Bright idea puts paid to power bills

Sun Herald
Sunday 5/7/2009 Page: 15

AS ENERGY bills rise by 20%, meet the man who pays nothing for electricity to power his four bedroom house. Warren Yates even managed to score a $10 credit from EnergyAustralia for selling electricity back to the grid - he is believed to be the only person in NSW to have done so - after covering his roof with a three kW solar energy system.

While average households will spend an extra $182 a year on electricity bills after last Wednesday's price rise, the Yates family home in Mosman creates more energy than it consumes. When domestic solar feed-in tariff rates rise from 27 cents for every kW hour not used, to a predicted 60 cents next January, Mr Yates estimates he will earn more money from electricity providers.

"I have become an energy geek," the 65-year-old engineering academic said. "I bought an appliance that measures how much electricity each appliance consumes so we can work out the most effective things to do for the least cost. It's become a game to minimise energy use without sacrificing comfort."

Mr Yates spent $30,000 installing the 18 solar panels, but he managed to claim $8000 back through the Howard government's solar energy rebate scheme. At first, we weren't self sufficient; it took us a while to get our energy consumption down," he said. Turning off the family computers overnight, running the dishwasher every couple of days and refusing to turn on the heating "unless we have visitors" were some of the tactics the family used to reduce consumption.

Most domestic solar electricity systems are only one or 1.5 kWs, which Mr Yates believes is too small to generate enough power to sell back to the grid. He installed a larger - and more expensive - system to power the household and faced the roof panels west to capture the afternoon sun. Most households with solar energy face the panels north to catch the sun all day, but Mr Yates said west-facing panels caught more intense afternoon sunlight, helping to power peak energy consumption in the evening.

Renewable energy firm Green Project said that as government policies covering grid feed-in tariffs and solar incentives improved, there would be more "net winners". Solar electricity "can put you ahead of the game to make sure you don't have to pay high energy bills", said the fine's head of operations, Esther Bailey.

EnergyAustralia's energy efficiency expert, Paul Myors, said most households with solar panels would need to significantly reduce energy consumption before earning money back. If you only have a 1kW system, you will probably only generate around 20 to 30% of the electricity an average household would use," he said.

Energy consultant Bruce Taper, who created BASIX, the Building Sustainability Index, agreed households wanting to sell energy back to power companies needed to become frugal with their electricity consumption.

Grab for green votes to make us pay while sun shines

Sunday Age
Sunday 5/7/2009 Page: 17

Victoria's solar energy feed-in scheme is built on empty promises, says Mary Aldred.

Solar energy would be great if it actually worked. And while state governments are falling over themselves to put up renewable energy schemes, taxpayers aren't getting a return on their money.

While the Federal Government has lost support over an early exit from its solar rebate scheme and the Senate has delayed the emissions trading bill, state governments have shot off on their own strange climate tangents. Instead of slashing emissions and boosting a self-sufficient industry, the schemes are a costly grab for votes. Put simply, state governments are throwing your money at feel-good schemes and empty promises.

For instance, the Victorian premium solar feed-in tariff is the latest on a list of State-inspired climate measures mined at encouraging uptake of renewable energy This Government reckons customers will reduce their average yearly electricity bill by about $600 under the scheme.

So far it's just numbers on paper, as green groups and industry slog it out over two models. The first- a "net" scheme- would see householders paid for unused solar-generated electricity that is fed back into the grid. But green groups are demanding a second "gross" scheme, under which householders would be paid for the electricity they use.

Since when were governments in the business of paying people for what they consume? Where would the extra money needed to pay for a "gross" feed-ht scheme come front? You guessed it: taxpayers. Although the details might be hazy, throw in the "climate change" bogie and Victorians are expected to cough up the dough. It is fiscally negligent of any government to force already struggling families to subsidise the solar energy consumed by other people who can afford their own solar panels.

Solar is largely a lifestyle choice that makes people feel good about their environmental morals, and any emissions cuts are minimal compared to what will be achieved under an emissions trading scheme. Emissions trading will also create a market for new energy technologies such as solar.

Those that can produce low emissions energy at the cheapest price will thrive. But that's not how state governments across Australia are playing it. The current schemes artificially prop up weak industries by creating government subsidies they can fall back on. And small, state based climate schemes, such as solar feed-in tariffs, wont even make a dent in Australia's greenhouse gas emissions.

After decades of economic reform by both sides of politics to wean industry dependence, it beggars belief that some sections of renewable energy are considered a special case for rent-seeking by state governments. Not only do the economic arguments not stack up; it gives viable sections of the renewable energy industry a bad rap.

Since grabbing for green votes has become a popular sport, state governments have been unable to resist introducing a wide range of ad hoc, overlapping legislation that doesn't do much except cost taxpayers a lot of money. Putting the focus back on cost and what works, the question that needs to be asked is: do these schemes warrant the huge cost? The clear answer is no.

Recently, NSW announced it would go ahead with a near identical feed-in tariff to the one proposed for Victoria. Yet it will return nearly $300 more to its householders than the Victorian scheme. Victorians have a right to ask why they deserve less than people living in an economic rust-bucket north of the border.

