How cool WAS that? Not that cool, it turns out.

Michael Giberson

While digging through the KP archives looking for another old story, I can across a 10-year old post titled “How cool is this?

(Let me warn you now that there isn’t much more to this 2013 post other than to observe that not every cool-sounding technology in 2002 turned out to work. You already know that; you can stop reading now. -MG)

What seemed pretty cool at the time was a new bladeless turbine that the inventor said would drastically reduce costs in a number of applications. The Hydrogen Renewable Energy Enterprise, LLC in Hawaii was reportedly very excited about the possibilities and signed up to be the exclusive seller of the technology.

Since I hadn’t noticed bladeless turbines taking over the world, I wondered what became of the technology. Unfortunately, other than a bunch of press release inspired news reports from about 10 years ago, not a lot of information is findable online about Hawaii-based The Hydrogen Renewable Energy Enterprise, LLC.

Utah-based International Automated Systems, Inc. (IAUS), developer of the bladeless turbine technology appears to be still around. In addition to the bladeless turbine, the company has developed products including a automated self-checkout retail system and a fingerprint identification system. The newest technology seems to be a solar energy thermal system which can be used with the bladeless turbine. The company website lauds its solar technology as “Years Ahead of Schedule” and costing less than “the World Government’s goal for solar power cost per kilowatt by the year 2020.”

In June 2009 Renewable Energy Development Corporation contracted with Needles, California to supply the town with solar power based on the IAUS technology. In an interview published in November of 2009, REDCO owner Ryan Davies touted the IAUS technology, saying, “All of our engineering reports and research data indicate that this technology will be significantly more efficient than PV. We’re quite excited about it.” A year later REDCO was pleading with Needles to boost the $128 per MW price in the contract after REDCO “discovered … fatal flaws in the technology they were going to use. Those flaws included cost and efficiency issues.” In 2012 REDCO filed for bankruptcy.

Neldon Johnson, President and CEO of IAUS, is quoted as saying he thinks the technology would have worked, had Davies and REDCO attracted enough investment. Maybe, but IAUS has apparently attracted a detractor online who has collected information about the company: See http://www.iausenergy.com, particularly the page http://iausenergy.com/NewsHistory/index.html, and don’t miss the website’s collection of photos from the IAUS solar pilot plant west of Delta, UT.

That’s about it. No real surprises.

 

Nest and technology-service bundling

Lynne Kiesling

nest-rush-hour-alert

Nest’s recent business developments are refreshing and promising. Building on the popularity of its elegant and easy-to-use learning thermostat in its first couple of years, Nest is introducing new Nest-enabled services to automate changes in settings and energy use in the home. Called Rush Hour Rewards and Seasonal Savings, Nest claims:

Rush Hour Rewards could help you earn anywhere from $20-$60 this summer—it takes advantage of energy company incentives that pay you to use less energy when everyone else is using more. Seasonal Savings takes everything Nest has learned about you and automatically fine-tunes Nest’s schedule to save energy, without sacrificing comfort. Field trials have been impressive: Nest owners have used 5-10% less heating and cooling with Seasonal Savings and 80% said they’d keep their tuned-up schedules after Seasonal Savings ended.

The ever-incisive Katie Fehrenbacher calls their move a bundling of its “smart thermostat with data-driven services“, which sounds about right to me.

Behind these new services is the cloud-based big data algorithms that are the secret sauce of Nest, and which Nest has now named Auto-Tune. Now that Nest has gotten hundreds of thousands of thermostats out there in the market, and has done two years of field trials, it has been able to collect a large amount of data about how customers use and react to temperature and cooling changes. Nest uses this data about behavioral changes to inform its services and how its algorithms work.

She also remarks on something I noticed — in its marketing of its new services Nest assiduously avoids the phrase “demand response”, instead saying “New features save energy & make money. Automatically.” Once you get beyond the elegant interface, the thoughtful network and device connectivity, and the “secret sauce” algorithms, Rush Hour Rewards is little more than standard, administered, regulator-approved direct load control. But Nest’s elegance, marketing, and social-media-savvy outreach may make it more widespread and appealing than any number of regulator-approved bill inserts about AC cyling have over the decades.

