by Heather Allen | Feb 2, 2022 | Advocacy, Legislative Watchlist, Local Government, Policy
Federal clean energy and climate investments are more crucial than ever. Congress must deliver a deal that includes clean energy investments in the Build Back Better Act.
This is a make-or-break moment to shore up the electric grid and help accelerate renewable energy and energy efficiency adoption in the U.S. These investments will make the difference between leading the global clean energy economy or lagging behind the rest of the world.
According to the Solar Energy Industry Association, the Build Back Better Act would drive $234 billion into the economy over the next four years and require at least 450,000 workers to get it done – double the size of today’s solar workforce!
In the last few weeks of 2021, the Build Back Better Act (Biden’s flagship climate and clean energy proposal) hit roadblocks. Regardless of the political stalemate, the critical importance of the Act’s clean energy and climate provisions cannot be overstated. As Stewart MacKintosh wrote in The Hill, “Achieving global climate change goals depends on the U.S. starting to implement Biden’s net-zero carbon emissions plan today- not two (or god forbid) four or more years from now. We have no extra time.”
The Build Back Better (BBB) Act is the third and most ambitious part of Biden’s original Build Back Better plan, including COVID-19 economic relief, social services, welfare, and infrastructure. Significant portions of the agenda were signed into law with two bills in 2021, The American Rescue Plan Act (March 2021) and the Infrastructure and Jobs Investment Act (November 2021).
BBB is the most powerful tool the Federal Government has in play to curb U.S. emissions and reach the climate and clean energy goals established in the Paris Agreement. BBB provisions would mobilize billions of dollars to expand access to clean energy and electric vehicles, improve the efficiency of buildings, electrify heating and cooling, support American clean energy industry growth, and help American manufacturers and other businesses reduce energy use and emissions. BBB also contains funding for social infrastructure, environmental justice investments, natural climate solutions, and rental assistance.
Image/Figure from https://rhg.com/research/us-climate-policy-2030/
This figure from the Rhodium Group shows that “Joint Action” can reduce emissions by 50% below 2005 levels. Joint Action refers to the collective impact of legislation adopted in 2021, BBB climate and clean energy provisions, and state and local action. BBB is the most critical element in this suite of actions and will accelerate clean energy adoption, save money for consumers, and reduce emissions.
Businesses and Workers Support Build Back Better
Last summer, Wisconsin businesses signed a letter calling on Congress for ambitious clean energy investments. Since that time, an increasing number of companies and organizations have signaled their support for clean energy investment to drive jobs and economic activity.
West Virginia coal miners called on Joe Manchin to support Build Back Better.
Provisions in the bill would support miners dealing with Black Lung Disease, provide incentives to develop clean energy projects on closed mines, and support the right to unionize.
400 companies signed a letter calling on lawmakers to pass Build Back Better.
“The climate components of the Build Back Better package are both fiscally responsible and critically needed to ensure a stable climate for businesses and communities, help companies save money with affordable clean energy, and strengthen U.S. competitiveness by building upon the important measures in the infrastructure package that passed Congress this fall,” said Hugh Welsh, president and general counsel, DSM North America.
Wisconsin’s solar installers, in particular, recognize that Build Back Better will provide greater access to clean energy, especially for farms and low-income families.
“The extension of the business and residential tax credits for solar are critical for our industry. But adding refundability to both 48C and 25D is a game-changer for low and moderate-income households, farms, and other entities that don’t have the tax liability to realize the normal tax credits and finally enables them to go solar. It has the potential to bring the equitable distribution of the benefits of solar to millions.” Josh Stolzenburg, CEO Northwind Solar, Amherst, Wisconsin.
Contact your senator today and ask them to support climate and clean energy provisions of Build Back Better. There is no time to waste.
by Andrew Kell | Nov 10, 2021 | Advocacy, Community, Focus on Energy, Local Government, Policy, PSC Priorities, Public Service Commission
In 2019, Governor Evers issued Executive Order #38 to establish a goal for carbon-free electricity in Wisconsin by 2050. As the state regulator of utilities, the Public Service Commission (PSC) is tasked with regulating the number one sector source for greenhouse gas emissions in Wisconsin[1]. As a result, PSC decisions play a key role in determining whether Wisconsin will be able to achieve a zero-carbon grid by 2050.
The PSC reviews utility proposals for construction projects, rate increases, and new utility programs for their customers. However, the PSC reviews these proposals separately from one another, and historically without the integration of other utility plans, carbon reduction goals, and cross-sector emission-reduction strategies. The good news is that the PSC has begun to explore how to incorporate these factors within its decision-making processes going forward.