A national solar feed-in scheme was recommended by the 2008 Council of Australian Governments meeting for its consistency and to give badly needed policy certainty to the industry. On that basis alone, state-based schemes should be abolished in favour of a national scheme from which every Australian can benefit equally.

The problems with state-based climate policies that overlap a national program are the extra level of regulatory and cost burdens on industry; no extra benefit for consumers; and zero extra emissions abatement.

Complementary climate measures that support emissions trading play a role - but not when they are two government layers thick and poorly designed. State governments need to look beyond drowning consumers in a quagmire of green tape that they are forced to bankroll. At the moment, it's just window dressing for votes, with no real value.

Mary Aldred is an energy industry consultant.

73-turbine wind farm given nod

Canberra Times
Saturday 4/7/2009 Page: 9

A $250 million windfarm at Gullen Range near Crookwell has received development approval from the NSW Government. Despite the approval, the project, by Epuron, will not progress until the Federal Government legislates for 20% mandatory renewable energy. Project director Simon Davey said this had been a pillar of Prime Minister Kevin Rudd's election platform. For political reasons, it had been linked to the emissions trading scheme.

Epuron executive director Andrew Durran said it was up to the Federal Government to stop delaying the expansion of renewable energy in Australia and implement the renewable energy target legislation. The project's approval, announced yesterday by NSW Planning Minister Kristina Keneally, coincides with the imminent commissioning of a 63-turbine windfarm between Bungendore and Tarago. It is claimed most of the electricity from that $280 million project will power Sydney's desalination plant. The remainder will be sold into the national electricity grid. The 73-turbine Gullen Range windfarms will be about 25km west of Goulburn.

Mr Davey said it would generate electricity equivalent to the average consumption of 63,000 homes. He claims it will reduce greenhouse gas emissions by 500,000 tonnes of carbon dioxide a year. The project would create about 150 jobs during construction and 15 operational jobs. Ms Keneally said conditions of approval included reducing from 84 to 73 the number of turbines to reduce possible impacts on the operations of nearby Crookwell airport.

Epuron would have to provide landscape screening and had agreed to operational restrictions when juvenile powerful owls began flying in the area. Mr Davey said construction of the wind farms would begin within two years of legislation setting the 20% mandatory renewable energy target. Construction was expected to take about another two years.

Meanwhile, Epuron was completing environmental studies for a 182-turbine windfarm about 25km west of Yass. As with the Gullen Range site, the mach larger project, to be built on three precincts, had excellent wind. Despite development approval in October 2005 for a $100 million windfarm on the Woodlawn and Pylara properties near Tarago, the project remains stalled with no purchaser for the electricity it would produce.

ActewAGL is one of four partners in that project, which would have about 25 turbines. ActewAGL general manager of business development and strategy Dianne O'Hara said yesterday dialogue continued between the four partners on how best to progress the project. Construction of a 60-turbine wind farms on the Molonglo Ridge, about 15km south east of Queanbeyan, was cancelled in May last year by Acciona Energy.

Renewable energy may cost less than coal power

Sydney Morning Herald
Friday 3/7/2009 Page: 6

USING more renewable power in Sydney would make electricity bills more affordable, according to a study prepared for the CSIRO that challenges assumptions about cheap coal-fired energy. More intelligent use of the existing energy grid could slash greenhouse gas emissions and cut household power bills by up to $60 a year, the report from the University of Technology Sydney shows.

On Wednesday the Independent Pricing and Regulatory Tribunal gave utilities permission to raise energy bills by a fifth, or up to $200 a year for some families. The study looked at five scenarios for NSW, ranging from building more coal-fired power stations, as recommended by the 2007 Owen review of the state's energy needs, to a large energy efficiency campaign combined with more renewable power.

It found building baseload power using coal was much more expensive than focusing on energy efficiency and tapping into a network of small "co-generation" power sources sprinkled in the suburbs. That conclusion was reached without factoring in the increased costs to fossil fuel generators that would be imposed if Australia brings in a carbon trading scheme. Carbon trading is expected to raise the costs of greenhouse-intensive power like coal even more.

"Even though we decided to be very conservative in our estimates of costs for coal, it still shows that there is no reason why we should see coal as cheap, and renewable power as expensive - it's more interesting than that," said Chris Dunstan, a researcher at the university s Institute for Sustainable Futures.

Cogeneration, or the similar tri generation, involves installing small, efficient low-emissions power plants in buildings and using them to power structures in nearby streets. The Owen inquiry found there would be a shortfall in the state's baseload power by 2014 and recommended that a new power station should be built to compensate. Yet energy demand in the past two years has not increased as fast as the 2007 inquiry forecast.

Building a new coal-fired power station to meet demand before 2020 would cumulatively cost up to $30 billion, while building the infrastructure to supply the grid from more local low-emissions sources plants would total about $27 billion over the next decade, the university report calculated. The study, released this week, is part of a wider project for which the CSIRO commissioned five universities to examine Australia's energy sector and look at ways to cut greenhouse gas emissions.