In a very good Wired story on Nest Energy Services, Steven Levy analogizes between the technology-digital service bundle in energy and in music; quoting Nest CEO Tony Faddell, Levy notes that:

This pivot is in the best tradition of companies like Apple and even Amazon, whose hardware devices have evolved to become front ends for services like iTunes or Amazon Prime Instant Movies. Explaining how this model works in the thermostat world, Fadell compares power utilities to record labels. Just as Apple provided services to help customers link with the labels to get music, Nest is building digital services to help customers save money. Unlike the case with record labels, however, Nest isn’t eroding the utility business model, but fulfilling a long-term need–getting customers to change their behavior during periods of energy scarcity.

“Until now, if utilities wanted customers to change their behavior to use less electricity at those time, they instituted what was called unilateral demand response—they wouldn’t automate the process, they’d turn off the air-conditioning whenever they wanted. It was like DRM during the iPod days—where companies like Sony said, ‘I am the guardian, and I’m going to tell you what to do’.”

Faddell (and Levy and Fehrenbacher) articulates the value potential of technology-service bundles to automate energy consumption decisions in ways that save energy and money without reducing comfort. While the guts of their services are still direct load control and are not dynamic in any way that would make meaningful use of such a potentially transactive technology, I do think it’s a promising evolution beyond the monolithic, administrative, regulatory demand response approach.

Is Iowa solar power ruling a camel’s nose into electric utility’s monopoly tent?

Michael Giberson

Eagle Point Solar, a for-profit solar power installer and operator, proposed to build a solar PV array on a Dubuque, Iowa municipal building under a long-term contract with the city. Under the contract, Eagle Point would own the solar array and sell power to the city in a “behind the meter” arrangement.

The local electric utility, Interstate Power and Light Company (IPL), challenged the arrangement as infringing on its exclusive service territory. In April of 2012, the Iowa Utilities Board agreed with IPL that the retail electric sales contract would require Eagle Point to be an electric utility and it would thereby be prohibited from providing service in IPL’s assigned exclusive electric service area.

Eagle Point appealed and in March 2013 the Iowa District Court for Polk County overturned the Iowa Utilities Board ruling. Eagle Point was declared not to be a public utility and therefore not in conflict with IPL’s assigned exclusive electric service area. Kari Lydersen at Midwest Energy News summarized key parts of the ruling:

The ruling emphasized that since there is no state statute defining what it means to sell to the public, the utility board should have relied on a decision in a 1968 Iowa case involving the state commerce commission and a natural gas company. Based on a series of tests outlined in that case and actually drawn from a previous Arizona case involving a natural gas company, the court decided that Eagle Point would not meet the definition of either a “public utility” or an “electric utility.”

Among other things, Schemmel noted, Eagle Point would not be able or required to meet all requests for service and it would not be competing with Alliant or creating a monopoly of its own.

Schemmel also pointed out that the solar panels would not meet all of the building’s electricity needs, hence the building would still be hooked up to the grid and buying electricity from Alliant. The building’s demand for electricity from the grid would be reduced, but this would be equivalent to the demand reduction created by energy efficiency measures like weatherization, Schemmel found.

The court also considered a state law declaring it “the policy of this state to encourage the development of alternative energy production facilities” as balancing against the public interests in the law granting monopoly territories to electric utilities.

A significant factor in this case was the ability of for-profit companies like Eagle Point, but not non-profit entities like city governments, to access numerous federal and state subsidies for solar power installations. If the deal was just about power supplies the city could have simply bought the solar array from Eagle Point. But this angle is actually less interesting that the broader possibilities of the precedent to support distributed generation.

The Iowa Utilities Board could appeal the decision to the state’s Supreme Court. But at least until that happens, or if the Supreme Court affirms the district court rules, behind-the-meter distributed power systems appear to be legal in Iowa (at least if they are “alternative energy” based generators, and if they don’t result in entirely removing a customer from electric utility service).

Small renewable providers and cogenerators, start your engines.

Eagle Point Solar: Dubuque City Operations Center

Eagle Point Solar: Dubuque City Operations Center

Free solar power tomorrow!

Michael Giberson

Well, not free-free, but subsidy-free. Maybe.

When I read a headline promising “Solar Power to Hit Cost Parity Next Year,” it reminds me of the sign above the bar promising “Free Beer Tomorrow.” Like tomorrow, “next year” is always approaching and never here.

