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#Post#: 277--------------------------------------------------
The Big Picture of Renewable Energy Growth
By: AGelbert Date: November 7, 2013, 3:12 pm
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[move]Are you tired of pro Fossil Fuel or Nuke Puke Propaganda?
[img width=80
height=055]
HTML http://www.createaforum.com/gallery/renewablerevolution/3-241013183046.jpeg[/img]ME<br
/>TOO! Get the FACTS to shut down the lies, duplicity and
obfuscation! Be Armed with IRON CLAD TRUTH the prevaricating
liars CANNOT DENY. Save this, the most recent data available,
provided by a network of more than 500 contributors and
researchers from around the world, all of which is brought
together by a multi-disciplinary authoring team. When the liars
open their YAP,
HTML http://www.u.arizona.edu/~patricia/cute-collection/smileys/lying-smiley.gif<br
/> Make FOOLS
HTML http://www.pic4ever.com/images/245.gif
of them with
the TRUTH
HTML http://www.pic4ever.com/images/301.gif
and send them
crawling back to their Koch
Masters.
HTML http://www.pic4ever.com/images/cowboypistol.gif[/move]
18 Fun Renewable Energy Charts From NREL Director Dan Arvizu &
Ren21′s Renewables 2013 Global Status Report
HTML http://www.pic4ever.com/images/8.gif
I had the good fortune of seeing NREL’s director, Dan Arvizu,
give an optimistic renewable energy and cleantech presentation
in Abu Dhabi in January. He certainly knows how to pack a
presentation full of interesting charts. More recently, Dan gave
a presentation in Colorado that I didn’t attend but have the
slides for. (Actually, the slides are online [PDF].) Below are a
few of my favorite slides from the new presentation, followed by
several fun charts and tables from the key findings of Ren21’s
Renewables 2013 Global Status Report. (Thanks to a reader for
tipping me off to both presentations!)
Renewable Energy Charts & Facts
This first chart is on annual capacity growth rates for
renewable energy technologies:
[img width=640
height=380]
HTML http://i2.wp.com/cleantechnica.com/files/2013/11/renewable-energy-growth-rate.png[/img]
Here’s a look at the world leaders for specific clean energy
technologies (at the end of 2012):
[img width=640
height=380]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/clean-energy-world-leaders-2012.png[/img]
Naturally, the pure capacity leaders are not necessarily the per
capita or per GDP leaders — normally they aren’t (a gripe I have
with these types of ratings). For the latest on those for wind
and solar, see:
Top Solar Power Countries ([I]link at "Read more[/I])
Top Wind Power Countries Per Capita ([I]link at "Read more[/I])
Top Wind Power Countries Per GDP ([I]link at "Read more[/I])
The next chart, moving away from renewables to energy use on the
consumer level, is a super fun one in my opinion. Ever wonder
where homes & businesses are using their energy? This chart has
the details:
[img width=640
height=380]
HTML http://i0.wp.com/cleantechnica.com/files/2013/11/energy-consumption-in-the-US.png[/img]
There’s much more in Dan’s presentation, including many slides
on NREL’s extremely high-tech, energy-efficient, LEED-platinum
campus. Check it all out for more fun. ([I]link at "Read
more[/I])
Below are now charts from Ren21’s Renewables 2013 Global Status
Report. As always, I recommend checking out the full report.
However, I’ve also gone ahead and pulled out several of my
favorite charts to share below. Enjoy! (If you’ve already
checked out Dan Arvizu’s presentation, you’ll notice that some
of the charts from the Ren21 report were used in that.)
Global Renewable Energy Charts & Facts
Here’s an estimate of renewable energy’s share of electricity
production at the end of 2012:
[img width=640
height=350]
HTML http://i0.wp.com/cleantechnica.com/files/2013/11/renewable-energy-split-2012.png[/img]
Non-hydro renewable being at 5.2% can be seen in a positive or a
negative way. It’s much higher than it was just a few years ago,
but it’s still a relatively small percentage. However you look
at it, though, definitely realize that it is growing fast and
will for years to come. We’re just getting started!
Here’s an even closer look at global renewable energy capacity,
showing the totals by country at the end of the past 3 years:
[img width=640
height=380]
HTML http://i2.wp.com/cleantechnica.com/files/2013/11/renewable-energy-facts.png[/img]
Here’s a look at the world’s non-hydro renewable energy capacity
leaders (again, in terms of total not relative capacity):
[img width=640
height=350]
HTML http://i2.wp.com/cleantechnica.com/files/2013/11/renewable-energy-growth-rate.png[/img]
Here’s a great summary of global renewable energy jobs totals,
and totals for some leading economies:
[img width=640
height=380]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/renewable-energy-capacity-leaders-2012.png[/img]
[img width=640
height=380]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/Renewable-Energy-Jobs-2012.png[/img]
Here’s a look at how many and which countries have renewable
energy policies (early 2013 compared to 2005):
[img width=640
height=880]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/world-renewable-energy-targets.png[/img]
Solar Energy Charts & Facts
Getting into solar energy specifics more, here’s a look at
global solar PV capacity growth:
[img width=640
height=350]
HTML http://i2.wp.com/cleantechnica.com/files/2013/11/global-solar-PV-capacity-growth.png[/img]
That’s a nice curve if I’ve ever seen one!
