taxpayer expense and minimal increases in electricity prices. Germany has 250,000 employed in renewables generating $30BN in sales. At the very least Florida policy makers and legislators should do what the utility solar association SEPA is doing, and undertake a trip to Germany to review first hand how Germany has a vibrant solar and renewable industry with ~ 4000MW of solar at the cost for ratepayers of “the price of a loaf of bread”. Both the Florida Solar Energy Industry Association (FlaSEIA), the Maryland, District of Columbia and Virginia SEIA, Environmental Defense Fund as well as several high profile manufacturers and solar integrators have publicly advocated introducing these feed in policies as the best public policy incentives for solar and renewables.

So for the sake of those desiring a vibrant renewables job market in Florida, I ask legislators and policymakers to reconsider these ill advised REC policies. Thanks to the efforts of the Governor, and his energy team, Florida has the opportunity to develop a clear energy policy that can get the state to 20% of electricity from renewable sources, create robust new industries employing thousands of people and improve the states energy security. However the state must be careful in what policy incentive mechanisms are introduced to get us there and avoid replicating ill conceived and dangerous policies that are already failing in other states. Other State SEIAs, such as in New York and Pennsylvania, need also to proactively participate in this growing debate and understand the full ramifications of what often is being foisted on them by other so called national industry mouthpieces with vested interests inconsistent with the local industry.

Comment by Chris Clement on August 21, 2008 at 11:17am

Have you noticed that the oil interests are laughing off Obama's tire pressure suggestion? 3% is a LOT and we all can do this one.

Comment by Luna on July 30, 2008 at 12:04pm

I'm so glad Mikey B. started this group..we definitely need to develop alternative energy in the U.S. so we are not so dependent on foreign oil..I'm so happy to see that so many people have cut down on their driving with the high gas prices..hope it continues if the price of gas drops..nuclear is NOT the answer--much too dangerous..wind and solar are our best sources in my opinion.

Comment by Alankar Gupta on July 22, 2008 at 9:45pm

Greetings Friends,
We all need to thank Mr. Pickens for explaining the energy problem that we as a nation face. Earlier it was one Group (users) pointing fingers at the other Group (suppliers) and vice versa. The problem is real. It was magnified to some extent, in recent times, by speculators. But, the truth is we are importing more oil every year and producing less. We are sending billions of dollars overseas.

I like Mr. Pickens Plan but I think it needs to be supplemented by other plans. It by itself will not get us to Energy Independence. It will just buy us more time. For this reason I have posted a petition for Energy Independence .

http://www.ipetitions.com/petition/windenergycorporation


Please (a) sign the Petition and (b) forward it to your friends. United we can achieve Energy Independence and avoid this constant financial bleeding of our great nation.
Thanks.

Regards and Best wishes,

Alankar Gupta

Comment by Roy R on July 22, 2008 at 6:50pm

Dear Solar Advocate,
Several associates of our organization and myself have recently attended Governor Crists Florida Summit on Global Climate Change and learned about a very effective renewable energy policy that we believe can make Florida a leader in clean renewable energy. In Europe this policy is called feed-in tariffs (FITs) and it has proven to be the world’s most effective renewable energy legislation. Here in North America it is being called Renewable Energy Payments (REPs).

REPs are incentives for individuals and businesses to become producers of renewable energy. They direct utility companies to provide access to the grid for anyone or any group producing renewable energy (RE), and to buy all the RE available at established prices per kilowatt hour for a set period of time, usually 15 to 20 years. The prices vary according to the type of technology, the size of the system, and its location. The increased costs to the utilities is paid for by adjustments to all their customers’ electricity bills. In Germany, this has meant an increase of around three dollars a month for average home owners—about the cost of a loaf of bread. A board is established that meets periodically to review the policy and adjust the rates for new contracts.

