Mereja

Author: Jigar Shah

  • Robert Boyce’s 5 Myths show ignorance

    First Sarah Palin, now Robert Boyce taking pot shots around things they barely understand
    1) Solar and Wind take up too much land: If you just focus on rooftop solar and buffer land at airports, brownfields, wastewater treatment facilities, and military bases you could power the US almost 2 times over with just solar power. Wind turbines on the top of light posts are being tested by Wal-mart and that market alone could power 10% of the country. Everyone wants to extrapolate from today’s large scale projects instead of using their brain — Boyce is no different:     http://www.ef.org/documents/EF-Final-Final2.pdf


    2) Going green will reduce our dependence on imports from unsavory regimes: this is true that there are some elements from copper to rare earth metals that we will have to import. But the dirty secret Robert won’t tell you is that business as usual also uses rare earth metals so we are not worse off than we would be otherwise.     http://seekingalpha.com/article/103972-rare-earth-metals-not-so-rare-but-valuable
    Plus we save gargantuan amounts of water, over 1 gallon per kWh of fossil fuels offset.

    3) A green American economy will create green American jobs: In this case, Robert goes off the deep end again. First, he shows that he doesn’t actually understand how jobs are created in our country. What the green economy does is create mostly short-term service jobs (some manufacturing). But more importantly, it takes money away from inefficient job creators like utility companies and shifts that money to the general marketplace where it can be used to buy new iphones, kitchen remodeling, or new cars for that matter. It doesn’t matter. The point is that we need to take money away from low growth industries like utilities and shift that money to the innovative parts of our economy — green technologies do that in electricity, water, natural gas, etc.

    4) Electric cars will substantially reduce demand for oil: His argument here is that he just doesn’t think that anyone will buy electric cars. So you are a downer, I get that but make a real argument. Not just that you don’t believe in global innovation — from the Manhattan Institute of all places. BTW, it may not be electric cars, it might be electric bicycles and mopeds. It will certainly take 20 years to replace existing vehicles, but Robert wants instant gratification. This is infrastructure, 20 years is a short period of time.

    5) The United States lags behind other rich countries in going green: Here is the one place I agree with you. America doesn’t get credit for what it has accomplished and the extraordinary growth trajectory it is on in these areas. Maybe I like Robert afterall 🙂

    For the record, I don’t know Robert and he is I am sure a brilliant senior fellow, but I needed a foil. Happy Earth Day!

    Jigar Shah
    CEO
    Carbon War Room

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  • Kansas Power Plant Overbudget

    Just saw this article: http://www.kansascity.com/2010/04/08/1866150/kcpl-boosts-cost-for-new-electricity.html


    Comparing the cost of the upfront capital in this plant to technologies have have free fuel costs are just inaccurate. Technologies like wind, solar, energy efficiency and others act like Nuclear power did in the 1970s. They have high upfront costs but reduce electric utility rates over time as their capital costs are paid off. This is why old coal and nuclear is cheap and NEW coal, nuclear, and natural gas is so expensive. Further, the 20th century technologies have volatile fuel prices. Natural Gas and coal are cheaper now, but were 2-3 times more expensive in 2008. The challenge here is that the utilities and the public service commission are using bad data to make decisions. I can’t believe they are deliberately cheating rate payers, but they seem to not know any better. The sad thing is that David Springe can do something about it, and is instead just trying to win a bet.

    Jigar Shah
    Carbon War Room
    Content provided by and all rights reserved to CleantechBlog.com. Also check out http://www.cleantech.org

  • Start-Ups, Not Bailouts

    This op-ed says it all. http://www.nytimes.com/2010/04/04/opinion/04friedman.html

    I am not usually a huge Tom Friedman fan (although I like him), mainly because I find that while he is an amazing communicator, I am not usually spurred to action. This time I am. The data here is well known to me because I follow the Kaufmann Foundation, but the bigger question for this group is, “what can we do to get the Obama administration to care?”
    The bottom line is that outside of R&D, helping entrepreneurs is tough. It requires focusing on the Presidential Climate Action Project: http://www.climateactionproject.com/ and removing other barriers that are not too sexy but pave the way for risk taking.
    I like the climate bill in Washington, but I like removing common sense barriers better. By removing these barriers we can help entrepreneurs take the step to start a Climate Change Solutions business.
    Jigar Shah
    CEO, Carbon War Room
    www.creatingclimatewealth.com
    Content provided by and all rights reserved to CleantechBlog.com. Also check out http://www.cleantech.org

  • The Right Way to do Solar Manufacturing in the US

    I was reading with sadness about the decision by BP Solar to shut down the Frederick, MD manufacturing facility. As many of you may know, I worked for BP Solar and this facility was the first real large scale solar mfg facility in the United States. Solarex (bought by BP) perfected the use of polycrystalline silicon (vs. mono) and pioneered it at this facility. More importantly, BP Solar will keep the R&D staff and function — this is important because they are some of the best in the world.

