Minnesota’s day in the sun for determining the value of solar

(Midwest Energy News, October 28, 2013)—Karl Rábago could be called the grandfather of the value-of-solar tariff, but the concept is so new that “young parent” might be a more apt moniker.

The basic idea is that instead of paying customers with solar panels the retail electricity rate for their surplus power, utilities should pay a price that reflects the true value of solar to the grid. That could include added value for reducing congestion or generating during peak hours when power is most expensive.

Rábago helped develop the first value-of-solar tariff during his tenure as a municipal utility executive in Austin, Texas, which implemented the scheme just last year. Today, as an independent consultant, he travels around the country promoting and explaining the concept to others considering it.

Minnesota is the first state attempting to establish a value-of-solar tariff, and Rábago believes his baby is in good hands.

The state is about halfway through a months-long stakeholder process that will determine the guidelines for calculating solar’s value in the state.

“It reminds me of the way we did it first at Austin Energy, but even better,” Rábago said. Continue reading “Minnesota’s day in the sun for determining the value of solar”

Q&A: Karl Rábago, grandfather of the value-of-solar tariff

Karl Rábago

Karl Rábago

(Midwest Energy News, October 28, 2013)—As a municipal utility executive in Austin, Texas, Karl Rábago led a team that came up with the very first value-of-solar tariff, an alternative to net-metering that aims to pay utility customers a rate for solar power that reflects its actual value to the grid and society.

Today, as an independent consultant, Rábago is the concept’s chief evangelist. He’s been hired by the Minnesota Department of Commerce to participate in a series of stakeholder workshops that will help the state set the rules for how value-of-solar tariffs should be calculated in Minnesota.

Here is a transcript of a conversation we had with Rábago last week, edited some for clarity and conciseness.

Midwest Energy News: Of all the discussions you’ve been involved in regarding the value of solar, how does this one stand out?

Rábago: It reminds me of the way we did it first at Austin Energy, but even better. When I first launched the value of solar concept, I did it from inside a utility. Utilities generally stay pretty close to the vest on things they’re working on. There’s a certain amount of nervousness or paranoia inside the utility culture. It’s the nature of the industry. But Austin Energy was a municipal utility so we built in from the start conversations with stakeholders and engagement with our policymakers.

In Minnesota, it’s been a public process from the very start. It’s been wonderful. My first visit up there as a consultant was just informational; sharing the experience and talking to groups; MnSIEA and utility people in very open discussions. The Department of Commerce has just set up this wonderful [process]. Everybody is being very forthcoming and honest and direct. Continue reading “Q&A: Karl Rábago, grandfather of the value-of-solar tariff”

If landowners get annual payments for wind turbines, why not transmission lines?

(Midwest Energy News, October 23, 2103)—For the large metal tower constructed on his land, one farmer will receive annual payments for as long as it stands.

His neighbor, however, whose land is divided by a string of vertical structures, gets a more modest one-time payment.

As a historic transmission build-out continues across the region, landowners are increasingly questioning the fairness of rewarding wind project participants more than those who allow transmission lines to cut across their property.

Frank James, staff director for Dakota Rural Action, says it’s an increasingly common complaint from South Dakota farmers.

“You know what they’re getting paid for those turbines, and it’s pretty good,” James said. “You’re going to get a transmission line that serves those wind turbines and you don’t feel like you’re getting paid as [well].”

The comments were made Monday at the Great Plains Transmission Summit in St. Paul, where the topic of alternative landowner compensation models surfaced during several panel sessions. Continue reading “If landowners get annual payments for wind turbines, why not transmission lines?”

Is burning garbage green? In Sweden, there’s little debate

(Photo by Dan Haugen / Midwest Energy News)

Göran Skoglund, press officer for Öresundskraft, peering into the incinerator at the Filborna waste-to-energy plant in Helsingborg, Sweden. (Photo by Dan Haugen / Midwest Energy News)

Editor’s note: Dan Haugen traveled to Scandinavia this month as part of the Heinrich Böll Foundation’s Climate Media Fellowship program.

(Midwest Energy News, October 17, 2013)—HELSINGBORG, SWEDEN—The view from the control room of the Filborna waste-to-energy plant is a dizzying one.

In a cavern ten stories below the glass-bottomed observation deck, a sea of stringy, gray and brown trash is in a state of constant settling as garbage trucks dump fresh loads into the massive pit.

