An Ignoble Experiment

2. Alliant supports Supreme Court solar decision but cannot predict impacts

Late last week, the Oregon Public Utilities Commission (PUC) issued a final order on the long-term energy mix of PacifiCorp (operating as Pacific Power in Oregon). The PUC refused to acknowledge Pacific Power's coal expenditures at two of the Jim Bridger coal units in Wyoming and one unit at the Hunter plant in Utah.

The ruling demonstrates the PUC's skepticism that the fleet-wide, multi-billion coal expenditures provide the least-cost option for Pacific Power's half a million Oregon customers and could cause Pacific Power significant challenges when it seeks rate recovery to pay for these expenditures. The PUC's final order reflects their findings that Pacific Power is putting its customers at risk of large electricity price increases.

The PUC is charged with ensuring that utilities are providing customers with the least cost, lowest risk energy options. The majority of Pacific Power's energy comes from coal and the company's rates in Oregon have increased 61 percent over the last seven years, while other utilities use half as much coal and have seen significantly lower rate increases. Less than 10 percent of Pacific Power's Oregon energy portfolio comes from renewable energy.

A major ruling of the United States 10th Circuit Court of Appeals last July -- giving the U.S. Environmental Protection Agency (EPA) full authority to enforce federal regional haze regulations to clean up coal plants run by Oklahoma Gas and Electric -- was expected to set a precedent for other coal fleets like PacifiCorp, who sells electricity through its subsidiaries not only in Oregon but in California, Washington, Utah, Wyoming and Idaho.

At the time, PacifiCorp argued that the EPA did not have the authority to ensure that state programs meet federal requirements and only a state could determine the level of pollution controls or Best Available Retrofit Technology (BART). But the ruling concludes that "the EPA may reject BART determinations that do not comply with the guidelines."

For more:
- see the final order

Related Articles:
Appeals court ruling could set coal precedent

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By Barbara Vergetis Lundin

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3. House supports keeping nuclear as part of the energy mix

The Iowa Supreme Court has ruled that a power purchase agreement (PPA) between the city of Dubuque and Eagle Point Solar does not violate state law. The case brought by Iowa's regulated utilities claimed exclusive rights to sell solar to customers in their service areas.

Straka Johnson Architects, Dubuque, Iowa. Credit: Eagle Point Solar

The case was originally brought forth to determine whether or not Eagle Point could enter into a long-term financing agreement related to the construction of a solar energy system on the property of the city of Dubuque -- under which the city would purchase from Eagle Point, on a per kilowatt hour (kWh) basis, all of the electricity generated by the system. Prior to proceeding with the project, Eagle Point sought a declaratory ruling from the Iowa Utilities Board (IUB) that, by law, under the proposed agreement Eagle Point would not be considered a "public utility" or an "electric utility." Either of these designations would prohibit Eagle Point from serving customers, such as the city, who are located within the exclusive service territory of another electric utility.

Under the Eagle Point PPA, the solar company would own, install, operate, and maintain the on-site PV generation system. The city would purchase power, the payments of which would not only provide consideration for the electricity provided by the project, but would also finance the cost of acquiring the generation system, monetize offsetting renewable energy incentives related to the system, and cover Eagle Point's costs of operating and maintaining the system.

Eagle Point would also own any renewable energy credits associated with the generation system but would credit to the city one-third of any revenues received from the sale of those credits. At the end of the agreement, Eagle Point would transfer all ownership rights of the PV generation system to the city.

The PV generation system constructed by Eagle Point would be on the customer side of the electric meter and would not pass through Alliant meters.

Regardless, the IUB concluded that Eagle Point would be a public utility and was prohibited from selling the electricity to the city, which Eagle Point appealed. The district court reversed the ruling in a split 4-2 decision, finding that the third-party PPA did not infringe upon the area in which Alliant Energy operates.

Alliant spokesperson Justin Foss told Iowa's THMedia that the ruling won't impact the company's dedication to renewable energy but that if PPAs become prevalent, it could create a financial strain that might have to be passed on to the consumer.

"The financing model, and the rate model, that Iowa utilities use is that the costs for the entire system are divided out among all the kilowatt hours that the customers use," Foss told THMedia, noting that customer bills cover not only generation costs, but employee and infrastructure expenses.

