Author: Terrence Murray

Red China is turning green. Last year the country doubled its wind capacity, installing more wind turbines in 2009 than either Europe or the U.S., according to data released today by the Global Wind Energy Council (GWEC).

China added 13,000 megawatts of new capacity in 2009, bringing the country’s total wind capacity from 12,100 megawatts in 2008 to 25,100 megawatts at the end of last year.

By comparison Europe, through 2009, added 10,500 megawatts, the U.S. added 9,900 megawatts to its wind generation portfolio.

Overall, the world’s wind power capacity grew by 31 percent in 2009, adding 37,500 megawatts of new capacity last year, bringing total global wind-powered generation to157, 900 megawatts.

In a prepared statement GWEC Secretary General Steve Sawyer said:

Copenhagen didn’t bring us any closer to a global price on carbon, but wind energy continued to grow due to national energy policy in our main markets and also because many governments in prioritized renewable energy development in their economic recovery plans.

The global market for turbine installations was worth €45 billion ($63 billion) in 2009, said the GEWC.

Separately, the European Wind Energy Association (EWEA) said that in Europe, last year Spain added the most wind turbines, installing 2,500 megawatts of new capacity.  Germany was second, added 1,917 megawatts, followed by Italy (1,114 megawatts), France (1,088 megawatts), and the UK (1,077 megawatts).

Chart: GEWC / EWEA; Image: Reuters

Update: We have been listening to a replay of the BP fourth quarter earnings call. Chief Executive Hayward said that when it comes to BP’s renewable business the focus is on biofuel development; continued development of its U.S. wind power portfolio; lowering production cost at its solar panel business; and investments in a carbon storage project in the United Arab Emirates.

Hayward’s comments are inline with BP actions over the past year.

Last march BP confirmed plans it would invest in two sugar-based ethanol refineries in Brazil.

Through 2009 the company also significantly scaled down its solar business,  closing manufacturing plants in Maryland and Spain. In 2008 the company shutdown a PV manufacturing plant in Australia.

In terms of wind power this year BP’s 400-megawatt Fowler Ridge wind farm, in northern Indiana, became fully operational.  Confirming its preference for the U.S. wind market, late last year BP sold two wind farms in India to Bombay private equity IDFC Private Equity.

Finally, at the end of last year BP acquired a 50 percent stake in a carbon capture and storage (CCS) project in Dubai from Rio Tinto.

We expect to have more details on BP’s investments in its renewable energy business when it announces its 2010 capital expenditure plan on March 2.

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BP, Europe’s largest oil and gas company, posted a fourth-quarter profit of $4.3 billion after losing $3.34 billion in the prior-year period when oil prices had plummeted. For the year, BP earned $16.58 billion, down 22 percent from 2008 levels.

When it comes to renewable energy BP is continuing to cut costs at a unit that until Tony Hayward’s 2007 appointments as CEO, acted as the cornerstone of the company’s “Beyond Petroleum” strategy.

BP cut costs in its renewable energy unit by $4 billion. Staffing over the past three years has also shrunk by 7,500. Specifically, it cut senior management positions from 650 to fewer 500 over the past year. One of the high profile departures was this summer’s resignation of Vivienne Cox, chief executive of BP’s alternative energy unit.

– More to come, we will be dialing in on the conference call.

Vulcan Power Company, a Bend, Ore., developer of geothermal energy projects, has raised $108 million in private equity funding from Denham Capital, an energy-focused investment firm. Vulcan plans to use proceeds to finance the development of its 300- megawatt project pipeline in California, Oregon and Arizona.

This is Denham’s second investment in Vulcan and brings the Boston-based PE firm’s total investment in the geothermal developer to $166 million. Bank of America Merrill Lynch is another major company investor.

In a prepared statement Vulcan acting CEO Robert Warburton, said:

Denham understands both the below ground and above ground dynamics of geothermal development, making them a great resource to Vulcan. This investment ensures Vulcan has the capital to continue the execution of its development program.

Geothermal, unlike wind or solar power, is constant, which makes it the only source of renewable power that can be used on a baseload basis.

According to a recent year-end report by the Geothermal Energy Association, in the U.S. geothermal power generates 3,152 megawatts of electricity and there are 6,442 megawatts of new capacity under development.