Here’s a look at solar PV’s global capacity split at the end of
2012:
[img width=640
height=350]
HTML http://i2.wp.com/cleantechnica.com/files/2013/11/solar-global-PV-capacity-top-countries.png[/img]
Here’s a look at the top solar PV module manufacturers at the
end of 2012:
[img width=640
height=380]
HTML http://i2.wp.com/cleantechnica.com/files/2013/11/top-solar-pv-module-manufacturers.png[/img]
Here’s a look at the growth of solar water heating around the
world:
[img width=640
height=350]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/solar-water-heating-global-capacity-growth.png[/img]
Here are the leading solar water heating countries in terms of
2011 additions:
[img width=640
height=380]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/solar-water-heating-2011-growth-leaders.png[/img]
Wow. Go, China! [img width=80
height=70]
HTML http://us.123rf.com/400wm/400/400/yayayoy/yayayoy1106/yayayoy110600019/9735563-smiling-sun-showing-thumb-up.jpg[/img]<br
/>
And this last solar chart shows global solar thermal capacity
growth:
[img width=640
height=380]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/global-solar-thermal-power-growth.png[/img]
Wowza! And expect 2013′s total to be much bigger. :o
[img width=45
height=100]
HTML http://www.clker.com/cliparts/c/6/7/1/12065737551968208283energie_positive_Wind_Turbine_Green.svg.hi.png[/img]
Wind Power Charts & Facts
Wind power has grown at a similarly impressive rate. Check out
these three charts for more on that as well as on the leading
wind power countries and companies:
[img width=640
height=380]
HTML http://i0.wp.com/cleantechnica.com/files/2013/11/wind-power-global-capacity-growth.png[/img]
[img width=640
height=380]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/wind-power-growth-by-country.png[/img]
[img width=640
height=330]
HTML http://i1.wp.com/cleantechnica.com/files/2013/11/wind-turbine-manufacturing-leaders.png[/img]
If you might want more, check out this brief summary of the
Renewables 2013 Global Status Report and then get your butt over
to the report’s key findings(link at "Read more") (or just jump
straight over to the full report)(link at "Read more"):
Renewable energy markets, industries, and policy frameworks have
evolved rapidly in recent years. The Renewables Global Status
Report provides a comprehensive and timely overview of renewable
energy market, industry, investment, and policy developments
worldwide. It relies on the most recent data available, provided
by a network of more than 500 contributors and researchers from
around the world, all of which is brought together by a
multi-disciplinary authoring team. The report covers recent
developments, current status, and key trends; by design, it does
not provide analysis or forecasts.[/b]
Also see:
About Solar Power ([i]link at "Read more")
About Wind Power (link at "Read more")
World Wind Power In 2012 Advances Nearly 20% (link at "Read
more")
Read more at
HTML http://cleantechnica.com/2013/11/07/renewable-energy-charts-renewable-energy-facts/#qV3O2UoIJW5lIGmO.99
#Post#: 290--------------------------------------------------
South Africa: Where Clean Energy is Growing the Fastest
By: AGelbert Date: November 9, 2013, 2:06 pm
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[I]South Africa: Where Clean Energy is Growing the Fastest[/i]
[img width=640
height=380]
HTML http://www.worldwidehomestay.com/res/default/southafrica2.jpg[/img]
[img width=640
height=380]
HTML http://1.bp.blogspot.com/-zEqkjl0Cbq4/Tyte8Uze-dI/AAAAAAAAAcA/QRA-LXoVf08/s728/South-Africa-Map.jpg[/img]
SustainableBusiness.com News
South Africa has concluded the third of five bidding rounds in
its Renewable Energy Independent Power Producer Procurement
Program (REIPPPP).
17 renewable energy projects, valued at $3.3 billion, received
the go-ahead out of 93 bids. In total, 1.5 gigawatts (GW) of
projects are approved: seven wind, six solar PV, two
concentrating solar, one landfill gas and one biomass.
China Longyuan Power Group will develop 244 megawatts (MW)
across two wind farms. :o
Close behind it is a 100 MW solar concentrating plant to be
built by Abengoa, which recently went public on Nasdaq (ABGB).
Xina Solar One will have 5-hour energy storage and combined with
its 100 MW KaXu Solar One, which is under construction, will be
the biggest solar complex in Africa.
It makes use of parabolic trough technology:
[img width=640
height=480]
HTML http://www.renewables-made-in-germany.com/fileadmin/user_upload/Bilder/1.jpg[/img]<br
/>
A consortium led by Mainstream Renewable Power will build three
wind projects totaling 360 MW, and will come online next year.
That's in addition to 238 MW awarded in the first round of bids.
With a development pipeline of 19 GW, Mainstream recently closed
a €100 million equity investment with Japanese Trading House
Marubeni Corporation.
US-based SolarReserve won a bid in the previous round.
The consortium behind these projects now hold a 20% share in
South Africa's solar market.
Earlier this year, Johannesburg-based Standard Bank Group and
the Industrial and Commercial Bank of China agreed to jointly
finance projects that win bids in the program.
The program is intended to quickly boost renewable energy in the
country while weaning it off coal, which supplies 85% of its
electricity. 3.7 GW of renewables will be added by the end of
2016 after the five bidding rounds are completed.
