http://www.renewableenergyworld.com/rea/blog/post/2014/11/welcome-to-our-new-energy-storage-e-newsletter

http://www.renewableenergyworld.com/rea/blog/post/2014/11/welcome-to-our-new-energy-storage-e-newsletter

“We must act quickly and decisively if we want to avoid increasingly disruptive outcomes,” UN Secretary-General Ban Ki- moon told reporters in Copenhagen. “If we continue business-as- usual, our opportunity to keep temperature rises below” the internationally agreed target of 2 degrees Celsius, “will slip away within the next decades,” he said.

The report is designed to guide policy makers around the world in writing laws and regulations that will curb greenhouse gases and protect nations most at risk from climate change. It will also feed into talks among 195 nations working on an international agreement to rein in emissions that envoys aim to reach in Paris in December 2015.

“We need to get to zero emissions by the end of this century” to keep global warming below dangerous levels, Ottmar Edenhofer, chief economist at the Potsdam Institute for Climate Impact Research Institute, outside Berlin, and a co-author of the report, said in a telephone interview. “This requires a huge transformation, but it doesn’t mean we have to sacrifice economic growth.”

Nobel Prize

The report is the culmination of five years of unpaid work by thousands of scientists, who sifted through research into all areas of global warming and condensed the conclusions into a single document that summarizes the most relevant findings. The panel, which has won a Nobel prize for its work, last carried out the exercise in 2007 and has become more certain about the threat since.

“Continued emission of greenhouse gases will cause further warming and long-lasting changes in all components of the climate system, increasing the likelihood of severe, pervasive and irreversible impacts for people and ecosystems,” according to the report. “Limiting climate change would require substantial and sustained reductions in greenhouse-gas emissions which, together with adaptation, can limit climate change risks.”

Narrative Sought

Delegates from about 120 nations spent the past week combing through the report line-by-line to ensure dense scientific findings were put into words understandable to a policy maker. Countries had submitted more than 2,000 comments about an earlier draft of the text, with U.S. envoys pushing for a “threading narrative,” and European Union officials saying the storyline “looks fragmented.”

Today’s study sought to link three earlier reports by the panel. Those detailed the observed physical impacts of climate change, the resulting damage and the tools governments have at their disposal to curtail emissions.

“It is technically feasible to transition to a low-carbon economy,” said Youba Sokona, another report co-author. “But what is lacking are appropriate policies and institutions. The longer we wait to take action, the more it will cost to adapt and mitigate climate change.”

Exxon Mobil

Companies including Exxon Mobil Corp and Royal Dutch Shell Plc have said they don’t see a danger of their assets becoming “stranded” as a result of climate-change regulation.

Ambitious emissions-reduction measures would shave just 0.06 percentage points off annualized economic growth this century compared to a business-as-usual scenario, the UN panel said. That doesn’t factor in the benefits of reduced climate change linked to human health, livelihoods and development, it said.

Other key findings highlighted by the panel include:

• Manmade greenhouse gas emissions have pushed atmospheric concentrations of carbon dioxide, methane and nitrous oxide to levels “unprecedented” in the past 800,000 years.
• Giving the world a two-in-three chance or more to cap the level of warming since the 1800s at 2 degrees Celsius (3.6 degrees Fahrenheit) requires total emissions since 1870 to be limited to about 2,900 billion tons of carbon dioxide, two thirds of which had already been emitted by 2011. Policies to cut emissions may devalue fossil-fuel assets and reduce revenues for fossil-fuel exporters.

Sea Level

• The global average sea level has risen by about 19 centimeters (7.5 inches) since 1901 and is likely to rise by 26 centimeters to 82 centimeters this century.
• The global average temperature has risen by 0.85 of a degree Celsius since 1880, and the panel predicts a gain of 0.3 degrees to 4.8 degrees for this century.

Economic damage resulting from climate change accelerates with increasing temperature. An increase of 2.5 degrees above pre-industrial temperatures would cut economic output by as much as 2 percent. The panel said there were “limitations” in this analysis.

