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May 30, 2011

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September 7, 2010

Corn Prices Surge. Is Ethanol to Blame?

Corn prices have surged but, as Biofuels Digest reports, the culprit this time is a poor harvest and shutdown of grain exports from Russia.

U.S. ethanol production remains sluggish as low gas prices and a lack of investment capital have held back plans for new plants.  In addition, Congress’  inability to  extend biofuel subsidies that expired that the end of 2009 means that China has surged ahead of the rest of the G20 both in energy consumption and in clean energy investment.

March 24, 2010

Alternative Fuels Industry Still Waiting for Tax Extenders Reconciliation

After the House and Senate passed bills including an extension of the alternative fuel mixture and biodiesel tax credit program, alternative fuel producers assumed that Congress would act quickly to put the legislation into a form that could be signed by the President. 

It has been more than two weeks now, however, and still Congress has not reconciled the two bills. 

House Ways and Means Committee Chairman Sander Levin (D-Mich.) is quoted by BNA Daily Tax Reports (March 23) to say that if lawmakers must hold a formal conference committee to settle differences on legislation extending expired and expiring tax cuts, it could be a long time before a compromise is reached.

Levin’s comments came the day after he told the House Rules Committee that it is “uncertain” when the House will consider the $31 billion extenders package (H.R. 4213), telling that panel the Senate-passed legislation has “many other provisions in it we need to consider within the committee and I’m thinking we’re going to have a conference committee and if we do I think the likely result is it will take considerable time to complete it.”

According to Levin, the House and the Senate used different offsets to pay for AFM and biodiesel tax cuts that expired December 31, 2009.

Until the bills are reconciled and signed by the President, the AFM and biodiesel tax credit remain in abeyance and the alternative fuel industry remains in limbo.

March 16, 2010

New Legislation for Offshore Wind Tax Credits

Filed under: CleanTech investing,wind — Tags: , , , , — Jonathan B. Wilson @ 6:04 am

Two bills have recently been introduced in the Senate that would expand or extend tax credit programs for offshore wind projects.

Senate Bill 3062 sponsored by Sen. Tom Carper (D-Del) would extend existing tax credits for offshore wind projects until January 1, 2020.

The Deepwater Offshore Wind Incentive Act (S. 3064 sponsored by Senators Carper and and Susan Collins (R-Maine)  would offer tax credits to “deepwater offshore” wind projects.  Some project developers believe that deepwater projects may be able to circumvent some of the environmental and NIMBY resistance tocloser-in offshore wind projects. 

S. 3064 would increase the Section 45 production tax credit for “deepwater offshore” wind projects to 3.04 cents per kWh, with an inflation adjustment for years after 2010.  The bill would also extend the placed in service date for qualifying projects to 2030 for Section 48 investment tax credit purposes. 

The bill defines “deepwater offshore” projects as any project that is located in water with a depth of 60 meters or more (regardless of whether the project is in the internal or territorial waters of the U.S.) 

Both bills have been referred to the Senate Finance Committee.

March 15, 2010

Alternative Fuel Producers Push for 30% Investment Tax Credit

Filed under: Biofuels,biomass,CleanTech investing — Tags: , , , , , — Jonathan B. Wilson @ 6:00 am

Blue Fire Ethanol and a consortium of 31 other alternative fuel producers have sent a letter to Congress asking for a 30% investment tax credit for biofuels.  While alternative fuel producers were encouraged by last week’s passage of extenders legislation to extend the alternative fuel mixture and biodiesel excise tax credit programs, those extentions are temporary.

While the national renewable fuels standard contemplates increasing amounts of biofuels by 2010, there are no commercial scale cellulosic ethanol plants schedule to come online before 2011, according to one industry letter sent to Congress.

February 3, 2010

Administration Announces New Program to Promote Biofuels and Renewable Energy (RFS2; Carbon Sequestration; Biomass Crop Assistance Program)

President Obama today announced a series of steps as part of a comprehensive strategy to enhance American energy independence and build a foundation for a new clean energy economy. The administration believes that the strategy will create new industries and millions of jobs. (Reuters;  Reaction from Renewable Fuels Association).  At a meeting with a bipartisan group of governors,  the President set forth three efforts that he believes will work in concert to boost biofuels production and America’s dependence on foreign oil:

• The Environmental Protection Agency (EPA) has finalized a rule to implement the long-term renewable fuels standard of 36 billion gallons by 2022 established by Congress.

• The U.S. Department of Agriculture has proposed a rule on the Biomass Crop Assistance Program (BCAP) that would provide financing to increase the conversion of biomass to bioenergy. 

