Colorado Developer Puts “World’s Largest Planned Microgrid” on the Market

Colorado’s 662-MW Niobrara Energy Park, which calls itself the world’s largest planned microgrid, is now shovel-ready and seeking buyers. Cushman & Wakefield announced early Wednesday that it is acting as exclusive agent for the sale of the northern Colorado project, under development for five years by Colorado land and resouce broker, Craig Harrison. Dubbed NED for short, the project stands apart in the microgrid world because of its sheer size and complexity. While most microgrids serve a handful of buildings, at best, and manage a couple of generation sources, NED has secured permits for 52 data centers, a 200-MW gas-fired plant, a 50-MW solar farm, 50 MW of fuel cells, other energy sources, and a range of energy storage technologies: compressed air, batteries, fly wheel, thermal and hydrogen storage, super capacitators and super conductors. “This opportunity is highly unique in its size, scale and scope,” said Jeffrey Cole of Cushman & Wakefield’s Irvine, California office. “We will be marketing this property to investors on a national and international basis, targeting everyone from data center investors, to users that would require cloud computing, to power company investors, telecom centers, local developers, green energy providers, and even certain Wall Street infrastructure funds.” The developer envisions the microgrid managing retail power within the project’s borders and selling any excess power into the wholesale market. The electricity would transfer at the Ault substation, 22 miles to the south, and be sold at one of Colorado’s busiest interconnects. “It’s an energy park, with the ability to provide its own microgrid,” said Cole. “The on-site energy sources include natural gas and a major electrical infrastructure, and plans call for a multitude of renewable energy sources. It also has its own water rights, as well as transcontinental fiber connection with access to 21 fiber carriers or providers. The project includes within its borders triple 230-kV power lines with dual feed direction from four substations, triple natural gas lines, a fiber-optic backbone with diverse carriers and a private 100 million gallons per year water supply. “With special approvals from the state and county in place, it is very rare to have a property of this size with zoning and energy sources already on-site,” Cole said. NED is named after the Niobrara gas and oil shale formation in northeast Colorado. Niobrara also means running water — which has been found under the site. The project is zoned for the 52 energy and data center uses, as well as Cloud data centers, energy-consuming manufacturing, natural gas power plants, solar, wind, and energy storage, with environmental waivers. Energy-related zoning includes up to 50 MW of solar, geothermal and wind, and unlimited energy storage, as well as up to 650 MW of natural gas plants and fuel cell power plants, and more, according to Cushman & Wakefield. It is located near I-25 and US 85 between urban areas of Northern Colorado and Southern Wyoming. “NED represents a unique opportunity to acquire a strategically located shovel-ready site with extraordinary energy and fiber infrastructure along with entitlements and zoning for a broad range of industrial and energy-related development,” said Jeff Cushman, executive managing director, Cushman & Wakefield. “It offers multiple revenue pathways for an investor along with speed to market. There is nothing else like it in the country.

