Gov. Hickenlooper announces Colorado Climate Plan

DENVER — Wednesday, Sept. 16, 2015 — Gov. John Hickenlooper, business and industry leaders and department directors today released the Colorado Climate Plan, a statewide strategy of policy recommendations and actions to mitigate greenhouse gas emissions and to increase Colorado’s level of preparedness. “Colorado is facing a potential increase in both the number and severity of extreme weather events,” said Hickenlooper. “We’ve seen what Mother Nature can do, and additional risks present a considerable set of challenges for the state, our residents, and our way of life. This comprehensive plan puts forth our commitment from the state and sets the groundwork for the collaboration needed to make sure Colorado is prepared.” Colorado has warmed substantially in the last 30 years and even more in the last 50 years, with projected temperatures rising an additional 2.5 degrees by 2050, as reported by Climate Change in Colorado: A Synthesis to Support Water Resources Management and Adaptation. Rising temperatures pose many challenges to Colorado’s environment, health, economy and infrastructure. In response to these risks, the state developed a plan for mitigating and adapting to a broad range of possible impacts from multiple sectors. The Colorado Climate Plan focuses on seven main sectors including water, public health, energy, transportation, agriculture, tourism and recreation, and ecosystems. The plan also includes a chapter highlighting ways local governments and businesses are playing a significant role. Some of the plan’s key recommendations include: Water: Promote and encourage drought preparedness through comprehensive drought planning mitigation implementation; incorporate climate variability and change into Colorado's Water Plan. Public Health: Coordinate with the Colorado Department of Public Health and Environment, Public Utilities Commission, the Colorado Energy Office, and additional stakeholders to develop and implement a Colorado-specific plan to substantially reduce carbon dioxide emissions from fossil fuel fired EGUs, in accordance with the EPA's Clean Power Plan; continue to assess potential correlations between vector-borne diseases and climate factors. Energy: Assure the timely and complete attainment of the state's RES 2020 goals; assist all utilities (investor-owned, municipal, and cooperative) in identifying and implementing best practices for integrating cost-effective renewable resources, both utility-scale and distributed; increase access to capital for commercial, residential, agricultural, and industrial customers seeking to improve the energy performance of their facilities. Transportation: Promote and encourage fuel-efficient vehicle technologies and programs to reduce vehicle emissions; provide guidance to local governments on land use planning strategies to promote efficient use of public resources and reduce GHG emissions through compact, transit-oriented development that utilizes smart growth practices and complete streets. Agriculture: Partner with research institutions and federal agencies to support producer's efforts to mitigate and adapt to climate change through improved irrigation and efficiency and enhanced tillage practices. Moving forward, the Colorado Climate Plan will serve as a roadmap for state agencies to confront some of the worst effects of climate change and identify priority actions. The state will work to ensure the plan complements other relevant efforts, including the Climate Change in Colorado Report, and the Colorado Climate Change Vulnerability Study. Dr. Larry Wolk, executive director and chief medical officer of the Colorado Department of Public Health and Environment, said, "​The Climate Plan helps develop our strategies for protecting public health as our climate changes. It also demonstrates our commitment to reducing greenhouse gas emissions through EPA’s Clean Power Plan and Colorado’s own initiatives.” "This plan outlines many steps state agencies can take - and are taking - to both reduce the emissions that affect our climate and prepare for the potential impacts that temperature and weather changes may have on our economy and lifestyle in Colorado,” said Mike King, executive director of the Department of Natural Resources. Contributing agencies include the Colorado Department of Natural Resources, the Colorado Department of Public Health and Environment, the Colorado Energy Office, the Colorado Department of Transportation, the Colorado Department of Agriculture, the Office of Economic Development and International Trade, Colorado Tourism Office and the Department of Local Affairs, along with input from key stakeholders. "This plan highlights the results to date of Colorado's leadership in innovative energy production and efficient energy consumption,” said Jeffrey Ackermann, director of the Colorado Energy Office. “Our continued progress is reinforced by forward-thinking policies like the renewable energy standard, strong public-private partnerships and creative strategies to foster new market development." Public and private sector organizations also contributed to the plan including Apt Environmental, Colorado Municipal League, Colorado Solar Energy Industries Association, Colorado State University/ Colorado Water Institute, Denver Water, Fort Collins Sustainability Group, Rocky Mountain Climate Organization, Rocky Mountain Institute, The Nature Conservancy, Western Water Assessment/ CIRES/ University of Colorado, Southwest Energy Efficiency Project, Xcel Energy and 360 Colorado. The plan, developed to meet the requirements of HB 13-1293, lays out many of the ways the state is working to find solutions. Each state agency that helped develop the plan will hold public engagement sessions specific to their agency throughout the coming year. The Colorado Climate Plan, along with additional information related to the state’s response to climate change is available at http://cwcb.state.co.us/environment/climate-change/Pages/main.aspx.