Image: Richard Seaman/ The Flying Kiwi

Summit Power plans to close financing on its ambitious $1.75 billion, (almost) carbon-neutral power plant by the end of the year.

Almost, because once operational the plant will capture 90 percent of its expected CO2 emissions.

In terms financing Summit is literally 20 percent there, having already secured, late last year, a $350 million grant from the U.S. Department of Energy.

Laura Miller, a director with Summit Power, tells GER that from now until December it plans to raise some $550 million in equity investment from a single investor — or a group of investors — for a majority stake in the Penwell, Texas-based power facility.

The balance of the project cost — about $1 billion — will be raised via long-term, none recourse bank debt. Miller declined to name investor and project finance banks it was in talks with.  “Talks are ongoing,” she says. “The DOE grant and the Obama administration’s support for clean coal projects are obviously fueling interest from investors.”

It’s been a hectic ride for Summit. Last year it had to take over the project from majority owner Babcock & Brown, the Australian bank and early victim of the global financial crisis.

Once operational in 2014, the 400 megawatts power plant will use integrated gasification combined cycle (IGCC) technology to converts its coal feedstock into a clean-burning mix of hydrogen and carbon monoxide known syngas.

Miller, the former Dallas mayor who is now overseeing the project’s development, says the plant will generate a third of its revenues from the sale of the captured carbon to West Texas oil developers who will inject it in antiquated oil wells as a way to recover hard to access crude reserves. The plant will also sell a little more than half of its  output via a long-term power purchase agreement.

China will invest $7.3 billion on smart grid projects this year, according to data compiled by Austin, Tex.,-based market research firm Zpryme.

By comparison, this year the U.S. government is slated to spend about $7.1 billion on smart grid projects in the form of tax credits and cash grants.

It’s estimated that China will have to spend $100 billion over the next decade to modernize its electricity grid.

In Europe, the UK and France, according to Zpryme, are set to spend less than $300 million of their own stimulus funding on smart grid initiatives. Zpryme’s Research Director Jason Rodriguez tells the New York Time’s Green Inc., that both the UK and France smart grid projects are “already more advanced in smart grid infrastructure than the U.S.”

Companies set to benefit from smart grid investments in the U.S, and China and across the globe include General Electric, IBM and Hewlett Packard.

Graph: Zpryme

On Friday electric sports car maker Tesla Motors became the first U.S. automaker to file for an Initial Public Offering since Ford Motor Co. floated its shares in 1956. The IPO comes at a time of growing investor-interest for battery-powered cars.

Goldman Sachs, Morgan Stanley, JP Morgan and Deutsche Bank Securities are the underwriters.

Telsa, which raised over $220 million in venture capital funding, is not expected to turn a profit until 2012, when it starts selling its Model S automobile.

The company reported a $31.5 million loss for the first nine months of 2009, down from a $57.3 million loss during the same period in 2008.

Draper Fisher Jurvetson, Daimler AG and VantagePoint Venture Partners are all investors.  Other backers include Abu Dhabi-based Aabar Investments, DraperValor Equity Partners, Technology Partners, The Westly Group and Compass Venture Partners.

The last headline-grabbing cleantech IPO was the A123 flotation last fall, in which the company raised more than $57 million.

As we head into the second month of 2010,  industry groups are releasing their overview of the past year. One worth highlighting was the year-end report for 2009 by the American Wind Energy Association (AWEA) that said that the U.S. wind industry grew by 39 percent last year, adding 9,922 megawatts of new capacity, which brought total U.S. wind generation capacity to over 35,000 megawatts.

The dried up credit markets and disastrous economy could have convinced developers to fold up shop for the year. And they actually might have, had it not been for the stimulus dollars. Was this government money crucial? You betcha! Because of the global economic implosion, going into 2009, the U.S. wind sector had actually predicted a 50 percent decline. AWEA says the stimulus turned an expected steep decline into a surging 39 percent upswing.

Obviously, The Obama White House, eager to bolster its record — that some say a year into its administration remains thin on major accomplishments — widely circulated comments by AWEA’s CEO Denise Bode lavishly praising the stimulus program. She said:

The U.S. wind industry shattered all installation records in 2009, and this was directly attributable to the lifeline that was provided by the stimulus package.