Adopting a REPs policy in Florida will encourage our energy entrepreneurship, expand our green energy marketplace, create jobs, and stimulate our economy—all this while significantly reducing pollution and greenhouse gas emissions. We urge you to develop and pass legislation like this in our state. You can learn more by visiting www.AllianceForRenewableEnergy.org.

Please let me know what action you will take to bring REPs to Florida and make us a leader in the renewable energy revolution.

PLEASE SEE ATTACHMENTS
Sincerely,
Roy Ratner
Atlas Solar Innovations
www.atlas-solar.com

Comment by Bill Hinegardner on July 20, 2008 at 8:40am

I am trying to get a bill sponsored to allow a new type of electric vehicle, a medium speed electric vehicle. A medium speed electric vehicle is similar to the low speed electric vehicle already allowed by federal law except they can go between 30 and 35 MPH and can travel on roads with speed limits posted 45 MPH and lower.

I feel that this vehicle would provide an exceptional alternate mode of transportation for many people, especially senior citizens living in urban areas. With the current high gas prices and more increase to come we all need relief; I felt this was a good option. It's also an eco friendly choice. I am trying to reach out to gain support having others contact their representatives about this issue.

Please note that I am not a lobbyist nor do I have a vested interest in the electric vehicle industry. I am just a private citizen trying to make a difference.

Draft Bill for Florida:

Current
320.01 Definitions, general.--As used in the Florida Statutes, except as otherwise provided, the term:
(42) "Low-speed vehicle" means any four-wheeled electric vehicle whose top speed is greater than 20 miles per hour but not greater than 25 miles per hour, including neighborhood electric vehicles. Low-speed vehicles must comply with the safety standards in 49 C.F.R. s. 571.500 and s. 316.2122.
Proposed
(XX) "Medium-speed vehicle" means any four-wheeled electric vehicle whose top speed is greater than 30 miles per hour but not greater than 35 miles per hour, including neighborhood electric vehicles. Medium-speed vehicles must comply with the safety standards in 49 C.F.R. s. 571.500 and s. 316.2122.

Current
316.2122 Operation of a low-speed vehicle on certain roadways.--The operation of a low-speed vehicle, as defined in s. 320.01(42), on any road as defined in s. 334.03(15) or (33), is authorized with the following restrictions:
(1) A low-speed vehicle may be operated only on streets where the posted speed limit is 35 miles per hour or less. This does not prohibit a low-speed vehicle from crossing a road or street at an intersection where the road or street has a posted speed limit of more than 35 miles per hour.
(2) A low-speed vehicle must be equipped with headlamps, stop lamps, turn signal lamps, taillamps, reflex reflectors, parking brakes, rearview mirrors, windshields, seat belts, and vehicle identification numbers.
(3) A low-speed vehicle must be registered and insured in accordance with s. 320.02.
(4) Any person operating a low-speed vehicle must have in his or her possession a valid driver's license.
(5) A county or municipality may prohibit the operation of low-speed vehicles on any road under its jurisdiction if the governing body of the county or municipality determines that such prohibition is necessary in the interest of safety.
(6) The Department of Transportation may prohibit the operation of low-speed vehicles on any road under its jurisdiction if it determines that such prohibition is necessary in the interest of safety.

Proposed
316.XXXX Operation of a medium-speed vehicle on certain roadways.--The operation of a medium-speed vehicle, as defined in s. 320.01(xx), on any road as defined in s. 334.03(15) or (33), is authorized with the following restrictions:
(1) A medium-speed vehicle may be operated only on streets where the posted speed limit is 45 miles per hour or less. This does not prohibit a medium-speed vehicle from crossing a road or street at an intersection where the road or street has a posted speed limit of more than 35 miles per hour.
(2) A medium-speed vehicle must be equipped with headlamps, stop lamps, turn signal lamps, tail lamps, reflex reflectors, parking brakes, rearview mirrors, windshields, seat belts, and vehicle identification numbers.
(3) A medium-speed vehicle must be registered and insured in accordance with s. 320.02.
(4) Any person operating a medium-speed vehicle must have in his or her possession a valid driver's license.
(5) A county or municipality may prohibit the operation of medium-speed vehicles on any road under its jurisdiction if the governing body of the county or municipality determines that such prohibition is necessary in the interest of safety.
(6) The Department of Transportation may prohibit the operation of medium-speed vehicles on any road under its jurisdiction if it determines that such prohibition is necessary in the interest of safety.

