by jboullion | Dec 1, 2010 | Uncategorized
For immediate release
December 1, 2010
More information
RENEW Wisconsin
Michael Vickerman
608.255.4044
mvickerman@renewwisconsin.org
Wisconsin Cannot Afford to Ignore Rising Coal Prices
Long-considered an inexpensive and reliable fuel source, coal has become subject to market and regulatory pressures that threaten to make it an expensive and risky way to generate electricity, according to national news reports and pertinent utility filings with the Wisconsin Public Service Commission (PSC).
“The expectation of continued increases in coal prices reinforces the value of relying on Wisconsin’s own energy resources. If there’s an effort to find savings for utility customers, the logical move would be to shutter antiquated coal plants before they become more of a liability,” said Michael Vickerman, Executive Director of RENEW Wisconsin, a statewide, nonprofit renewable energy advocacy organization.
A key driver behind coal’s rising cost is China, which has moved from an exporter to an importer of coal. The New York Times (NYT) reported last week that Chinese coal imports will hit all-time highs for November and December of this year. Some of this coal is coming from Wyoming’s Powder River Basin, the coal field that also supplies many Wisconsin power plants.1
In the New York Times story, an executive from Peabody Energy, the world’s largest private coal company, predicted that his company will send larger and larger quantities of coal to China in the coming years.
Further adding to the upward price pressure on coal is the rising cost of diesel fuel. The PSC has estimated that half of the delivered cost of coal in Wisconsin is attributable to rail shipment, that is highly sensitive to the price of diesel fuel, which sells for 38 cents more per gallon than it did a year ago, according to the U.S. Energy Information Administration.2 Tom Whipple, editor of the Peak Oil Review, expects diesel fuel supplies to tighten in 2011 as a consequence of flat production volumes and increasing demand from Asia.3 This phenomenon could affect Wisconsin electric utility rates as early as January 2011, according to Vickerman.
We Energies’ coal costs have escalated by $57 million, of which transportation costs account for almost $33 million, according to the utility’s most recent rate filing with the PSC. On top of that, We Energies expects to pay an additional $8 million in oil surcharge costs.4
Regulatory costs add pressure
Additionally, compliance with coming federal clean air regulations is certain to propel the cost of coal generation higher, especially if utilities install expensive pollution control equipment on their aging and increasingly costly generators.
Several U.S. utilities, including Minneapolis-based Xcel Energy, have decided to meet that upcoming regulatory challenge by shutting down old coal-fired units and replacing them with a combination of gas-fired and renewable generation. An Xcel executive told the Denver Post that it’s often more cost effective to shutter these plants than to retrofit them.5
“The only thing that keeps these clunkers going is the belief that coal will always be the cheapest resource available to utilities,” said Vickerman. “But it is now quite apparent that coal is no longer dirt cheap, and it’s time we in Wisconsin face that reality. When you add up the costs of mining, transportation, and cleaning up old power plants to meet new clean air standards, coal shapes up as an expensive anachronism, not the bargain fuel that it once was. Of course, the premium that utilities pay to keep burning coal will be passed along directly to utility customers.”
Wisconsin’s energy policies, which expressly favor conservation and renewable resources, have been exceptionally effective at diversifying and localizing the state’s energy mix, as well as generating thousands of family-supporting jobs here, said Vickerman.
1. Breaking Away From Coal, New York Times, November 30, 2010
http://www.nytimes.com/2010/11/30/business/energy-environment/30utilities.html?_r=1&scp=1&sq=breaking%20away%20from%20coal&st=cse
2. Weekly Petroleum State Report
http://www.eia.doe.gov/pub/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/current/pdf/highlights.pdf
3. Peak Oil Review
http://www.aspousa.org/index.php/2010/11/review-november-29-2010
4. We Energies’ Application for Reopening rate request docket
http://psc.wi.gov/apps35/ERF_view/viewdoc.aspx?docid=137970
5. Rising coal costs will be felt in electric bills, Denver Post, October 24, 2010
http://www.denverpost.com/search/ci_16412425
END
by jboullion | Nov 17, 2010 | Uncategorized
From a presentation by RENEW executive director Michael Vickerman at the November 15-16, 2010, in St. Paul, MN:
•Understand that demographics matter – there is a deep cultural divide between farm households and commuter households
•Developers who operate in a transparent, above-board, even-handed manner will eventually earn the community’s trust
•Maintain an active presence in the community – figure out a way to support youth groups and local charities
•How one responds to complaints in the first year of project operation will make a lasting impression
•While it not possible to please all the people all the time, strive to stay on the good side of the most influential residents
•Eventually, wind turbines will become an accepted part of the landscape
•Good neighbor payments are helpful, but they’re no panacea
45 dBa sound thresholds are here to stay
•Sensitivities to environmental impacts vary widely – how individuals may respond to environmental changes can’t be predicted accurately
•Opposition to wind energy capture is as old as Don Quixote
•Some individuals are intrinsically put off by tall structures and continuous motion
•Public acceptance of WI’s smallest projects has been very high
by jboullion | Nov 10, 2010 | Uncategorized
Commentary
by Michael Vickerman, RENEW Wisconsin
November 10, 2010
Earlier this week, I had the privilege of attending a celebration of Shirley Wind, Wisconsin’s newest commercial wind installation. Located in the Brown County township of Glenmore, a mere 15 miles southeast of Lambeau Field, the project consists of eight Nordex N100 turbines rated at 2.5 megawatts (MW) apiece. All eight turbines are fully erected and will be turned on individually as part of the commissioning process. Commercial operation should begin in a few weeks.
