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kristopher

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Member since: Fri Dec 19, 2003, 02:20 AM
Number of posts: 29,798

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NREL report on cutting solar costs by recognizing that PV is a permanent fixture on a property

This report from NREL is part of the Sunshot Initiative that Obama launched. It looks at one element of the "soft" (non-hardware) costs of solar - a financing mechanism known as Real Estate Investment Trusts (REITs). To get an idea of how significant this can be consider that, exclusive of any incentives, the averaged US cost for one watt of installed solar capacity is $4.44 while the cost in Germany for the same watt of solar is $2.24.
The difference is "soft" costs.

Photovoltaic Systems Share Characteristics of "Real Property"
By Bill Scanlon, NREL
June 25, 2012 | 3 Comments


Photovoltaic (PV) systems may meet many of the important criteria to be considered real property — a status that could make them eligible for easier financing — a new report by the U.S. Department of Energy's National Renewable Energy Laboratory, contends.

The NREL report, "The Technical Qualifications for Treating Photovoltaic Assets as Real Property by Real Estate Investment Trusts (REITs)," points out that PV systems aren't meant to be moved — thus arguably achieving the threshold of "permanence;" and don't involve mechanical energy — thus possibly meeting the criteria for "passiveness." Those are two of the criteria that could gain PV status as "real property," similar to houses or railroad tracks, as opposed to personal property, such as bulldozers or trains.

Currently, PV systems are not eligible for a major source of public funding: Real Estate Investment Trusts (REITs) which are popular among those seeking investments in real assets. Such investors hope to see stable, long-term returns typical of real assets.

The stakes are potentially huge....

That ineligibility leaves PV contending for loans in the private market where lack of supply and access allow investors to demand rates of return that can be three times higher than seen in public markets, said David Feldman, an NREL analyst and co-author of the report....

http://www.renewableenergyworld.com/rea/news/article/2012/06/photovoltaic-systems-share-characteristics-of-real-property?cmpid=SolarNL-Tuesday-June26-2012


From the NREL report:
Context
One of the requirements for solar electricity1 to achieve broad adoption and cost competitiveness with traditional forms of energy generation in the United States is widely accessible and low cost financial capital. The Department of Energy’s SunShot goals, which would result in solar energy contributing to 14% of the nation’s total electricity production by 2030, would require approximately $250 billion of solar electric generation deployment (DOE 2012). Currently, solar electric generation projects are primarily financed by institutions deploying private capital, which often require a high return on their investment. As a result, there has been a growing interest in financial policies and structures that would help migrate financing of renewable energy projects from private sources of capital to public capital markets (Mendelsohn 2012).

One investment vehicle that has been discussed by legal and financial experts in the project finance community to accomplish this is a real estate investment trust (REIT). While REITs have historically provided capital for buildings, they have recently been used to help finance other types of property, such as cellular towers and transmission lines.2 The purpose of this study is to examine the fundamental physical, functional, and operational characteristics of a photovoltaic (PV) system in the context of the characteristics of “real” property as defined by the tax code, to help determine whether REITs can own PV systems. The solar market has treated PV as “personal” property for federal and state tax purposes. If the IRS were to classify PV as “real” property, it would likely have implications on existing market structures. This work has been reviewed and informed by real estate, tax and project finance attorneys as well as experts in PV technology and deployment, however should not be viewed as an exhaustive study of the legal and tax issues surrounding the topic.

