Now is the Time to Invest in Renewables

Faegre Baker Daniels logoThe renewable industry remains abuzz about the American Tax Payer Relief Act that included the extension and modification of energy tax provisions. The tax extenders make investing in the renewables industry and in energy efficiency technologies a good move. Why? The firm of Faegre Baker Daniels LLP put together a brief overview of several key provisions that aid the industry for the next year and beyond.

Electricity Generation:

  • Production Tax Credit (PTC) — is a per-kilowatt hour incentive for the generation of electricity from qualified, renewable sources. The wind PTC was extended through 2013. In addition, the trigger for eligibility was changed to the start of construction of the facilities instead of the production of the electricity which significantly extends the use of the credit. The Treasury Department and the Internal Revenue Service will issue rulemakings clarifying this important change. Finally, the law amends the definition of municipal solid waste facilities to remove recyclable paper as an eligible feedstock.
  • Investment Tax Credit in Lieu of Production Tax Credit — Solar facilities can currently qualify for an investment tax credit of 30 percent of the cost of investment when a facility is placed in service. The law enables other renewable generation facilities to opt for this investment tax credit as opposed to the PTC mentioned above.
  • Indian Country Coal Production Credit — The law extends a provision that enables Indian tribes to qualify for a PTC equal to $2 per ton of coal sourced through their land through the end of 2013.

Energy Efficiency:

  • Energy Efficient Improvements to Existing Homes (25C) — The tax credit for installing energy efficient improvements to existing homes — such as improved HVAC units, windows, furnaces, and heat and water pumps — was extended through 2013 and is capped at $500. The law also updated the standards that such appliances would need to achieve to be eligible for the incentive.
  • New Energy Efficient Homes Credit — The law extends through 2013 the tax incentive for the production of energy efficient homes. To be eligible, new homes must achieve a 30 percent or 50 percent improvement over heating or cooling energy usage of a comparable residence. The level of efficiency determines the value of the credit.
  • Energy Efficient Appliance Credit — The tax credit for U.S.-manufactured, energy-efficient appliances was extended through 2013. This credit includes refrigerators, dishwashers and clothes washers. Continue reading

Missouri Students Travel to School with Propane

gI_80437_BlueBirdPropaneVisionWindmillStudents in O’Fallon and St. Peters, Missouri are riding to school in Blue Bird propane-powered vision school buses. The Fort Zumwalt School District piloted eight propane-powered school buses and found that they cut costs and reduced emissions. Since last June, the buses have produced 60 percent less carbon monoxide, 12 percent less carbon dioxide, 20 percent less nitrogen oxide and up to 25 percent less greenhouse gases when compared to gasoline. In addition, for the current fiscal year, the district is averaging $2.15 per gallon less than diesel fuel.

“The district is saving around 18.9 cents per mile due to lower fuel costs and anticipates these 8 Propane-Powered buses will save approximately $18,000 this school year,” said Jeff Orr, chief financial officer for Fort Zumwalt School District. “I have been told Fort Zumwalt is the first school district in the state of Missouri to add Blue Bird’s innovative Ford and ROUSH CleanTech powered propane buses to its fleet, and we are pleased to be the leader.”

Earlier this week, the school district won the Community Leadership in Environmental Awareness Now (CLEAN) award, presented by the Missouri Propane Education & Research Council. The award recognizes organizations that replace conventional fuel consumption for cleaner burning, domestically produced propane.

“We are delighted that Fort Zumwalt School District is seeing the immediate savings and environmental benefits associated with our propane technology,” added Phil Horlock, president and CEO of Blue Bird Corporation. “These buses will ensure that students in O’Fallon and St. Peters benefit from cleaner air while taxpayers can relish in the fuel and maintenance savings associated with propane autogas. With our partners at Central States Bus Sales and ROUSH CleanTech, Blue Bird will continue to provide comprehensive training and support to the transportation team at Fort Zumwalt.”

Gov. Branstad Chairs Governors’ Biofuels Coalition

IA Gov Branstad at Iowa Renewable Fuels SummitIowa Governor Terry Branstad has been selected to become Chair of the Governor’s Biofuels Coalition (GBC) for 2013. Rick Schwarck, president of the Iowa Renewable Fuels Association, wrote a letter to Branstad, who will be speaking at their upcoming Summit, congratulating him.

“Your leadership and willingness to serve as a great representative of Iowa has been instrumental in helping our state lead the nation in both renewable fuels production and policy. Your work as the original chair of what was then called the Governors’ Ethanol Coalition and your more recent accomplishments as Vice Chair of the GBC have truly helped lift the industry to where it stands today.”