There are many features of this project that stand out. The most obvious one is the turbines themselves, which are the tallest in Wisconsin and are among the tallest in North America. The nacelle is perched on a 100-meter tower (330 feet). Attached to the rotor are three blades extending 50 meters (165 feet). For comparison purposes, the tower is more than 60 feet taller than the next largest turbine in Wisconsin, the Vestas V82, and the blades are about 30 feet longer. According to Michels Wind, the general contractor for Shirley Wind, the spread foundations supporting these turbines are the largest in North America.
Between their height and blade length, Shirley Wind’s eight turbines will be the most productive wind generators in the state. The power conversion zone of a Nordex N100 is one-third larger than those of the Vestas and GE turbines located in Fond du Lac and Dodge counties. The turbine’s productivity is enhanced by the favorable wind resource that flows over the relatively flat terrain in southeast Brown County. All told, Shirley Wind’s turbines should produce about 64 million kilowatt-hours of electricity each year, which will exceed the annual output from the 20 turbines at the 30 MW Montfort installation in Iowa County, now in its 10th year of operation.
Another praiseworthy feature of Shirley Wind is the degree of local participation in the manufacturing and construction of the project. The towers were fabricated in Manitowoc by Tower Tech Systems. Manitowoc Crane supplied the giant crane that assembled the turbines. Brownsville-based Michels Wind Energy, which was also the general contractor for the 86-turbine Forward Energy Center surrounding its headquarters, organized and oversaw all facets of project construction. Numerous Wisconsin-based subcontractors, consulting engineers and natural resource professionals also made significant contributions to Shirley Wind. And Emerging Energies, the enterprising developer that started prospecting in this area in 2004 and drove the project forward across the finish line six years, is a Wisconsin corporation whose principals have deep roots in the Badger State.
It is no accident that the Shirley Wind project sets a new standard for Wisconsin content and participation. From its inception, Emerging Energies sought to maximize the benefits of windpower development to two important constituencies: Wisconsin businesses and the local community. As it turned out, its decision to partner with Tower Tech was a money-saving proposition, due to the very short distances needed to haul 80-ton tower sections from Manitowoc to the project site 25 miles away.
To build support among local officials, Emerging Energies agreed to set aside a portion of their receipts for compensating local governments and project neighbors, even though such payments are not required on power plants under 50 MW. The developer devised an innovative arrangement that allocates one-third of this revenue pool to the Town of Glenmore, one-third to Brown County, and one-third to project neighbors living within a certain distance of a wind turbine. This commitment to equitable distribution of revenues was no doubt instrumental in helping Emerging Energies secure a conditional use permit from the township in March 2007. This was no mean feat for a seasoned wind developer, let alone a relative newcomer to the industry.
With permit in hand, Emerging Energies set out to find an entity with an appetite for renewable energy. Initially, the developer approached Wisconsin utilities, which are required under 2005 Act 141 to increase the renewable energy content of the electricity they sell. However, by the time Emerging Energies started knocking on their doors, the utilities were already moving forward with their own acquisition plans, which emphasized owning and operating renewable generation sources over purchasing renewable electricity from third parties.
However, the same state law created another entity that needed to acquire renewable energy, namely, the State of Wisconsin. Under Act 141, which was signed into law in March of 2006, the State is obligated to source, by 2011, 20% of the electricity it consumes, or 184 million kilowatt-hours per year, from renewable resources. For state government officials, the purchasing requirement presented an opportunity to back an in-state wind project that could showcase Wisconsin’s prowess in manufacturing and construction as well as bolster the local economy. As a modest-sized project that had assembled a highly capable project development team, Shirley Wind shaped up to be an ideal fit for the State’s aspirations.
Because only utilities can legally sell electricity at retail, the State of Wisconsin and Emerging Energies needed to engage Wisconsin Public Service Corporation, the local utility, in a purchasing agreement that could allow the project to move forward. This was accomplished under a novel arrangement that allows Wisconsin Public Service to purchase both electricity and renewable energy credits from Shirley Wind under a 20-year contract and resell the credits to the State of Wisconsin.