The City of Sydney is the only council seriously planning for a network of small cogeneration plants. The Lord Mayor, Clover Moore, confirmed this week that the council intended to build a tri generation plant in the basement of Town Hall, with a view to supplying the QVB and possibly other surrounding buildings with energy.

"I have proposed a pilot project.., in partnership with a project by Frasers Property at the former Carlton United Brewery site," Cr Moore told business leaders on Wednesday. "Our restoration of Prince Alfred Park provides another opportunity for tri generation, and our consultants are now working on options for distributing lighting, heating and cooling for the project itself and parts of the surrounding neighbourhood."

Stress test for power generators

Summaries - Australian Financial Review
Friday 3/7/2009 Page: 1

The Federal Government has asked Morgan Stanley to examine claims by the Energy Supply Association of Australia that the proposed emissions trading scheme could cause electricity generators financial distress and create disruptions to the national energy market.

The investment bank will study power stations such as International Power's Hazelwood, TRUEnergy's Yallourn, Babcock and Brown Power's Flinders and the Intergen-supported Millmerran and Callide C. Coal-fired generators have already held talks with the Australian Securities and Investments Commission on concerns that they could breach licensing requirements following the introduction of an ETS.

A source at one major generator complaining 'we are being treated like polluters and terrorists,' while others have described the approach to the issue by the Minister for Climate Change, Penny Wong, as 'ideological.' The new study follows research commissioned by the industry from KPMG and Ernst & Young, which found asset write-downs would reach into multiple billions.

New standards on energy efficiency

Australian
Friday 3/7/2009 Page: 5

INEFFICIENT hot water systems will be phased out and all appliances will be properly labelled under new national energy efficiency standards as part of a 10-year energy efficiency plan adopted by the Council of Australian Governments yesterday. And state and territory leaders have also agreed to streamline and harmonise processes for building applications to reduce red tape and costs for developers.

While much of the focus at COAG was on indigenous affairs yesterday, the leaders continued with a rolling agenda of other reforms, including energy efficiency measures that they expect will make a significant impact on carbon emissions. Measures to improve the energy efficiency of appliances are expected to reduce emissions by the same amount as would be achieved by removing 4.8 million cars from the nations roads.

The changes will include national legislation for improved labelling and energy ratings as well as a major push to begin next year to phase inefficient electric hot water systems. From next year, all new homes and commercial buildings will have to meet energy rating standards. COAG also agreed to accelerate the phase-out of inefficient lighting, beginning with a ban on incandescent light globes to start in November.

Kevin Rudd said last night that energy efficiency was the "low hanging fruit" of greenhouse gas abatement, with analysis from the International Energy Agency indicating cost-effective energy efficiency improvements could provide savings equivalent to one fifth of projected global energy related emissions in 2030.

"Through the combination of incentives, consumer and business education and carefully targeted regulation, the National Strategy on Energy Efficiency will fundamentally change the policy settings for energy efficiency across Australia," the Prime Minister said.

Mr Rudd said the premiers had agreed to continue their program of micro-economic reforms designed to create a seamless economy in which it would be easier and cheaper for businesses to operate across the nation. The leaders agreed to create a single system of development assessment processes covering all three levels of government, with major nation-building programs to be dealt with by one coordinator who would address all approval requirements. Building codes will be harmonised, with the states agreeing to measure their performance to ensure better approval times.

In a further change to make shipping more efficient, the Australian Maritime Authority will become the single regulator for all maritime safety. At present, it is responsible only for interstate shipping movements. The leaders also agreed to improve efficiency in the trucking industry by creating a single national heavy vehicle regulator responsible for inspection standards, safe driving hours, mass limits and registration.

Altona Project - Evaluation pact

Adelaide Advertiser
Friday 3/7/2009 Page: 80

Altona has signed an agreement with Chinese company CNOOC New Energy Investment which could lead to the full funding of the evaluation of its Arckaringa project. Altona is doing a bankable feasibility study on the viability of a 10 million-barrel-a-year coal-to-liquids plant with a 560MW cogeneration power facility in South Australia's Far North.

Sun rises on a world-first

Adelaide Advertiser
Friday 3/7/2009 Page: 5

Whyalla's 301 days of annual sunshine will be driving the world's first solar energy station, producing electricity 24 hours a day by this time next year. The $15 million plant will again put South Australia's regional areas at the forefront of sustainable and emission-free energy production. It will also address the problem of finding an emission-free electricity source capable of providing a base-load, or 24-hour, power supply, which is a necessity for the world to combat climate change.

Construction of the solar thermal power plant, Whyalla Solar Oasis, began last week. It will initially comprise four "Big Dishes" while the technology is demonstrated, generating power for up to 1000 homes. The long-term plan is for 600 dishes to be built, each 500sq in in area, in a 2km by 1km area at the city's northern entrance.

The expanded plant is expected to generate about 130 GWs of power a year, enough for 19,000 average homes and preventing 129,000 tonnes of greenhouse gas emissions being produced - equal to that generated by 36,000 cars each year. Whyalla Council deputy mayor Eddie Hughes said it was "incredibly exciting" for work to start after 12 years of planning and 30 years of research by the Australian National University.