Negative RECs for community solar: Market failure or utility opportunity?

Solar advocates say the Colorado Public Utilities Commission opened the door to a significant market failure when it declined to reconsider a decision allowing Xcel Energy to accept negative Renewable Energy Credits (REC) bids for community solar projects. In states like Colorado with a renewable energy mandate, utilities are required to accumulate a certain number of RECs each year from developers when they contract for mandated renewables generation. The credits normally add a small premium to the price paid by utilities, creating an added incentive for developers. For the first time this summer, Xcel began accepting bids for negative REC prices for community solar arrays in a recent Request for Proposals (RFP). Installers, who say the negative RECs are illegal and are driving a “race to the bottom” in shared solar, filed a complaint with regulators. But the Colorado Public Utilities Commission (CPUC) saw nothing wrong with negative RECs on their face. In response to the complaint from the Colorado Solar Energy Industries Association (CoSEIA), the CPUC agreed with Xcel that its RFP that included the negative RECS “does not violate any statute or Commission rule.” The commission, however, did not comment on whether negative RECs fit into the intent of the state’s community solar law, opening up further debate between Xcel and the installers. The ruling allowed the utility to use its market leverage to drive bids down in pursuit of the best deal for its entire customer base, but developers say the negative RECs limit their ability to serve the full range of potential community solar customers. How negative RECs came about In 2013, bidding on community solar projects took REC prices to $0.00. That pushed SunShare SunShare CEO David Amster-Olszewski to first raise the question in 2014 of whether regulators should exercise authority over the competitive bidding process and establish a REC floor price. That, he and other solar advocates argued, could help prevent a utility from taking advantage of its natural monopoly to drive down prices. The commission declined to act on the question, based on proceeding technicalities. It has subsequently stood by its decision in response to more recent filings from CoSEIA and Western Resource Advocates requesting reconsideration. Xcel is compelled by a 2014 Colorado PUC order to construct between 6.5 MW and 30 MW of community solar. When the commission declined to clarify whether it was in keeping with the mandate’s intent for Xcel to let REC prices go negative, the utility naturally seized that opportunity to take the lowest possible bids. In response to its most recent RFP, Xcel accepted bids for 29.5 MW in Colorado projects from SunShare, CEC, and Community Energy Solar, thereby meeting almost the maximum amount of mandated community solar. The REC policy debate Bound by non-disclosure agreements, the utility and the developers cannot specify what REC prices were accepted. Xcel confirmed to Utility Dive that it did, in fact, accept negative REC offers in the bidding. Solar installers say the negative RECs do more than cut into their revenues — they make customers pay more. “The bids are not for the power price. That is set by pre-established tariffs,” explained SunShare CEO David Amster-Olszewski. “When the REC price is positive, the utility pays the customer, but when the REC price becomes negative, the customer pays the utility for the utility to meet its mandate.” Xcel says that lower REC costs mean just the opposite — that they save customers money and allow the utility to invest elsewhere. “The acquisition of the REC, for the purposes of meeting the Colorado Renewable Energy Standard, is recovered from all customers through the Renewable Energy Standard Adjustment,” Xcel Rates and Regulatory Affairs VP Alice Jackson said. “The lower cost of the REC from developers benefits our customers directly and allows for those dollars to potentially be spent on other renewable projects.” In a reply to the Colorado SEIA filing, Xcel argued that “bidders are free to bid whatever prices they wish.” “[I]f your members believe that a negative bid price is too low,” it wrote in its filing, taking aim at the solar industry group, “they do not need to offer such a price.” “We will continue to offer a market for vendors to bid to build projects to provide our customers with an additional solar choice,” Jackson said. “The price at which those vendors elect to bid is entirely at their discretion.” Solar installers say they will push forward with new bids and attempt to continue the debate over RECs. “While this makes the 2015 RFP process more difficult, we expect there will be the opportunity to discuss this further with Xcel and the other stakeholders.” said Tom Hunt, VP of corporate development for Clean Energy Collective, a community solar developer. Implications of negative RECs The hopes of those who see community arrays increasing solar access for low and middle income residential utility customers without solar-suitable roofs could be stymied if negative REC bidding continues and/or spreads to other states. Negative REC pricing, SunShare’s Karen Gados told Utility Dive, would likely drive her company and other community solar developers to focus their customer acquisition on the commercial and industrial rate class and bypass lower and middle income residential customers. Clean Energy Collective's Hunt agreed. “We share the concern that negative RECs are not good for the market because they distort mechanisms put in place to get low and middle income residential customers involved." While Colorado wrestles with its negative REC issues, community solar is taking off across the nation. A recently released National Renewable Energy Labs study reported that at least 49% of U.S. households and 48% of businesses do not have solar-suitable rooftops. “By opening the market to these customers, shared solar could represent 32%–49% of the distributed PV market in 2020,” NREL wrote, “thereby leading to growing cumulative PV deployment growth in 2015–2020 of 5.5–11.0 GW, and representing $8.2–$16.3 billion of cumulative investment.” The U.S. community shared solar market will add 115 MW in 2015, a roughly 500% year-on-year increase in growth over the 21 MW added in 2014, and almost twice the 66 MW cumulative installed capacity at the end of last year, according GTM Research’s "Community Solar Outlook 2015-2020." GTM Research forecasts 59% annual growth for community solar over the next five years to reach an annual capacity addition of 500 MW and a cumulative installed capacity of 1,800 MW in 2020. Some 29 developers are now working in community shared solar development, with sector leaders Clean Energy Collective (CEC) and SunShare accounting for 32% of the capacity now online.