• The President’s Biofuels Interagency Working Group released its first report – Growing America’s Fuel. The report, authored by group co-chairs, Secretaries Vilsack and Chu, and Administrator Jackson, lays out a strategy to advance the development and commercialization of a sustainable biofuels industry to meet or exceed the nation’s biofuels targets. 

In addition, President Obama announced a Presidential Memorandum creating an Interagency Task Force on Carbon Capture and Storage to develop a comprehensive and coordinated federal strategy to speed the development and deployment of clean coal technologies. The U.S. will continue to rely on the availability and affordability of domestic coal for decades to meet its energy needs, and these advances are necessary to reduce pollution in the meantime.

The Presidential Memorandum calls for five to ten commercial demonstration projects to be up and running by 2016.

President Obama said, “Now, I happen to believe that we should pass a comprehensive energy and climate bill. It will make clean energy the profitable kind of energy, and the decision by other nations to do this is already giving their businesses a leg up on developing clean energy jobs and technologies. But even if you disagree on the threat posed by climate change, investing in clean energy jobs and businesses is still the right thing to do for our economy. Reducing our dependence on foreign oil is still the right thing to do for our security. We can’t afford to spin our wheels while the rest of the world speeds ahead.” 

“Advancing biomass and biofuel production holds the potential to create green jobs, which is one of the many ways the Obama Administration is working to rebuild and revitalize rural America,” said Agriculture Secretary Tom Vilsack. “Facilities that produce renewable fuel from biomass have to be designed, built and operated. Additionally, BCAP will stimulate biomass production and that will benefit producers and provide the materials necessary to generate clean energy and reduce carbon pollution.”

“President Obama and this Administration are strongly committed to the development of carbon capture and storage technology as a key part of the clean energy economy. We can and should lead the world in this technology and the jobs it can create,” said Energy Secretary Steven Chu. “The actions President Obama has taken today will create jobs, slash greenhouse gas emissions and increase our energy security while helping to put America at the leading edge of the new energy economy,” said EPA Administrator Lisa P. Jackson. “The renewable fuel standards will help bring new economic opportunity to millions of Americans, particularly in rural America. EPA is proud to be a part of the President’s effort to combat climate change and put Americans back to work – both through the new renewable fuel standards and through our co-chairmanship with the Department of Energy of the Interagency Task Force on Carbon Capture and Storage.”

January 25, 2010

MiaSole to Build Solar Manufacturing Plant in Georgia

Filed under: CleanTech investing,solar — Tags: , — Jonathan B. Wilson @ 8:46 am

MiaSole, a manufacturer of Copper Indium Gallium Selenide (CIGS) thin-film solar panels, is said to be planning to  build a 500,000 square foot manufacturing facility in Griffin, Ga. 

Santa Clara, Calif.-based MiaSolé will initially employ about 250 at the plant but would probably ramp up to nearly 1,000 employees.  The 500,000-square-foot plant could be one of the largest solar factories in the United States,

While Georgia is hardly a hot spot for the solar industry, the MiaSolé deal helps prove the state can compete for such investment. The company is said to have considered at least a dozen states for the plant.  While Georgia is often a target destination for corporations looking for corporate relocations Georgia has not yet taken advantage of opportunities to attract players in the solar and renewable energy fields.

January 9, 2010

NREL Publishes Primer on Community Wind Projects

The National Renewable Energy Laboratory at Berkeley has published a new paper on the application of federal incentives on community wind projects.  (Revealing the Hidden Value that the Federal Investment Tax Credit and the Treasury Cash Grant Provide to Community Wind Projects). 

The paper provides a helpful summary of the investment tax credit, the Treasury cash grant program and ways those incentives can be monetized and harnessed for locally-owned wind power projects.  Perhaps more importantly, though, the paper points out how the recession of 2008-09 may turn out to have been a blessing in disguise for community-owned wind projects.

Wind power grew dramatically during the middle 2000s, but most of these projects were investor-owned.  For-profit developers’ demands for turbines and qualified engineers often resulted in a shortage in those resources for more cash-strapped developers.  The downturn impacted many of these projects and resulted in an excess of supply over demand, allowing community-owned projects to begin to take up the slack.

The expansion of the investment tax credit and the availability of the Treasury cash grant have made it possible for community-based projects to get started with less upfront capital than in the past.

January 5, 2010

Fuel Cell Economics Improving, Offering Energy Storage Solutions

Filed under: CleanTech investing — Tags: , , — Jonathan B. Wilson @ 7:37 am

The economics of fuel cells are improving each year, according to Pike Research, which forecasts that global revenues will more than double over the next few years, from $336m in 2009 to $716m in 2013, according to reports. Pike Research’s analysis indicates that stationary fuel cells offer enormous long-term potential, offering a clean, efficient source of electricity and range in size from 1 kW up to 10 MW or more.