UK could generate £70bn from wind, wave power – Carbon Trust

www.environmental-finance.com
2 July

The UK offshore wind and wave power markets could be worth £70 billion ($115 billion) and provide at least 15% of the carbon dioxide (CO2) emissions reductions needed to meet the country's 2050 targets, said the Carbon Trust today.

At the launch of its 'Clean Tech Revolution' campaign, the company - set up by the UK government to aid the transition to a low-carbon economy - said that developing the offshore wind energy sector could have a net economic value of £65 billion and create 220,000 jobs by 2050, through developing the technology in the UK rather than importing it. To support this, up to £600 million is needed for R&D as well as the lifting of regulatory barriers and mechanisms to accelerate the deployment of offshore wind energy.

And with 25% of global wave power technology already being developed in the UK, the country is poised to be the "natural owner" of this market, said the Carbon Trust. This could generate £2 billion per year by 2050 and support 16,000 jobs directly, plus an unquantified number of secondary service jobs.

"These technologies are not green 'nice to haves', but are critical to the economic recovery of the UK," said Tom Delay, chief executive of the Carbon Trust. "To reap the significant rewards from their successful development, we must prioritise and comprehensively back the technologies that offer the best chance of securing long-term carbon savings, jobs and revenue for Britain... The global race is clearly on and the clock is ticking." He added that the UK needs to focus on technology prioritisation, and channel public support to technologies that offer the maximum impact on cutting CO2 emissions and generating economic benefit for the country.

As part of the campaign, launched today, the Carbon Trust will be launching 15 R&D and technology acceleration projects this year, adding to the 40 already underway.

Renewables industry pushes for tougher targets

www.environmental-finance.com
2 July

Renewable energy advocates have welcomed the momentum toward adoption of a US federal renewable electricity standard (RES), but vowed to keep pushing for a stronger mandate.

The American Clean Energy and Security Act, sponsored by Congressmen Henry Waxman and Ed Markey, was the first bill to pass a house of Congress that would cap greenhouse gas emissions. However, it also requires electric utilities to meet 20% of their electricity demand through renewable energy and improved energy efficiency by 2020. Although lower than the 25% target featured in the initial Waxman-Markey proposal, the bill passed on 26 June surpasses the 15% by 2021 requirement adopted by the Senate energy and natural resources committee last month.

"We need to strengthen the RES," said Tim Howell, commercial leader, power & renewable energy for GE Energy Financial Services in Stamford, Connecticut. "We're going to have to keep pressure on Washington." Utilities selling more than 4 million MW hours of electricity a year would be required to source 6% of their power from renewable sources or reduce demand through energy efficiency initiatives by 2012, increasing to 15% from renewable energy sources and 5% from energy efficiency improvements by 2020, according to the House bill.

Since about 20% of US electricity is produced by entities below the threshold, it makes the bill "less aggressive" in driving renewable energy production, said Jack Ihle, Washington-based associate director of climate change and clean energy for energy market information firm IHS Inc.

The momentum for a federal RES after years of stalled efforts in Congress bodes well for the renewable energy sector, said Gabriel Alonso, CEO of Horizon Power Wind Energy in Houston, Texas. "I'm confident we will have a RES that will make a difference in the near future," he said.

But the federal targets are seen by renewable energy developers as insufficient to spur significant demand beyond that which is already driven by state mandates. "Some states already have more aggressive goals than [the federal RES bills] so the higher the better," said Pat Agudow, vice-president of administration and policy management for solar product supplier Opel International in Shelton, Connecticut.

Congress should encourage renewable energy development in US regions without standards, specifically the south-east, while doing nothing to discourage the states that already have mandates, either through pre-emption or an adverse interaction with carbon legislation, said John Geesman, co-chairman of the board of directors of the American Council on Renewable Energy in Washington, DC.

"That's a difficult legal balance," he said. "But I think if you look at most of the states with aggressive [renewable portfolio standard] programmes, there's less interest in the positive side of federal legislation and more apprehension of the potential negative effect."

The House bill clarifies that US states can implement feed-in tariffs, a mechanism designed to encourage renewable energy development by requiring utilities to purchase energy generated by renewables at above-market rates set by the government. Since the House has adopted the RES with the feed-in tariff, the Senate will be lobbied heavily to include it in its bill, Agudow said. California adopted a feed-in tariff in 2008 to support the development of up to 480MW of renewable generating capacity from small facilities while other states are considering implementing tariffs.

The feed-in tariff provides guaranteed rates of return for long periods of time and requires the least amount of up-front capital from the government, but can be vulnerable to fraud if the programmes are improperly structured, said Frank Middleton, vice-president of marketing for Opel. "The feed-in tariff is the one we're favouring the most because we've seen how well it's worked in Europe," he said. "It's not the perfect model, but it's probably the best model we know of."

For Sale: Caribbean Geothermal Energy

www.aer-online.com
01 July 2009

The Caribbean nation of St. Kitts and Nevis is looking to sell its excess geothermal energy, and it is marketing the surplus power to the neighboring U.S. Virgin Islands (USVI).

