By
TIM FAULKNER/ecoRI.org News staff
Renewable
energy isn’t just wind turbines and solar panels. There also is loads of
politics, planning, economics and science involved with any green power
project. The state Office of Energy Resources (OER), under the guidance of
director Marion Gold and Office of Administration director Richard Licht,
intends to harmonize these sometime discordant forces.
The
Renewable Energy Coordinating Board (RECB) recently addressed several of these
issues:
Offshore wind. Leases for the offshore wind farms proposed for 164,750
acres off the Rhode Island and Massachusetts coast is unexpectedly subject to a
live bidding process. This bidding makes it easier for developers to surpass
local construction jobs, as well as the use of the wind energy. This new
multi-factor bidding format allows developers with greater resources to build
and assemble the turbines in another state or country. The green electricity
might also bypass Rhode Island if a larger pool of developers bid for the
power-purchase agreement.
“It’s
not a good situation,” Licht said. He said he met with Senators Sheldon
Whitehouse, D-R.I., and Jack Reed, D-R.I., to discuss the unfavorable
lease-auction agreement. He also plans to address the issue during a public seminar in
Narragansett on Jan. 15.
Less gas.
Natural gas supplies 98 percent of Rhode island’s electricity supply. The state
goal for renewable energy aims for 16 percent renewable electricity by 2019.
“How do we address the fact that we have a lot of natural gas but we know that
natural gas is not the be-all and end-all," Gold said. "We don’t want
to be 100 percent reliant on natural gas."
A
RECB subcommittee is reviewing the existing legislation and setting targets for
renewable energy and emissions. A report is expected in March.
“We
have to look at this in an integrated way,” Licht said. “Recognizing that we do
have the concern for economic development and the cost of energy in the short
term, but there are long-term costs to natural gas.”
Renewable Energy Certificates. REC prices have soared during the past year. RECs are
purchased by electricity generators in order to meet annual renewable energy
production goals. Since December 2011 REC prices have jumped from a range of
$15-$30 to $64. Each REC represents 1 megawatt-hour of electricity generated by
a renewable energy source.
Nicholas
Ucci, a policy analysts for the state Public Utilities Commission (PUC),
attributes the increase on the low price of natural gas. Low prices have
reduced production of more expensive biomass power, which burn landfill gas,
clean wood and agricultural waste. Natural gas, Ucci said, “pushed these other
resources off the margin in the energy market.”
Other
factors in the price increase include fewer RECs available for purchase from
hydro and wind power produced in other states; increased demand from state
renewable energy mandates; fewer new renewable power sources due to the
economic slowdown; and uncertainty about expiring federal tax credits.
Some
at the meeting asked if moratoriums and public opposition to wind energy have
also slowed development.
“Everything
hinges on Washington,” Ucci said. “If they can get their act together. If they
don't pass or extend the production tax credit — it already has a chilling
effect on development. I’m really not sure where that industry goes without
that, outside of significant state-level subsidies, which the industry is
already receiving.“
Higher
REC prices have increased funds for the state's Renewable Energy Fund (REF),
which funds local green energy projects. Traditional energy producers have
bought less-expensive alternative compliance payments instead of RECs. These
payments added $4.5 million to the REF in 2012.
Ucci
said the PUC has a strong relationships with similar entities in the Northeast.
The groups are collaborating on improving their energy buying power, enhancing
power transmission and finding suitable locations for new renewable energy
projects. Maine, which has paused new wind projects, offers the best locations
for new wind turbines.
Climate change. Grover Fugate, director of the state Coastal Resources
Management Council (CRMC), reminded the committee that renewable energy is
needed to temper the impact of climate change. Recent findings from
Hurricane Sandy revealed that offshore storm waves reached 47 feet in height,
when waves of a maximum of 30 feet were predicted.
“Climate
Change is something that’s going to come in play more and more in this whole
arena,” Fugate said. “And I think it’s going to force (development of) a lot
more renewable energy.”