A pair of giant orange cranes take turns scooping and scattering the debris, mixing it to an even moisture content before feeding it onto a slow moving metal grate that will carry it into an incinerator.

It looks like dirty business, but in Sweden this is viewed as one of the country’s great green achievements.

While waste-to-energy incinerators remain a controversial topic among U.S. environmentalists, there’s been little such debate in Sweden as the country increased its waste burning capacity over the past decade.

“I have not heard any complaints, I don’t think — ever,” said Björn Palm, head of the energy technology department at Stockholm’s KTH Royal Institute of Technology. Continue reading “Is burning garbage green? In Sweden, there’s little debate”

As Midwest cities mull congestion pricing, Swedish drivers are already sold

Dire predictions about Stockholm's congestion-pricing plan failed to materialize, as traffic started flowing more smoothly the day it was implemented. (Photo by Derek Yu via Creative Commons)

Dire predictions about Stockholm’s congestion-pricing plan failed to materialize. (Photo by Derek Yu via Creative Commons)

Editor’s note: Dan Haugen traveled to Scandinavia this month as part of the Heinrich Böll Foundation’s Climate Media Fellowship program.

STOCKHOLM, SWEDEN—As a city of islands, Stockholm was in a unique position, geographically speaking, to implement congestion pricing for motorists. Just 18 crossings exist where cars and trucks can enter or exit the inner city.

When it comes to politics, though, the city had no special advantage.

In fact, public reaction to the proposal was very, well, American.

Opinion polling taken in the months before it was implemented in January 2006 showed 80 percent opposed the congestion pricing plan. The disaster scenarios predicted in the media involved everything from license plate thefts to bankrupt retailers. Companies would flee the city to spare their employees and customers from paying the fees. Authorities would use the payment system to spy on motorists, tracking their every turn.

“It was like the Obamacare in politics in Stockholm,” said Gunnar Söderholm, director of the city’s environmental and health administration, who was tasked by the mayor with implementing the program.

A conservative party leader told the press that Söderholm would be the first to lose his job if there were a change in majority. It was “political suicide,” he recalled.

What happened next may have saved Söderholm’s career: The system worked, and people liked it.

“All the catastrophes you could think of were predicted, and nothing of that happened,” Söderholm said.

Overnight, every fourth car disappeared from the city. Transit ridership spiked, and travel times plummeted.

“People saw the benefits. They actually saw them overnight,” he said. The air was more pleasant to breath. Crossing the street was less stressful. Buses ran on time and were even forced to idle to avoid getting ahead of schedule.

Newspaper editors who had previously slammed the concept changed their tone after one day.

“They said: this actually works. This is actually a different city — and it was. It was free flow in all streets, all day long,” Söderholm said. “Nobody had experienced that since we had horses on the streets.”

Traffic levels remain low

Stockholm has a goal of being fossil-fuel-free by 2050. Already a leader in district heating and renewable energy, addressing transportation is seen by some as the city’s biggest climate challenge.

After a half-year congestion pricing trial in 2006, voters narrowly passed a referendum to re-instate congestion pricing permanently starting the following January. Public opinion polling now shows about 70 percent of people support the traffic fees.

One explanation for the turnaround in public support, according to Söderholm, is that the system technically works very well and hasn’t been a hassle to use. Instead of pulling over at a toll booth, drivers get a single monthly bill at home based on data from license plate cameras set up at the 18 entry points. They pay about $3 for entering the city during peak hours, around $2 for semi-peak hours and around $1.50 during the middle of the day. Most people pay less than $15 per month.

The volume of cars entering the city has rebounded a bit since 2006, but it’s remained about 20 percent lower than pre-congestion pricing levels. And that’s despite being one of the fastest-growing cities in Europe.

“We have had almost continuously stable traffic despite that fact that we now have 100,000 more people in the city and 200,000 more people in the region,” Söderholm said. “The traffic is decreasing and the population is increasing.”

Public transit use is near an all-time high almost every day, he said, and the number of “clean cars” — electric or alternative fuel vehicles exempt from the congestion fees — has continued to climb as well.

Will traffic return?

Söderholm’s assessment of the program’s success is backed up by 2011 study by a group of Swedish researchers published in Transport Policy (and covered here by The Atlantic Cities).

