The incredible shrinking solar plant

By Jeff Postelwait
Online Editor

In the U.S. solar power market, developers are looking for access to the cash they need to build large, utility-scale solar projects, but that money is proving hard to find. If this keeps up, makers of solar farms in excess of 20 MW could be eclipsed by firms who put solar panels on rooftops.

In the first quarter of 2012, there were 506 MW of new solar projects that went online — accounting for some $1.9 billion in spending. This is a drop from the last quarter of 2011, which saw $3.1 billion worth of investment.

One factor? Shrinking and disappearing subsidies. Government funding is fading fast, and it's hard to say when Washington might feel like investing in solar power again — particularly with elections looming. It goes without saying that any whiff of uncertainty isn't good for upstart solar companies and their projects.

However, where the industry has recently favored big solar projects like the 290 MW Agua Caliente Solar Project being built by First Solar and NRG Solar in Yuma County, Arizona, we could soon see an uptick in small and medium solar power projects.

A huge undertaking like Agua Caliente was once thought to represent an industry sea change toward big solar power, but even proponents of solar power as a generation source can't deny that Agua Caliente would still be a patch of bare sand out in the desert without the Department of Energy loan guarantee that made it possible.

It's much easier at this point for solar developers to pursue smaller projects, like say teaming up with a big-box electronics store and installing some solar panels on the rooftops of a few stores. The chain gets good press, the solar manufacturers sell equipment, the projects are easier to approve, nobody has to worry about harming the desert tortoise's habitat, and generally everyone goes home happy.

But is this the way for the solar industry to finally get off what I've heard energy analysts describe as "the crack cocaine of public subsidies" once and for all and stand by themselves as their own industry? It's hard to say yet because there are still too many factors to consider.

Cheap natural gas is still a fierce competitor to just about any other generation technology, whether it's coal-fired plants or a solar farm. On the other hand, many state governments still have renewable portfolio standards to think about. On the other, other hand, there's the problem of incorporating too much solar energy onto the grid too soon without infrastructure upgrades. On the other-other-other hand, solar still has the advantage of being "sexy," meaning companies who want to look hip or forward thinking are still going to want to invest a little in solar — like Google, Inc. for one example.

Whether solar as an industry is ready to take off the training wheels and pedal without extensive tax breaks and subsidies is too large a question for me to answer. But from the way things are looking now, I expect to see fewer mega-sized solar projects going up in the U.S.

What your email address says about your energy use

By Jeff Postelwait
Online Editor

Do you Yahoo? Maybe you prefer Gmail. But did you know what email address you're registered with could reveal something about how much energy you use at home?

According to energy efficiency technology firm Opower, Yahoo Mail users could be paying $110 more annually on their energy bills than people who use Google's Gmail.

It's not that the act of sending emails eats up less energy if you use Gmail. This analysis has more to do with demographics. Opower looked at the overall household energy use of 2.8 million households across the country. Of those, roughly 1.15 million of them used either Gmail or Yahoo.

The average Yahoo Mail household used 11 percent more electricity than a Gmail household. The Yahoo users are eating up nearly a whole megawatt-hour more ever year than Gmail users.

Why is that? Well, Opower thinks the people who prefer Yahoo are more likely to live in larger households and use more energy per square foot. Gmail users typically are city dwellers who live in more compact, energy-efficient housing. Gmail users are also more likely to take an interest in their home energy usage by signing up for an energy audit or similar program.

So if you are interested in using less energy in your house, it's not as simple as registering for a new email account. It's more that people who care a little more than average about cutting their energy use tend to prefer Gmail over Yahoo. No matter what email you use, though, there are still plenty of things you can do to use less energy.

Talking Congress, security and generation at EEI

By Jennifer Van Burkleo,
Associate Editor

At the EEI Annual Convention this week, I caught up with former EEI Chairman Tom Farrell and Lew Hay, the new EEI chairman and CEO of NextEra Energy, to talk about what conventioneers were talking about in Orlando this year. I was glad to be inside, given how hot and rainy it was most of the time.