With reformer technology, fuel cells are able to tap into established or accessible sources of fuels such as natural gas, and they can run off of various other fuels including biofuels and gases that are by-products of adjacent industrial processes. With cogeneration or combined heat and power, efficiencies improve dramatically from 40–50% up to as high as 85%. However, cost issues make the technologies’ long-term potential difficult to predict. In order for costs to come down, volumes will have to increase.

Pike Research, however, claims that costs will need to be reduced substantially in order for volumes to materialize. Without uniform government subsidy programs, Pike Research argues, it is unclear if or when that tipping point may occur. The estimated size of the fuel cell market in 2008 was 38 MW, and it is expected to grow to 219 MW by 2013, representing a CAGR of 33%. This translates into a market with a dollar value of $242M in 2008 that will grow to nearly $716M by 2013, representing a CAGR of 24%.

January 4, 2010

Renewable Energy Around the Web: January 4, 2010

Filed under: Around the Web,Biofuels,CleanTech investing — Tags: , , , — Jonathan B. Wilson @ 8:10 am

Welcome to our first “around the web” summary for the new year.  Renewable Energy Around the Web is a weekly compilation of renewable energy news and information.  Please write to us with idea or suggestions for topics at “editor at renewableenergymemo.com”. 

Top Ten Biofuels Predictions for 2010

Our friends at BiofuelsDigest have posted their predictions for the coming year:

#10 – Low Carbon Fuel Standards – Following California’s lead, BFD predicts that other states will also adopt low carbon fuel standards that will spur investment into renewable fuels.

#9 – Cellulosic Ethanol “Happens”- BFD predicts 102 million gallons of advanced biofuels capacity by the end of 2010 with 25 Mgy of it cellulosic ethanol at 17 facilities.

#8 – Aviation Biofuels Surge- 2009 say several successful tests of aviation biofuels.  Look for an increase in interest and investment in 2010.

#7 – Oil Companies Acquire Ethanol Capacity- BFD predicts that a major oil company will acquire 200-800 Mgy in ethanol capacity, at a discounted rate of $0.70 per gallon of capacity.

#6 – Green Chemicals and Plastics Boom – Look for big investments by ‘old’ economy chemical companies into biochemical and related lines of business.

#5 – Jatropha Revival – BFD predicts major investments in this once-maligned plant for use as a feedstock.

#4 – U.S. Renewable Fuel Standard – Congress will take up the renewable fuel banner and will extend targets into the future. 

#3 – Micrcrops / Algae- BFD predicts that Lemna, cyanobacteria and heterotrophic algae gain traction as microcrops begin transition from R&D to commercialization.

#2 – Green Ports / Marine Biofuels- Look for major deals involving marine biofuels.

#1 – Alternative Finance / REITS Move In – BFD predicts the formation of at least one $1B+ investment fund that will finance renewable energy on a build-leaseback basis.  BFD cites its earlier poston the need for project securitization to make project finance money available for biofules projects. 

Our take?  BFD’s ten predictions are an ambitious (and probably somewhat hopeful) look at the year ahead.  Some, like the commercialization of cellulosic ethanol and an interest in green chemical platforms by traditional chemical companies, seem to be the product of trends that were put into place over the past few years.  Others, like a revival of interest in Jatropha, are hard to visualize as we’re sitting here today. 

Still others, like a prediction that Congress will pace a renewable fuel standard, depend on political forces that are notoriously difficult to predict. 

If even half of these predictions come to pass, however, 2010 will bring a great deal of interest and focus to the renewable fuels sector.

And In Other News

Alternative Fuel Mixture Credit Expires.     Congress failed to act, allowing the alternative fuel mixture credit to expire on December 31st.  My tax lawyer buddies tell me that an extender bill is likely in the coming month that will be retroactive, but with this Congress there can be no guarantees.

Environmentalists vs. The EnvironmentAnother report of a large solar park planned in the Mojave Desert falling prey to environmental challenges that the site will endanger the desert tortoise.  Environmental challenges continue to make it difficult for large solar projects in the desert southwest to get permitted and get funded.

European Supergrid – Energy planners in Europe, meanwhile, are pondering the merits of a ‘supergrid’ that would interconnect the electrical grids of participating states in Europe.  Carrying a price tag of nearly $30B Euros, the supergrid would link “turbines off the wind-lashed north coast of Scotland with Germany’s vast arrays of solar panels, and join the power of waves crashing on to the Belgian and Danish coasts with the hydro-electric dams nestled in Norway’s fjords.” 

(Passing interest – If you follow the link to the supergrid story, check out the picture of the solar park in Schleswig-Holstein Germay.  The park is so far north that the solar panels are point almost perpendicular to the ground in order to see the sun. )

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