    I was asked by the Obama Administration back in February 2009 to, “help bring solar manufacturing to Michigan”. My response was:
    1. Solar is practically illegal in Michigan (see solar bill of rights here)
    2. US hasn’t had a manufacturing policy in years and I wouldn’t imagine why anyone with half a brain would mfg in the US when you can achieve such a low cost of mfg in Germany, China, Malaysia, etc
    3. US has to invest some time in this space to help elected officials understand the drivers of our cost cycle. In fact, labor is not the dominant COGS for solar PV (although it is not insignificant). The biggest drivers that the government could help with are:

    • Fully automated plants (crystalline) costs about $2.5/Wdc or $2.5B for a 1,000 MW plant. So the government needs to match the 50% capex subsidy other governments provide as they have for battery mfg
    • Property taxes can be a killer that local governments can help with
    • Electricity prices. With our rising electricity prices, other governments offer $0.04/kWh
    • Tax abatements. The Obama adminstration must be out of its mind when it suggested raising taxes on Corporations. We are one of the highest tax places in the World. Raise taxes on the rich and everyone else but for heaven sake we have to reduce corporate taxes by at least half in this country. Malaysia and others offer a 10 year tax holiday for new mfg.

    The reason manufacturing matters is that the US is huge and uses alot of stuff. To take the approach the UK has done and just become a service economy won’t work. Further manufacturing has a much larger multiplier of other jobs that support each plant from suppliers to logistics, to local services.
    We squandered Billions of stimulus money on consumption for new solar and wind projects. Instead we should have spent that money on Solar and Wind manufacturing. On the projects side all we need is for the Federal government to use the bully pulpit to embarrass State public utilities commissions who keep approving higher cost electricity projects from new Coal, Nuclear, and Natural Gas compared to much lower cost distributed generation from solar, fuel cells, energy efficiency, targeted smart grid, and targeted storage.
    By the way the Obama administration has done some great things like working on reducing health care costs for small businesses. Now it is time to get them to focus on this issue.
    Jigar Shah
    CEO, Carbon War Room
    Founder SunEdison LLC
    Content provided by and all rights reserved to CleantechBlog.com. Also check out http://www.cleantech.org

  • Missouri Solar taking off

    Since 2000, electricity rates have gone up by about 4.5% annually. Even in this downturn, electric utility have little shame in raising rates to invest in infrastructure that depends on 20th century approaches. In 2008, Missouri voters decided to pass a 300 MW solar program within a bold RPS plan. The plan requires a rebate for solar at $2/Watt for projects up to 100kW. In the meantime, solar PV prices have plumented and 100kW solar systems can be installed now for less than $3.90/Watt. With matching federal incentives solar is now cheaper than rates in Missouri, especially after AmerenUE decided to raise rate again. These utilities really have no ability to look out more than a few years. As AmerenUE decides to keep raising rates they are driving electricity customers to keep look for alternatives. These don’t just include solar. They now include geothermal, cogeneration, fuel cells, and other technologies.


    Jigar Shah
    Carbon War Room
    www.carbonwarroom.com
    Content provided by and all rights reserved to CleantechBlog.com. Also check out http://www.cleantech.org

  • Vermont Yankee to be Shut Down

    “Vermonters sent a message to President Obama and the nuclear industry today,” said Greenpeace’s Nuclear Policy Analyst Jim Riccio. “The nuclear renaissance is dead on arrival. We can retire old, decrepit and leaking reactors like Vermont Yankee and help usher in the energy revolution that America needs.”

    “When American’s have the choice about the kind of energy they want in their communities, they don’t want nuclear. Vermont has shut down the myth of the so-called nuclear renaissance. Greenpeace is calling on Vermonter legislators to vote against relicensing in the house as well so that the message to America registers loud and clear.”

    This decision is an interesting one. Like Sacramento many years before it, Vermont decided to proactively shut down their Nuclear plant. In this case, Vermont was choosing this pathway even though the variable costs of the plant were less than $0.03/kWh.

    For new Nuclear we have a slightly different case. The recently $8.3B in loan guarantees for Southern Company’s nuclear plant is on a total bill of $14.4B for just 2,200MW of nuclear. At the same time, McKinsey claims that over over 85% of the 17 gigatons of carbon reduction we need globally by 2020 could be achieved by efficiency alone. Further, that for $14.4B, Southern company could perform such deep energy efficiency retrofits that they would create 10 times the number of construction jobs than the Nuclear plant.

    I am not anti-nuclear, but some of these large Nuclear plants plans need to rethought towards more manageable strategies. Companies like Hyperion are creating small reactors that can be sited and financed more easily than the large Nuclear power plants.