Future scenarios that limit the global temperature rise to 2 degrees, an internationally agreed target, involve almost quadrupling the share of zero-carbon technologies in energy supply. These include wind and solar power, nuclear reactors and fossil fuels equipped with carbon capture and storage equipment.

Cost reductions and performance improvements in renewables enable governments to decarbonize their economies at a price that’s lower than ever, according to Samantha Smith, who leads the climate program at environmental group WWF.

U.S. Secretary of State John Kerry said the report sends a strong message around the world.

“The longer we are stuck in a debate over ideology and politics, the more the costs of inaction grow,” Kerry said today in an e-mailed statement. “Those who choose to ignore or dispute the science so clearly laid out in this report do so at great risk for all of us and for our kids and grandkids.”

Copyright 2014 Bloomberg

Lead image: Climate change sign via Shutterstock

In 2011, David Lesser was an executive with experience running REITs and a passion for renewable energy looking for his next opportunity. He realized that solar and wind farms produce reliable, long term cash flows, but at the time, there were no publicly traded vehicles for income oriented investors to benefit from these cash flows.  He saw the opportunity for a REIT to buy the land underlying wind and solar development, lease it back to the wind and solar operators, and deliver the payments to investors in the form of a sustainable yield.  Lesser and his allies saw PWV as an appropriate vehicle for this, and began buying its stock.  In 2011, he became Chairman and CEO, and formed the holding company Power REIT to own PWV and future renewable energy real estate assets as a publicly listed holding company.

The immense appetite that investors have shown for the yeildcos launched by renewable energy developers in 2013 and 2014 has amply demonstrated Lesser’s business plan to be a good one, but PWV’s railroad asset has side tracked its execution.  The company has only done two smallish solar deals because of the distraction.

Side Tracked on West End Branch

The side track started with a minor dispute over legal fees.  The lease is somewhat unusual, in that (according to the court filings of the lessees) it was designed to give the lessees as much control of the property as possible without taking legal ownership under US tax laws.  Since PWV retained ownership of the property, but ceased to be an operating company when the lease was signed, the lease provides for the lessees to pay any of PWV’s expenses which are «necessary or desirable» to protect its interest in the property, unless those expenses were «solely» for the benefit of its shareholders.

When Lesser received notification in 2011 that WLE intended to sell a part of the property known as «West End Branch» he consulted with his attorneys to understand PWV’s rights and obligations under the lease. While WLE does have the right under the lease to sell parts of the property it does not need as long as it follows the appropriate procedures, it refused to pay the resulting attorney’s fees.  Since the lease seemed to be clear to Lesser and his attorneys in this regard, after several attempts to get WLE to pay, this refusal became an incurable default under the lease.   Since the default was incurable, PWV’s only recourse was to foreclose.

WLE and NSC wanted to maintain what had become a very attractive agreement in their favor over the fifty years since it had initially been signed, and so they filed a civil action against PWV and Power REIT to prevent the foreclosure in early 2012.  Over the last two years, increasing amounts of PW management and resources have been required in the litigation against two larger and much better funded companies, but Lesser feels firmly that the time and expense will eventually prove to be very attractive investments.  Not only does a reasonable interpretation of the lease provide for WLE and NSC to pay all the expenses (which seem to be a clear example of expenses which are «necessary or desirable» to maintain PWV’s interest in its property), but numerous other violations of the letter of lease have come to light since the initial dispute about West End Branch legal fees.  

If PW is able to foreclose, a bookkeeping «settlement account» under the lease worth at least $16 million and as much as $68 million will be due, and it (or part of it) may be due even if the court finds the lease not in default.  

The State of Litigation

The current litigation is complex, with multiple accusations in both directions.  Power REIT has posted an archive of most of the court documents on its website.  The most recently filed documents are each party’s opposition to the other’s Motion for Summary Judgement, and these documents do an excellent job of summarizing each party’s position in a very complex case.