In keeping with a recent trend of investigating policy issues (such as Electric Vehicles and Parallel Generation), this past spring the PSC opened a docket (5-EI-158) to pursue a “Roadmap to Zero Carbon.” As described in the Notice of Investigation, the PSC intends to evaluate government and utility goals to reduce carbon emissions to zero by 2050, recommendations from recent Wisconsin reports on clean energy and climate change, and the development of partnerships to achieve carbon-free electricity by 2050.
The Zero Carbon Roadmap docket garnered much interest from active PSC intervenors (such as RENEW), with participation from environmental, health, and business advocates as well. Members of the general public also participated with input and suggestions. PSC staff issued a memo for public comment on scoping of priorities. After gathering public input, PSC staff issued a follow-up memo to the Commissioners in August that summarized stakeholder input and provided the Commissioners with options on the next steps. The Commissioners then discussed the memo and issued an order in September to take some initial actions.
In short, the PSC decided to leverage ongoing planning processes and to investigate a potentially new approach to utility ratemaking. Below is a summary of these initial steps:
- The PSC will gather more robust carbon-reduction planning information from utilities during the current biennial Strategic Energy Assessment (SEA). Utilities will soon respond to the PSC staff’s initial data request, and PSC staff will issue a draft report by next spring for public comment;
- Additionally, the PSC will seek public input on ways in which the state’s Focus on Energy program (Focus) can better incorporate beneficial electrification, programs for low-income customers, demand response, and other utility voluntary programs into its program design over the next four years. This is called the Quadrennial Planning Process, and a PSC staff recently issued a memo for comment on scope; and
- Finally, the PSC will organize a workshop on Performance-based Regulation (PBR). This workshop will gather information and perspectives on how rethinking utility goals and investment incentives can lead to a more equitable clean-energy future. The PSC will also consider customer affordability issues in relation to the transition to a zero-carbon grid.
Even with these planning processes already underway, the book is not closed on the Roadmap to Zero Carbon docket. RENEW recently reached out to Joe Fontaine, PSC Policy Advisor, to get a better sense of next steps for the investigation docket itself. Fontaine said:
“Commission staff is excited to kick off the Roadmap by addressing four of the highest priorities identified by commenters and approved by the Commission. Each of these four areas — more transparent resource planning, development of performance-based regulation concepts, and further analysis of affordability and energy efficiency issues — can help us develop a strong general foundation to address a wider range of issues related to the clean energy transition, in this investigation as well as in other Commission dockets. Future decisions in the Roadmap will be well-informed by the analysis and stakeholder input we’re receiving at each step in the investigation. Potential next steps will be determined as we make progress on these initial priorities over the next few months.”
The PSC’s Roadmap to Zero Carbon activities is running in parallel with the Office of Sustainability and Clean Energy’s (OSCE) Clean Energy Plan drafting process. Beyond the electricity sector, the Clean Energy Plan will assess, and make recommendations on, strategies cutting across all economic sectors statewide. The OSCE recently gathered public input during several public listening sessions, focusing on 1) economic and environmental justice, 2) infrastructure and industry, 3) transit and transportation, and 4) clean energy and energy efficiency. The OSCE continues to gather written comments through its website.
RENEW is also proactively partnering with Clean Wisconsin and GridLab to conduct a zero-carbon grid study for the PSC’s consideration. While the scope is still being finalized, the study will use modeling designed to answer important policy questions, such as:
- What is the right mix of renewable resources in-state and out-of-state?
- What is a good balance between utility-scale and distributed solar resources?
- How much transmission is needed in a zero-carbon future?
- What will be the health, jobs, and economic impacts as we make this clean grid transition?
Stay tuned on these zero-carbon planning activities and upcoming study developments. RENEW plans to organize presentations and panel discussions on these topics at our Renewable Energy Summit on January 27, 2022.
[1] See the Department of Natural Resources’ Wisconsin Greenhouse Gas Emissions Inventory Report of August 2020. Figure 1, on page 3, presents emissions by sector. Electricity generation is the highest emitting sector and represents 33 percent of all Wisconsin emissions.
by Michael Vickerman | Oct 27, 2021 | Advocacy, Community, Community Solar, Local Government, Policy, RENEW Wisconsin, Renewables, Solar, Sustainability
For decades, utility investments in power plants and transmission lines have been predicated on the concept of economies of scale. The theory behind it is beguilingly simple: the larger the installation sought by an electric utility, the lower the unit cost of the investment, which utility planners and regulators regard as a measure of economic efficiency. When loads are growing, the “bigger is better” paradigm is often an economically rational fit for electric utilities seeking to recover large-scale capital investments in fossil generation over the broadest possible cohort of current and future customers.