With this three-way arrangement in place, Emerging Energies then sold a 90% stake in Shirley Wind in late 2009 to an outside investor, Central Hudson Enterprise Corporation, a Poughkeepsie, N.Y.-based company. The other 10% of the project remains with Emerging Energies. Having consummated that investment, Shirley Wind cleared the last remaining preconstruction hurdle. Project construction commenced in April.
When fully operational, Shirley Wind will produce enough electricity to equal the annual consumption of approximately 8,000 households without discharging so much as an ounce of carbon dioxide into the atmosphere. At the same time, the project as well as generate thousands of dollars each year in supplemental income to host landowners and their neighbors. At every step of this six-year endeavor, Emerging Energies pursued its vision of locally beneficial renewable energy development in a patient and transparent manner, which eventually bore fruit when the State of Wisconsin decided to apply the power of the public purse to seal the deal for Shirley Wind. Shirley Wind represents an auspicious debut for Emerging Energies. Hopefully, there will be more projects coming through that particular pipeline.
Michael Vickerman is executive director of RENEW Wisconsin, a sustainable energy advocacy organization. RENEW Wisconsin hosts and updates the on-line Wisconsin Wind Information Center (http://www.wiwindinfo.net) and facilitates the Wisconsin Wind Working Group. These commentaries also posted on RENEW’s blog: http://renewwisconsinblog.org.
by jboullion | Oct 4, 2010 | Uncategorized
By Michael Vickerman
September 30, 2010
On September 23, Alex DePillis and I hopped on board a tour bus filled with natural resource professionals and gave an overview of wind development in Wisconsin as we headed to the 54 MW Butler Ridge Wind Facility. The project is located in the Town of Herman in southeast Dodge County, a few miles west of State Highway 175. Most of the project’s 36 turbines are located south of State Highway 33.
The project was developed by Midwest Wind, which also developed the Cedar Ridge project owned by Alliant Energy. The project was sold to Babcock & Brown’s U.S. division, which then constructed the facility. The general contractor for that project was RES Americas. Butler Ridge was placed in commercial operation in March 2009. Right now, it is the newest utility-scale wind project in Wisconsin, but that distinction will only late this year, when Shirley Wind comes on-line.
In December 2009, NextEra Energy (formerly FPL Energy) bought Butler Ridge from Babcock and Brown. NextEra is also the owner of the Montfort project in Iowa County.
It turned out to be an excellent day to see wind generation in action. Thanks to a strengthening low pressure system to the west, there was a steady southerly air flow sweeping over southern Wisconsin that morning. Every flag we saw that morning was stiff as could be and pointing due north. Wind speeds at hub height ranged between 20 and 25 mph. The GE turbines were producing at about 75% of their rated capacity.
We stopped at Butler Ridge’s operations and maintenance center on Illinois Road. From the vantage point of the facility, we could see wind turbines in every direction. The closest turbine, at about 1,100 feet away, was audible but barely so.
All of the output from Butler Ridge is sold to WPPI Energy, which serves a number of municipal utilities in the area, including Hartford, Slinger, Hustisford, and Juneau.
Once at the O&M center, the group listened to Nate Crawford, Butler Ridge’s site manager for NextEra, and Julie Voeck, NextEra’s manager for regulatory affairs in the Midwest. Most of the questions from the group addressed environmental impacts. Nate explained that the some of the turbines were moved to the east to create a larger buffer zone between the project and the Neda Mine bat hibernaculum. We also talked about the new permitting rule, the flow of dollars into the local area, and the effects of turbines on radio and TV reception.
Nate said that there have been very few complaints from the neighbors, and they have been almost always about TV reception. NextEra is in the process of providing the affected households with satellite TV service that features Milwaukee stations.
Only one person has taken his complaints to the Herman Town Board. That person, Nate said, has been a vocal opponent of the project from the outset. The Town Board did not find any merit in that individual’s complaint. Nate characterized the local reaction as being very positive, and the Town Board seems very supportive of the installation.
The turbines generate $216,000 annually in utility local aids. Dodge County receives about $125,000 a year, with the remainder going to the Town of Herman.
Though compensating neighbors is not a standard feature of projects developed by NextEra Energy, neighbors of the Butler Ridge turbines do receive compensation. This is a hallmark of Midwest Wind Energy’s developments in Wisconsin.
The Q&A lasted through the allotted 25 minutes. Alex and I stayed a while after the tour bus left to look at the SCADA system and continue our conversation with Nate and Julie. The availability factor at Butler Ridge is very high, with numbers hovering around 99%. I asked Nate if he could recall a time when Butler Ridge was curtailed due to transmission congestion. He could not. But it has become a serious problem at several NextEra Energy projects in Iowa. Julie and I had been at a Wind on the Wires meeting earlier that week, where it was revealed that curtailments in the MISO region are expected to shave 5% off this year’s output from wind generation. There were several at the meeting, including Julie, who believe that the MISO estimate is too low.