The Geothermal Energy Association (GEA) also released its own batch of data this week. The GEA reported that by the end of 2009, the installed geothermal power capacity in the U.S. was 3,152 megawatts. California alone accounts for 2,605 megawatts of that capacity. Far behind that, in second place, is Nevada, with 450 megawatts, and in third place is Utah with 47 megawatts of installed geothermal power.

Overall when it comes to the long-term development of large-scale geothermal power projects, over the past year the sector has been rocked by well-publicized flops. Last month, Google-backed AltaRock Energy said it would abandon its utility-scale Geysers drilling project north of San Francisco, in part out of concern that drilling so deep into the earth’s core could trigger earthquakes. And earlier this month, GER reported that the Department of Energy was looking to implement new measures that would require companies to have a plan to shut down if deep drilling were to cause significant earthquakes.

In Washington, President Barack Obama, in his first official State of the Union address, reiterated some well-worn talking points on the need to invest in renewable energy to create well-paid green-collar jobs and to mitigate the effects of climate change. Obama and his army of advisors can spot a divisive issue from miles away. As a result, the president carefully framed the climate change and energy bill has a jobs creation bill. Of note, the President also called for an extension of offshore oil and gas drilling.

This week saw some noteworthy moves. Ted Turner, the inventor of the 24-hour news cycle, said that he was teaming up with Atlanta-based Southern Co., to develop solar projects across the U.S. Apart from a headline-making name and a noted commitment to environmental issues, in Turner, Southern Co. gets access to lots of private land. Turner owns two million acres (809,371 hectares) of land across the Western U.S., making him the country’s largest landowner. This is all land that’s void of Not In My Back Yard (NIMBY) sentiments.

Duke Energy, in Charlotte, N.C., entered the solar business with its acquisition this week of the 14-megawatt Blue Wing Solar Project, near San Antonio, Texas. Duke’s portfolio includes 630 megawatts of wind energy, and the company is serious about developing its solar capacity. Last fall it inked a joint development deal with China’s ENN to develop solar farms in the U.S. and China.

The GER VC Radar

Funding

Better Place, a Palo Alto, Calif.-based provider of electric vehicle services, raised $350 million in a Series B funding round led by HSBC. In the UK, the Environmental Innovation Fund, a government-backed renewable energy fund held a first close on £125 million ($201 million) in capital commitments. Also in the UK, Earth Capital Partners, which last month held a first close on €750 million ($1.125 billion), hired a team to focuse on green and sustainable investments.

Rambling

We began with data, so why not conclude with another stream of data. On Thursday Thomson Reuters released an insightful poll of leading, mostly U.S.-based, VC investors. Of the venture capitalists they polled, 88 percent said that the U.S. would remain the best place to base a cleantech business and invest in cleantech in the next five years. Only 16 percent of them said China was the best cleantech market. Take that, China!

This week, we also learned of some of Bill Gates’ plays in the clean energy space as he told Cnet News that he had invested some money in Vinod Khosla’s renewable energy fund, Khosla Ventures.

Image: Flickr / Marvin908

The German Environment Ministry is considering delaying the proposed 15 percent cut in its feed-in tariff, which utilities are obligated to pay solar power producers, by one month.  Under the new proposal the cuts would come into effect on May 1 rather than April 1.

Also, citing sources close to Environment Minister Norbert Roettgen, Reuters reports that additional subsidy cuts, slated to come into effect in 2011, could actually be steeper than originally planed.

Roettgen is considering a 3.5 percent cut in subsidies next year — instead of the planned 2.5 percent — If there are more than 3,500 megawatts of solar power capacity installed over a 12-month period, according to Reuters.

Barclays Capital Vishal Shah says the one-month delay could add between 400 megawatts and 500 megawatts of new installations.

In a note emailed this morning Shah also predicts that demand for solar panels in Germany could actually increase this year in anticipation of the steeper cuts in the country’s feed-in tariff slated for 2011. He writes:

A greater subsidy cut from 2011, further supports our view that 2H10 demand in German could increase in anticipation of another FiT change in 2011.

Solar power companies in Germany have said the  cut in the feed-in tariff are too steep and could kill jobs.

Image: Die Bundesregierung

Last November Chinese solar developer Suntech Power announced it had picked Arizona over Texas to house its first U.S.-based manufacturing plant.
In Texas Austin had been lobbying hard to get the plant. It turns out the town of Goodyear, Ariz., a suburb west of Phoenix, will house the plant and  get the coveted tax revenues and the 75 jobs the plant is expected to create, the Chinese company announced yesterday.