Battlement Mesa solar array to switch on this month

1,422 solar panels to power Metro District’s water treatment plant The large solar array that will power the Battlement Mesa Metro District water treatment plant is expected to go live on the Xcel Energy grid later this month, says Katherine Rushton, commercial sales manager for Sunsense Solar. The 1,422 solar panels in the array are rated to generate nearly 700,000 kilowatt-hours per year, comparable to the electricity used by about 100 homes. The array is sized to power 100 percent of the treatment plant’s annual electrical demand. Sunsense Solar of Carbondale built the array for the Metro District using third-party financing, so the upfront cost to the district was $2,500. By locking in the cost of electricity with a financed solar array, the district is expected to save about $3,000 in the first year of operation, and about $200,000 over the coming 20 years. The project came about through a workshop in April 2014 hosted by CLEER, Sunsense Solar and Garfield Clean Energy. Steve Rippy, general manager of the Metro District, was among the local government officials learning about the financing mechanism. Further conversations between Sunsense and the Metro District board, with energy consulting from Matt Shmigelsky of CLEER, brought the project from an idea to a plan of action. “Steve Rippy and the Metro District Board of Directors were very open to learning about how to implement solar through a power purchase agreement,” said Rushton. “Once they understood the concept, they were eager to move forward.” Rushton noted that during the construction, from May 11 to Aug. 20, Water Plant Superintendent Roger Bulla served as the liaison between the Metro District and the construction team. A Sunsense crew of seven solar installers and five assistants built the racks and installed the solar panels, along with 16 inverters that convert direct current (DC) produced by the panels to alternating current (AC) used by the electric grid. Also on the job were three subcontractors. SGM of Glenwood Springs handled structural engineering for the foundation. Lyons Fencing of Silt carried out excavation on the two-acre site and built the concrete foundation and perimeter fencing. Expert Electric of Rifle wired the AC side of the array. “This was a challenging place to build, due to the river rock throughout the site,” Rushton said. “The Sunsense install crew worked closely with Lyons Fencing to remove some very large rocks.” The Battlement Mesa array joins a robust list of government-owned solar arrays across Garfield County. A total of 27 arrays from Battlement Mesa to Carbondale have a total generating capacity of 4.6 megawatts, and produce about 8.4 gigawatt-hours of clean electricity per year.