Last year, investors poured $5.7 billion into South Africa
renewable energy projects, which have 20 year power-purchase
agreements with the utility, Eskom, reports Bloomberg New Energy
Finance.
Because of this program, South Africa is showing the most rapid
clean energy growth in the world. [img width=80
height=70]
HTML http://us.123rf.com/400wm/400/400/yayayoy/yayayoy1106/yayayoy110600019/9735563-smiling-sun-showing-thumb-up.jpg[/img]<br
/>
HTML http://www.sustainablebusiness.com/index.cfm/go/news.display/id/25342?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+SBGeneralNews+%28SustainableBusiness.com+General+News%29
#Post#: 315--------------------------------------------------
It Doesn't Have To Be So Hard: Making Renewable Energy Siting Ea
sier
By: AGelbert Date: November 13, 2013, 7:53 pm
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It Doesn't Have To Be So Hard: Making Renewable Energy Siting
Easier [img width=80
height=80]
HTML http://www.createaforum.com/gallery/renewablerevolution/3-081113015033.png[/img]
America's Power Plan
November 12, 2013
There is a deep irony at work in the intersection of energy and
the environment. The biggest threat to our planet is climate
change, caused in large part by our profligate use of energy.
And one of the biggest solutions is to de-carbonize our
electricity system by building renewable energy projects, linked
to cities and large urban centers with new transmission lines.
These renewable energy systems can require large amounts of
land. But with careful planning, we can preserve conservation
values while significantly reducing our carbon footprint.
A second challenge is that most renewable energy and
transmission development will take place on private lands,
especially farms and ranches. While farmers and ranchers are
eager to see the economic benefits of hosting wind farms and
supplying biomass for energy, the track record with transmission
development in America gives many of them pause. But again, new
policies and practices can help make new infrastructure welcome
in the American countryside.
At the request of the Energy Foundation, we have developed some
ideas for improved siting policies and practices, as part of
America’s Power Plan. The Plan is a comprehensive response to
the rapid changes in the power sector coming from new
technologies, consumer demand, and policy. Siting new renewables
and the associated infrastructure will be a key part of that
transition.
How much land will be needed to move to a high-renewables
future? The National Renewable Energy Lab (NREL) calculates that
getting 80 percent of our power from renewables would use about
200,000 square kilometers, less than 3 percent of the U.S. land
base.
Most of this would come from biomass production, such as growing
prairie grasses and other fast growing species specifically for
energy production. Wind power, though it needs open spaces, only
takes a small amount of land away from farming and ranching. In
one scenario, NREL estimates wind would need 87,000 square
kilometers of space, but only use up 4,200 square kilometers.
In a core scenario, NREL estimated the need for about 120
million “megawatt-miles” of new transmission, an investment of
$6.5 billion per year between now and 2050 to reach 80 percent
renewables. While this seems like a lot of lines—our current
system has 150-200 million megawatt-miles—most of this would be
built in the sparsely-populated wind belt (see the accompanying
map). NREL also created a “constrained transmission” scenario,
which limited new grid construction and forced more renewable
generation closer to load. That scenario required only 25
million megawatt-miles additional, but had higher overall costs
and more congestion. With thoughtful and integrated planning, we
believe we can maximize the use of current lines and minimize
the need for new.
[img width=640
height=420]
HTML http://www.createaforum.com/gallery/renewablerevolution/3-131113204125.png[/img]
Source: NREL, Renewable Electricity Futures.
While the Beltway conventional wisdom is that building
transmission lines is “simply not feasible,” lines are in fact
being built. Transmission investment is rising from a mid-1990s
trough, with much new development intentionally benefiting
renewables. In fact, new lines are starting to fill in the NREL
map already. The three power systems stretching from Texas to
Minnesota, called ERCOT, the Southwest Power Pool and MISO, have
approved $20 billion of new lines to bring wind power to market.
Rural communities, landowners, and policymakers in these areas
are willing to live with transmission partly because they see
the economic and environmental benefits of renewable energy, and
understand the need for infrastructure. As the saying goes, “If
you love renewables, you’ve got to at least like transmission.”
It is also helps that developers are becoming more sensitive to
the concerns of communities and regulators. One developer, Clean
Line Energy Partners, has had 600 public meetings in the process
of siting a line from Iowa to Illinois.
And the federal government has become proactive in addressing
siting issues on public lands early and openly, through programs
launched by former Interior Secretary Ken Salazar.
The Bureau of Land Management has set aside 1,000 square miles
of land in 24 solar-energy study areas and is evaluating them
for appropriate development. These areas have the technical
potential to generate nearly 100,000 megawatts of electricity or
enough to power 29 million homes. Interior is working to
encourage development of all renewables, especially offshore
wind on the East Coast.
As part of America’s Power Plan, we have developed a set of
recommendations for smart reforms of policies and business
practices. With the right changes, we can see continued success
in siting new generation and transmission.
First, of course, we must maximize the efficiency and use of the
existing grid. “Non-wires” alternatives like targeted efficiency
improvements, demand response, and distributed generation can
help us wring more out of our existing transmission system.
But the current grid was built for fossil and nuclear
generators. A system for renewables will need to increase access
to new regions, like the Midwestern wind belt and the sunny
Southwest. It will also need to be more interconnected, to
minimize the impacts of variable generation, like wind and
solar.