Some economists predict that congestion pricing becomes less effective over time as drivers get used to the charges and are lured back into their cars by additional road space. So far, there’s no evidence of that happening in Stockholm.

“All told, the findings of this report suggest that Stockholm’s system might provide a blueprint for those American cities who do ultimately push for congestion pricing,” writes The Atlantic Cities’ Eric Jaffe.

Minneapolis-St. Paul is one of five U.S. regions awarded federal funding in 2007 to experiment with congestion pricing projects. Carpool lanes on two Twin Cities freeways now double as rush-hour toll roads for single-occupant vehicles.

Congestion pricing has also been a subject of debate in Chicago, where a combination of road tolls and parking fees have been debated. The reception so far has been described as “chilly.”

The question is: if American commuters ever see a full-scale implementation, will they warm to congestion pricing the way Stockholmers have?

Originally published October 15, 2013 at 06:00AM at Midwest Energy News http://www.midwestenergynews.com/2013/10/15/as-midwest-cities-mull-congestion-pricing-swedish-drivers-are-already-sold/

Once dismissed as ‘sewing circle,’ Swedish co-op creates a stake for women in wind industry

Unable to afford a share of a community wind farm, Wanja Wallamyr started a co-op for women only. (Photo by Dan Haugen / Midwest Energy News)

Unable to afford a share of a community wind farm, Wanja Wallemyr started a co-op for women only. (Photo by Dan Haugen / Midwest Energy News)

Editor’s note: Dan Haugen is traveling in Scandinavia this month as part of the Heinrich Böll Foundation’s Climate Media Fellowship program.

FALKÖPING, SWEDEN—When Wanja Wallemyr learned a community wind project would be built a few kilometers from her family farm, she knew she wanted to be a part of it.

Only problem: she couldn’t afford the 1 million Swedish Krona (roughly $154,000) minimum investment on her own.

That was in 2007, just as the farmer and rural activist was also preparing to attend a regional conference on creating economic opportunities for women.

With both issues on her mind, she came up with a single solution: Wallemyr would start an all-women wind energy cooperative.

It turned into a two-week sprint. She had just 14 days to commit to joining the wind project or not. Starting with other women at the conference, Wallemyr found nine others to join her in forming Qvinnovindar.

In an industry whose leadership still skews heavily towards men, it’s very likely Qvinnovindar is the only company of its kind anywhere in the world.

Last week, the company received a regional cooperative of the year award, and it’s been nominated for a similar prize at the national level.

An ‘old boys’ club’ mentality

The name combines the Swedish words for wind and women. The group bought a share of the three-turbine project near Wallemyr’s farm in 2007. Since then they’ve grown to 80 members and invested more than 10 million Krona ($1.5 million) in other projects, including a portion of a five-turbine installation built on Wallemyr’s farm.

Qvinnovindar members individually invested anywhere from 500 to 300,000 Krona ($77-$46,000) each, giving them an equal vote in how the company is run, regardless of the amount they put in. Members come from diverse lines of work: a farmer, a florist, a dentist, a bookkeeper, a consultant and a retail clerk, among other professions.

Initially, the women were mocked by other project investors as “the sewing circle” or “Tupperware party,” as if buying wind turbines was merely an excuse to socialize.

It caused a minor stir in town when they ran a newspaper ad before their second project soliciting new investor members, but women only.

“That was a bit controversial,” says Wanja’s daughter, Sara Wallemyr, who fielded some calls from men who wanted to know why they couldn’t join.

“I told them I could help them create a cooperative for men. That is not a problem,” said Sara Wallemyr, who now works in sales for Eolus Vind.

Both Wallemyrs say they’re often the only women in the room during meetings about wind projects, and that’s not uncommon for women working in the U.S. wind industry either.

The best estimate is that women make up about 20 to 25 percent of the U.S. wind industry’s workforce, according to Kristen Graf, executive director of Women of Wind Energy.

“The kicker is that it’s not spread evenly across all roles and positions. The vast majority of that is in admin and HR,” said Graf.

Women of Wind Energy was started in 2005 by a group of women frustrated by the lack of females attending conferences and other industry events. Today it counts 3,000 members and local chapters in more than 30 cities. The organization helps recruit women to the industry and provide career development for those already working with wind power.