All in all, the conservationists seemed to enjoy their visit to Butler Ridge. For me, it was my first visit to this project, and I came away thinking that this is an attractive and well-run facility. It is only an hour’s drive from Madison, and less so from Milwaukee. We are grateful to NextEra Energy for opening up their installation to us.
by jboullion | Sep 28, 2010 | Uncategorized
Commentary
by Michael Vickerman, RENEW Wisconsin
September 27, 2010
One of the abiding pleasures of my job at RENEW Wisconsin is going out into the field to visit renewable energy installations. Many of the systems sprouting across the state owe their existence to state and federal policies that make these systems economically viable to their owners.
In turn, some of those policies owe their existence to RENEW, an advocacy organization that has elevated the Wisconsin renewable energy marketplace from a dreamy aspiration to a thriving marketplace employing hundreds of people and generating millions of dollars a year in local revenues.
Whenever I’m asked to describe our mission, I often say that we act as a catalyst for advancing a sustainable energy future in Wisconsin. Our vision of that future places small, entrepreneurial companies at the center of the transition toward clean, locally available energy resources that do not deplete over time.
RENEW endeavors to steer Wisconsin along this path through policy mechanisms that help renewable energy businesses establish themselves in an economy that for many decades has operated almost exclusively on fossil energy. Because of that dependence on concentrated energy sources like coal, natural gas and liquid hydrocarbons, which are still priced very cheaply, the shift to renewable energy has been an uphill battle. The incumbent energy sources are well-entrenched and will not hesitate to expend significant political capital to block policy initiatives aimed at putting renewable energy on a more equal playing field.
At RENEW’s urging, the State of Wisconsin has taken a few measured policy steps to carve out some room for renewable energy. The most important of these initiatives is a statewide incentives program (Focus on Energy) for small-scale renewable energy systems. Though most of Focus on Energy’s budget is set aside for energy conservation and efficiency, about $10 million a year is reserved for customer-sited renewable energy systems such as solar hot water, solar electric, biogas, biomass heating, and small wind.
This program, coupled with several voluntary utility initiatives, has elevated Wisconsin into a regional showcase for renewable energy systems serving dairy farms, cattle farms, orchards, greenhouses, breweries, cheese producers, corporate campuses, apartment buildings, municipal wastewater facilities, schools and technical colleges, and manufacturers.
The policy seeds planted 10 years ago are yielding an impressive crop of installations this year, broadly distributed throughout the state. As important as these policies are, however, these systems don’t get built unless someone decides to spend dollars today to receive a decades-long supply of energy tomorrow. We at RENEW would like to give a shout-out to the owners and installers of this year’s bumper crop of home-grown renewable energy, including:
The City of Evansville, for hosting a 100 kilowatt (kW) Northwind turbine to serve its wastewater treatment plant. Installer: H &H Solar, Madison.
Stonehouse Development, for building two Green Built apartment houses in the Madison area, each with 60 kilowatts of rooftop photovoltaic (PV) systems and solar water heating systems. Installers: Full Spectrum Solar, Madison (PV); Cardinal Solar, Sun Prairie, solar hot water.
Random Lake School District, for hosting a 50 kW Endurance wind turbine on the high school grounds. Installer: Kettle View Renewable Energy, Random Lake.
Fountain Prairie Inn and Farms, in Columbia County, for hosting a 50 kW Endurance wind turbine to serve its sustainable family farm. Installer: Seventh Generation Energy Systems, Madison.
SCA Tissue, Menasha, for hosting four 20 kW Renewegy wind turbines at one of its facilities. Manufacturer and installer: Renewegy, Oshkosh.
Milwaukee Area Technical College, for building the state’s largest PV system, to be used as a training center. The system is rated at 540 kW. Contractor: Johnson Controls, Milwaukee; Installer: Pieper Power, Milwaukee.
Montchevré-Betin, Belmont, a producer of goat cheese, for upgrading its wastewater treatment capacity with an anaerobic digester and 335 kW generator. Contractor: Procorp, Milwaukee. System owner: Clear Horizons, Milwaukee.
I urge the citizens of Wisconsin to go out and see for themselves how fertile the territory is here for home-grown renewable energy. As you observe these installations out in the landscape, delivering clean energy year after year to the local area, you begin to appreciate the totality of benefits that these systems yield. If you talk to system owners or installers, you will feel their passion and soak in the positive energy that comes from being part of this growing community. They are, along with the installations themselves, the most persuasive advocates for extending and strengthening Wisconsin’s clean energy policies. They not only represent today’s jobs and business opportunities, but also tomorrow’s hope.