A package of reforms and best practices can reduce conflict and
streamline the process of siting new projects, making it faster,
cheaper, and less controversial.
New approaches include engaging stakeholders early, accelerating
innovative policy and business models, and employing “smart from
the start” strategies to avoid the risk of environmental and
cultural-resource conflicts. Institutional reforms may be the
most critical, such as greater coordination among regulatory
bodies and improved grid planning and operations. Developers and
regulators should work with landowners to develop new options
for private lands, including innovative compensation measures.
A number of these improvements are being deployed already, such
as in the Western Governors’ Association Regional Transmission
Expansion Planning Project and the Interior Department’s
pro-active work to site America’s first offshore wind farm.
Modernizing the grid and transitioning to clean power sources
need not cause harm to landowners, cultural sites or wildlife.
On the contrary, taking action today will provide long lasting
benefits.
By Carl Zichella, Johnathan Hladik and Bentham Paulos
Zichella and Hladik are speaking at the Renewable Energy World
Conference & Expo in Orlando, Florida on November 13 in session
19B - "Seizing Opportunities in Wind Development and Planning."
Carl Zichella is Director of the Western Transmission, Land &
Wildlife Program for the Natural Resources Defense Council.
Johnathan Hladik is an attorney and energy policy advocate for
the Center for Rural Affairs. Bentham Paulos is the manager of
America’s Power Plan.
HTML http://www.renewableenergyworld.com/rea/blog/post/2013/11/it-doesnt-have-to-be-so-hard-making-renewable-energy-siting-easier#comment-127783
#Post#: 349--------------------------------------------------
Re: The Big Picture of Renewable Energy Growth:Financial Innovat
ion Next Big Thi
By: Golden Oxen Date: November 15, 2013, 6:25 pm
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Hi everybody. My first posting, found this article moments ago
by one of my favorites Chris Nelder. Hope you find it of
interest.
Agelbert I had a problem deciding if this belonged here or
general discussion. Feel free to move it if it is in the wrong
spot. Still feeling my way around your very well thought out
site.
Financial Innovation is the Next Big Thing in Clean Energy and
Efficiency
HTML http://i.bnet.com/blogs/william-kamkwambas-old-windmill-whiteafrican.jpg
A new wave of innovation is sweeping the energy transition
sector, promising to accelerate deployment and cut the costs of
energy-efficiency measures, as well as wind and solar
generation.
It isn’t a technological improvement, like cutting hardware and
labor costs. It isn’t a policy mechanism like feed-in tariffs.
It isn’t even a new business model, like selling storage
services.
It’s financial innovation.
If the very words make you clutch your wallet and roll your
eyes, I understand. After all, it was the innovation of
mortgage-backed securities, credit default swaps and
collateralized debt obligations that opened the door to an
unprecedented level of financial recklessness and nearly brought
down the global economy five years ago.
However, at the risk of incurring the wrath of the market gods:
This time it’s different.
The problem: The capital gap
Financial innovation in the cleantech sector is needed for a
simple reason: Wind and solar systems (even large, utility-scale
ones) and energy-efficiency upgrades are hard to finance. They
typically require a homeowner or business owner or renewable
project developer to come up with a significant chunk of capital
up front, then receive the benefits of the investment over a
long time horizon — typically, 20 years or more. They’re all a
little different, making it hard to evaluate risk. Even if an
investment offers an excellent return over time, coming up with
the initial capital can be too high a hurdle. And when a
developer manages to raise the money to build a project, it
usually needs to sell the project to a long-term investor so it
can free up its capital to build the next solar park or wind
farm.
The natural long-term holders of assets like these are pension
funds, infrastructure funds, sovereign wealth funds, insurance
funds, and the like. They are accustomed to investing tens or
hundreds of millions of dollars at once and then receiving
modest, single-digit returns over a period of decades. This is
the so-called fixed-income market, where the investments are
usually come in the form of very low-risk assets like Treasury
bills, equity positions in historically stable sectors like
utilities, or long-term, high-grade corporate debt.
The problem in the cleantech sector has been matching assets to
their natural investors.
Over the past year, I’ve heard the same story over and over
again. Globally, fixed-income investment entities have trillions
of dollars of available capital that they would love to put into
renewable energy and efficiency projects. Enough to build a huge
chunk of the new infrastructure needed to transition the world
from fossil fuels to renewable energy. But the available
projects are too small. Whether the investment is $50,000 or
$500 million, it still requires about the same level of due
diligence effort to evaluate: many billable hours paid to
high-priced lawyers, accountants, researchers, and fund
managers. That cost can be a killer if the investment is less
than (roughly) $5 million dollars; there just isn’t enough
margin to justify it.
So the trick has been to find a way to “de-risk” (do the due
diligence) and bundle cleantech and energy-efficiency
investments, in order to be able to offer a suitably large
investment to the fixed income market at an acceptably low
transaction cost.
Enter financial innovation.
Solution 1: Standardization
Several recent initiatives are tackling the first part of the
problem by finding ways to standardize investments.
The U.S. National Renewable Energy Laboratory (NREL) just this
week released a set of standardized contracts for solar
projects. The contracts, which include lease agreements for
residential solar systems offered by third-party solar leasing
companies and commercial power purchase agreements (PPAs) for
larger systems, were developed by a working group NREL convened
in the spring called Solar Access to Public Capital (SAPC).