Caribbean Net News reports that Carlisle Powell, minister of communications in the Nevis Island Administration, and Rawlinson Isaac, general manager of West Indies Power Ltd., made a presentation to the USVI Senate's Economic Development, Energy and Technology Committee that detailed a five-year plan to install underwater cables that will transport a supply of geothermal energy from Nevis to the USVI. Isaac stated that Nevis only uses about 9 MW of its geothermal power.

Powell and Isaac also stated their government was seeking to sell its excess geothermal energy to other Caribbean islands.

Flood of funds for clean alternatives

Australian
Thursday 2/7/2009 Page: 5

AUSTRALIA has said it will not pick winners in the shift towards clean energy technologies, but carbon capture and storage and solar energy will be by far the biggest recipients of direct government funding of the sector over the next 10 years. As part of the May budget, the Australian government announced $4.5 billion would be spent over the next decade on clean energy infrastructure, with nearly half of that going to CCS and a third to the development of large-scale solar energy plants.

The central components of the Clean Energy Initiative are the $2.45bn allocated to the CCS Flagships Program over nine years and $1.6bn to the Solar Flagships Program over six years. Both programs are designed to fund 1000 MWs of capacity in their respective technologies. The CCS Flagships Program is likely to comprise three installations representing various CCS options, such as coal gasification, post combustion capture and oxy-firing, which can be used to reduce emissions from coal-fired power stations.

The solar program is likely to comprise four installations testing two systems under the banner of solar photovoltaics, and two from solar thermal, as well as energy storage a critical component if the technology is going to meet more than just peak demand. Projects for both programs are expected to be chosen next year, and construction is expected to begin around 2012, with commissioning of the facilities in 2015.

The federal government also has a $300 million Renewable Energy Demonstration Program (REDP), which will allocate $1 for every $2 spent to fund commercial developments of new renewable technologies such as geothermal, ocean energy and biomass. Several dozen applications have made it to the final round of assessment, but only a handful of projects across the various technologies will be chosen.

Although these government allocations represent nearly the total of direct support, a far greater investment in clean energy infrastructure is likely to come from the government's proposed renewable energy target (RET), should it make its way through both houses of parliament.

The target of 20% renewable energy by 2020 is expected to generate more than $20bn worth of renewable energy infrastructure. Much of this, at least in the early years, will come from wind energy, which is the most mature of the clean energy technologies and can be quickly rolled out.

However, developers of geothermal and ocean energy technologies are also confident they will be in a position to build large facilities by 2020, with the geothermal industry predicting some $2bn of investment by 2020, and ocean energy producers more than $1bn. Indeed, many in the clean energy industry have argued that the RET could and should be expanded, possibly to 25%, to cater for the potential investment that could be made.

The same argument has been made for the REDP, with the government confirming that projects worth more than $15bn have been proposed. Developers have suggested that some projects, and their technologies, will move to more supportive jurisdictions overseas, particularly in Europe, if they fail to get REDP funding.

The power of government incentives was highlighted in the subsidy for solar rooftop installations, which was halted several weeks early last month after costing the government more than $700m some $500m more than forecast. The subsidy will be replaced by a solar credits program that will tie in with the RET.

Support for clean energy infrastructure as part of the separate nation-building stimulus packages was relatively limited, with the major item being $2.71-)n set aside for home insulation essentially the installation of pink batts. To put that in a global context, in a survey of 17 developed economies by HSBC, Australia ranked ninth in the allocation of economic stimulus funds to the green sector.

Australia's spending on green initiatives pales in comparison with the $US220bn ($275bn) announced in China, amounting to one third of its overall stimulus package, according to HSBC's definition of green and climate related projects. It estimated the Obama administration had announced $US94bn worth of green measures in its stimulus package and noted that more than 80% of South Korea's $US31bn stimulus went to green and climate-related initiatives and infrastructure.

Still, Australia's focus on green issues in its stimulus package was more generous than that of India, which directed none of its $13.7bn stimulus plan towards green ventures, according to HSBC, and Italy and Japan, which allocated just 1.3% and 2.6% of their packages respectively, making them the least green of the G7 member countries.

The Obama administration has gone further than its fiscal stimulus package and has pledged a strategic investment of $US150bn over 10 years in clean technologies and other green themes such as energy efficiency and building efficiency. US President Barack Obama has made energy security and reducing the reliance on imported oil a central policy.

China has also announced its intention to become the world leader in electric vehicle production, and the National Development & Reform Commission has said spending on renewable energy installations may top $US600bn by 2020. The commission said earlier this month it would soon release details of a long-term plan to develop renewable energy to replace coal and oil with cleaner burning fuels.

In Australia, various state governments are also providing incentives for renewable energy, with Victoria announcing in May it would commit up to $100m towards a large solar energy station for the state, subject to the receipt of matching funding from Canberra.

South Australia also has a renewable energy target of 20% by 2014, and announced in its budget for this year and next that it would increase that target to 33% by 2020 to stimulate additional investment in renewable energy and accelerate growth in green jobs. It allocated $20m over two years to its Renewable Energy Fund.