Foss explained in his interview with THMedia: "When people use less of those energy units, you have a smaller pool by which to divide all of those costs for the power pole, for the power line, for the power plant, for the employee."

For more:
- see the ruling
- see this article

Read more about: Alliant Energy
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By Barbara Vergetis Lundin

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4. Ocean energy ROI questionable

Chairman Mike Simpson and Ranking Member Marcy Kaptur have successfully passed the fiscal 2015 Energy and Water Development Act in the U.S. House of Representatives. HR 4923 approves funding that keeps nuclear energy as part of the diverse electricity mix.

Yucca Mountain Johnny -- a mascot created by the U.S. Department of Energy to provide information about nuclear waste disposal to children. Credit: Wikimedia Commons

In particular, the bill did not include a $2 billion tax on nuclear utility customers proposed by the administration. The duplicative tax, to help pay for the decontamination and decommissioning of the U.S. Department of Energy's uranium enrichment facilities, would force consumers of electricity from nuclear energy facilities to pay a third time for their share of those remediation costs.

The House did budget $205 million -- $150 million to DOE and $55 million to the Nuclear Regulatory Commission -- to continue licensing activities for the Yucca Mountain nuclear waste repository project planned for the Nevada desert to safely and securely manage used nuclear fuel.

Additionally, instead of halting construction, the House provided $420 million in fiscal 2015 for the fissile materials disposition program -- including continuing construction of the mixed-oxide (MOX) fuel fabrication facility at DOE's Savannah River Site in South Carolina.

"The Appropriations Committee confronted a number of amendments that would have cut the bill's support for nuclear energy during debate on the floor, and lawmakers were able to turn back those proposed cuts in all but one instance," said Alex Flint, senior vice president for governmental affairs, Nuclear Energy Institute. "The industry recognizes that budget pressures are intense. The committee's commitment to progress at the Yucca Mountain repository for used nuclear fuel management, its support for workers at the mixed-oxide fabrications facility in South Carolina, and its investment in research and development for advanced-design reactors are immensely important."

For more:
- see the bill

By Barbara Vergetis Lundin

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5. Super GHGs target of EPA emissions ban

In 2013, the wave and tidal energy market was valued at $25 million, and Transparency Market Research (TMR) anticipates that will reach $10.1 billion in 2020 -- a Compound Annual Growth Rate (CAGR) of 64.1 percent from 2014 to 2020.

Credit: Malene Thyssen/Wikimedia Commons

When harnessed effectively, ocean could prove to be one of the largest reserves of clean and sustainable energy.

Tidal stream power plants are a relatively new technology with ample scope for development, while tidal range power is a mature form of energy generation technology, according to TMR. Commissioned in 2011, The Sihwa Lake Tidal Power Station -- with 254 MW capacity, commissioned in 2011 -- replaced France's Rance Tidal Power Station as the largest tidal power plant in the world, TMR notes.

Wave energy, on the other hand, is a relatively new concept, according to TMR, with the installed capacity aggregated at just 5.77 MW in 2013.

Both wave and tidal stream technologies have significant potential of reaping benefits of economies of scale, as TMR predicts large-scale commercial array deployments of wave and tidal power plants will be followed by massive cost reductions. Strong development of the offshore wind energy sector in many countries around the world can also contribute significantly to cost reduction potential of wave and tidal energy.

TMR expects major developments in wave and tidal stream plants to take place in Europe but estimates South Korea to grow fastest in terms of tidal barrage operations. In terms of installed capacity, the wave and tidal energy market is projected to reach 3712 MW by 2020 -- expanding at a CAGR of 34.5 percent from 2014 to 2020, led by addition of large-scale tidal barrage capacity in South Korea. Wave energy development in Asia-Pacific would be concentrated in Australia, according to TMR, where the country is likely to add nearly 25 MW of capacity by the end of 2020.

Currently, only tidal barrages are capable of generating returns on investments through the sale of electricity, TMR reveals. Both tidal stream and wave power plants are still not capable of generating power at grid parity levels due to a lack of commercialized technology.

For more:
- see this report

Read more about: Wave Energy
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By Barbara Vergetis Lundin

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