Inherent to answering this question is whether PV systems possess three fundamental properties: permanence, passivity, and being integrated as a system. These three properties are associated with real property as follows: The Internal Revenue Service (IRS) stipulates that if a system is inherently permanent, then it is realty,3 and if it is an accessory to the operation of a business, it is not. Inherently permanent and an accessory to the operation of a business are mutually exclusive terms. Therefore, to establish whether a piece of property should be considered realty, it must be determined which term best applies based on the facts and circumstances of the particular situation. Passivity is one characteristic that helps determine whether an asset is an accessory to the operation of a business, and thus non-real property. It is also important to determine what pieces of a PV system should be characterized as real property. If a PV system is integrated, one could make an argument that all of it should be classified in the same way. Therefore, establishing whether a PV system is inherently permanent and passive will help inform whether it is real, and establishing whether it is integrated as a system will establish whether all of it should be treated in the same way. Further research should be performed to explore possible outcomes of treating PV systems as real property, and whether or not it would be practical for REITS to own them.
Introduction to REITs
The REIT structure was designed to bundle and securitize real estate assets in order to attract capital from a wide range of sources. A REIT is a tax designation status that eliminates most corporate taxes so long as the REIT distributes 90% of its taxable income to investors.4 The REIT structure has several attractive features compared to traditional sources of financing for PV. Many of these have the potential to lower the cost of capital for projects, increase the pool of potential financiers, and allow a large number of locations well cited for solar to be more easily developed.

Key Benefits
Some key benefits of REITs include:
....


http://www.nrel.gov/docs/fy12osti/55396.pdf

Who Owns Solar?

Who Owns Solar?
Expanding ownership models are growing the solar industry.
HERMAN K. TRABISH: JUNE 19, 2012

Along with the emergence of three distinct ownership models (customer-owned, third-party-owned, and utility-owned), the U.S. photovoltaic (PV) market has grown, over the last ten years, at an average annual rate of approximately 70 percent, according to GTM Research.

...The bulk of national solar growth has been in rooftop installations. More than 62,000 systems were installed in the U.S. in 2011, bringing the national cumulative total at the end of the year to over 203,000 distributed PV systems making up an installed capacity of almost 2,700 megawatts (AC).

...



In 2009, residential systems were 87 percent customer-owned and commercial systems were 49 percent customer-owned. Customer ownership of commercial systems increased in 2011 to 58 percent.

But as third-party ownership became the fastest-growing segment of the residential rooftop sector of the industry, customer ownership of residential systems fell to 59 percent and third-party ownership of residential systems went from 2009’s 13 percent to 41 percent in 2011.

http://www.greentechmedia.com/content/images/articles/2CPFsunshot(1).jpg

The economics of solar...



More at: http://www.greentechmedia.com/articles/read/who-owns-solar/

Seismologists warn Japan against nuclear restart

Seismologists warn Japan against nuclear restart

TOKYO | Tue Jun 26, 2012 4:30pm IST
(Reuters) - Two prominent seismologists said on Tuesday that Japan is ignoring the safety lessons of last year's Fukushima crisis and warned against restarting two reactors next month.

...Seismic modeling by Japan's nuclear regulator did not properly take into account active fault lines near the Ohi plant, Katsuhiko Ishibashi, a seismologist at Kobe University, told reporters.

"The stress tests and new safety guidelines for restarting nuclear power plants both allow for accidents at plants to occur," Ishibashi told reporters. "Instead of making standards more strict, they both represent a severe setback in safety standards."

Experts advising Japan's nuclear industry had underestimated the seismic threat, Mitsuhisa Watanabe, a tectonic geomorphology professor at Tokyo University, said at the same news conference.

"The expertise and neutrality of experts advising Japan's Nuclear Industrial Safety Agency are highly questionable," Watanabe said...


http://in.reuters.com/article/2012/06/26/us-japan-nuclear-idINBRE85P0FP20120626

Redding City Council Votes to Expand Ice Energy's Thermal Storage Program

Redding City Council Votes to Expand Ice Energy's Thermal Storage Program


...Ice Energy, a leading provider of distributed energy storage and smart grid solutions for increasing energy system efficiency and improving grid reliability, and REU will collaborate on the second phase. The program to install Ice Bear units within the northern California territory aims to reduce peak electricity load demand by up to 6 MW over five years.