At the convention, held at the Marriott, my editor in chief Teresa Hansen and I were able to meet with both the incoming and outgoing chairmen. Hay said that although he is the incoming chairman, he will work closely with Farrell on industry priorities like cyber security, distributed generation, workforce issues and the direction of EEI.

Utilities compete in many ways, but they also pull together and work together for mutual advantage, Hay said. He also credited Farrell for helping build a consensus among EEI's member utilities.

As we sat down, the two men tackled the topic of cyber security. Hay and Farrell agreed that EEI would support a legislative solution in Congress to help private industry and the government share information on cyber threats. Such a bill is making its way through Congress, having earned approval in the House of Representatives in April and now awaiting a vote in the Senate.

The bill was introduced by Rep. Mike Rogers, a Michigan Republican, who heads the House Intelligence Committee. The Obama administration threatened to veto the bill, claiming that the country's critical infrastructure would not be adequately protected by the legislation. The administration also expressed doubts about the level of protection the bill offered for consumer privacy.

"I think my company's system gets attacked more than a million times a day, but most aren't robust and we detect them," said Hay as he ate a giant cookie, provided at the meeting.

Hay and Farrell agreed that the government and Congress should let utilities share information to better protect their customers.

"The government clearly has information (about threats) that they aren't sharing with us," Hay said. "It will take an act of Congress to work these issues out."

When we asked about the future of distributed generation, Farrell stated that it will grow in a variety of forms, many that are still unknown. Utilities should be sure that they have in place a fair way to distribute the cost of upgrading the distribution grid to accommodate distributed generation now rather than when it might be too late in the future, Farrell said.

EEI's outgoing president Thomas Kuhn, who stepped into our meeting later on, used Germany's current cost problem as an example of why the U.S. should prepare for the future now. Because Germany waited too long to deal with the issue of electric costs, utility prices are now double those seen in the U.S.

According to Hay, utilities need to communicate the value of electricity to their customers. They need to find a way to communicate what is driving utility bills.

As technology changes, so do employees and their skills. Companies need to update their training materials by including more detail to what the position is, Hay said. Utilities shouldn't assume that potential employees know what the position description is.

Hay also suggested that companies look toward military personnel and veterans to fill their open positions, adding that troops are much better trained than they were 20 years ago.

Farrell has been chairman, president and CEO of Dominion since 2007. Hay is CEO and chairman of NextEra Energy. Hay's last day as CEO will be July 1, 2012, where he will then take over as executive chairman of NextEra through 2013.

It's (trade) war between the U.S. and China

By Jeff Postelwait
Online Editor

Things are heating up again between the U.S. and China, and this time the trouble has to do with international trade and the equipment used to capture solar energy. For several years now, U.S. energy companies have complained they can't compete with the "flood" of cheap solar energy gear that's coming from China and flooding the U.S. and world markets. Companies facing financial troubles or bankruptcy, like Solyndra for one, are looking for a scapegoat, and many of them are pointing at China.

In response, the U.S. Department of Commerce is launching an investigation into these practices. This "anti-dumping" investigation led Commerce to explore the option of levying duty fees, or tariffs, against the Chinese-made solar goods. Just last year, China sold more than $3.1 billion worth of solar cells and panels in the U.S., so it's easy to see why it's referred to as a "dump." While nothing is final yet, Chinese firms are hopping mad, some American firms are pointedly silent, and trade groups with interests worldwide just want everyone to get along.

This isn't the first time Commerce has threatened to impose such tariffs, or indeed carried them out. There were tariffs taken out against Chinese electric blankets, of all things, not too long ago. But protectionism is always controversial, and in today's global economy it's not always easy to know if one country's tariffs might not also harm companies within that same country's borders. Some American energy companies that use Chinese-made solar parts might stand to lose profits if they have to buy them at higher margins, for example.