Perhaps the most remarkable feature is just how far apart the two sides are.  Power REIT spells out several counts on which WLE and NSC have violated the wording of the lease.  WLE and NSC deny them all, and say that Lesser is a money-grabbing capitalist whose intention has all along been to manufacture defaults under the lease to extract money out of them.  Their main argument is that the parties had been doing everything their way all along, and so that should not change, even if the lease says otherwise.  They also claim, somewhat hypocritically considering the above argument, that Lesser is trying to change the terms of the lease, and that should constitute a default.

I’m not a legal expert, and I have no way of knowing which side is in the right when it comes to the legal issues.  How much does the intent behind the lease count compared to the words of the lease itself?  How important are the previous actions of the parties?

“The trend is toward a rush of installations,” said Qin Haiyan, secretary general of the Chinese Wind Energy Association. The nation may add as much as 20 gigawatts of wind power in 2014 and maintain that pace next year, Qin said.

Should that target be reached, China this year will surpass the 18 gigawatts of wind the nation installed in 2011, the highest annual number on record, according to data compiled by Bloomberg. Installations in Denmark, a pioneering nation in the application of wind energy, will edge 1 percent higher to a total installed base of 4.9 gigawatts by the end of 2014, according to Bloomberg New Energy Finance data.

By annual additions, China is set to build almost twice as much onshore wind power as Europe and more than triple new installations in the U.S., according to Zhou Yiyi, a Shanghai-based analyst for Bloomberg New Energy Finance.

All that new wind energy means China’s policy makers are now at the stage where they’re set to withdraw the incentives brought in to encourage developments.

China has proposed cutting tariffs by as much as 11 percent for projects to be built after June 30, 2015, Zhou said in a Sept. 23 note, which cited a draft document from the National Development and Reform Commission outlining the change.

Market Driver

The current tariffs were introduced in 2009 and comprise four different levels for onshore wind farms ranging from 0.51 yuan a kilowatt-hour to 0.61 yuan a kilowatt-hour. China surpassed the U.S. a year after the tariffs were brought in to become the world’s biggest wind market. Capacity has doubled in the past three years.

China aims to more than double its wind capacity to 200 gigawatts by the end of 2020. The nation had 89.6 gigawatts of wind installations at the end of 2013, according to BNEF data.

The rush “will be a driver for fast development of equipment makers,” said Apple Li, a Hong Kong-based analyst from Standard Chartered Bank (HK) Ltd. “The entire wind power market will be very robust before the first half of 2015.”

China’s biggest turbine maker will account for at least 4 gigawatts of installed capacity in 2014, Wang Haibo, chief executive officer of Xinjiang Goldwind Science Technology Co., said in a conference in Beijing last week. Guodian United Power Technology Co. will double shipments this year, general manager Chu Jingchun said.

Idled Capacity

“If the tariff cut is implemented, China would see an obvious decline in installations in 2016,” said BNEF’s Zhou. “Developers building projects originally planned for 2016 or 2017 then won’t have enough capital and the issue of idled capacity at wind farms could worsen,” she said.

Switching off wind turbines in China because their electricity can’t be absorbed by the grid is limiting how much planners can cut incentives given to renewable power producers, Yi Yuechun, deputy chief engineer at the China Renewable Energy Engineering Institute, said in April.

The idled capacity is a result of the rush to build turbines in the windiest areas of China, surpassing the transmission grid’s ability to handle and transmit the power. Leaving wind farms turned off cost operators at least 8.16 billion yuan in lost revenue last year, according to the institute.

Cost Competition

China had 11 percent of its wind power capacity sitting unused last year, with the rate rising to more than 20 percent in the northern provinces of Jilin and Gansu, according to the institute.

The planned tariff cut in China is “not in anyway unique” when compared with other parts of the world, said Anders Runevad, chief executive officer of Vestas Wind Systems A/S, the world’s biggest wind turbine maker. “We have to focus on bringing down the costs of wind electricity” to compete with other energy sources.

Vestas Wind will extend its push into China with plans to use more component contents from Chinese suppliers while also bringing models suited for varying wind conditions to the country.

The company will “look at much more tailored service offerings toward different customers with different needs,” Runevad said in an interview in Beijing.