Comprising some 20 to 25 companies in the sector — including
project developers, law firms, and analytical entities — SAPC
analyzed many existing contracts for solar projects and figured
out which parts could be standardized and which parts needed to
be customizable.
I asked NREL Energy Analyst Paul Schwabe, who headed the
contract standardization project, why new contracts are needed.
“We see a number of benefits for those leases and PPAs,” he
says. “One, lowering transaction costs for entities who don’t
already have those documents available; they don’t have to
reinvent the wheel. Two, improving customer transparency,
particularly on the residential side. By using a standard
contract, the consumer can more easily compare multiple projects
and know that the contract has been analyzed by a number of
industry stakeholders. And three, we think it can help
facilitate the pooling of cash flows into a common investment
that can access capital markets.”
The working group hopes standardized contracts will reduce the
cost of capital for project developers, and make it easier for
customers and investors to evaluate investments. So far, the
prospects are good.
“We’ve gotten buy-in from a large majority of the residential
installer community, and we’ve made good inroads in the
commercial industry as well,” Schwabe says. “We’ve confirmed
that a large percentage of the market will use them.” The
working group now has more than 125 members, he estimates, and
that number is growing rapidly.
Ultimately, the standardization of contracts will make it easier
to assess the expected cash flows from solar projects, and thus
make it easier for investors to feel assured that projects will
perform as advertised.
Solution 2: Data and metrics
The contract standardization effort is part of a broader NREL
initiative to organize the industry and establish collaboration
between stakeholders. NREL is also collecting data for solar
performance, which will help standardize an understanding of how
well various pieces of solar gear perform.
Another industry working group called TruSolar is working on a
complementary set of metrics and tools to standardize solar
project financing, including rating photovoltaic (PV) projects
for performance and establishing credit screening criteria.
TruSolar is part of SAPC. It has partnered with NREL to
publicize their respective efforts and highlight the synergy
between them, Schwabe says.
By collecting historical data on actual system performance and
establishing standard credit criteria, the two groups will solve
another part of the problem: the lack of a trusted track record.
Whereas the performance of mortgages has a well-analyzed record
that stretches back over more than a century, the data trail for
solar projects is only a few decades long, and only the last
decade of that trail is really representative of how well modern
equipment performs.
These investments in collecting data and establishing metrics
will make it easier to de-risk solar projects and assign them a
credit rating major investors can accept without having to do so
much of their own due diligence. This will ultimately reduce the
cost of capital and increase the velocity of deal-making.
Schwabe was not at liberty to say whether or not any of the
major credit rating agencies are involved in SAPC, but did say
that a key conclusion from an earlier NREL paper that led to its
formation was that “standardization was needed for
securitization and those stakeholders felt it was necessary.”
Solution 3: Securitization
Securitization is the process by which a pool of assets is
bundled, graded, sliced and diced, and sold into capital
markets. It’s the same process that brought the world the
dreaded mortgage-backed securities. But the underlying assets in
cleantech are quite different, and far less risky.
Securities in the cleantech sector rely on cash flows generated
by stable things: solar equipment sits in the sun, insulation
sits in buildings, and wind turbines stand and spin. As long as
the gear has been properly evaluated and graded — which is part
of what SAPC and TruSolar are doing — and properly maintained,
then the only real risk to continued production of cash flow is
weather. Fortunately, on an annual basis, insolation (the amount
of light falling on a given location), wind, and temperature are
quite predictable and have very long historical data records.
Averaged over a period of decades, they will not deviate enough
from historical averages to constitute a significant financial
risk. So the actual risk of non-performance in solar- or wind-
or efficiency-backed securities is far lower than the risk of a
homeowner who got a “liar’s loan,” lost his job, and then
couldn’t pay his mortgage.
Several new approaches to securitization in cleantech are now
coming into existence.
NREL, as part of its suite of initiatives, is developing a “mock
portfolio” comprising a pool of solar park assets, both
commercial and residential, and testing how it might perform as
a securitized investment.
SolarCity, one of the largest third-party solar leasing
companies, announced this week that it will begin offering $54
million worth of “Solar Asset Backed Notes” to qualified
investors. The securities, which will be secured by a pool of
the company’s solar systems, leases and PPAs, will pay investors
out of the cash flow those assets generate, and free up the
company’s capital to invest in new projects.
Jigar Shah, the founder of SunEdison, pioneered the third-party
solar leasing model companies like SolarCity and Sunrun have
followed. I asked him for his take on securitization.
“The financial innovation that we’re doing now is just an
extension of what we started in 2003,” he says. “We popularized
it at SunEdison. Securitization is the next step. The first step
was to make solar an asset class acceptable to insurance and
pension funds. We got Wells Fargo, MetLife, and a few others to
give SunEdison $2.3 billion in commercial paper, and something
on the order of $1 billion in residential paper. Now we have the
right to pursue securitization. But it only happens because the
banks believe there’s a multi-billion-dollar market. Until then,
the ratings agencies like S&P are not able to participate.”
Although SolarCity’s $54 million offering is tiny in the world
of commercial securities, Shah sees it as significant because
the company has obtained, for the first time, an
investment-grade rating for commercial solar securities. Within
five years, he expects the sector to be well into the billions
of dollars.