Aspen, Colorado, Just Became the Third U.S. City to Reach 100 Percent Renewable Energy

Aspen, Colorado, is the third city in the country to have reached 100 percent renewable energy use, including wind, solar and geothermal heat. Burlington, Vermont, and Greensburg, Kansas, were the first two cities to claim their respective titles. “It was a very forward-thinking goal and truly remarkable achievement,” David Hornbacher, director of Aspen’s city utilities and environmental initiatives, told the Aspen Times. “This means we are powered by the forces of nature, predominately water and wind with a touch of solar and landfill gas.” Hornbacher said the milestone is the result of a “decades-plus” city goal. The 100 percent goal was reached once the city signed a contract with Municipal Energy Agency of Nebraska, a wholesale electric energy provider. Before its contract with MEAN, the city was using anywhere from 75-80 percent renewable energy sources. But the city planned had planned for this day to come much sooner – about 10 years sooner. Despite challenges along the way, however, Hornbacher applauded the “small, progressive community” for working together to “demonstrate that it is possible.” “Realistically, we hope we can inspire others to achieve these higher goals,” Hornbacher said.

Top 10 Solar States Have Strong Renewable Energy Policies

Solar electric power tripled in the U.S. between 2012 and 2014, with 10 states responsible for 86% of the nation's solar electricity capacity, according to a new report by the Environment America Research & Policy Center. Solar policies are closely correlated with solar ranking, the report says. All of the top 10 states in the report for solar capacity per capita - Hawaii, Arizona, Nevada, California, New Jersey, New Mexico, Vermont, Massachusetts, North Carolina and Colorado - have some combination of policies that directly contribute to the growth of solar capacity, the report found. Policies among the top 10 states include the following: Nine have strong net-metering policies and, in most, consumers are compensated at the full retail rate for the excess electricity they supply to the grid; Nine have strong statewide solar interconnection policies; All have renewable portfolio standards (RPS) and eight have carve-outs that set specific targets for solar; Nine allow creative financing options, such as third-party power purchase agreements; and Nine allow property assessed clean energy (PACE) financing. "Our analysis shows that policy choices are a key driver of solar energy growth," says Gideon Weissman of Frontier Group, co-author of the report. "State and local government policy leadership is closely aligned with success in growing solar energy." Rhone Resch, president and CEO of the Solar Energy Industries Association, says that over the last five years, the solar sector has become one of the fastest-growing industries in the U.S., with an estimated annual value of $18 billion and currently employing 174,000 workers. However, for this growth to continue, he says, stable and effective state and federal public policies, such as the federal investment tax credit, state RPS, PACE financing and net energy metering, need to be extended and even expanded. "Environment America’s new report correctly points out that smart public policies and the development of clean, affordable solar energy go hand in hand," Resch says.

Fossil Fuels Losing Cost Advantage Over Solar and Wind

The cost of producing electricity from renewable sources such as solar and wind has dropped significantly over the past five years, narrowing the gap with power generated from fossil fuels and nuclear reactors, according to the International Energy Agency. “The costs of renewable technologies – in particular solar photovoltaic – have declined significantly over the past five years,” the Paris-based IEA said in a report called Projected Costs of Generating Electricity. “These technologies are no longer cost outliers.” The median cost of producing so-called baseload power that is available all the time from natural gas, coal and atomic plants was about $100 a megawatt-hour for 2015 compared with about $200 for solar, which dropped from $500 in 2010. Those costs take into account investment, fuel, maintenance and dismantling of the installations over their lifetimes and vary widely between countries and plants. For instance, commercial rooftop solar installations generate power for $311.77 a megawatt-hour in Belgium and $166.70 in sunnier Spain, the findings show. The IEA findings come as more than 190 nations prepare to broker a new climate agreement in Paris in December to limit carbon emissions from burning fossil fuels. Based on figures from 181 power plants in 22 countries, the study concludes that no single technology is the cheapest under all circumstances and costs depend “highly” on available resources, labor costs and local regulations. Cost Increases The median costs of power generation from gas and coal rose over the five-year period, the agency said. For atomic energy, the findings indicate that costs are “roughly on par” with those reported in 2010, “thus undermining the growing narrative that nuclear costs continue to increase globally.” The costs are expected to change considerably in the coming decades as new technologies are deployed. Coal plants will become as much as 70 percent more expensive if they include equipment to capture carbon emissions while offshore wind and solar costs are expected to fall, the IEA study showed. New utility-size solar installations could produce power for less than $100 a megawatt-hour before 2025 in the sunniest regions while panels on rooftops could reach that level five years later. In Europe, governments have set targets for lowering carbon emissions and producing power from renewables such as solar and wind. The U.K. is in the process of making a final decision on developing costly nuclear plants while Germany has increased generation from coal, the dirtiest fossil fuel, following a phase out of atomic plants after the Japanese disaster at Fukushima in 2011.