If the tariffs go through, Chinese companies will be left to either raise their prices in hopes of turning a (now lowered) profit, or else move their manufacturing centers outside of China to dodge the tariffs. Some companies that might be subject to future tariffs could be poised to do so. Suntech Power Holdings, for example, which could face tariffs as high as 31.2 percent, has regional headquarters in Switzerland and the U.S. as well as China, and could conceivably shift operations to those or other countries. Mexico and Taiwan are two spots that Suntech, and other companies like it, might consider.

Suntech, perhaps predictably, says it opposes any barriers to trade at any point along the solar power supply chain. But what are American companies saying? As I write this, they're mostly pretty quiet, and I'd assume happy. But there are signs I might be assuming wrong.

Whether an energy company in America is smiling or frowning about these potential tariffs depends greatly upon where they sit on the solar supply chain. The guys who shape steel and silicon into panels might be happy, but the folks who actually slap the finished panels onto rooftops, for example, might be less so.

We should also not forget that there are other firms in other countries who'd like to do business making solar farms in the U.S. Companies based in Germany, Spain and elsewhere are feeling the squeeze as China has tightened its grip on the U.S. market these past few years. They might also stand to benefit from tariffs, perhaps. Assuming they are pointed squarely at Chinese firms, that is.

The U.S., for its part, claims that all it wants to do is level the playing field. But can it really be level at this point? By now everyone understands the problems that China, also known as "The World's Factory," can cause the rest of the world with their massive workforce and low labor costs. They have the power and willingness to produce goods and ship them to market at costs few other countries can match.

Still, there is the little matter of international trade laws. While I am by no means an expert on those, I assume the U.S. Commerce Department is. So I will be watching what comes out of their offices in the coming weeks, as I'm sure the Chinese will as well. It should be interesting. Stay tuned for more.

No, Obama is not paying your utility bills

By Jeff Postelwait
Online Editor

Presidents promise a lot, particularly in an election year, but President Barack Obama is apparently getting credit for delivering on a promise he never made — namely, paying people's utility bills.

Major utilities like PG&E, Westar Energy and SDG&E have posted some announcements in recent days to alert customers of a "nationwide scam." It seems imposter utility workers are going door to door with promises that the president has started a program by which customers can obtain credits to pay for their utility bills. The scammers, as usual, are sniffing around for people's personal information, like Social Security numbers and the like, in the furtherance of other scams.

Obviously, utilities don't want their good names tarnished by some phishing fiasco, so several of them are doing what they can to spread the word that there is no such government program, and that you should always confirm that someone claiming to be a utility worker is legitimate before handing over any personal information.

Also par for the course when it comes to con artists, the main targets appear to be elderly people. The scammers, according to reports, make their contacts door to door, by phone or online and ask for the customer's information. After they get that, they give the customer a fake bank routing number (not unlike the notorious "Nigerian prince" identity theft scams) where the customer can make payments. They are promised credit on that account, but the payment makes its way to the scammer's pockets, and not to any utility company.

So... basically be on your guard, and beware of phony utility workers bearing gifts. It's not a bad idea in an election year to take everything with a larger than usual grain of salt.

Why is coal in a slump — really?

By Jeff Postelwait
Online Editor

Everyone knows that with enough time and pressure, coal can turn into diamonds. What will become of the coal industry with all the pressure it is currently under, nobody can say.

The Wall Street Journal took a look at two of the top three coal producers, Arch Coal and Alpha Natural Resources, both of which are experiencing lower demand and falling profits. Peabody Energy, another top coal miner, predicted that demand for coal could drop by as much as 10 percent this year. But why?

Given the fact that everyone has their own politics concerning using coal to make power, it's tempting to point the finger at either EPA regulations or some draconian piece of legislation that came from Congress, but I think blaming any one culprit for this trend is short sighted.

One factor the Journal neglects to get into, for example, is the other fossil fuel we use for energy. Natural gas recently hit a 10-year low in demand, some estimates have it. We're sitting on massive new reserves of the stuff because of new extraction techniques, and so many utilities would much rather build a natural-gas fired unit than a coal unit right now.