In a detailed Oct. 21 essay about solar securitization for Power
Intelligence, energy finance attorneys Elias Hinckley and David
John Frenkil wrote that solar asset-backed securities “will
enable the solar industry to access a much larger and more
diverse investor base, which will eventually help to reduce the
long-term cost of capital to a likely range of 3 percent to 7
percent, compared with the 8 percent to 20 percent rate required
by some project finance equity and tax equity investors in the
current market.”
Securitization is also coming to the building efficiency sector.
Massachusetts-based insurance company Energi Insurance Services
has extended its risk evaluation services for renewables to the
energy-efficiency sector, including energy-savings warranties,
electricity-generation performance warranties and equipment
warranties. It also backstops performance guarantees offered by
energy-efficiency contractors through product underwritten by
the International Insurance Company of Hannover. Last month,
Energi started working with NREL to analyze and quantify risk
for small building energy-efficiency retrofits, giving lenders a
tool they can use to rate energy-efficiency loans. Ultimately,
the methodology could give rise to efficiency-backed securities,
which will deliver cash flows to investors much as securitized
solar projects do.
Solution 4: Crowdfunding
Oakland, Calif.-based Mosaic also offers solar asset-backed
securities. Instead of being based on a pool of assets, they are
issued for specific solar projects. Each note issued by the
company corresponds to a certain solar installation, and the
payment on those notes derives directly from the cash flow
generated by the loan obligation attached to that installation.
After less than a year in business, Mosaic has more than 2,500
investors from nearly every state, who have invested as little
as $25 for shares in 19 solar projects with a combined $5.7
million in asset value. Investors typically receive 4 percent to
7 percent returns annually, depending on the project. The
company boasts 100 percent on-time payments with zero defaults
thus far.
Speaking at the VERGE San Francisco conference last month,
Mosaic CEO Billy Parish said interest is brisk in his company’s
offerings. Investors are disillusioned with conventional
financial markets, he says, and increasingly feel that the stock
market is rigged against them. With tens of millions of dollars
worth of new solar projects in the Mosaic pipeline, he is
confident investors will continue to find the low risk and
modest return of the notes attractive. “The transition from
fossil fuels to renewables is the biggest opportunity for wealth
generation this century,” he declares.
Another Mosaic innovation could open up a torrent of new
capital: a security that will be eligible for purchase through
IRA accounts. There is $17 trillion sitting in IRAs in the
United States alone, according to Parish.
A related recent development in financial innovation will give
more investors access to the cleantech sector. The JOBS Act,
which President Obama signed into law in April, created a new
playing field for crowdfunding that makes it easier for
individuals who don’t qualify as high net worth “accredited
investors” to invest small amounts in small businesses and
startups which, in turn, weren’t qualified to offer public
securities.
Earlier this week, the Securities and Exchange Commission
finally proposed rules defining the new terms. Investors with
less than $100,000 in annual income and net worth will be able
to invest up to $2,000 a year, or 5 percent of annual income or
net worth, whichever is greater. Those criteria are considerably
looser than the ones Mosaic has operated under thus far, so it
will open a much larger pool of potential investors in
renewable-energy- and efficiency-backed securities.
“We’re glad to see financial innovation occurring in the
renewable energy sector, including through use of securitized
investments,” Parish told me.
And that’s not all. A multi-billion-dollar market in global
finance for renewable energy and efficiency is now giving very
large investors, like sovereign wealth funds and pension funds,
easy access to these new securities. Stay tuned to this space
for more on that exciting new sector.
Photo: William Kamkwamba’s old windmill, Malawi
(whiteafrican/Flickr)
HTML http://feedproxy.google.com/~r/Getreallist/~3/7PW50B7a12U/financial-innovation-is-the-next-big-thing-in-clean-energy-and-efficiency.html
#Post#: 350--------------------------------------------------
Re: The Big Picture of Renewable Energy Growth
By: AGelbert Date: November 15, 2013, 7:00 pm
---------------------------------------------------------
Thanks GO. I agree financing is definitely part of the big
picture for renewables.
Mosaic is doing a great job but now that California has made a
pact with B.C., Canada and some other Northwest States to price
carbon, the renewable energy projects, most of which have large
depreciation time horizons which do justify long term financing,
as your article pointed out, will hopefully get easier financing
for the large up front costs.
There are some states that are quite friendly to sustainable
business ventures in renewable energy. Here's a snippet of a
document written for the hypothetical venture capital investor
with x amount of money for y type of renewable energy
investment.
Article from July 2013: “The Most Solar-Friendly States in the
US”:
SNIPPET:
Vermont won recognition in 2011 for its groundbreaking
streamlined solar permitting rules, emphasizing residential and
small solar installations, which it expanded in 2012. (The
state’s solar “registration” process, rather than “permitting,”
is described in an interview with AllEarth Renewables’ David
Blittersdorf.)
Interestingly, Vermont is also at the forefront of the net
metering debate. A report earlier this year found that solar net
metering is a net-positive for the state, even with a state
incentive factored in, and not including any tangential economic
multipliers. Similar reports, and conclusions, have been
published for California, New York, and Texas.