Queensland has set aside $9.3m for a new geothermal power station at Birdsville, and $7.5m for a solar gas project with the CSIRO. It has also committed $19m for the first year of a 3000 job Green Army, and its solar hot water program will offer solar and heat pump systems priced at $100 for pensioners and low-income home owners.

Beyond pathetic is BP's dumping of alternatives

Age
Thursday 2/7/2009 Page: 2

IS IT any wonder that people are cynical about marketing when a company like BP decides that after a decade of trying to be the nice guy it can now relax and just be itself? Yes, it no longer needs to pretend that it is anything but a producer of oil and gas-with a nice little sideline in alternative energy. It no longer has to bear the slings and arrows of environmentalists accusing it of greenwash for extensively promoting clean energy initiatives that were wholly disproportionate to its actual investment in those programs.

Now that it is closing its alternative energy headquarters in London - which follows last year's closure of its photovoltaic manufacturing plant at Homebush Bay - BP's army of spin doctors, branding consultants and ad agency executives can take a break.

But the only problem is that BP told its that it was more than just an oil and gas company with a patchy record in human rights. BP wanted to be regarded as "an energy company", to be part of the solution of climate change not the problem. In short, it wanted to be loved and spent a fortune wooing us.

After it bought Amoco in 2000, BP bought some small-cap solar energy companies and five years later committed $US8 billion to solar and wind energy programs and developed a biofuels program. It then hired image consultants Landor & Associates and ad agency Ogilvy & Mather to come up with an identity that reflected this conversion to renewable energy. Thus was born Beyond Petroleum.

Real people voicing their opinions about oil companies starred in their ads, making a refreshing change to the muscular commercials that typified the oil sector. The crisp clean yellow and green sunburst logo neatly encapsulated the changes, as any good brand identity should.

But this week all that washed up on BP's reputation like an oil slick on a pristine beach. "It's perhaps unfortunate for their that they came up with such a memorable line as now they appear to be hoist with their own petard," notes Wayde Bull, planning director of branding consultants Principals. BP spent nearly a decade and $US200 million persuading its it was all true. On the day it announced it was halving its clean energy investment its own public relations people trashed that bank of trust and goodwill in a matter of minutes.

"I'm not sure that it's been our branding," BP spokesman David Nicholas said. "It's a strapline that's been used in our corporate advertising." He had "no idea" if "Beyond Petroleum" would continue to be used. The sceptics who dismissed the branding as cosmetic fluff were right. BP insists its $US8 billion alternative energy investment remains but in light of this news that money seems more like a corporate social responsibility initiative than a game-changer.

So, the next time a company gushes about its new brand identity, forgive its if we stifle a yawn.

US government lending could support $250bn of renewables projects

www.environmental-finance.com
25 June

With the distressed capital markets currently reluctant to provide extensive funds for renewable energy projects, the US Department of Energy (DOE) is committed to temporarily providing financial support for mature technologies, officials said. Over the next 18 months, the federal government will make a series of loans to mature technologies because the capital markets are not providing such funding, said Matt Rogers, senior advisor overseeing DOE investments from the economic stimulus package.

But the government does not plan to serve in that capacity indefinitely because its long-term role is to underwrite advanced technologies and fill funding gaps for projects such as energy efficiency that the markets do not handle well, he said.

"Our intent is to step in specifically where market failures exist and to solve that particular problem," Rogers said at the Renewable Energy Finance Forum in New York this week. "But the federal government is not and should not be a long-term substitute for the capital markets." The government can potentially provide enough funds to support nearly $250 billion worth of renewable energy projects, a meaningful, but insufficient investment in the sector, he said. "This is about making a down payment," he said.

An upcoming report from the DOE will establish long-term renewable energy goals, such as fulfilling 15% of US electricity demand from wind, 6% from solar by 2030 and at least 9-12% from hydropower by 2030, said Kristina Johnson, undersecretary of energy at the DOE. While there are numerous barriers to expanding the US renewable energy sector, a sizeable amount of increased production can be achieved by improving efficiency and expanding capacity at existing sites, she said.

In 2008, the DOE's loan guarantee programme received 46 applications for renewable projects and provided $10 billion out of the $14.3 billion sought by developers. The programme will soon reopen with an additional $8.5 billion for renewable projects starting in July, said David Frantz, director of the DOE's loan programme. The stimulus package provides for an additional $48.6 billion for renewable energy projects through September 2011. The law requires the agency to set terms and conditions in a manner designed to ensure loan repayment and to be a self-supporting entity, DOE officials said.

"We are clearly senior lenders," Frantz said. "We behave as a senior lender as you would expect. We're very careful and diligent in all of our underwriting activities and I think this probably explains, in some part, the delay in getting specific projects out." The DOE is working quickly to issue guidance for its loan guarantee programme and streamline the process by taking steps such as enlisting lenders interested in participating to assist the agency in the underwriting process, he said.

The guidance, likely to be released in July, must answer critical questions about the interaction between loan guarantees and grants, including whether projects can be eligible to receive both sources of government funding, said Neil Auerbach, managing partner for Hudson Clean Energy Partners.