But solar power, the default resource option for electric providers today, is a somewhat different animal due to its scalability. Yes, economies of scale can certainly reduce the unit price of solar generating capacity, but other on-the-ground factors can influence the economics of this resource. These factors include but are not limited to the cost of acquiring site control of the host properties and obtaining all the necessary approvals to construct the project. Interconnection costs can be high as well, especially for larger projects requiring additional land and approvals to supply power to the grid.
These thoughts came to mind after visiting two smaller solar farms that started producing power this year. The first project, called Strobus Solar, was developed by OneEnergy Renewables and serves Jackson Electric Cooperative. The second installation, O’Brien Solar Fields, was one of the stops in this September’s Ride with RENEW bicycle tour. Developed by EDF Renewables and owned by Madison Gas and Electric (MGE), this 20 MW solar farm in Fitchburg supplies electricity to seven MGE customers under long-term contracts.
At a Glance
Solar For the Distribution Grid – 2021 |
| Project name |
Strobus Solar |
O’Brien Solar |
| County of location |
Jackson |
Dane |
| Capacity (in MWac) |
1.5 |
20 |
| Project developer |
OneEnergy Renewables |
EDF Renewables |
| Project owner |
Greenbacker Capital |
Madison Gas + Electric |
| Utility territory |
Jackson Electric |
Madison Gas + Electric |
| General contractor |
Arch Electric |
Boldt Construction |
| Landowner |
Northern Family Farms |
O’Brien Brothers Farm |
Governor Evers and the Project Developer, Eric Udelhofen, from OneEnergy Renewables at the Ribbon Cutting Ceremony for the Strobus Solar project.
Strobus – A Mastodon Solar project
Occupying a mere 12 acres, Strobus Solar is located about six miles north of Black River Falls and is tucked into a compact parcel framed by evergreen trees and U.S. Highway 12. On a cloudy September day, more than 50 people attended a ribbon-cutting ceremony for the Strobus project, one of eight solar farms in southeast Minnesota and west-central Wisconsin that make up OneEnergy’s Mastodon Solar portfolio. With a combined 17 megawatts (MW) of AC-rated capacity, all eight Mastodon solar farms are located in the territory served by rural electric cooperatives.
As noted on OneEnergy’s website, “the electricity generated by each project will be purchased by the local participating electric cooperative, resulting in savings on energy supply and increased resiliency. These savings will be passed onto the cooperative’s members. The available Renewable Energy Credits will then be sold separately to visionary buyers committed to ensuring their renewable energy procurement dollars are devoted to new projects that serve local communities.”
Of the four Mastodon projects located in Wisconsin, Strobus is the second to be energized this year, following Blue Prairie, a 2.5 MW installation southwest of Black River Falls. The other two, Stromland and Shamrock, should be operating before the end of this year. Plymouth-based Arch Electric is the general contractor for all four Wisconsin projects.
Governor Evers spoke at the ribbon-cutting ceremony, along with representatives of Jackson Electric Cooperative, Arch Electric, and Northern Family Farms, the participating landowner. Based in nearby Merillan, Northern is Wisconsin’s largest Christmas tree grower, operating on more than 7,000 acres. After the prepared remarks, OneEnergy and Arch opened the gates to let Governor Evers and other guests circulate through the project and ask questions.
On one corner of the Strobus parcel is the substation that feeds the solar-generated electricity directly into the wires overhead. Though the equipment onsite is brand-new, low-growing grassy vegetation has already been established, covering the entire project footprint. After three years, the mix of deep-rooted, primarily native plants will provide a healthy habitat for birds, insects, and other species. At nearby Blue Prairie, sheep are already grazing around and under the 7,000 panels installed there.
Strobus is expected to generate about 3,000 megawatt-hours of electricity a year. But the Renewable Energy Credits associated with that output will not flow to Jackson Electric. They will instead be sold to Native, a Public Benefits Corporation, through its New Renewables Portfolio.
According to Native’s website, the purpose of the Portfolio “is to enable Renewable Energy Credit (REC) buyers to play a causal role in actualizing new renewable energy projects. Native has committed to a 10-year renewables purchase agreement with Strobus, LLC on behalf of Portfolio investors. Without this type of long-term REC purchasing agreement, this project would not be economically viable.”