Shanelle Montana, a legislative and regulatory affairs associate with EDF Renewable Energy, said several companies’ Midwest offices have a higher percentage of women.

“Like a lot of industries, the energy industry has sort of that old boys’ club mentality,” Montana said. “That’s changing, and I think it’s changing a little bit faster in renewables.”

‘She’s not afraid of the power’

For Wanja Wallemyr, Qvinnovindar is about empowering women, and also boosting the rural economy and displacing nuclear power with cleaner energy.

“I say no to nuclear and yes to wind power,” says Wallemyr.

On a recent afternoon, a misty fog obscured the view of the uranium-rich mountains and plateaus lining the horizon in this fertile farming area in south-central Sweden.

Wallemyr worries that continued use of nuclear power will increase pressure to mine uranium in the region, which could spoil their views and pollute their groundwater.

“If they mine these mountains, we’ll have no mountains,” says Wallemyr.

Like other Swedes, her views on nuclear power are also colored by the Chernobyl disaster, which sent a radioactive cloud over the country, poisoning farm land and increasing cancer risks.

Sweden shut down three of its ten nuclear reactors in 2006 due to safety concerns, and the questions of whether to continue operating or building new reactors is controversial.

Wallemyr says women and young people generally oppose nuclear power, and that it’s mostly older men who continue to support the industry.

“Women think more of the children’s future,” she says.

The impact she’s hoping to make is global in scope. The cooperative’s investments have been relatively small so far, but they’re looking to expand in wind and other green energy.

She also hopes to inspire women around the world to follow in Qvinnovindar’s path. After talking at conferences around Europe, she’s been contacted by women in Spain, Mexico and Turkey.

Frans Wallemyr, translating for his mother, summarized her words: “She wants to be part of making the world a better place. She’s not afraid of the power.”

Originally published October 11, 2013 at 06:00AM at Midwest Energy News http://www.midwestenergynews.com/2013/10/11/once-dismissed-as-sewing-circle-swedish-co-op-creates-a-stake-for-women-in-wind-industry/

How Denmark turned an efficiency obligation into opportunity

Power lines in Copenhagen, Denmark. (Photo by David Dai via Creative Commons)

Power lines in Copenhagen, Denmark. (Photo by David Dai via Creative Commons)

Editor’s note: Dan Haugen is traveling in Scandinavia this month as part of the Heinrich Böll Foundation‘s Climate Media Fellowship program.

COPENHAGEN—In the U.S., there’s rising anxiety and speculation about how flat or falling electricity demand could affect utilities’ long-term business models.

Here in Denmark, though, electric companies have long operated in a slow- or no-growth market, and they continue to invest in further lowering customers’ energy use.

The Danish efficiency scheme has become the model for a new European Union efficiency law currently being implemented, and it could offer ideas and inspiration for U.S. policymakers, too, as they attempt to design incentives that can convince electric utilities to take a lead role in helping customers use less of the very product they sell.

Denmark has steadily invested in energy conservation ever since the 1970s energy crisis, when an Arab oil embargo caused fuel shortages and skyrocketing prices. As President Reagan was pulling solar panels off the White House roof, Denmark continued to spend money improving its building and power plant efficiency.

The country’s conservation commitment recently increased with a 2012 agreement that’s expected to cut energy use 12 percent by 2020 compared to 2006.

The pact has also generated demand for energy efficiency services, prompting several utilities to launch new businesses to capitalize on the opportunity.

“A lot of the companies now as see this as a potential to increase their market in advising on energy savings,” says Tina Sommer Kristensen, administrator for Denmark’s Department of Buildings and Energy Efficiency.

A collaborative process

Like much of Denmark’s regulation, the efficiency policy is the result of a consensus negotiation process, in this case between the Danish Climate, Energy and Buildings Ministry and the trade associations for approximately 450 energy distribution companies, including oil, electricity, natural gas and district heating.

The agreement is an update of a pact originally signed in 2006 and updated again in 2009. It sets a total, nationwide annual savings goal of nearly 3,000 gigawatt hours for 2013 and 2014, and a target of nearly 3,400 gigawatt hours for 2015 — a 75 percent increase compared to the previous three-year agreement.

Each sector — oil, electricity, natural gas and district heating — is assigned a specific share, roughly proportional to their market share. It’s up to the trade associations for each sector to then delegate responsibility for those obligations to its member companies, typically also based roughly on market share.