Colorado PUC Considers Distributed Energy Storage Challenges and Opportunities

Against the backdrop of speculation concerning Tesla’s upcoming announcement which is widely anticipated to be a distributed energy storage product, and with continuing industry reports of a burgeoning domestic and international market for both grid-connected and behind the meter energy storage, on April 23, 2015 the Colorado Public Utilities Commission (CPUC) spent the afternoon hearing from a wide variety of stakeholders about the challenges and opportunities presented by distributed energy storage. The discussion came in the context of the CPUC’s ongoing proceedings related to retail renewable distributed generation and net metering (Proceeding No. 14M-0235E). Beginning in June, 2014, the CPUC has held a series of panel discussions focused on different aspects of the distributed energy resource and net metering issue. In addition to discussing distribution system design and ancillary benefits associated with solar photovoltaic systems, solar PV system sizing and panel orientation, and minimum billing issues, the CPUC’s most recent panel discussion delved into the current costs and economics of energy storage for residential, commercial and industrial customers, the anticipated growth rate for distributed energy storage in Colorado, the relationship between energy storage and net metering, and the regulatory changes needed to encourage energy storage projects. Ben Kaun, Senior Project Manager in the Electric Power Research Institute’s (EPRI) Energy Storage Program, provided an overview of the varying roles energy storage systems can play including functioning as a capacity resource, supporting the grid through flexible ramping, voltage control, and renewable integration, and providing grid reliability and resiliency services. Mr. Kaun emphasized that that traditional metric of the Levelized Cost of Energy (LCOE) is not suitable when evaluating energy storage applications; rather, a lifetime net present value approach should be employed to consider the full range of costs and benefits associated with energy storage. Mr. Kaun explained that when evaluating behind-the-meter energy storage it is important to consider the perspective of both the customer and the utility or grid operator since the incentives for energy storage and the potential uses and benefits of storage systems may differ between these two perspectives. A customer whose primary interest is using a storage system to take advantage of time-of-use rates may not be aligned with a utility that is interested in using aggregated energy storage systems to manage overall load. From EPRI’s perspective, the tools needed to understand the value of energy storage and its grid impacts are still under development; however, ongoing industry efforts, including California’s substantial commitment to energy storage deployment, should lead to rapid maturation of energy storage applications over the next five years. Ryan Hanley of SolarCity spoke on behalf of several distributed solar stakeholders. Mr. Hanley updated the Commissioners on the general trend toward declining battery prices which is expected to continue for the foreseeable future. Describing SolarCity as bullish on energy storage, Mr. Hanley stated that the company expects that by 2020 all of its solar PV installations will include a storage component. Mr. Hanley emphasized, however, that policies are needed which recognize the full range of benefits distributed storage can provide and allow participants to realize the revenues associated with those benefits. Furthermore, widespread deployment of smart inverters is needed to fully recognize the multiple benefits of distributed storage. While focused primarily on the potential of distributed generation paired with distributed storage, Mr. Hanley agreed that there is no one “sweet spot” in terms of energy storage system size, location, and technology; rather, a diverse portfolio of distributed and grid-level storage is needed and should be considered as part of utilities’ planning processes. Commissioner Glenn Vaad asked the question that many people seemed interested in, especially given the context of the proceeding in which this discussion was taking place — isn’t distributed energy storage the anti-thesis of net energy metering? Mr. Hanley acknowledged that customer-sited storage could result in no distributed generation being sent to the grid and, therefore, no need for net metering; however, he opined that storage simply provides another set of flexible benefits in addition to the potential load modification benefits of distributed solar PV. Sky Stanfield spoke on behalf of the Interstate Renewable Energy Council (IREC) and presented specific regulatory recommendations from IREC’s February, 2015 report, “Deploying Distributed Energy Storage: Near-Term Regulatory Considerations to Maximize Benefits.” IREC recommended that the CPUC consider appropriate rate designs, including time of use rates and demand charges, to incentivize customer behavior related to energy storage. Consistent with comments from other speakers, Ms. Stanfield explained the importance of energy storage “benefit stacking” and the need to open-up markets for demand response and ancillary services that can be provided by aggregated energy storage systems. This, however, is a particular challenge in Colorado where there is no ISO or RTO to facilitate such market participation. IREC also recommended that the CPUC ensure that both interconnection and net metering policies and standards are clear and make sense when applied to distributed energy storage systems. Similar to a point made by Mr. Hanley, Ms. Stanfield encouraged the CPUC to integrate consideration of energy storage into the broader utility distribution system planning process. IREC’s final recommendation focused on the importance of a coordinated approach to safety in the context of industry codes and standards for energy storage. throughout the discussion, the CPUC Commissioners probed into the various policy and practical considerations associated with distributed energy storage and its potential applications in Colorado. While Colorado presently lacks the legislative mandate that is driving the deployment of energy storage in California, the Commissioners seemed most interested in identifying how regulatory initiatives could help build Colorado’s experience base related to energy storage. Chairman Joshua Epel framed the challenge as how best to “leap-frog” distributed energy storage in Colorado? Based on the panel discussion, it appears the answer will be a combination of regulatory incentives, creative approaches to realizing the system and monetary benefits associated with energy storage, and patience as technologies mature and utilities, customers, and storage providers gain more experience with deployed energy storage