REU Utility Director Barry Tippin, said, "We are very excited to continue the expansion of our Energy Storage Program. After more than seven years of evaluation, installation and analysis, the Ice Bear product has proven to be a good fit for the Redding community and a cost effective means of shifting on-peak air conditioning demand to off-peak hours. This program improves REU's electric system efficiency and creates essential jobs in our community."

Currently, 40 commercial buildings in Redding have Ice Bears. Those installations have exceeded 1 MW of peak demand reduction and benefited the local economy by employing local HVAC technicians and engineers. The utility reported a 95 percent reduction in peak load demand since the units were installed. The latest phase of Ice Energy's Thermal Energy Storage Program significantly expands the program, and brings manufacturing jobs to Redding.

The Ice Bear system is a distributed energy storage solution used in conjunction with commercial direct-expansion (DX) air conditioning (AC) systems. Ice Bear units utilize electricity from the grid during off-peak periods, converting it into stored thermal energy in the form of ice, and use the ice to perform useful work for building cooling by displacing the operation of commercial AC condensing units during on-peak periods. The benefits include:
- Improved grid efficiency and reliability
- Deferral of the need to add new generating, transmission, and or distribution infrastructure
- Reduced emissions
- Local green job creation

REU expects to have the thermal energy storage program completed in 2017. Skyway Machine, a local Redding manufacturing company, will provide final assembly of the new Ice Bear units....


More at: http://www.utilityproducts.com/news/2012/06/23/redding-city-council-votes-to-expand-ice-energy-s-thermal-storage-program.html


See also: http://www.ice-energy.com/
http://www.ice-energy.com/ice-bear-energy-storage-installations

Researchers develop a promising new technology for grid-scale energy storage

Researchers develop a promising new technology for grid-scale energy storage
(Nanowerk News) An interdisciplinary team of researchers from Drexel University have reported the development of a new technology for grid-scale energy storage which could provide a fast, efficient method for storing energy on the electrical grid. This new technology, dubbed the “electrochemical flow capacitor,” stores energy in the same way as a supercapacitor, but is much less costly to scale up for large, industrial applications. Results from the team’s most recent study were published in a special issue of Advanced Energy Materials ("The Electrochemical Flow Capacitor: A New Concept for Rapid Energy Storage and Recovery" focusing on next-generation batteries.
The electrochemical flow capacitor uses a flow cell architecture, similar to existing redox flow batteries for grid storage, consisting of an electrochemical cell connected to external electrolyte reservoirs. However, this technology is unique in that it uses a flowable slurry of capacitive particles suspended in a liquid electrolyte carrier fluid. Uncharged slurry is pumped through a flow cell, where energy is stored capacitively within the solid particles. The charged slurry can then be held in reservoirs until the energy is needed, at which time the entire process is reversed. By utilizing this capacitive slurry instead of conventional battery electrolytes, the Drexel team says that its new design can be operated in high power applications for hundreds of thousands of charge-discharge cycles, vital for industrial applications.


Illustration by Kristy Jost, PhD student of Materials Science and Engineering.

“It is well known that conventional supercapacitors provide very high power output with minimal degradation in performance. However, they have always had fairly limited energy storage capacity”, said Dr. Yury Gogotsi, distinguished university professor and Trustee Chair of Materials Science and Engineering and director of the A.J. Drexel Nanotechnology Institute at Drexel University, one of the lead scientists on the project. “By incorporating the active material of supercapacitors into a fluid, we are able to address issues of capacity and scalability by adopting the system architecture from redox flow batteries”...

Read more: http://www.nanowerk.com/news/newsid=25663.php#ixzz1yqLmDU8Z

Cheap Coal Is Dead. Long Live Renewable Age (Part 1)

"...In March, the power generating arm of India’s largest conglomerate, the Tata Group, announced that it was shifting its investment strategy from coal-fired thermal plants to wind and solar renewable projects. Coal projects, Tata said, were becoming “impossible” to develop, and investment in them had stopped.