“We look forward to working with you as GBC Chair to continue to expand E15 availability nationwide, maintain the federal Renewable Fuel Standard (RFS), and enact stable, long-term tax policies favorable to the further development and growth of the biodiesel and cellulosic ethanol industries.”

Click here to read the entire letter.

U.S. Energy Initiatives to Build Biodiesel Plants

USEI logoU.S. Energy Initiatives Corp (USEI) has signed a letter of intent to form a joint venture that will provide support to build several small scale biodiesel plants in California featuring Methes Energies Canada’s Denami 600 technology. Methes Energies Canada is a biodiesel equipment provider and biodiesel Methes Energies logoproduction. Collaboratively, a biodiesel plant will be built in Southern California with a nameplate production capacity of 1.3 million gallons.

Anthony Miller, U.S. Energy Initiatives’ CEO, said, “We are excited to be working with companies with such stellar reputations.” He noted that in 2013, the company will focus on biodiesel and then move into oil and gas technologies. To implement the company’s strategy, USEI has entered into two joint partnerships.

According to Methes, the Denami 600 has one of the smallest footprints in the industry and can quickly and easily be set up anywhere to produce 1.3 million gallons of ASTM quality biodiesel per year.

You’re Invited – Green Guides Webinar

What’s it mean to be “green,” “non-toxic” and “renewable”? You’ll will be able to answer these questions after participating in the upcoming webinar: FTC ‘Green Guides': Implications for biodiesel and biobased communications being held on January 17, 2013 at 1:00 CST.

NBB-logo1During the webinar, participants will learn what the Federal Trade Commission’s (FTC) revised “Green Guides” mean for biodiesel and biobased products manufacturers and marketers.  FTC has recently updated its “Green Guides,” which are designed to help marketers ensure that the claims they make about the environmental attributes of their products are truthful and non-deceptive.

The National Biodiesel Board (NBB) is offering this webinar to NBB members and biobased products manufacturers. The featured speaker is FTC Senior Attorney Laura Koss. In addition to her extensive work on the “Green Guides,” Koss has worked on a variety of matters, including investigations involving the advertising and promotion of dietary supplement products and country-of-origin claims. Prior to working at the FTC, Ms. Koss was an Associate at the international law firm Crowell & Moring in Washington, D.C.  She holds a bachelor’s degree from Cornell University and a J.D. from Harvard Law School.

Click here to learn more about the webinar and to register.

API’s Crusade Against Ethanol Continues

API 2013 State of Enery ReportYesterday the American Petroleum Industry (API) released its annual “State of American Energy” report. The release of the report was part of an event where API President and CEO Jack Gerard gave an energy highlight speech. Following the event, Tom Buis, CEO of ethanol industry organization Growth Energy, said that Gerard’s speech brought nothing new to table. Buis said that Bil Oil is fixated on on a “finite resource” and the industry fails to “acknowledge that renewable fuels will play an important role in meeting the nation’s future energy needs.

“While they may mention an ‘all of the above’ approach, the reality is they continue to pursue an ‘all of the above, except renewables.’ Special interests continue to be complacent, accepting the status quo of relying on foreign sources of oil and exporting America’s hard earned money to nefarious groups like OPEC and dictators from some of the most hostile and anti-American countries in the world,” continued Buis.

He noted that the Renewable Fuel Standard (RFS) is working and has helped to decrease foreign oil imports by 32 percent; created more than 400,000 good paying jobs; improved the environment; and allowed consumers choices at the pump.

Buis concluded, “What API really said yesterday is that they want to kill any competition that may threaten their bottom line and record profits. They will stop at nothing to maintain the blend wall, prevent market access for fuels such as E15 and ensure that their lock on the fuels market goes unchecked. The RFS is the most successful energy policy this nation has enacted in the last forty years. Not only is it creating jobs but it is revitalizing rural economies. The RFS is a win-win for America, as it is an essential part of a true “all of the above” energy strategy needed to meet the growing energy demands of the 21st century.”

Mexico’s Future Shines Bright

There is gold in Mexico. Not the kind you wear around your neck and fingers in the form of jewelry, but the kind that produces renewable energy. The field of energy dreams lies in the Sonora Desert in Northern Mexico, and some experts believe that only 25 square kilometers could provide enough solar energy to supply Mexico’s 114 million residents with power.

SolarPanel In Mexico community Photo: Jason WestAlthough the country is blessed with lots of sun, the solar industry is still in in infancy. The Global Horizontal Irradiation (GHI) averages nearly 5 kWh/m2/day, making Mexico a great place to invest in solar energy. But how do you attract investors in a time when many are hesitant to invest in renewable energy, despite it’s bright outlook? This will be one of the main themes during SolarPlaza’s El Futuro Solar: Mexico conference that will be held in Mexico City on February 28, 2013.