Comment by Teale Nicolaides on July 13, 2008 at 4:15pm

Florida is going out of control with our foreign oil. It's amazing what the companies around here are doing. Your paying 4.20 per gallon and if you look closely enough at the board, It isn't even pure gasoline. We have companies ripping us off by adding up to 20% fuel additives and charging us up the ass for it. I have an idea if anyone feels like hearing but if not then whatever here goes. We have some very powerful waves and currents here in south Florida and if we can find a way to harness this power and possibly convert it into a pneumatic form of energy the possibilities are endless of what we can do with it. I have personally learned from experience that it takes a hell of a lot to flatten out of wave because it is pure energy. If someone would be willing to sponsor me I could get a whole organization to draw up some plans and get this into action. And if people want to join for the cause it would be well worth it. In Ft Lauderdale, we have this electric plant that uses what I'm sure is big containers of oil fresh out of port everglades and I'm sure it's all foreign.other then that, we have Turkey Point Nuclear Facility, and a Waste-to-Energy incinerator in Davie. Another economy flood we have here in Hollywood, is the Seminole Hard Rock Casino where the "people" who own the place have made a deal with this Charlie Christ asshole to legalize black jack for 100 million a year and 50 million up front. Not only is their profits untaxed but they make well over 100 million a month doing it. If they could fund an alternative energy source, we would get somewhere in this world. But yeah I'm going to close this up because I know your probably really bored listening to a 16 year old trying to make a good point so here goes. All i need is a team and some funding and we can produce at least 500 megawatts a year using hydro power.
Oh and one last thing... I know we love keeping stuff cheap but we can stop sending our money over seas. there are two ways we can do this. Option Number 1: Get rid of Bill Clinton's bill that allows outsourcing. Option number 2: When you buy something look for the tag that says made in America. <--!Fuck Yeah lol--!>
Oh and another thing since your still reading this long thing. Since I'm talking about Florida, maybe I have somebody reading who might be worth this so here goes. In Florida we have something called the No Child Left Behind Act Of 2001 (the reason why our education system is shit). This makes for some bullshit called standardized testing that grades our schools based on how our teachers "teach". This has made it so the teachers spend all year teaching us how to pass the FCAT (Florida Comprehension Achievement Test) that they don't teach us those things that will be valuable for a good career in the future. Another thing we have that was brought up in January 29, 2008 elections that merged our tax borders so all of our tax money is exported to Tallahassee and they send it where they want. Watch the news and all you hear is cuts, cuts, and more cuts. Its not the governments fault, we were the ones who voted it in. So what i have to say on the subject of voting is that we should have a law here; in order to vote you must have a permit that like a drivers permit, you have to take lengthy classes and pass a test so that you don't vote for the wrong things.
Any questions, comments, or iterations, feel free to contact me. send me a message, an email, or find me on MySpace

Thanks for reading.
Truly yours,

~_TE^AL_E

Comment by Bill Mollring on July 10, 2008 at 1:24pm

Please take a look at our group site Mariah Power. The Windspire is now on display in Washington D.C. at the U.S. Capitol Botanic Garden through October 2008. Units are going up in California, Nevada, and Utah now, and we will very visable and effective throughout Hawaii this year. Mariah will be available worldwide as production increases with the completion of a new plant in Youngstown, Ohio. For more information contact us through http://www.emsystems.net or contact Bill Mollring at : 831 402-2037 mrbillmaui@yahoo.com -
http://www.push.pickensplan.com/group/mariahpower See "Photos" for units in place or on my page: Bill Mollring

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