The Goodyear plant is expected to have an initial production run of 30 megawatts a year but has the potential to expand to over 120 megawatts.

Manufacturing is slated to begin in September.

Bill Gates, the world’s most ambitious philanthropist, is planning to spend $4.5 million to fund the research of two scientists at the forefront of geoengineering, the controversial practice of altering climate on a global scale to mitigate the impact of climate change.

Alexis Madrigal at Wired Science reports the money will fund research projects overseen by Ken Caldeira of Stanford University’s Carnegie Department of Global Ecology. David Keith, a physicist at the University of Calgary will also get some of the money. Both scientists will actually disburse the Gates funds to support promising technologies that alter the stratosphere to reflect solar energy, filter carbon dioxide directly from the atmosphere and brighten ocean clouds.

Gates has been a believer of geoenginneering, but not as a long-term solution to climate change.

Gates spokesman John Pinette tells Madrigal that “Bill views this as an important avenue for research — among many others, including new forms of clean energy.”

Separately, has Gates has also invested some of his money in Vinod Khosla’s renewable energy fund, Khosla Ventures, one of the most cutting-edge renewable energy investment funds.

Jim Pierobon is vice president – policy & market development at Standard Solar, Inc., a developer, integrator and installer of solar electric systems based in Gaithersburg, Md. He is a former chief energy writer for the Houston Chronicle.

Now that the dust is settling from Scott Brown’s U.S. Senate victory in Massachusetts, it’s becoming clear that the political momentum to pass a comprehensive energy and climate change bill has flatlined.

Let’s face it, despite President Obama’s call in yesterday’s State of the Union address for America to lead the world’s clean energy economy, it is unlikely that a law to make such an economy a reality will actually be considered until at least 2011, when the 112th Congress convenes. That’s despite a growing chorus of voices from corporations, utilities and clean energy advocates rooting for Congress to price carbon rather than relying on the Environmental Protection Agency’s (EPA) regulatory gauntlet to reduce carbon emissions.

The legislative uncertainty has got to be frustrating for companies longing for the competitive advantage that long-term, low-carbon strategies would offer. Nike, Hewlett Packard, Exelon, and Pacific Gas & Electric, have all come out in favor of cap-and-trade. The longer Congress delays passing clean energy legislation, the more time their competitors have to catch up. Perhaps more importantly, the harder the U.S. will have to work to catch up with countries and companies in the European Union and Asia who could be far ahead of us by the time Congress acts.

For the rest of this year’s legislative calendar in Congress, already shortened by the mid-term elections in November, the hearings, proposals and politicking — at least on the Senate side — will assemble more pieces of the climate change legislation puzzle.

Any legislation that can survive into the next Congress will have to accomplish at least these five objectives to help keep U.S. companies competitive:

1. Set a clear, economics-driven price on carbon with a market-based approach to buying and selling emission credits;

2. Ease the way for the U.S. power sector to transition off coal;

3. Include new technologies such as next-generation nuclear reactors clean coal in the technology portfolio;

4. Ensure that consumers benefit from trading of emission credits;

5. The legislation has to be revenue-neutral to the federal government.

To Garner enough votes to get a bill out of the Senate will mean including provisions supporting controversial policies such as the development next-generation nuclear power and carbon-capture-and-storage technologies. Clean energy advocates may also need to back off of efforts pushing for renewable electricity requirements in states that don’t already have them — over 15% of states currently have renewable portfolio standards mandating that specific percentages of a state’s electric generation portfolio be from renewable resources. As negotiations proceed, we may even see the word “renewable” replaced by “alternative” to make it easier to include technologies other than wind, solar, biomass, and hydro in carbon reduction and energy plans. Pennsylvania already uses the word in the title of its clean energy program.

One of the newer bids to frame the strategy for reducing carbon emissions is from Senator Maria Cantwell, a Washington State Democrat. Her Carbon Limits and Energy for America’s Renewal (CLEAR) Act would have every fossil fuel producer or importer (coal mining companies and oil and natural gas producers) participate in a monthly auction to bid for carbon permits for each ton of fossil carbon they place into U.S. commerce. Three-fourths of the revenues from these auctions would be refunded directly to every American on a so-called “equal per capita” basis each month.