Lead image: Wind Turbine on the grassland, Chengde, Hebei Province, North China via Shutterstock

The boom in renewables is often made for economic reasons, Ethan Zindler, a Washington-based Bloomberg New Energy Finance analyst, said in an interview. An island nation like Jamaica, where wholesale power costs about $300 a megawatt-hour, could generate electricity from solar panels for about half as much. Similarly, wind power in Nicaragua may be half as expensive as traditional energy.

“Clean energy is the low-cost option in a lot of these countries,” Zindler said by telephone. “The technologies are cost-competitive right now. Not in the future, but right now.”

Climatescope was developed two years ago by Bloomberg New Energy Finance, the Multilateral Investment Fund of the Inter-American Development Bank Group and the U.K. Government Department for International Development to track clean energy in 26 Latin American and Caribbean nations. This year’s report includes 19 African nations and 10 in Asia, research supported in part by the U.S. Agency for International Development.

Clean Energy Economies

The nations included in the study increased total renewables investment to $122 billion last year, more than double the 2007 sum of $59.3 billion.

The 55 nations in the Climatescope study have passed more than 450 measures linked to renewables, including South Africa’s renewables program, which awarded 17 bids for projects about a year ago. About $10 billion has been invested in that country in the past two years.

“They’re very proactively trying to build their clean energy economies themselves,” Zindler said. “They’ve learned a lot of the lessons about what it takes to grow clean-energy capacity and are taking steps to do it.”

The International Energy Agency said Oct. 13 that renewable energy and hydropower will supply almost half of the generation required for growth in Africa through 2040, as the sub-Saharan economy quadruples. Energy use in that region, up 45 percent since 2000, is expected to climb 80 percent through 2040.

Copyright 2014 Bloomberg

Lead image: Globe grass via Shutterstock

The loss of the cheaper coal units will boost power prices by as much as 25 percent on grids that serve about a third of the nation’s population, according to the Brattle Group, a Cambridge, Massachusetts-based consulting company. The biggest impact may be in the Midwest and Northeast, where demand for gas for heating jumps during the cold-weather months.

“We are really in for a wild ride for five to six years because of the amount of coal shutting down in such a short amount of time and the transformation toward more gas being used to generate electricity,” Philip Moeller, a member of the Federal Energy Regulatory Commission in Washington, said in an Oct. 23 interview. “Prices will definitely rise. The question is how much.”

Midcontinent Independent System Operator Inc., or MISO, which manages the electricity network that runs from Manitoba to Louisiana, expects its power reserves to fall short of targets by about 2,000 megawatts by 2016, with deficits mounting after that. Even with the shale boom that’s cut gas prices, power generated with the fuel costs $30 to $35 a megawatt-hour, compared with about $25 for coal, according to Brattle.

Frigid Winter

Power and gas prices surged last winter when a weather system known as a polar vortex brought frigid arctic air to large portions of the U.S.

NRG Energy Inc., the largest U.S. independent power producer, ran some older plants that had been shut for five to 10 years, Chief Executive Officer David Crane said in an Oct. 16 interview at Bloomberg News headquarters in New York.

“The polar vortex scared us to death at NRG,” Crane said. “If the polar vortex were to happen two years from now, I don’t know what would have happened in the Northeast.”

PJM Interconnection LLC, whose mid-Atlantic grid is the largest in the U.S., has received notices from plant owners planning to shut 11,578 megawatts of available output through 2015, or about 6.4 percent of supplies as of 2013. One megawatt can power about 800 homes.

EPA Rules

Half of the plant shutdowns will take effect next year, when the Environmental Protection Agency’s Mercury and Air Toxics Standards, which require coal-fired plants to install scrubbers to remove contaminants or shut down, take effect, SP said in a Sept. 29 report.

While power prices are set to rise, the increase may not be enough to encourage the construction of new plants.

“The price that you can see does not justify building,” Crane said. “When natural gas sets the marginal price of electricity, it not only makes it impossible to build any other type of power plant unless there is a market mandate but it also makes it impossible to build natural gas plants.”

On-peak power at PJM’s benchmark Western hub, which includes deliveries to Washington, averaged $43.33 a megawatt- hour during the third quarter on the Intercontinental Exchange, the least since 2009, data compiled by Bloomberg show.