With this declaration, one of Asia’s biggest energy players confirmed an emerging reality. The U.S., Europe, Russia, Australia and Japan all had created modern consumer economies dependent on abundant, cheap fossil-fuel energy. In the 21st century that is no longer viable; the high-carbon growth path is closing...."




Cheap Coal Is Dead. Long Live Renewable Age (Part 1)
By Carl Pope, Bloomberg
June 20, 2012

"Sustainable Energy for All" is the main theme for this week's Rio+20 United Nations gathering in Brazil. The challenge of making energy both accessible and sustainable has grown more complicated in the past year or so, and also more exciting. These are tough times for coal and other high-carbon sources of energy, while the news about clean energy is more promising.

In March, the power generating arm of India’s largest conglomerate, the Tata Group, announced that it was shifting its investment strategy from coal-fired thermal plants to wind and solar renewable projects. Coal projects, Tata said, were becoming “impossible” to develop, and investment in them had stopped.

With this declaration, one of Asia’s biggest energy players confirmed an emerging reality. The U.S., Europe, Russia, Australia and Japan all had created modern consumer economies dependent on abundant, cheap fossil-fuel energy. In the 21st century that is no longer viable; the high-carbon growth path is closing.

The reason is cost. Oil has long been expensive, because low-cost oil producers such as Saudi Arabia have learned to demand high prices by limiting supplies and refusing to sign long-term price agreements. Coal had always been different — traded locally, on both long-term concessions and short-term spot contracts. Two years ago, China and India could supplement their domestic coal supplies with imports from Indonesia, Australia and South Africa. Some of the cheapest coal mines serving China in 2010 were in Indonesia, where India’s Adani Power Ltd. and Tata were purchasing coal mines and building their own shipping and port facilities to ensure they could supply a wave of huge new power projects.

Geologically Abundant

While coal is geologically more abundant than oil, cheap coal, close to population centers, is not. The biggest ....


http://www.renewableenergyworld.com/rea/news/article/2012/06/cheap-coal-is-dead-long-live-renewable-age-part-1??cmpid=GeoNL-Thursday-June21-2012

Why there's only one honest objection to wind farms

Why there's only one honest objection to wind farms
The daft claim that wind subsidies have driven 50,000 people into fuel poverty exemplifies the dishonesty of most objections


There are 320 onshore windfarms in UK, a third of them in England, with a similar number awaiting both construction and planning permission. Photograph: David Lawson /Alamy
Here's a little gem that exemplifies the fundamental dishonesty underlying all but one of the objections deployed against onshore wind farms. The Sunday Telegraph reported that "subsidies paid to windpower companies are forcing up to 50,000 households a year into fuel poverty, according to analysis of government figures by the House of Commons Library."

This statement is at best daft, as I will argue below. The analysis is believed to have been requested by Conservative MP Chris Heaton Harris, who led the 100 Tory MPs demanding big cuts in subsidies for wind farms. The House of Commons Library does not publish its work for MPs, but I now have a copy of the short analysis, which is reproduced in full at the end of this post so you can all admire its idiocy.

The essence of the calculation is as follows. Wind power subsidies - both onshore and offshore - cost energy bill payers about £10 a year, less than 1% of the average annual bill for gas and electricity. Of the 4.75m people suffering fuel poverty in the UK in 2009, 40,000-50,000 (less than 1%) were up to £10 below the threshold for fuel poverty, which is crossed when more than 10% of income is spent on fuel. Therefore, wind subsidies pushed 40,000-50,000 people into fuel poverty.

It's difficult to know where to start unpicking this simple-minded nonsense, but let's begin with one of the three elements of fuel poverty, energy bills themselves. Between 2004 and 2010, dual fuel bills rose by £455, of which £382 was due to soaring gas prices. That's where the real blame lies, quite possibly driving a million or two into fuel poverty, and more renewable energy is the solution, not less.