“We´re at the very beginning of formalizing the market,” said Carlos Flores, CEO of Conermex, a Mexico City-based company specializing in renewable energy solutions. He will be one of the speakers at the event. He notes there are still few incentives for investors in terms of subsidies or injection tariffs. “One of the problems is the cost of solar power for private users with high levels of consumption; the industrial sector pays much less.”

Although efforts have been made to make the market more attractive, there is still a long way to go to reach the country’s solar energy potential. To date, solar development has been mainly focused on small scale projects in rural areas to provide communities with off-grid electricity. This, however, is changing and more large solar projects are under consideration. Flores add that not only do solar projects needs to be developed, but the domestic market, including manufacturing, need to be developed as well.

MyEnergi Lifestyle Initiative Launched

A new initiative, MyEnergi Lifestyle, has been launched to demonstrate how a typical American family can significantly reduce their electricity bills and carbon dioxide footprint. The campaign is a collaboration between Ford, Eaton, SunPower and Whirlpool and combines energy efficiency tips with plug-in vehicle technology. Specifically, MyEnergi Lifestyle showcases how combining renewable energy generation with “time-flexible” loads optimizes energy consumption across a plug-in vehicle and home appliances.

FORD MOTOR COMPANY MYENERGIMy a home incorporates MyEnergi Lifestyle, A computer model developed by Georgia Institute of Technology predicts a 60 percent reduction in energy costs and savings of more than 9,000 kg of CO2 (55 percent reduction) from a single home. The new program is being featured during the 2013 International CES in Las Vegas this week.

“More than ever, cars are sharing the same energy source as the home,” said Mike Tinskey, global director of Vehicle Electrification and Infrastructure, Ford Motor Company. “The time is right for the home appliance and transportation sectors to converge if we are going to tackle a myriad of sustainability challenges in a rapidly changing world.”

According to Warwick Stirling, global director for energy and sustainability for the Whirlpool Corporation, the average American home uses more than 11,000 kWh of electricity per year. However, he said, recent technologies can help a family use energy smarter and more efficiently.

“SunPower is offering Ford plug-in vehicle owners the world’s most efficient solar power systems to ensure they maximize emission-free power generation for use at home and for their vehicles,” said Ken Fong, SunPower general manager, Americas. “SunPower systems offer the industry’s best warranty, so homeowners can count on 25 years or more of clean power to support their sustainability goals and generate significant annual savings on their electricity bills.”

Joanne Edwards, added, that as innovation in home electrical technology advances, so does the need for safe, reliable power distribution. She is the vice president and general manager of Eaton’s residential division and notes that giving homeowners the tools to tap into distributed power in their homes allows them to modify their behavior and reduce energy consumption.

Wind Power Makes Gains in China

According to Liu Qi, deputy director general of the National Energy Administration, wind power is the third-largest source of electricity in China. He proclaimed that there is no electric power to substitute the position of wind power as No. 3, during the 18th CPC National Congress. He added that China “is determined to promote the revolution of energy generation and consumption to control the total consumption of energy, to improve energy conservation, and to support the development of energy conservation and the low carbon industry as well as renewable energy in order to ensure the safety of national energy.”

Longyua Offshore Wind FarmLate last year, the State Council released the white paper, “China’s Energy Policy 2012,” stating that wind power has the greatest possibility of large-scale development and market utilization. The country’s development of wind power is the fastest in the world and China’s 12th Five-Year Plan, sets a goal of developing wind energy in both concentrated and distributed formats and the utilization of wind resources will be accelerated including the development of offshore wind power.

Qi also announced that China is committed to strengthening grid construction, improving grid dispatching, enhancing equipment performance, advancing wind power predictions and forecasts, more. The goal, by 2015, is for the country’s total wind turbine installed capacity to reach 100 million kW, including 5 million kW offshore.

On November 23, Longyuan Wind Power realized the completion of 150 MW in an offshore wind demonstration project in Rudong, Jiangsu Province. This is the largest offshore wind farm to date in China. As more projects continue to be developed, the county’s industry is hosting Offshore Wind China 2013 being held in Shanghai June 19-21, 2013. The event is being organized by the Chinese Renewable Energy Industries Association, the National Renewable Energy Center, and Shanghai International Exhibition Co., Ltd.