    Nuclear power holds the promise to be a big player in our effort to decarbonize the electricity grid, but their lack of common sense around how to handle public relations seems to be their Achilles heel.

    Jigar Shah
    CEO, Carbon War Room
    Founder, SunEdison

    Content provided by and all rights reserved to CleantechBlog.com. Also check out http://www.cleantech.org

  • Investing our way out of the Recession

    I recently ran across this blogpost from a man I really respect. He says, “However, Paulson acknowledged to NPR host Scott Simon, the “conundrum” is that to spur the economy, we now need to spend more and create more jobs. Paulson did not offer a solution to this impasse.

    Indeed, this contradiction is now paralyzing the nation’s political life, as Americans are worried about both high unemployment and record deficits. The Obama Administration and Congress are now walking a tightrope between these anxieties.


    Investment as Solution. The solution to this jobs vs. savings conundrum is to invest money now, into projects that when completed will help us individually and as a nation to save more.”

    The blog post goes on to offer some recommendations and I would visit it here: http://energyeconomyonline.com/Job_Needs_Push_Energy_Bill.html

    My recommendation is to focus only on the built environment. According to a Navigant study funded by the Energy Foundation, there are 15,000,000 Commercial buildings in the US. out of a total of 130,000,000 million structures. There has been huge movement in the non-recourse financing space since SunEdison pioneered financing for solar PV in 2003. Today Property Assessed Clean Energy (PACE) bonds and utility on-bill payment mechanisms can bring interest rates for non-recourse energy efficiency bonds down to below 8.5% over 20 years. Not bad!

    Companies like Pulse Energy, SCI, and others have software/hardware solutions that for less than $15,000 per building to perform retro-commissioning/continuous commissioning solutions to save over 10% of total electricity used in the Commercial sector — or around 150 terawatt hours. Given the 80/20 rule you would focus your efforts on the 3,000,000 buildings that are the largest opportunities or $45B in investment. The savings from these 20% of buildings would exceed 100 terawatt-hours per year or $10B per year. With interest the customer pays an extra $1,000 per year and savings of over $3,000 per year.

    Job creation occurs from this one cost effective technology alone is almost a half a million job years. Taking energy audits that have already been completed for deeper energy retrofits and giving them a non-recourse financing solutions gives you a 2-3X multiplier on this opportunity. Cost effective solar, demand response, ice storage, and other consumer technologies multiply this by another 3X. LBNL estimates that the opportunity is around $440B using today’s technology.

    The job creation from the work is important but not really what we are after. Money that is freed up from the sleepy electricity industry is usually redeployed in much more value creating areas — new businesses, consumption, savings

    The multiplication effect here is what we are after. The Carbon War Room has recently launched the Green Capital Global Challenge to go after this opportunity.



    There are so many investment opportunities that do not need federal government financial support — simply some assistance on removing market barriers. Smells like an opportunity!

    Jigar Shah
    Founder of SunEdison
    CEO of the Carbon War Room
    www.carbonwarroom.com

    Content provided by and all rights reserved to CleantechBlog.com. Also check out http://www.cleantech.org

  • Why isn’t there a Building Efficiency Trade Association

    Is it time for a real trade association for the Building Efficiency industry?

    I was thinking about this today. I have seen one that really does the job. For those of you that have been a part of the efficiency industry for a long time, you know that it is like a greyhound race. Companies running as fast as they can to realize the dream only to come up short on actually catching the rabbit. Energy Efficiency in the US alone is estimated to have $440B of potential by LBNL and over $3 Trillion when calculating the ultimate economic potential by 2030. As the costs of new electricity, water, and natural gas capacity continues to rise, saving electricity, water, and natural gas becomes a far more cost-effective option – important during a recession. The challenge is that from energy efficiency financing to building codes – there is no coherent industry voice.

    That’s why we need a real trade organization. Yes, there’s the Alliance to Save Energy; American Council for an Energy Efficient Economy; US Green Building Council and many others. And, yes, these organizations have worked on standards, financing, and regulations that would help the industry.

    All that’s well and good, but we need an organization willing to do the hard work in the industry to establish and prioritize efforts to tackle the biggest obstacles to our growth. This is not easily done by a non-profit – we need a trade association. Currently, there is no widely recognized leader for energy efficiency financing, standards, and other issues. Leaving this to non-profits will leave us in the slow lane. A pathway for incremental change and more stop/start efforts.

    An industry-wide trade association dedicated to energy efficiency financing, building codes, and other important areas make sense.

    Jigar Shah, CEO Carbon War Room, Founder of SunEdison

    Content provided by and all rights reserved to CleantechBlog.com. Also check out http://www.cleantech.org