Bills currently being debated in the Senate and House of Representatives would reform the existing DOE loan guarantee programme, create a new clean energy investment fund to allow funds to be used to support technology deployment and a new administration within the DOE to implement the programme, called the Clean Energy Deployment Administration (CEDA). The DOE does not have a formal policy on CEDA, but Rogers said there are several key issues to consider, namely that the bill establishes the programme without providing funds.

"Authorisation without appropriation is actually going to make all of us crazy," he said. "One of the challenges we had at the Department of Energy loan programme over a long period of time is that it was authorised but not appropriated. It's really hard to make a programme work if you don't have resources." In addition, Rogers expressed concern that the provisions of the current bill could allow for the bypassing of the Federal Credit Reform Act, which was established to better control and manage the government's direct and guaranteed loan programmes. "If we make a set of bad loans, this industry or whichever industry receives those bad loans will suffer from it for 20 years and we can't afford to do that because this is a long-term game," he said.

ADB’s energy policy draws fire, despite renewables boost

www.environmental-finance.com
25 June

The Asian Development Bank (ADB) is to double its clean energy investments to $2 billion from 2013. However, it is to maintain its support for coal-fired generation and some large-scale hydro plants, drawing criticism from environmentalists.

"While $2 billion annually is a significant commitment, this represents only a fraction of the region's financing needs in the area of clean energy," said ADB president Haruhiko Kuroda last week, during its 'climate and clean energy week'. "But we expect that this contribution will catalyse significant additional resources from the private sector, carbon markets and other sources."

The commitment is part of the ADB's Energy Efficiency Initiative, which set a target of investing $1 billion annually by 2008 - a target which it says it has exceeded. However, the Manila-based multilateral bank's updated energy policy - approved by its board on Friday - will see the ADB continue to support environmentally controversial power sources.

"ADB will also selectively support large hydroelectric power plants," it said. "However, such financing will be based on the economic benefits and the projects will comply with ADB's social and environmental safeguards requirements." Large-scale hydro projects often involve the displacement of local populations and the destruction of valuable habitats - and, particularly in tropical countries, the creation of their reservoirs leads to significant greenhouse gas emissions, caused by decaying vegetation.

Also, ADB will continue to support coal-fired plants: "To meet the electricity needs of the region, large capacity additions will be required for which coal-based generation will grow. ADB will encourage DMCs [developing member countries] to adopt available cleaner technologies, such as fluidised bed combustion, supercritical and ultra-supercritical boilers, and flue gas desulfurisation.

"As new technologies - such as integrated gasification combined cycle and carbon capture and storage (or sequestration) - are shown to be technically feasible and economically viable, ADB will support their deployment in DMCs to increase their financial viability," the policy states. It also said it will "selectively support coal-based power projects if cleaner technologies are adopted and adequate mitigation equipment and measures are incorporated into the project design.

"For all the brave words uttered during the meeting on climate leadership, ADB's new energy policy is seriously flawed," said Greenpeace Southeast Asia climate and energy campaigner Amalie Obusan. "For the ADB, 'clean energy' are words that do not mean anything." Greenpeace slammed the energy policy as "business as usual, with no intention of removal of coal, oil or gas from its portfolio to make way for investments in tried, tested and real 'clean energy' technologies such as wind, solar and modern biomass.

"Instead it is shifting funds to clean coal, with dubious techniques such as fluidised bed combustion, supercritical and ultra-supercritical boilers, and flue gas desulphurisation." The ADB notes that "nearly a billion people still lack access to electricity and Asia's energy needs are expected to double by 2030, presenting major supply and energy security challenges as well as accelerating climate change." However, its energy policy does state, as its first principle, that "support for energy efficiency improvements and renewable energy projects will be prioritised and broadened to reach as many sectors in as many ways as possible." It will also continue to eschew financing nuclear energy generation.

GE, Hitachi to Seek Guarantees for Nuclear Project

www.bloomberg.com
June 30

General Electric Co., Hitachi Ltd, and Cameco Corp, plan to seek U.S. Department of Energy loan guarantees to help finance a venture that would use lasers to enrich uranium for nuclear fuel. GE Hitachi Global Laser Enrichment said today it completed an application to the U.S. Nuclear Regulatory Commission to build the world's first commercial uranium enrichment plant to use laser technology.

The proposed development in Wilmington, North Carolina, would create as many as 300 permanent engineering and support jobs, as well as employ more than 500 workers during construction, Tammy Orr, chief executive officer of Wilmington- based GE Hitachi Global Laser Enrichment, said today in a telephone interview.

"We are closely working with the government on the next round of loan guarantees and would be very interested in participating," Orr said. "We believe nuclear energy is a worthwhile energy to invest in from a stimulus perspective." She declined to disclose the project's estimated cost or the potential size of the Department of Energy guarantees. The guarantees allow energy-project developers to borrow at lower rates than they could without the government's backing, according to the Web site of the Nuclear Energy Institute, an industry trade group.