Colorado’s Solar-Friendly Communities Go National

The thousands of solar installers in Colorado – as in many other states – have a hard time developing energy regulation. As with most other green businesses, they are often small shops in a nascent industry. Since the rules about rooftop solar are local (decided by towns or counties), more than half the cost of installation are now the “soft costs” of permitting and inspection, said Rebecca Cantwell, executive director of the Colorado Solar Energy Industries Association (COSEIA). But COSEIA’s Solar Communities program has made strides so far in streamlining the installation process, offering a $500 discount for customers of participating companies. The organization now hopes to expand its program to the rest of the country. Solar Communities is a program sponsored by a Department of Energy grant through the Sunshot Initiative and managed by COSEIA, which works directly with local governments to help them implement 12 best practices for rooftop solar. So far, Solar Communities has certified 16 communities in Colorado as “solar-friendly” cities, ranging from Denver to Lyons. This covers over half the population of the state. “Solar is growing incredibly fast,” said Cantwell. “Cities might not have the resources to deal with them, and companies (working in different towns) might have to learn 50 different ways of doing business. “Right now, putting solar panels on your roof is almost as complicated as a whole custom-home addition,” she continued. “But it should be as easy as getting a new furnace. It should almost be plug and play.” COSEIA’s staff has done a great deal of outreach to local governments in order to make this happen: In some cities, the city council took action, while some towns in Colorado learned about the program from each other. “In each case, it took a champion,” she said. The form is easy to look at online, and towns can start getting recognized by following the first three of the best practices the team developed. COSEIA’s 12 Best Practices for Local Governments (important enough to list all of them!) Provide a checklist of all requirements for rooftop solar photovoltaics and solar thermal permitting in a single online location Offer a standard permit form that is eligible for streamlined review for standard residential or small commercial rooftop flush-mounted systems Offer electronic or over-the-counter submittal and review options for standard systems Issue permits within a specified time frame Charge actual costs for permits and inspections with a cap on the total Replace community-specific solar licenses, if required, with standard certification for installers Provide inspection checklist that explains unique requirements beyond applicable codes Specify a narrow time window for system inspection For efficiency, require only one inspection for standard rooftop systems on existing homes or businesses Adopt ordinances that encourage distributed solar generation and protect solar rights and access including reasonable roof setback requirements Educate residents on solar energy by providing information on financing options and projected economic benefit Show your commitment to being a solar-friendly community by tracking community solar development and provide tools showing solar access in your community Some of the best practices may not seem like a big deal (they wouldn’t list fixing your website if there wasn’t a need), but what they really affect is time. “For installers, time is money,” as Cantwell said, but in this case, time is also the temperature of the planet.

Renewable energy isn’t boosting electric bills study contends

Renewable energy is seen as the culprit behind higher electricity bills by Colorado Republican lawmakers, but a new study contends it just ain’t so. The Colorado Senate passed a bill rolling back the state’s renewable energy standard – which requires that investor-owned utilities get 30 percent of their energy from renewable sources by 2020 and rural electric coops to get 20 percent — to 15 percent for both. “We want to make sure we’re not pushing the envelope so far that we’re hurting consumers, especially the rural consumers,” said the sponsor, Sen. Ray Scott, R-Grand Junction. And handing out graphs of comparative rates, Rep. Dan Thurlow, R-Grand Junction, said, “We’ve gone from being one of the lowest-cost states, to being higher than most of our neighbors in the mountain states.” The bill, however, died in the Democratic-majority House. It is true that Xcel Energy, the state’s largest electricity provider, has had a series of rate hikes over the last few years, but $347 million in increases between 2006 and 2009 were the result of the utility’s new $1 billion Comanche 3 coal plant coming on line. A lot of the rate increases were also driven by Xcel adding long-deferred infrastructure, such as transmission lines. Putting that aside, have wind and solar installations increased the cost of electricity? A study by Nancy Pfund and Anand Chhabara says there is no evidence to show they have. The study “Renewable Are Driving up Electricity Prices – Wait, What?” looks at the top ten states for renewable energy, the ten state with the least renewable energy and the nation averages. “Basically we didn’t find much difference and I think that’s the point,” said Pfund, who is a managing partner in DBL Investors, a San Francisco-based venture capital firm specializing in clean technologies and sustainable products and services. Chhabara, who is working on dual law and business degrees at Stanford University, was a summer associate a DBL. In their analysis the top 10 states in renewable energy had an average increase in retail electricity prices of 3.06 percent between 2002 and 2013. The 10 states with the least renewable energy generation had a 3.74 percent, while the national average was 3.23 percent. The numbers don’t prove anything one way or another, but they don’t particular support the contention that renewables boost rates. On the other, hand they don’t give any sense of what the rates would have been in those leading renewable energy states if they hadn’t add wind and solar. Another part of the analysis plotted rate increases by year and showed that leaders and laggards had similar curves, though in the early years renewable energy states had higher rates and after 2005 lower rates. Xcel has gone into wind energy in a big way. By 2016, 30 percent of its generation will come from wind. One reason is that the utility has gotten very advantageous prices in wind power purchase agreements. Xcel’s average purchase cost for wind since 2007 has been about $42 a megawatt-hour, according to the company. That is cheaper than natural gas generation and on par with exiting coal plants. “And there are no price fluctuations for the fuel – like you see and coal and natural gas – because the fuel is free,” Pfund said. Solar has been more expensive than wind, but Austin Energy, the Texas city’s municipal utility, in July reportedly signed a purchase power agreement for utility-scale solar at $50 a megawatt-hour. Another way of assessing the relative costs of different generation is a “levelized cost of energy” analysis, which tallies up all the costs of building and running a generation source, a coal plant or a wind farm, over its life and then divides those costs by the amount of energy the plant produces. Lazard, the financial advisor and asset management firm – no earnest environmentalists they, have been tracking levelized costs for several years. In their 2014 analysis for the competing types of generation without any consideration of subsidies finds a pretty tight price spread. Lazard gives ranges for costs per megawatt-hour and the range for utility-scale photovoltaic solar is $72 to $86, while onshore wind is $37 to $81. The range for a supercritical pulverized coal plant, the most efficient coal technology, is between $66 and $151. A natural gas combined cycle plant – again the best technology – is $61 to $87. While natural gas and coal might be marginally cheaper on the low side, renewables looked to be more predictable in price. Residential rooftop solar is just about the most expensive form of generation at $180 to $265 a megawatt-hour – even more expensive than nuclear power or coal with carbon capture, according the the Lazard analysis. The only electricity generation more pricey is a diesel at $297 to $332. Looking back at Lazard’s 2012 analysis one finds utility-scale PV at $101 to $149 per megawatt-hour and wind at $48 to $95. At the same time the price for coal has edged-up from 2012 by $4 to $10 a megawatt-hour. “The cost curves are coming down for renewables,” Pfund said. “And they will continue to come down as markets grow and technologies achieve economies of scale. It is a virtuous cycle.”