Under Cantwell’s vision, no Wall Street traders or speculators would have access to the auctions and therefore would not be able to manipulate carbon prices or supply.

All this said, in this election year, a Senate version of the House Waxman-Markey climate change and energy bill will likely be more of a cleantech jobs bill, and not a bill to cut carbon emissions. Mind you, there are some job incentives provisions in Waxman-Markey that could conceivably be copied and pasted into a Senate bill. The bill mentions solar PV and hot water heater installers, the next generation of nuclear engineers needed to succeed those retiring from their plant owners, design engineers and assembly-line workers at domestic geothermal equipment plants, not to mention fuel cell, wind turbine and solar module manufacturing plants sprouting to meet Made-in-America mandates.

But what about cap-and-trade? Not likely in an election year. Jobs are a lot easier to agree on than how to put a price on a ton of carbon.

– Jim Pierobon

According to a survey of 41 cleantech-focused venture funds by Thomson Reuters the United States remains, ahead of China, overwhelmingly the best place to launch a clean tech business.

Survey respondents, all veteran early-stage investors, said the U.S. would remain the best cleantech market over the next five years, and 88 percent told Thomson Reuters that America would be the best place to base a cleantech business in the next five years.

Far behind the U.S., in second best place is China. For 16 percent of the polled investors, most of them California-based, China represented the best cleantech market and 13 percent agreed it was the best place to locate a cleantech business.

China, which has committed more than $200 billion to develop its clean energy portfolio over the next two years, is becoming the “country to beat” in the cleantech race. The Obama administration has repeatedly said that it wants Silicon Valley not Shanghai to be the world’s cleantech capital.

While the size of the Chinese market is pushing a lot of European and U.S. companies to set up shop there, the reality is that contracts have until now largely gone to local companies that often license foreign technology.

On the appeal of the U.S. market over the Chinese or even European ones, Robert Nelsen, co-founder and managing director of Arch Venture Partners, said:

The world has absolutely no hope of making any substantial impact on global warming without major scientific breakthroughs, almost, all which will come from United States’ innovation. China and Europe are doing well developing markets and applications, but we still own the fundamentals.

In terms of investments venture capitalists told Reuters that they plan to make up to 140 new investments in cleantech companies this year, a significant increase from the 117 investments made last year, according to a venture capital database maintained by Thomson Reuters.

Earth Capital Partners, a clean tech-focused private equity fund based in London, has hired a team of investment profetionals focused on sustainable agriculture and forestry investments from IBIS Capital Management and EMP Global.

The new hires include Bosworth Monck , who joins  Earth Capital as head of sustainable agriculture and forestry investment. Gabriel Montana and Richard Smith also join as partners.

Last month Earth Capital held the first close of its debut fund, the  €750 million ($1.125 billion) ECP Renewable Energy Fund One.

A report released yesterday by the Geothermal Energy Association says that in the U.S. geothermal power generates 3,152 megawatts of electricity and there are 6,442 megawatts of new capacity under development.

In California geothermal power generates 2,605 megawatts of electricity; Nevada, the country’s second largest producer, generates nearly 450 megawatts of electricity from geothermal.

General Electric (GE) is close to signing an agreement to supply, its 1.5 megawatts class of wind turbines, to two wind projects in Brazil that once operational are set to generate more than 400 megawatts of electricity.

One project is a 144 megawatts project that is being developed by Dobreve Energia in the state of Rio Grande do Norte and Renova. GE is also close to inking another deal to supply turbines for a 270-megawatt project located in the state of Bahia that is being developed by Renova Energia.

Both projects are expected to go into commercial operation in July 2012.

Brazil generates a majority of its power from large hydro power plants and currently only  has 605 megawatts of wind capacity – compared to 35,000 megawatts in the U.S. — and another 450 megawatts that is under construction.

Ted Turner, the country’s largest landowner, (and the creator of the 24-hour news cycle), is teaming up with Southern Co., to develop solar power projects across the U.S. Southwest.

Southern, based in Atlanta, is one of the country’s largest operator of coal-fired power plants. Like a lot of power utilities it has been investing in renewable energy to offset its carbon and green house gases emissions.

Southern will team-up with Turner’s, Turner Renewable Energy to develop photovoltaic-based solar power plants.

