RENEWABLE ENERGY POLICY THAT IS PROVEN TO WORK

Dear Solar Advocate,

Several associates of our organization 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 The United States 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 the U.S. 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 THE United States and make us a leader in the renewable energy revolution.


Sincerely,
Roy Ratner
Atlas Solar Innovations
www.atlas-solar.com
» Legal Eagle (Guest Opinion)
Feed-In Tariffs
A Regulatory Tool
by lois Barb er
All across the country, whether
motivated by a concern for the environment,
energy security, job creation, the economy — or just a
desire to make a buck — Americans are looking
outside our borders to see what’s been fueling the
global growth in renewable energy. They are finding
that one type of legislation, in Europe and elsewhere
called a feed-in tariff (FIT), has proven to be the
world’s most effective renewable energy policy.
FIT legislation is in place in more than 40 countries,
states, and provinces throughout the world. The laws
differ in details, but share essential principles. They
require utility companies to provide access to the grid for
anyone or any group producing renewable energy , and
to buy all the renewable energy 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 are paid for by adjustments
to all their customers’ electricity bills. In Germany,
this has meant an increase of about $3 a month for
average homeowners — 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.
Germany introduced this type of legislation in 1991
and it has made them the world’s leading producer
of renewable energy technology, creating close to
a quarter-of-a-million jobs. Renewable energy jobs
increased 40 percent between 2004 and 2006 alone.
Germany now has 1.3 million solar panels in place.
It reached its target of producing 12.5 percent of its
energy from renewable sources in 2007 — three years
ahead of schedule. Now it is up to 14
percent. The country has already reduced
its CO2 emissions by 18.5 percent compared
with 1990 levels, and is on track to
meet its target of a 40 percent reduction
by 2020. Dr. Hermann Scheer, a member
of the German Parliament who played a
key role in writing and enacting the law,
points out how FIT laws allow everyone —
people from all walks of life — to profit from
producing renewable energy. “New players
have stepped into the market who now no
longer have to ask the established energy
providers for permission to access the grid.
Only in this way can a breakthrough for
renewable energy take place,” Scheer said.
One-third of the solar energy produced
in Germany is from farmers putting solar
systems on their barn roofs.
FIT legislation has also made Denmark
and Spain global leaders in renewable
energy. Together, wind turbines in Denmark, Spain
and Germany represent 53 percent of the total
wind-generating capacity worldwide.
Until recently, this idea that has proved successful
in creating jobs and reducing CO2 emissions, while
handsomely rewarding investors. But it has received
little attention here in North America. Only Ontario
has a basic FIT system in place. But now, eager to
bring these benefits to their own states and provinces,
legislators are lining up to get similar bills introduced.
In September, Michigan Rep. Kathleen Law introduced
House Bill 5218, the Michigan Renewable Energy
Sources Act. It includes all renewable energy sources
without discrimination: hydro, wind, solar, geothermal,
biomass and biogas; sets 20-year contracts; and gives
“reasonable returns” on investment. The rates for solar
energy range from 50 cents to 71 cents per kilowatt
hour depending on the type of technology and the size
of the system. For wind, the rates range from 2.5 to 10.5
cents per kilowatt hour. Everyone who wants to participate
must be connected to the grid within two months
of their request. Any increase in price will be shared
among all utility rate payers. Promoters of the legislation
point out that over time any short-term rate increases will
eventually turn into long-term savings as utilities switch
from buying increasingly expensive fossil fuels to clean,
Lois Barber
Photo by Stuart Ha ywa rd
14 ENERGYBIZ May/June 2008