RP Siegel begins his Triple Pundit article, “Solar Power to Hit Cost Parity Next Year,” in full solar triumph mode:

They said it couldn’t be done. They tried to tell us that renewable energy could only survive if it were propped up with government subsidies. Never mind that our whole system of economic development, beginning with the patent office, is predicated on the idea that fledgling, underfunded industries need special protection for a limited time until they are strong enough to go it alone. Never mind that the fossil fuel industry, which can hardly be considered fledgling or underfunded, is still receiving billions in taxpayer subsidies.

But like the little engine that could, or the middle aged rock star that, after twenty years of struggling in sleazy dives has suddenly become an overnight sensation, solar power, having now surpassed the 100 GW threshold, has finally arrived and is good to go, in many places, without subsidies.

Great, so can we now pull the plug on solar power subsidies? And, by all means, yank the fossil fuel subsidies too.

(I’m passing over the wildly off-the-mark claim about “our whole system of economic development.” Not credible enough to take seriously. As it turns out, neither is the “grid parity” claim credible yet. But let’s at least explore the triumphant claims of success.)

Curiously, the article follows the “has finally arrived and is good to go … without subsidies” declaration with accounts of subsidized success. Apparently one-third of the 100 GW of world solar power capacity has been installed in Germany because of its generous feed-in tariff policies. Installations in China are growing fast. India and then Spain are mentioned. Spain built a lot of solar with subsidies, but recently stopped the subsidies. I’ll come back to India, but let’s look closer at the claim for Spain. Let the fisking begin!

Spain, the article declares, has achieved “grid parity,” backing the claim with only a link to a post at Forbes.com last December. The Forbes.com blog by Peter Kelly-Detwiler, “Solar Grid Parity Comes to Spain,” builds off a report from Bloomberg titled “First Large Solar Plants Without Subsidy Sought in Spain.” The Bloomberg article reports that many large-scale solar projects have applied to connect to the power grid, and the head of solar energy analysis at Bloomberg New Energy Finance is quoted as saying, “Spain is probably set to have Europe’s first utility- scale solar parks without subsidies.” So following the chain of links we have gone from gleeful declarations of “grid parity” to mere grid-connection paperwork that “probably” will yield “solar parks without subsidies” according to a solar energy analyst.

But read a little more and you get the views of the solar power lobbyist in Spain who reports that while many companies are anxious to develop solar power projects…

The biggest hurdle they face is to get the government of Prime Minister Mariano Rajoy to restart the planning process for new solar generation, said Eduardo Collado, director of operations at lobby group Union Espanola Fotovoltaica. Rajoy ordered the end of subsidies for new projects 10 months ago.

“None will go ahead until that changes, even though there are a few plants definitely needed at points in the system where the network operator wants them,” Collado said in an interview.

So, none of the subsidy-free projects will go forward until the policy that ended subsidies is changed?

Still, just a bit later in the article, a solar power developer said it would be able to build without subsidies. Maybe, at long last, this report justifies the triumphant claim that Spain has reached “grid parity”?

Not exactly. In June 2012 the developer said it expected to be able to build without subsidies in the last half of 2013, because “we think the cost of photovoltaic will have dropped enough by then and, given the irradiation in Spain, will be totally competitive.” So once again we have hopes of grid parity “next year,” which through the magic of sloppy reporting become triumphant claims that “Spain has … achieved grid parity.”

So what about India? As the Triple Pundit post reports, Deutsche Bank anticipates solar power transitioning “from subsidized to sustainable markets in 2014″ based on the emergence of “large unsubsidized markets in places like India, where sunshine is plentiful and the alternatives are expensive.” Okay, so once again we have analysts claiming that solar power could live subsidy free soon, just not yet, and no doubt one day such predictions will come true.

But in parts of India, as with many other places around the world, where centralized grid power is expensive or unreliable or unavailable altogether, solar power is already an economical option. Solar power is a product with a few successful market niches, and these market niches will likely continue to grow as (and if) costs continue to fall.

Without extensive policy interventions, a sustainable solar power industry would tend its market niches and prepare to exploit other niches as it became more competitive.

And, by the way, please do yank fossil fuel subsidies and address externalities with appropriate policies, and let fossil fuels shrink to their market-justified size as well.

Get policy right and let the market sort ‘em out.

Who is the renewable power policy “playground bully”?