Colorado's Big Coal Cosuming Utilities Move to Renewable Power

Most of the electricity developed in Colorado still comes from burning coal, but even the state's two largest coal burners are adding far more renewable energy. The Tri-State Generation and Transmission Association and Platte River Power Authority every single lately announced plans for new renewable energy sources. "We've observed the rates dropping, and we've been in a position to add these renewable power projects," stated Lee Boughey, a spokesman for Westminster-primarily based Tri-State. Tri-State announced this month that it would add a 150-megawatt wind farm in Kit Carson County. Platte River Energy, based in Fort Collins, is set to add a 22-megawatt solar installation near Wellington. "Their current investments in wind and solar represent true progress and are essential methods toward diversifying their power supplies," said John Nielsen, power plan director at the environmental group Western Resource Advocates. Colorado has a Renewable Power Regular that calls for investor-owned utilities to get 30 percent of their electricity from renewable sources by 2020. Municipal utilities have a ten % target, and rural electric cooperatives, below a bill in the legislature, would have a 15 percent target. Advertisement Platte River Power and Tri-State are wholesale electricity generators and do not fall directly beneath the standards for renewable power. Tri-State supplies electricity to 44 rural electric cooperatives in four states, such as 18 in Colorado. Platte River Energy serves municipal systems in Estes Park, Fort Collins, Longmont and Loveland. About three-quarters of the electrical energy the two corporations generated in 2014 came from coal, according to company figures. And so, though there have been advances in adding natural gas and renewable energy generation, coal remains king in Colorado. In December 2014, 58 % of Colorado's electricity generation came from coal-fired plants, and renewable sources created up 15 percent. By comparison, Minneapolis-primarily based Xcel Power, Colorado's largest electrical energy supplier, reduce its coal-fired generation to 53 % in 2014 from 65 % in 2005. Xcel, an investor-owned utility, projects coal will be 46 percent of generation in 2020 and renewable sources 28 percent. About 26 percent will be natural gas. Still, Tri-State and Platte River Energy slowly are adding renewable sources. Tri-State has added 800 megawatts of renewable resources due to the fact 2008, Boughey said, and 24 % of its electrical energy came from wind and hydropower in 2014. In 2013, for example, Tri-State contracted with the city of Boulder to invest in electrical energy from the Boulder Canyon Hydroelectric facility. The new Kit Carson wind farm is being built by Juno Beach, Fla.-primarily based NextEra Power at a price of $240 million and will sell energy to Tri-State on a 25-year contract. Though the prices for renewable energy are coming down, Tri-State's Boughey said the challenge is adding transmission to tie in these sources. Tri-State is building a 72-mile line in between Burlington and Wray at a projected expense of $40 million. "Developing transmission lines is time-consuming and expensive," Boughey said. Tri-State's member cooperatives also added 54 megawatts of distributed renewable-power resources, and an extra 15 megawatts are under development. Distributed resources are smaller sized generation projects that include things like wind, solar, hydropower and recycled-heat projects, Boughey said. In October, Tri-State put out a contact for proposals for further renewable-power projects and these are now below overview, Boughey mentioned. Platte River Power generates significantly less than 5 % of its energy from wind and, at the moment, none from solar. About 20 % of the authority's energy comes from hydroelectric plants. The authority board, even so, has set a goal for reducing carbon emissions from energy generation by 20 % by 2020 and 80 percent by 2050. Coal-fired power plants are the largest single supply of carbon dioxide emissions &mdash about 30 % of the nation's 2014 total, according to the federal Energy Facts Administration. Carbon dioxide is the principal greenhouse gas linked to climate alter in several scientific studies. And so, the Platte River Power Authority board's request is aimed straight at the company's three massive coal-fired plants. The federal Environmental Protection Agency has drafted rules that would require Colorado to reduce back energy plant carbon emissions by 35 percent by 2030. Platte River Energy is effectively on the way to raising its renewable energy to 32 percent by 2016, stated John Bleem, the authority's organizing and customer service director. That figure involves hydropower and renewable power credits bought from renewable-energy installations in other states, Bleem said. As for trying to get to the purpose of an 80 percent reduce in carbon by 2050, Bleem stated "we've been crunching the numbers." That purpose has to be met in the context of sustaining reliability of the program and keeping rates amongst the lowest of wholesale suppliers, Bleem mentioned. Platte River Energy sells kilowatt-hours to its municipal systems for about 5.5 cents a kilowatt-hour, Bleem said. That is about half the rate Xcel charges residential buyers. The steps taken by Platte River Power and Tri-State enable them to greater integrate renewable energy on their systems, said Western Resource Advocates' Nielsen. "With this expertise in hand, resistance to these technologies decreases and utilities develop into significantly additional open to acquiring further renewable energy," Nielsen stated. "Our hope is that this will be the case with each Platte River and Tri-State."