Unlike the other top 12 states, Vermont does not have a formal
RPS policy; rather it has “goals” of 20 percent of electricity
retail sales from renewable energy and combined heat/power by
2017 as part of a Sustainably Priced Energy Enterprise
Development (SPEED) program. Beyond that, the state has targets
for each providers’ annual electricity of 55 percent of retail
sales in 2017, increasing 4 percent a year until reaching 75
percent by 2032.
Rank ‘Em: The Most Solar-Friendly States in the US
HTML http://dl3.glitter-graphics.net/pub/465/465823jzy0y15obs.gif
HTML http://www.renewableenergyworld.com/rea/news/article/2013/07/rank-em-the-most-solar-friendly-states-in-the-u-s?page=all
Vermont Has excellent Solar investment incentives.
[img width=640
height=380]
HTML http://www.createaforum.com/gallery/renewablerevolution/3-091113190338.png[/img]
Quantifying State-Policy Incentives for the Renewable Energy
Investor
Sreenivas
HTML http://web.ornl.gov/sci/electricdelivery/pdfs/VERDE_IEEE_ECCE_Policy_Paper__Version_4.pdf
HTML http://web.ornl.gov/sci/electricdelivery/pdfs/VERDE_IEEE_ECCE_Policy_Paper__Version_4.pdf
[img width=640
height=380]
HTML http://www.createaforum.com/gallery/renewablerevolution/3-091113190724.png[/img]Quantifying<br
/>State-Policy Incentives for the Renewable Energy Investor
Sreenivas
HTML http://web.ornl.gov/sci/electricdelivery/pdfs/VERDE_IEEE_ECCE_Policy_Paper__Version_4.pdf
HTML http://web.ornl.gov/sci/electricdelivery/pdfs/VERDE_IEEE_ECCE_Policy_Paper__Version_4.pdf
[img width=640
height=480]
HTML http://www.eia.gov/todayinenergy/images/2012.02.03/RPSMap.png[/img]
I wish the Federal Reserve would jump in and assign the SAME
level of interest rates for Renewable Energy add-ons to homes
and businesses as for housing construction and re-finance. That
would be ROCKET FUEL for getting people quickly off of fossil
fuel heat and electricity in their homes. The job spurt alone
would be enough to goose our economy if the Wall Street crooks
would stop trying to get a war going someplace and instead get
some renewable energy cheap financing going here.
Renewable energy is the quintessential wise investment because
of the excellent EROEI. I read recently that Solartech or
SolarCity (not sure which) is securitizing chunks of PV power
purchase agreements (PPA).These are basically 25 to 30 year
bonds that facilitate financing so I am certain some money
people are getting on the band wagon. If you could find out who
they are and report on it, I would be grateful. [img width=30
height=40]
HTML http://www.createaforum.com/gallery/renewablerevolution/3-141113185047.png[/img]<br
/>
By the way, I'm making up for lack of certain emoticon buttons
by putting images in the gallery of emoticons you can link to.
You may have to size them but once you've got the right width
and height, it's a cinch.
The above green smiley is set like this (without the brackets so
you see the script):
img width=30
height=40]
HTML http://www.createaforum.com/gallery/renewablerevolution/3-141113185047.png[/img<br
/>
#Post#: 352--------------------------------------------------
Big FINANCIAL Innovation Emerging in Renewable Energy!
By: AGelbert Date: November 15, 2013, 8:17 pm
---------------------------------------------------------
The Next Big Innovation in Renewable Energy Won't Be
Technological
It will be financial.
Todd WoodyNov 11 2013, 3:30 PM ET
Silicon Valley solar company SolarCity last week quietly did
something that could revolutionize renewable energy in the
United States. No, the company did not invent a radically more
efficient or cheaper photovoltaic panel. Rather, it announced it
plans to sell $54 million in asset-backed securities. :o
And that is a very big deal, even if the dollar amount of the
notes on offer is rather small. That’s because the assets
backing the securities are leases for some of the rooftop solar
systems it has installed on homes across the country. Hundreds
of millions of dollars in solar leases have been signed in the
U.S. in recent years.
If those leases can be bundled and sold to pension funds and
other investors, “solar securitization” could open up a
potentially huge new pool of capital that could be tapped to
finance the expansion of renewable energy as federal and state
tax breaks for renewable energy begin to expire.
For homeowners and businesses, solar securitization could
translate into cheaper electricity. A SolarCity spokesman
declined to comment on the securities offering. ;)
Much of the innovation responsible for the solar industry’s
explosive growth has been financial rather than technological.
Half the U.S.’s solar capacity, for instance, was installed just
in 2012. Driving those sales was the ability of homeowners to
avoid the five-figure cost of a photovoltaic system by leasing
it for a monthly payment that often is lower than what they’d
pay their local utility. Anywhere between 75 and 90 percent of
all solar systems are now leased as a result.
That’s a lot of demand sitting around waiting to be monetized.
After all, Wall Street for years has packaged leases for planes,
trains and automobiles and sold them to investors. The risk is
considered manageable as rating agencies like Standard & Poor’s
evaluate the credit-worthiness of such investments can rely on
decades of data on the value of those rolling assets as well as
the credit scores of people who sign the leases.
Solar panels, on the other hand, are a relatively new technology
HTML http://www.coh2.org/images/Smileys/huhsign.gif
and have only
become a mass market over the past few years. Then there’s the
specter of the subprime mortgage debacle that crashed the global
economy when the value of both the homes securing
mortgage-backed securities and the credit-worthiness of the
homeowners proved an illusion.