O’Brien Solar Fields in the city of Fitchburg, Wisconsin.
O’Brien Solar – Clean Energy Produced Offsite for Larger Customers
Occupying 130 acres along the edge of urban Fitchburg, O’Brien Solar Fields is as large as a distributed solar project gets. However, while every kilowatt-hour produced at O’Brien flows directly into Madison Gas and Electric’s distribution grid, only seven customers see the impact of this project on their utility bills. Those customers are the State of Wisconsin, University of Wisconsin-Madison, City of Fitchburg, Promega, Placon, Tribe 9 Foods, and Willy St. Co-op.
Energized this summer, O’Brien Solar is the newest Renewable Energy Rider (RER) project serving MGE customers. Several years ago, MGE received approval from the Public Service Commission (PSC) to build solar farms to serve individual customers, including those with multiple facilities, through its RER program. Unique to MGE, this service allows customers to be served by one larger solar farm instead of building numerous solar systems to supply each of their facilities.
A voluntary program, MGE’s RER program does not affect base electric rates. Participating customers fully absorb the cost of MGE’s investment in the solar arrays, and these costs are spread over 30 years. The electricity generated at O’Brien offsets grid power that would otherwise flow to these customers at specified prices throughout the contract term. Should standard electric rates rise faster than the agreed-upon pricing for O’Brien’s electricity, the savings will flow directly to the participating customers.
This unique model combines elements of both behind-the-meter generation and community solar power. But in order to entice customers to access brand-new yet low-cost sources of power, the project owner must design and develop projects that are competitive with the utility’s own avoided cost of power.
The question arises, what did MGE do to keep O’Brien’s development costs in line with its investments in larger solar projects and make it an affordable option for customers?
First, the project occupies only one parcel of land, the former Stoner Prairie Dairy owned and operated by the O’Brien brothers over several generations. Though the parcel is adjacent to a rapidly growing neighborhood, the project’s configuration allows the O’Brien family to maintain its most profitable farming operations as well as live in their long-time residence. Negotiating with only one landowner gives a developer more room in tailoring the project to avoid potentially expensive workarounds.
Second, from an electrical perspective, the project is divided into three zones, each with a separate interconnection to MGE’s feeder lines. By spreading out the project’s output in this fashion, MGE could forgo the more significant expense of running a large tie-in line to the closest substation.
Third, much like a 30-year residential mortgage, the RER contract is a powerful tool for breaking down a significant capital outlay into a manageable expense for the customer. Just as utilities rely on extended depreciation schedules to help them digest the costs of building central station power plants, the RER service provides a similar benefit to participating customers.
In the end, the all-in cost of O’Brien Solar Fields amounted to $29.5 million, which, on a unit basis, comes to $1,475 per kilowatt (kW). To put that number in perspective, the unit price of six larger solar farms totaling 414 MW that Alliant Energy proposes to acquire is $1,449 per kW. In fact, O’Brien’s unit cost is within 10% of the estimated cost of acquiring a 20 MW share of a project ten times as large.
Moreover, it took only three years for EDF Renewables, O’Brien’s original developer, and MGE to advance this power plant from the concept stage to fruition, a relatively speedy turnaround compared with larger solar installations.
Conclusion: The Policy Case for Smaller Solar Farms
Indeed, small solar farms can deliver affordable electricity at a reasonable price by avoiding the increased complexities and additional permitting hurdles associated with larger solar farms that tie into the transmission system. Moreover, while larger solar farms make a great deal of sense in areas rich in transmission infrastructure, relying solely on those locations would exclude much of Wisconsin from being able to host solar power.
There are many parcels of land throughout Wisconsin that have the requisite attributes for hosting projects on the scale of Strobus and O’Brien. In addition, projects of that size are ideal vehicles for community solar offerings, designed to deliver zero-carbon electricity to subscribing customers who cannot access solar power at their residence or business.
Over time, with increases in system power costs looking very likely, the state should explore and adopt policies to promote smaller solar farms within its boundaries. As exemplified by the Strobus and O’Brien projects, development on that scale can yield faster results at comparable costs while potentially providing a reliable revenue stream to the many thousands of landowners who don’t live near high-capacity transmission lines and substations.
Wisconsin is in the beginning stages of an energy revolution. With a more forward-looking policy framework, Wisconsin could emerge as a national leader in solar power. Embracing distribution-level solar solutions now will help more Wisconsinites participate in the benefits of these projects and give every city, town, and village a solar project to call their own. Wisconsin’s population is distributed throughout the state–our renewable energy portfolio should be as well.