You could well argue that natural gas, being a finite resource, is also subject to price swings back and forth, but based on all the generation news I handle every day, I'm definitely seeing a big trend toward natural gas to the detriment of other forms of generation.

To explore another possible explanation for this problem, just open a window. It's beautiful out, and it has been for several financial quarters. The almost freakishly warm winter that the U.S. experienced had people eating up less energy — from coal or from any other source. While the EPA has been flexing its regulatory muscles in the direction of coal power lately, you can hardly blame the weather on government bureaucrats.

To be fair, we are seeing quite a few new and proposed regulations that appear to have the coal industry in their sights, whether you'd call it intentional or not. There's the proposed Clean Air Act standard for carbon dioxide pollution for new power plants. There's the Mercury and Air Toxics Standards rule issued in February, which could require coal plants to retrofit and reduce emissions of arsenic, acid gases, nickel, cyanide and other toxins. And finally there's the Cross-State Air Pollution Rule from earlier in 2012.


When the new carbon standards were proposed, more than a few were saying that this was regulation meant to kill coal for good. But at that time, the Energy Information Administration listed only a single coal-fired unit in the pipeline to be built. So if there is a piece of regulation out there threatening to kill coal, this one wasn't it. 


If coal is dying off — still an alarmist thing to say for this multi-billion dollar a year industry — there isn't a single factor you can point to if you're looking for something to blame. The entire energy industry is changing, just as surely as the customers it serves are changing their minds and thinking more about how energy is produced. So while these may be challenging times, there is still time to make changes.


If these trends prove irreversible and it becomes impossible to sell coal in the same country where it is mined, then the U.S. coal industry needs to develop new markets. I can think of nowhere better to look than at China and India, the former of which is about to become the world's most coal-hungry nation. China generates nearly 70 percent of its energy from coal, but only has about 13 percent of the world's reserves. That's just one country that has "potential customer" written all over it.

Unmanned drones could deploy in the fight against outages

By Jeff Postelwait
Online Editor

Maybe this is just the viewpoint of an American who grew up on "Terminator" movies, but I still find it incredibly weird and interesting that we live in a world where robots patrol the skies. Apparently the Electric Power Research Institute still thinks robots are cool too because they're researching ways for the technology to help out the electric power industry.

Unmanned Aerial Vehicles, or drones, of the same category of the Hellfire-carrying Predator, deployed around the world by the United States Armed Forces, could potentially be used by utilities to check on the status of distribution systems, according to an EPRI study. Instead of sporting Hellfire missiles, though, these units could carry cameras, sensors and global positioning capability.



It's easy to see why an all-seeing eye that can fly to a remote area and report data back to its operators might be of good use to an industry that frequently deals with icy roads, downed trees and other hazards at the very same time when the need for good communications has never been higher.

EPRI decided to take that idea and run with it with a series of tests of different types of UAVs at the New Mexico State University Flight Test Center, which is just a short distance away from the White Sands Missile Range in south-central New Mexico. These aircraft carried high-resolution video cameras and transmitted images of power lines from a useful distance of 7,000 feet in the air.

Footage shot like this could provide timely information to grid operators and their field crews, allowing them to better prioritize their outage restoration efforts and get accurate information sent off to affected customers.

"The tests indicated that unmanned airborne technologies equipped with sensors, cameras and GPS could be deployed quickly, allowing utilities to evaluate large areas more quickly than ground-based crews, then develop a repair strategy and mobilize repair crews more quickly and effectively," according to EPRI.

EPRI is also taking a look at the capabilities of drones for the inspection and assessment of overhead transmission lines. To make sure these findings are more practical for the utilities, EPRI is gathering data on UAV functional requirements, costs, inspection technologies, as well as testing several different types of UAVs.

Other sectors have taken a look at UAVs before, including the oil and gas industry, firefighting departments, meteorologists, forestry services and others. Still, I think that for utilities that have the resources to put these drones in the sky, it could dramatically boost response time — and utilities know that when customers are in the dark, every second counts.