Michael Giberson

According to a poll by Fallon Research, “Nearly 60% [of Ohio voters] would pay an extra $3 a month on a $100 dollar energy bill to support the development of electricity from clean sources.” It is an interesting factoid, I suppose. My initial response is to wonder whether state electric power regulations in Ohio somehow prohibit Ohio voters who are so inclined from buying “electricity from clean sources.” If so, the regulations should be revised so that consumers have the opportunity to buy the kind of electric power they want.

Heather Taylor-Miesle, of the NRDC Action Fund, apparently thinks differently. She reads the survey results and thinks, “Great, this is a good reason for state regulators to force everybody to buy clean-sourced electricity, including the more than 40 percent who said they didn’t want to pay as much as 3 percent extra for clean-sourced electricity.”

Can we imagine polling Ohioans on whether they support the Cincinnati Bengals or the Cleveland Browns, and then having state regulators require every consumer buy a T-shirt from the majority-favored team? Why should electricity policy involve state-mandated purchases?

Granted, electric power production involves environmental harms and we might find state and federal policies useful in addressing these harms. But renewable-power purchase mandates are a inefficient way to pursue environmental goals. Granted also, there may well be positive information spillovers from research and development of less-polluting technologies. Renewable-power purchase mandates are an especially ineffective way of promoting the growth and spread of knowledge.

The main point of Taylor-Miesle’s Huffington Post piece was to suggest the conservative, pro-market policy group ALEC was playing the “playground bully” by advocating repeal of state renewable power purchase mandates. I find the suggestion hilariously backward.

So far as I have seen reported in the press, ALEC isn’t out threatening violence for state legislators who refuse to comply with ALEC’s wishes. So far as I know, ALEC operates mostly by distributing policy papers and hosting conferences where people talk a lot. I’ve never heard of a playground bully hosting a public policy conference.

Of course the policy that Taylor-Miesle favors is a policy of coercion: state renewable power purchase mandates simply require electric power retailers to purchase some fraction of their power from government-approved “clean sources.” Should a utility fail to comply, the state will impose penalties. Should a utility fail to pay, the state will seize money in the utility’s bank accounts. If that doesn’t work, the state eventually will close the utility down.

The state is the bully here. Taylor-Miesle is like that kid on the playground hiding behind the bully, egging him on. ALEC, on the other hand, wants to reduce the bully’s reach a little bit.

Europe is burning more American coal

Michael Giberson

Natural gas production is booming in the United States. The resulting low natural gas prices are helping the fuel displace other energy sources, most particularly the use of coal to produce electric power. As U.S. demand for coal falls, so has its price and as a result international coal buyers are increasingly turning to U.S. suppliers. One big buyer: Europe.

Ironies abound in this Washington Post report on growing European use of coal. The EU has elaborate and costly greenhouse gas regulations while the U.S. has failed to implement any systematic federal greenhouse gas policies. European nations like Germany, Spain, and Denmark are frequently cited as models for their support of renewable energy. And, with these policies in place, greenhouse gas emissions are falling in the United States and Europe is burning more coal. Apparently good intentions are not enough. The Wall Street Journal had a similar report yesterday: “U.S. Coal Finds Warm Embrace Overseas.”

One more point: All that “good news” about reductions in U.S. greenhouse gas emissions is mitigated a bit by tracing through the economic logic. We’ve displaced some coal consumption by increased gas consumption, but much of that coal is simply being burned in Europe or China or elsewhere. U.S. coal production has been relatively flat for two decades, but U.S. coal exports have doubled since the 2006. (See EIA data here.) So we’re cutting emissions, but there will be essentially no climate change pay-off from the cuts. This same consequence would have arisen had the U.S. shifted from coal to natural gas because of carbon taxes or an effective U.S. cap-and-trade scheme (except in that scenario we pay more for energy rather than less. Technological improvements rule!).

Chu’s solar power regrets

Michael Giberson

From The Onion:

WASHINGTON—Sources have reported that following a long night of carousing at a series of D.C. watering holes, Energy Secretary Steven Chu awoke Thursday morning to find himself sleeping next to a giant solar panel he had met the previous evening. “Oh, Christ, what the hell did I do last night?” Chu is said to have muttered to himself while clutching his aching head and grimacing at the partially blanketed 18-square-foot photovoltaic solar module whose manufacturer he was reportedly unable to recall… According to sources, Chu’s encounter with the crystalline-silicon solar receptor was his most regrettable dalliance since 2009, when an extended fling with a 90-foot wind turbine nearly ended his marriage.