Just in – Results from 100% Biofuel Jet Flight

The results are in from a flight powered by 100 percent biofuel. According to data released by the National Research Council of Canada (NRC), ReadiJet reduced emissions and provided better fuel efficiency than petroleum aviation fuel. ReadiJet is produced by ARA and Chevron Lummus Global using feedstocks developed by Agrisoma Resonance.

readijet-fuelingInformation collected in-flight on October 29, 2012 was analyzed by a team of National Research Council. The results showed a 50 percent reduction in aerosol emissions when using ReadiJet biofuel compared to conventional fuel. Additional tests from the static engine show a significant reduction in particles (up to 25 percent) and in black carbon emissions (up to 49 percent) compared to conventional fuel. These tests also show comparable engine performance, but an improvement of 1.5 percent in specific fuel consumption during the steady state operations. The jet’s engines required no modification as the biofuel tested in-flight meets the specification test property limits of petroleum-based fuels.

“We are pleased with these positive results. The flight went smoothly and the data collected enables us to better understand the impact of biofuel on the environment,” said John R. McDougall, President of the National Research Council of Canada. “We will continue to work with our partners Applied Research Associates, Chevron Lummus Global, and Agrisoma Biosciences, Inc. to bring this effective energy solution to market. The final product will be a sustainable option for reducing aviation emissions.”

Chuck Red, ARA’s Biofuel program manager added, “Partnering with NRC Canada’s outstanding team to fly the first ever 100% biofuels flight with a fuel that meets petroleum specifications test property limits without blending was historic. Their exceptional data collection capabilities and detailed analysis shows that our ReadiJet, which produces much lower lifecycle green house gas emissions than petroleum, will also contribute to a cleaner environment with significantly lower aerosol, particle, and black carbon emissions.”

Future Trends for Ag, Fuel

2012 Iowa Renewable Fuels SummitOne of the key topics for discussion during the free, 7th Annual Iowa Renewable Fuels Summit and Trade Show being held in Altoona, Iowa on January 30, 2013 is future trends for U.S. agriculture and fuels. The “Market Outlook for 2013 and Beyond” panel will include Robert Gough, Director of Renewable Fuels for the Oil Price Information Service (OPIS), who will provide an analysis of crude oil and renewable fuels price trends through the next decade.  Also joining the panel will be Nathan Kauffman, an economist with the Federal Reserve Bank of Kansas City, who will discuss his recent publication which highlights the role of markets in determining the scale of ethanol production and its use of corn in the future.  The final panelist and moderator, John Urbanchuk of Cardno ENTRIX, will highlight the impact of renewable fuels on Iowa’s economy.

“This panel will provide the Summit audience with a glimpse of what to expect for renewable fuels and gasoline production, demand and pricing and its impact on farm commodities now and in the future,” said Monte Shaw, Iowa Renewable Fuels Association’s (IRFA) executive director. “This panel will be an excellent compliment to announced speakers like Gov. Terry Branstad and Growth Energy’s Tom Buis.  Additional speakers will be announced soon.”

The Iowa Renewable Fuels Summit provides a great opportunity to hear experts address state and national issues facing the future of renewable fuels, as well as network with biofuels professionals and business leaders throughout the Midwest. Registration for this free summit is currently open and you can register online here. Can’t make it to Des Moines? The DomesticFuel team will be onsite to bring you live and post event coverage.

Corn, Ethanol Industries Drive Rural Economy

Screen Shot 2013-01-08 at 11.36.43 PMAccording to a new study released by the Missouri Corn Growers Association (MCGA), the state’s corn and ethanol industries are adding to the state’s bottom line. The study, conducted by the University of Missouri Commercial Agriculture Program, reported that the corn and ethanol industries injected $12 billion into Missouri’s economy from 2000 to 2011. Each year, the state’s ethanol industry utilizes around 100 million bushels of corn to produce nearly 300 million gallons of ethanol and 825,000 tons of distillers grains, a high protein livestock feed. In 2011, Missouri corn production alone added over $1 billion in value to the state’s economy and together the two industries supported 67,000 jobs.

“This research substantiates the tremendous economic benefits corn and ethanol production bring to Missouri,” said MCMC Chairman Jim Stuever, a corn grower from Dexter, Mo. “They are significant drivers for the state by creating jobs, generating tax dollars and increasing vitality of rural communities.”

Over the 12 years studied, the combined benefits to the state’s economy from the corn and ethanol industries were:

  • $12 billion in economic value,
  • $5.3 billion in labor income, and
  • $2.2 billion paid in local, state and federal taxes.

“This is truly a success story for agriculture and the state of Missouri,” noted MCGA President Rob Korff, a corn farmer from Norborne, Mo. “The state’s ethanol industry was built on the faith and dedication of hardworking farm families and support from state leaders.”