Why Ted Turner? He’s the country’s largest private landowner, overseeing over two million acres (809,371 hectares) of land across the Western U.S.  This valuable, private real estate could streamline development process because it will, among other things, bypass Not In My Back Yard (NIMBY) sentiments.

A poor economy and a dried-up credit market have not slowed the pace of construction of wind farms in 2009.  According to figures released today by the American Wind Energy Association (AWEA), the U.S. wind industry grew by 39 percent in 2009, adding 9,922 megawatts of new capacity last year, bringing total U.S. wind-powered generation to over 35,000 megawatts.

Before the stimulus money, the wind industry predicted that wind installation in 2009 would actually fall by as much as 50 percent. Denise Bode, CEO of the AWEA, says the stimulus money changed that and helped turn around an expected steep decline into a nearly 40 percent growth. She tells the New York Times’s DealBook:

The U.S. wind industry shattered all installation records in 2009, and this was directly attributable to the lifeline that was provided by the stimulus package.

Wind-rich Texas added 2,292 megawatts of wind generation last year, followed by Indiana, which added 905 megawatts of new capacity. A lot of those new megawatts, came from the 400-megawatt Fowler Ridge wind farm, in Indiana’s Benton County, which came online this year.  Iowa, in third place, added 879 megawatts of new capacity.

Data Source: American Wind Energy Association

Duke Energy Generation Services (DEGS) has purchased the 14 megawatts Blue Wing Solar Project, marking the Charlotte, N.C. company’s entry into the solar generation business.

DEGS is buying the project from the U.S. unit of juwi Solar, the German developer.

The 139-acre project, located near San Antonio, Texas, is expected to go live at the end of the year, according to DEGS.

Blue Wing’s total output is backed by a 30-year power purchase agreement with San Antonio-based CPS Energy.

Back in October DEGS forged a partnership with China’s ENN Group to grow its solar generation portfolio. DEGS currently generates 733 megawatts of wind power.

The Environmental Innovation Fund, a renewable energy venture capital fund launched by the government-backed UK Innovation Investment Fund (UKIIF), has held a first close on £125 million ($201 million) in capital commitments.

Hermes Private Equity will manage the fund as part of its Hermes Private Equity Environmental Innovation Fund (HPEEIF). Over the next two – to – three years the Environmental Innovation Fund will invest in low carbon and clean technology funds.

In a prepared statement UK Prime Minister, Gordon Brown said:

The UK has a wealth of innovators and entrepreneurs seeking to create the businesses of tomorrow – businesses that will make the UK a world-leader in low carbon innovation and industry, and help to tackle some of the biggest challenges we face around energy and climate change. This fund will provide substantial investment where it is needed and deliver strong returns for investors.

Kate Mackenzie at the Financial Times’s EnergySource blog has an  interesting take on the future of U.S. coal. Citing a report by Bernstein Research analyst Hugh Wynne, she writes that the recent proposal by the Environmental Protection Agency (EPA) to tighten sulfur dioxide emissions could actually push coal into a “secular decline.”

Existing SO2 standards were implemented nearly 40 years ago and cap emissions at 140 parts per billion as part of a 24-hour “primary standard.”  They also include a “secondary standard” for three-hour periods that cap SO2 emissions at 500 parts per billion. The EPA’s proposes a one-hour standard of up to 150, parts per billion, which according to Bernstein Research’s Wynne, could cut SOE emissions by 50 percent by 2015.

The new SO2 regulations, Wynne writes, could convince power utilities to retire old coal-fired power plants at a faster pace because SO2 scrubbers are expensive, costing about $100 million to install on a 350-megawatt power plant.

In a recently issued report, Wynne writes:

We estimate that over the next five years approximately 12 percent of U.S. coal fired generation capacity (equivalent to some 4 percent of total U.S. generation capacity) will be retired.” He adds stricter SO2 emissions rules would accelerate the retirement of older power plants.

To curb the EPA’s regulatory reach Senator Lisa Murkowski (R-Alaska) has drafted an amendment that would block the agency from regulating CO2 and other greenhouse gas emissions. According to Wynne that amendment is unlikely to pass.

Mackenzie does give credence to Wynne’s arguments, noting that the growing popularity of natural gas could indeed lead to a decline in the use of coal. But she also notes that these new EPA regulations might turn out to “be a boon” for regulated utilities, as they will have to increase their rates to pay for SO2 scrubbers.