The risks of subprime solar is probably low. Solar installers
like SolarCity, Sungevity, and SunRun only sign leases with
customers with high credit scores. And most homeowners are
likely to continue paying their electricity bill even if they
can’t make their car payment.
HTML http://www.pic4ever.com/images/128fs318181.gif
The big unknown, however, is the long-term performance of solar
panels.
HTML http://1.bp.blogspot.com/-TzWpwHzCvCI/T_sBEnhCCpI/AAAAAAAAME8/IsLpuU8HYxc/s1600/nooo-way-smiley.gif<br
/>Manufacturers typically offer 20-year or more warranties. But
as
I wrote earlier this year in The New York Times, the extreme
financial pressures faced by Chinese solar industry, which
supplies most of the world’s photovoltaic panels, has led to
cost-cutting and growing incidents of defective solar modules.
::) Whether that is a short-term blip or indicative of a more
long-term problem won’t be known for years. (SolarCity chief
executive Lyndon Rive, however, told me his company has not
experienced any issues with its Chinese-made panels.)
Agelbert NOTE: OF COURSE they haven't experienced any "issues"
with Chinese-made panels BECAUSE the hit piece in the New York
Times was overblown THEN and has proven to lack substance. I can
provide links to anyone interested in seeing that there was
NEVER an actual quality control problem above a tiny (less than
3%!) of production and that was ONLY for a few months. The
article was a scare tactic, not a balanced piece of industrial
quality control problem news.
That makes Big Data companies like kWh Analytics crucial for the
success of solar securitization. The Oakland, California,
startup analyzes the real-time performance of some 10,000 solar
systems—including 3 million photovoltaic modules—to help
investors evaluate the risk of putting money into solar assets.
The U.S. Department of Energy recently awarded kWh $450,000.
Richard Matsui, kWh’s chief executive, told The Atlantic that
his company will use that money to build out a comprehensive
database similar to one assembled to analyze home mortgages by a
company called CoreLogic.
“Today's solar investors are flying blind, accepting unknown
risks
HTML http://www.smileyvault.com/albums/userpics/12962/noway.gif<br
/> in exchange for the promise of financial returns,” Matsui sai
d
in a statement. “Understanding risk is essential to making
investments, but is difficult without aggregated data on panel
quality, inverter reliability, and customer default rates.”
HTML http://www.theatlantic.com/technology/archive/2013/11/the-next-big-innovation-in-renewable-energy-wont-be-technological/281345/
Agelbert NOTE: Matsui is obviously talking his book so he can
milk the "pricing renewable energy" cash cow to hilt! >:( I
think the risks are overblown. Here's why. PV is NOT a new
technology; it has been tested to beat the band. We have had PV
in outer space for over 40 years! Yes the efficency has improved
but the durability, unlike what this article is sweating, is an
establishe MTBF (mean time between/before failure) born of no
nonsense testing. They will probably last longer than 25 years.
Planes, trains and automobile securitized leases are FAR more
risky and yet Wall Street securitizes these rapidly depreciating
assets that are simply not in the same league as PV (or wind
turbines, for that matter).
Renewable energy, from wind turbines to PV to geothermal to
hydropower has been MUCH MORE scrutinized than dirty energy
fossil fuel power plants or nuclear power plants ever were in
regard to cost-benefit. So these jitters are simply NOT
justified.
The securitization gate has been opened. Unlike the CRAP
securitization for mortgages SCAM, this is the real thing and,
if priced correctly, should be quite popular. With this
financial boost the Renewable Energy "Genie" is out of the
bottle! Enjoy the death of fossil and nuclear fuels! [img
width=60
height=60]
HTML http://www.smile-day.net/wp-content/uploads/2011/12/Smiley-Thumbs-Up2.jpg[/img]<br
/>
#Post#: 357--------------------------------------------------
Re: The Big Picture of Renewable Energy Growth
By: Golden Oxen Date: November 16, 2013, 8:25 am
---------------------------------------------------------
Imagine where we would be today if our government had spent the
resources on getting us out of our Global Warming Fossil Fuel
burning emergency as it did bailing out the banksters from their
evil ways. :-[
#Post#: 362--------------------------------------------------
Re: The Big Picture of Renewable Energy Growth
By: AGelbert Date: November 16, 2013, 4:52 pm
---------------------------------------------------------
Yep. It would be a different, and much healthier world. I hope
it's not too late.
#Post#: 380--------------------------------------------------
Rocky Mountain Institute New Video
By: AGelbert Date: November 17, 2013, 11:30 pm
---------------------------------------------------------
HTML http://www.youtube.com/watch?v=NztbbAL-wpA&feature=player_embedded<br
/>
#Post#: 385--------------------------------------------------
Re: The Big Picture of Renewable Energy Growth
By: Surly1 Date: November 18, 2013, 6:06 pm
---------------------------------------------------------
[quote]Imagine where we would be today if our government had
spent the resources on getting us out of our Global Warming
Fossil Fuel burning emergency as it did bailing out the
banksters from their evil ways.
[/quote]
That was this generation's Apollo program, gents. And the money
went right into the bankster's pockets.
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