Wholesale power declined in recent years as the revolution in producing natural gas from shale formations sent U.S. output to records and reduced gas prices by 73 percent from a 2008 peak. Gas futures on the New York Mercantile Exchange were trading at $3.69 per million British thermal units at 9:37 a.m. versus the July 2008 high of $13.577.

Coal Plants

Some 20,000 megawatts of coal plants, which operated at 38 percent of capacity this year through June, will shut permanently by the end of 2015, Teri Viswanath, director of commodities strategy at BNP in New York, said in an interview yesterday. They will be replaced by about 4,000 megawatts of natural gas capacity, she said, in addition to some renewables.

The impact of gas on power costs has increased, according to an Aug. 14 report by Monitoring Analytics, the independent monitor for PJM. Gas set spot power prices 41 percent of the time in PJM during the first six months of 2014, up from 33 percent a year earlier.

Gas Projects

Of the 35,374 megawatts in gas plant projects planned from 2014 through 2020, 75 percent have not started construction, with many still awaiting regulatory approval, according to the U.S. Energy Information Administration.

“We are going through the lightest development cycle we’ve ever witnessed over the next decade and it’s in response to a period of very, very low power prices,” Viswanath said. “What we’re seeing is a net subtraction of supply.”

Copyright 2014 Bloomberg

Lead image: Smokestack via Shutterstock

Wind turbine blades harvest energy from currents of air, but they don’t come off an assembly line like widgets. Indeed, it’s difficult to appreciate just how much effort and care goes into crafting them until you see the process up close.

That’s why I was recently honoured to be the first professional photographer to lens the shop floor at PowerBlades Industries in Welland, Ontario. The company is a Canadian subsidiary of German wind turbine manufacturer Senvion.

PowerBlades opened last year to support the growth in renewable energy in Ontario spurred in turn by the province’s Green Energy Act. As of this week, the company will have fabricated 78 fiberglass blades, each 45 meters long and up to three meters wide, for dozens of 2.05-MW Senvion turbines.

Birth of a Blade

Inside PowerBlades, overhead cranes move girders and blades from one part of the building to the next. Here, 136 production workers, machine operators, and office staff work on various stages of blade production, including lay-up, lamination, curing, sanding, painting, inspection, repair, finishing, loading, and transport.

Blades begin their lives in the plant’s Main Shell Area, where workers lay sheets of fiberglass mat and resin into a pair of side-by-side proprietary molds each about 50 meters long and four meters wide. Each blade is built up in two halves, split down the long axis like a pea pod.

Once the resin cures, workers carefully glue the two halves together. Eight to 10 workers then physically climb into the blade to scrape out excess glue from the inside. They then apply heat to finish the curing and gluing process.

Going Over the Wall

Crane operators then gingerly lift the blade to the first of several finishing stations in a delicate process known as “going over the wall.” Over the course of several weeks, operators will lift and shift each blade to a variety of finishing stations for trimming, laminations, adding minor hardware (such as receptors and the pointed tip), sanding, painting, and “root end close out,” which involves installing a plywood attachment that seals off the base of the blade.

Like sculptors, workers swarm over every inch of the blade with palm sanders, painstakingly and meticulously smoothing out bumps and imperfections, before the cranes again hoist the blades to the painting section.

Buckets and Rollers

The final phase of finishing is refreshingly low-tech — four painters, two on each side, attack each blade with rollers. Each takes two coats of paint, about 15-20 gallons in total. On average, it takes a couple of days for the team to finish its work.

Gantry operators then lift the finished blades one final time into shipping crates and convey them out of the building into the storage yard. From there, Senvion’s clients truck them to installation sites.

The crew at PowerBlades take great pride in their work, knowing that they are not only making a good living, but also slowly-but-surely reducing their province’s dependence on natural gas and nuclear energy.

“We’re so proud to be working here,” explained Adam Chevalier, a 28-year-old production worker. “To have a job, first. And then to have a job that is doing something good for the environment, renewable energy, it’s great!”

Click next below to see the step-by-step process.

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