During the 12-year period, the ethanol industry yielded a 6:1 return, a net value of over $600 million, on the state’s investment. According to the study, Missouri’s six majority farmer-owned ethanol plants alone generated the following direct and indirect benefits to the state: $734 million in economic value; $416 million in labor income; and $174 million in local, state and federal taxes.

Renewable Fuels Legislation Crib Sheet

Although the Taxpayer Relief Act is an all but done deal, stakeholders across numerous industries continue to pick at the legislation. This is particularly true for the renewable energy industry. Legislation can be hard to digest and so the law firm Milbank, Tweed, Hadley & McCloy created a “crib” sheet, or alert, giving a brief overview of how the Act will Screen Shot 2013-01-07 at 7.25.38 PMimpact current and future projects in the renewables space including wind, biomass, geothermal, landfill gas, hydropower, cellulosic and advanced biofuels, biodiesel and even marine and hydro projects.

According to Millbank, the most important feature was the extension of the production tax credit for qualifying wind projects. A project must begin prior to January 1, 2014. The alert notes, “any such qualifying facility (or the electricity generated and sold from it)” that can get off the ground in the next year will be eligible for the tax credit – “regardless of when the facility is placed in service.” That suggests a big financial infusion into the wind industry during 2013 to jump-start projects that may have been put on hold pending the outcome of the tax bill.

Milbank points out in the alert that the legislation does not modify the eligibility requirements for certain types of projects, including those generating power through small irrigation, solar energy, refined coal, or Indian coal, rather keeps the same requirements in place. In addition, the alert takes a close look at tax allowances, including the special first-year allowance, otherwise known as “50% bonus depreciation” to qualifying property placed in service before next January 1.

Across the board for renewable energy, the tax extenders only stay in place for one year. This means that the renewable energy industry will need to take advantage of the tax packages this year while also looking at how to continue growth as uncertainty about industry tax incentives remain on the “cliff” beyond this year.

Students Earn Scholarships to Futher Biodiesel Education

StudentScholarship_Robert_Willis_USUSeveral students from around the U.S. will get a hands-on biodiesel education during the National Biodiesel Board’s Annual Conference: Momentum, February 4-7, 2013 in Las Vegas. Sixteen young college scientists were selected to receive scholarships to the conference, a program the National Biodiesel Board views as a long-term investment.

“There is tremendous potential for this NBB program to have a lasting impact on biodiesel research,” said Kyle Anderson, NBB’s Technical Projects manager. “It’s a great investment to share solid information and build relationships with tomorrow’s scientific thought leaders.”

The scholarships were awarded to members of the Next Generation Scientists for Biodiesel, an NBB program that aims to educate and collaborate with young scientists. This year’s scholars come from schools such as Utah State University, University of Colorado, Texas A&M, Southern Illinois University, and Clemson University.

“I believe the knowledge and professional network I will gain from this conference will only allow my passion for biofuels to grow, and will strengthen my commitment to continue in a field that is so important to our quest for global sustainability,” said Nina De la Rosa, an Environmental Studies student at Florida International University in Miami who was awarded one of the scholarships, and will present a poster on her research during the event.

The scholarships are funded by state soybean organizations and the United Soybean Board through the soybean checkoff. To learn more about the NBB Conference including online registration click here. You can learn more about the Next Generation Scientists for Biodiesel here.

Two Solar Projects Kick Off in South Africa

Two ground-mounted solar power projects totaling 33 megawatts are underway in South Africa, a joint venture between AE-AMD Renewable Energy and Tenesol, a subsidiary of SunPower. Tenesol will construct both projects, located near Douglas, South Africa in the Northern Cape Province. The ground-mounted solar systems will feature 138,000 Tenesol TE 240 photovoltaic solar panels on single-axis trackers. The solar panels are being produced at the Cape Town manufacturing facility which has been in operation for more than a decade, and has 3BBBEE rating.

South Africa Northern CapeHerbert, a 22-MW project, has begun construction, and groundbreaking for the 11-MW Greefspan project will begin soon. They are both part of the South African government’s Independent Power Producers Procurement Program and completion for both projects is expected in the second quarter of 2014. The last step in financing took place on November 16, 2012 when final agreements were signed-off by the South African Department of Energy.

SunPower’s successful track record of building solar power plants around the world, coupled with Tenesol’s historic presence in South Africa, will positively impact this region,” said SunPower Regions President Howard Wenger. “These two solar power projects will generate local construction jobs and deliver clean, reliable energy to the community.”

Both systems are owned by AE-AMD Renewable Energy in partnership with the IDEAS Fund, managed by Old Mutual Investment Group of South Africa. The electricity created by the solar projects will be sold to Eskom. Tenesol has a five percent share in both projects.