Companies can claim credit for energy savings that they themselves helped realized, either by providing technical advice or financial support. The utility’s involvement needs to be documented before an energy savings project begins. They may also partner with energy savings companies and others to help find opportunities.

The Ministry is indifferent about whether an individual company fails to hit its target for the year, so long as the sector as a whole meets its energy savings obligation. Utilities are allowed to buy, sell or share savings certificates with each other when one company exceeds their own requirements for the year.

Since 2007, companies covered under the agreements have surpassed the nationwide energy savings goals in every year.

Utilities embrace the changes

Sommer Kristensen said in the beginning there was some reluctance among some energy companies, but most have since come around to embrace the scheme, for several reasons.

One, the arrangement is cost-neutral for the utilities. Whatever a company spends to meet their obligation, they can pass along the full cost to customers in the form of a tariff on the following year’s energy bills.

Secondly, the system is highly flexible. The Ministry doesn’t care how sectors meet the targets, just that they do. There are no requirements to achieve a certain amount of savings from residential or low-income customers, for example. There’s even no requirement to achieve savings from your own customers or own sector.

Kamilla Thingvad, senior consultant for the Danish Energy Association, said that flexibility has driven companies to find the best, most cost-effective savings, no matter where they exist.

“It also takes away this [idea] that you have to reduce what you’re selling,” says Thingvad, whose organization represents the country’s electric companies.

A regional electric distributor, for example, could meet its obligation by helping to change out inefficient light bulbs in another part of the country. Or it could meet the obligation by helping their own customers insulate their homes and businesses, lowering their heating bills instead of their electricity consumption.

In practice, though, most companies have focused on finding savings in their own territory and sector, because that is where their expertise lies, Sommer Kristensen says.

Another factor that’s helped reduce some of the potential tension between energy conservation and electricity sales is the structure of Denmark’s utility industry. Electric distribution companies operate separately from generation companies. Customers also have their choice of retail companies, which buy power from producers and pay distributors to get it to customers.

This “liberalized” or deregulated structure means the distribution companies covered under the agreement aren’t directly affected by falling demand for generation. Most distribution companies are either municipally or customer-owned and considered common good companies rather than profit-driven.

New business opportunities

In addition, most distribution companies have formed sister companies that focus on providing energy savings services, which directly benefit from the conservation targets.

An electricity distributor will typically partner with energy savings companies as well as builders, installers and others to identify projects for the utility to participate in.

In 2006, the first year of the original agreement, all of the savings were achieved through contracts with distributors’ own “sister companies” that provide energy savings services. The money spent by distribution companies on efficiency was fully reimbursed by customers and went to pay energy services companies that were often affiliated with the distributor.

The agreements include rules to encourage competition, however, and so as more companies and consultants have entered the field, the share of energy savings work going to distributors’ own sister companies had fallen to around a third of the total spending in 2012.

“There’s been quite a change in how savings are made,” says Thingvad.

As the competition to provide retail services increases, companies are also beginning to package energy efficiency in retail service pitches to prospective customers. A company might approach a large electricity customer and offer rebates or other financing for equipment upgrades if the customer switches to their retail service.

Companies are expected to meet the targets for the lowest possible cost. Utilities annually report their spending to the Ministry, which makes the data public so that customers can compare their utility with others. “That’s a pretty strong driver to keep the costs low,” Thingvad says.

While electric companies have embraced the new system, there’s been less enthusiasm from the district heating sector, Sommer Kristensen says. These heating companies tend to be very small and local in scope. They’ve seen less incentive to pursue efficiency projects beyond their territory because they can’t bundle them with other services.

In general, though, both the government and energy companies view the agreement as a success. Thingvad says companies don’t see efficiency as a conflict.

“It’s part of their identity,” Thingvad said. “The distributors see it as a way to fulfill an obligation to society, and also part of the green transition of the energy system. You have to put in more renewables, but you also have to reduce consumption to make ends meet.”

Dan Haugen is traveling in Scandinavia this month as part of the Heinrich Böll Foundation‘s Climate Media Fellowship program.

Originally published October 08, 2013 at 06:00AM at Midwest Energy News http://www.midwestenergynews.com/2013/10/08/how-denmark-turned-an-efficiency-obligation-into-opportunity/