What, no Solyndra jokes?

Secretary Chu responded on Facebook:

I just want everyone to know that my decision not to serve a second term as Energy Secretary has absolutely nothing to do with the allegations made in this week’s edition of the Onion. While I’m not going to confirm or deny the charges specifically, I will say that clean, renewable solar power is a growing source of U.S. jobs and is becoming more and more affordable, so it’s no surprise that lots of Americans are falling in love with solar.

Reading between the lines here, in particular, the claim “renewable solar power is a growing source of U.S. jobs,” I think we can conclude that the solar panel’s manufacturer has even more damning photos in a vault somewhere.

The Onion:

The Onion: “Hungover Energy Secretary Wakes Up Next To Solar Panel”

A call for controlled experimentation in California’s energy efficiency programs

Michael Giberson

UC-Berkeley economist Catherine Wolfram has an op-ed in the Sacramento Bee advocating the state use controlled experimentation to discover with energy efficiency programs work best. As she explains, retailers are increasingly using experimentation and advanced data analysis to discover how to increase sales. Surely, she suggests, when planning to spend nearly half a billion tax dollars annually on energy efficiency California ought to devote a bit of effort into separating programs that sound good and work well from those that merely sound good.

[HT to Elizabeth M. Bailey at Energy Economics Exchange.]

New group formed to promote research in U.S. electric power markets

Michael Giberson

Last week saw announcement of the Electric Markets Research Foundation. The group plans “to fund unbiased research that will examine the track records of centralized electricity markets and traditionally regulated markets in providing affordable and reliable supplies of power as well as meeting clean energy, transmission and environmental needs.” The news release continues:

“There is a dearth of research available on this market-versus-regulation debate and little analysis has been conducted on this 50-state experiment. The Electric Markets Research Foundation intends to address this by supporting research by academics and industry experts on major electric market issues, including customer rates, reliability and service,” said Bruce S. Edelston, the foundation’s president and the driving force behind the research effort.

The governance group looks a little heavy on DC-oriented policy folks, except for Albert Danielsen, a long-time professor of economics at the University of Georgia and executive director of the Bonbright Center for Public Utilities at U. of G. I guess we’ll have to count on Danielsen to keep an eye on the lobbyists.

I’m looking forward to their efforts.

Ford’s MyEnergi Lifestyle

Lynne Kiesling

You may know that the annual Consumer Electronics Show has been going on this week in Las Vegas (CES2013). CES is the venue for displaying the latest, greatest, wonderful electronic gadgets that will enrich your life, improve your productivity, reduce your stress, and make your breath minty fresh.

And, increasingly, ways to save energy and reduce energy waste. The most ambitious proposition to come out of CES2013 is Ford’s MyEnergi Lifestyle, as described in a Wired magazine article from the show:

Here at CES 2013, the automaker announced MyEnergi Lifestyle, a sweeping collaboration with appliance giant Whirlpool, smart-meter supplier Infineon, Internet-connected thermostat company Nest Labs and, for a green-energy slant, solar-tech provider SunPower. The goal is to help people understand how the “time-flexible” EV charging model can more cheaply power home appliances, and how combining an EV, connected appliances and the data they generate can help them better manage their energy consumption and avoid paying for power at high rates. …

Appliances are getting smarter, too. Some of the most power-hungry appliances, such as a water heater and the ice maker in your freezer, can now schedule their most energy-intensive activities at night. Nest’s Internet-connected thermostat can help homeowners save energy while their [sic] away. While some of the appliances and devices within MyEnergi Lifestyle launch early this year, others are available now, Tinskey said.

One reason why I think this initiative is promising is its involvement of Whirlpool and Nest, two very different companies that are both focused on ways to combine digital technology and elegant design to make energy efficiency in the home appealing, attractive, and easy to implement.

The value proposition is largely a cloud-based data one — gather data on the electricity use in the home in real time, program in some consumer-focused triggers, such as price thresholds, and manage the electricity use in the home with the objective of minimizing cost and emissions. Gee, I think I’ve heard that one here before