Another element of fuel poverty is...


http://www.guardian.co.uk/environment/damian-carrington-blog/2012/jun/21/wind-power-subsidies

Explosives prompt Sweden nuclear plant probe

Explosives prompt Sweden nuclear plant probe
Thu Jun 21, 2012 10:51am EDT
* Small amount of explosive found on way into Swedish nuclear plant

* Police say explosive could not have caused much damage, open probe

* Alert levels raised after fresh nuclear safety incident (Adds details, quotes)

STOCKHOLM, June 21 (Reuters) - Sweden raised alert levels at its nuclear power plants and police launched an investigation after a routine check found a forklift truck entering on of the plans with a small amount of explosives on it

Police said on Thursday the small amount of explosive could not have caused much damage had it been set off, but opened a probe into sabotage, without saying who would want to carry out such an act. A spokesman said that so far there were no signs of a terror attempt on the facility.

The incident happened on Wednesday afternoon at the Ringhals nuclear power station, which is on the southwest coast near the city of Gothenburg, operator Vattenfall said in a statement...


http://www.reuters.com/article/2012/06/21/sweden-nuclear-idUSL5E8HL7FF20120621

Offline Nuclear Plant Squeezes Energy Access In Calif.

Offline Nuclear Plant Squeezes Energy Access In Calif.

One of California's two nuclear power plants has been closed since the discovery of a radioactive leak in late January. With summer here — and increased energy use with it — the state is bracing for the possibility of rolling blackouts in San Diego, Los Angeles and Orange County. L.A. Times reporter Abby Sewell talks with Melissa Block about what's being done to stave off an energy calamity.

MELISSA BLOCK, HOST: One power plant in particular is on the minds of many here in Southern California. It's the San Onofre nuclear plant, roughly 60 miles south of Los Angeles. The plant was shut down back in January because of a leak that released a small amount of radioactive steam. It's been off-line ever since. And this week, nuclear regulators called what led to the leak, a significant, serious safety issue.

With San Onofre out of commission, officials are scrambling to find alternative sources of energy to keep from plunging Southern California into a summer of rolling blackouts. For more, I'm joined by Abby Sewell. She's been covering the story for the Los Angeles Times. And, Abby, let's start with the leak. I gather that tubes carrying radioactive water were vibrating excessively that led to the leak. What happened? What led up to this?

ABBY SEWELL: That's correct. Southern California Edison, the operator of the plant, had, within the last couple of years, replaced the steam generators, which are these massive pieces of equipment that have thousands of tubes carrying this radioactive water....


http://www.npr.org/2012/06/20/155454750/offline-nuclear-plant-squeezes-energy-access-in-calif

RWE pulls out of nuclear sector and puts fossil fuel plants on hold

"Further investment depends on the “future market design”"...

Future market design equals either 'centralized thermal' (which includes fossil fuels and nuclear) or distributed renewables.

RWE pulls out of nuclear sector and puts fossil fuel plants on hold
21 June 2012

On June 20, German utility RWE said it was permanently withdrawing from building nuclear power plants and has also put on hold any plans for new fossil-fuelled projects. RWE, which operates nuclear reactors in Germany and owns a stake in the Netherlands’ only atomic power plant, has already withdrawn from the Horizon project in the UK, a nuclear joint venture with E.ON.


Chief executive-designate Peter Terium told journalists that the company is pulling out of nuclear because “the financial risk is no longer acceptable and is unreasonable for our shareholders”. Terium, who will take over as chief executive next month, said that decision was taken because of uncertainty over German energy policy.

...The plan to suspend until further notice any fossil-fuelled power plants is unexpected, and Terium said the freeze will stay in place until there is some clarity on the future of Germany’s energy regulatory framework. Further investment depends on the “future market design”, he added.

...


http://www.hazardexonthenet.net/article/51192/RWE-pulls-out-of-nuclear-sector-and-puts-fossil-fuel-plants-on-hold.aspx?AreaID=2
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