Clean Energy Policy

Jesse Kharbanda –

Executive Director, Hoosier Environmental Council

Ray McCormick – Farmer & Vice President for the Indiana Association of

Soil and Water Conservation Districts

Tom Conway – Regional Program Manager for the Blue

Green Alliance

The Landscape of Energy The Landscape of Energy Issues in 2011Issues in 2011

Jesse Kharbanda

Executive Director

Hoosier Environmental Council

November 6, 2010

In Montana's Glacier National Park only 27 of the 150 glaciers which existed in 1910 remain today and they will be gone in only 20 years.

Unfortunately the fight for Unfortunately the fight for clean energy won't be easy clean energy won't be easy

at all...at all...• Status Quo & Stubborn Myths

– “Nuclear is cheap”

– “We can't run our businesses on wind power”

– “We're out of power!”

• Old School Economic Development

– Don't worry about the environment

– Or small businesses...

Our GoalsOur Goals

• Back policies that definitively achieve a net benefit for Hoosiers

• Oppose policies that don't...

Making an Impact this Making an Impact this Session? Really??Session? Really??

• Two positive opportunities:

– Property Assessed Clean Energy (PACE) Bonds

– Renewable Electricity Standard (RES)

• And also a need to be very cautious:

– Trackers

– CWIP

PACE Legislation

Opportunity #1Opportunity #1

As energy saving, cost-minded, environmentally conscious

homeowners & businesspeople, we dream of..

Using clean energy...Using clean energy...

General Barriers to General Barriers to On Site Clean EnergyOn Site Clean Energy

• Technical assistance

• Interconnection standards

• Net metering

• Money

• Hard Knocks

PACE: Solves Key ProblemsPACE: Solves Key Problems

• Property Assessed Clean Energy

• Funds raised from bond sale used to give loans to pay for upfront capital

• Borrowed funds stay with the property

Most Appealing AspectMost Appealing Aspect

Energy bill savings > Incremental cost

Net savings, greater cash flow

PACE: Becoming Reality PACE: Becoming Reality for a Communityfor a Community

State legislation PACE program design

City Council voting on PACE Bond

issuance PACE funds to beneficiaries

Clean Energy Investment

PACE Program DesignPACE Program Design

• DOE Guidelines• Local design– Eligibility– Interest rates– Safeguard details

• Uniformity effort– Renewable Funding

PACE from the Lens of PACE from the Lens of

Different StakeholdersDifferent Stakeholders

Home and Business Owner Home and Business Owner PerspectivePerspective

• Voluntary

• Application• Nature of improvement

(whole; part; appliances); dollar range

• Financial information

• Receives PACE funds

• Works with certified contractor

Energy ContractorEnergy Contractor

• Qualified auditor

• Licensed contractors

• Qualified quality assurance professional

MunicipalityMunicipality• Votes to establish

program

• Establishes assessment district

• Issues bonds

• Issues PACE funds

• Admin costs rolled into consumer loan

• Collected on same day as property taxes

In a NutshellIn a Nutshell

A Thought Through Program

PACE MapPACE Map

Preliminary ResultsPreliminary Results

• In one city alone

– 1,000 retrofits

– 60% lower delinquency rate

Federal SituationFederal Situation

State DevelopmentsState Developments

• 22 states have passed PACE authorizing language

– Including neighbors

• Discussions with Indiana legislators; interest by Governor's office

PACE Needs Your SupportPACE Needs Your Support

• Public awareness campaign

– Letters to editor

• Legislator awareness

– Emails to legislators

– Emails to mayors

comments@hecweb.org, PACE

Enormous Potential…Enormous Potential…

• Majority of U.S. homes built pre-1980

• Indiana on-site renewable systems

The Great Opportunity if The Great Opportunity if Barriers Truly FallBarriers Truly Fall

• Can avoid building multi-billion dollar power plants

– Minnesota's example (under R Gov!)

• Can create thousands of new jobs in Indiana

• RAEL study

Opportunity #2Opportunity #2

Renewable Electricity Standard

RES DiagramRES Diagram• Renewable projects

require hundreds of millions in capital.

• Investors will be more likely to site projects where there is guaranteed income.

• By carving out part of the electricity market for renewables, RES provides investment certainty

And this pans out…And this pans out…

70% of

investment in

wind power

occurs in

states with an

RES.

#1: Jobs and Investment#1: Jobs and Investment

• ~6,000 jobs in construction, operation and maintenance

• $7 billion in investment

Texas Installed Wind Capacity

Pre-1999: 42 MW

2006: 2,768 MW

2008: 5,000+ MW

2010: 10,000 MW

Source: Ken Donohoo, ERCOT; SPP

#2: Reduced energy costs#2: Reduced energy costs

Mitigates rising costs from coal power, federal carbon rules

#3: Enhanced Rural #3: Enhanced Rural DevelopmentDevelopment

• Lease payments for hosting:– Substation– Access Road– Simply being located

between turbines

• Renewable energy investments can generate county benefits.

#4: Revitalization of #4: Revitalization of ManufacturingManufacturing

The Basic ChallengeThe Basic Challenge

• RES as a vehicle for...

– Enshrining the status quo

– Old school economic development

• We may have to accept some realities, in exchange for significant gains to renewable power

Fight for the best possible Fight for the best possible billbill

• Minimize the role of non-renewables

• Focus trackers narrowly

RES Needs Your SupportRES Needs Your Support

• Public awareness campaign

– Letters to editor

• Legislator awareness

– Emails to legislators

– Emails to mayors

comments@hecweb.org, RES

Carbon Control TrackersCarbon Control Trackers

Nuclear CWIPNuclear CWIP

Denbury CO2 PipelineDenbury CO2 Pipeline

Stay Informed & InvolvedStay Informed & Involved

• www.facebook.com/hecweb

• www.hecweb.org

• Comments@hecweb.org

– Questions

– Comments

– Tell Us How You Want to Get Involved

Let's Never Forget the Let's Never Forget the StakesStakes