Colorado shows growth in residential, commercial solar installations

Led by solid growth in both the residential and commercial markets, Colorado ranked 13th in the nation in installed solar capacity last year, according to the recently-released U.S. Solar Market Insight 2014 Year in Review. In 2014, Colorado added 67 MW of solar electric capacity, bringing its total to 398 MW. That’s enough clean, affordable energy to power more than 76,000 homes. The report went on to point out that Colorado’s biggest solar gains came in residential installations, but commercial installations increased, as well. Of the new capacity added, 42 MW were residential and 25 MW were commercial. Together, these installations represented a $212 million investment across Colorado. From an environmental perspective, solar also helped to offset nearly 450,000 metric tons of harmful carbon emissions last year in Colorado – the equivalent of removing more than 90,000 cars off the state’s roads and highways, or not burning nearly 500,000 gallons of gasoline. “To put the state’s solar growth in some context, the 398 MW of solar PV installed today in Colorado is nearly as much as the entire country had installed by 2006. And frankly, the state is just scratching the surface of its enormous potential,” said Rhone Resch, president and CEO of the Solar Energy Industries Association (SEIA). “Looking forward, we expect 2015 to be the best year ever for new PV installations across the state, with 100 MW in new projects expected to come online.” Today, there are 380 solar companies at work throughout the value chain in Colorado, employing more than 4,000 people. Notable solar projects in Colorado include: Alamosa Solar Generating Project was completed in 2012 by developer Cogentrix. This concentrating photovoltaic (PV) project has the capacity to generate 30 MW of electricity – enough to power more than 5,400 Colorado homes. Another utility scale project, the Hooper Solar Project, is currently under construction in Colorado and is scheduled to come online in 2016. Several large retailers in Colorado have also gone solar, including Kohl's, REI, Safeway and Walmart. IKEA has installed one of the largest corporate PV systems in the state with 1,120 kilowatt (kW) of solar capacity at its location in Centennial. In addition to a growing commercial sector, the Colorado residential market also showed impressive gains last year, with installed system prices dropping by 8 percent – and down a total of 49 percent since 2010. Nationwide, the U.S. residential market added 1.2 GW of installed capacity in 2014, marking the first time that this growing sector surpassed 1 GW of clean, affordable solar. Residential also continues to be the fastest-growing market segment in the U.S., with 2014 marking three consecutive years of greater than 50 percent annual growth. “Today, the U.S. solar industry employs 174,000 Americans nationwide – more than tech giants Apple, Google, Facebook and Twitter combined – and pumps nearly $18 billion a year into our economy,” Resch added. “This remarkable growth is due, in large part, to smart and effective public policies, such as the solar Investment Tax Credit (ITC), Net Energy Metering (NEM) and Renewable Portfolio Standards (RPS). By any measurement, these policies are paying huge dividends for both the U.S. and Colorado economies, as well as for our environment.”