GE Energy, of which the nuclear venture is a part, provided $29.31 billion of the parent company's $183 billion in sales last year. The Fairfield, Connecticut-based parent company doesn't disclose sales figures for the GE-Hitachi venture. GE Energy is the world's biggest maker of power-plant turbines. GE fell 4 cents to $11.72 at 6:40 p.m, in New York Stock Exchange composite trading. The shares have fallen 28% this year.

Maryland commission OKs Areva-designed reactor

www.newsadvance.com
June 30, 2009

A nuclear energy project that would use Areva's U.S. Evolutionary Power Reactor design received a key approval on Monday. The Maryland Public Service Commission issued a Certificate of Public Convenience and Necessity for the proposed reactor at Constellation Energy's Calvert Cliffs power plant near Lusby, Md.

UniStar Nuclear Energy, a joint venture between Constellation and Electricite de France, is leading the project. The Maryland commission's approval was required before construction could begin. It was one factor for which Constellation and UniStar were waiting before making a final decision to build an EPR. Much of the design work on the U.S. Evolutionary Power Reactor was done in Lynchburg by Areva NP Inc.

Areva is in the process of expanding and hiring 500 new employees in Lynchburg to support the detailed design and construction of proposed projects like the one in Maryland. Areva employs more than 2,000 people in the Lynchburg region. The Calvert Cliffs project is one of four that are undergoing the final due diligence and negotiations with the U.S. Department of Energy in hopes of receiving a federal loan guarantee, which could be essential to get loans for the project.

If it receives a loan guarantee by the end of 2009, UniStar could move forward on the project, according to a news release from Constellation. The project also needs approval from the Nuclear Regulatory Commission. A new nuclear energy reactor has not been built in the U.S, since the 1970s, and several companies are racing to be the first to build one soon. The NRC has 20 construction license applications at various stages in the approval process, including four that cite Areva's design.

Scotland plans “big push” towards European grid connection

newenergyfocus.com
30-06-09

The Scottish Government is planning a "big push" to establish an offshore grid network in the North Sea, as part of its aim to export electricity directly to Europe.

Speaking at the Second International Wave Energy Summit in London today, Lynn Vallance, head of the offshore renewables team in the Scottish Government, explained that it saw its proposal for an underground network of cables between itself, Norway, Sweden, Denmark, Germany and the Netherlands as one of its main objectives for the country in the renewables sector.

Originally announced in November last year (see this New Energy Focus story), the 'super-grid' would potentially allow the easy transfer of renewable energy among northern European countries, however, plans for the proposed network preclude England despite its extensive North Sea coastline.

The announcement comes as part of plans by the Scottish Government, which possesses 25% of Europe's tidal power energy potential and 10% of Europe's wave energy potential, to establish itself as an exporter of renewable energy across the continent and not just to the UK.

Ms Vallance said: "We are doing lots and lots of work in terms of pushing this sector forward for Scotland. The big push is off shore supply grids, whereby we will not just act as an exporter of renewable energy to the UK markets but also be shipping it to Europe."

Addressing the delegates at the event, Ms Vallance gave an overview of the current status of Scottish work in the field of renewable energy and said that its Marine Renewable Energy Roadmap was set to be published next month, which will assess where the Government is in relation to its goals for 2020.

Saltire
In addition, Ms Vallance defended the timescale currently in place for companies and researches to win the Saltire Prize, which is a £10 million grant to anybody able to successfully engineer a project capable of producing 100GW of energy over a continuous period.

Simon Grey, chief executive of Alness Ross-shire-based AWS Ocean Energy, asked if the current timescales for the project, which sets a deadline of operation as April 2015, were "set in stone" as he said companies "just don't have the time" to be able to compete for the prize under these deadlines.

Ms Vallance said the timescales for the Prize, which was said to have attracted 100 registrations of interests in April of this year (see this New Energy Focus story), were currently being looked at but tight deadlines would help accelerate delivery of technology. Responding to Mr Grey, she said: "We are trying to come up with time scales that are challenging and ambitious but they have to be ultimately achievable."

Commitment
Also speaking at the event, Trevor Raggatt, deputy director of marine energy and operations innovation unit of the Department of Energy and Climate Change (DECC), explained the UK Government was very much committed to support for the renewable energy sector and wanted to capitalise on the opportunity for the UK to become a "genuine world leader" in the field.

He said: "Between the UK government and the Scottish Government we are genuinely committed to the renewables sector and the idea of getting from where we are - at about 1.5% renewable energy generation to 20% in five years. "It looks like a heck of a challenge but it is a challenge that we as a government are committed to and we are committed to doing right and going forward from 2020 to 2030/2050 to meet the challenging climate change and carbon targets. We are committed to renewable energy," added Mr Raggatt.

Mr Raggatt also took the opportunity to explain that the Marine Research Deployment Fund (MDRF) could soon look to help finance projects having yet to issue any money from its £50 million budget. The MDRF was established in 2004 to help fund to wave or tidal power energy generation projects that have completed their initial research and development and are ready to commercially deploy.

He said: "We haven't given any cash out yet but we are getting to a stage now where we are seeing real sector movements towards marine deployment and what I can see is when you are ready for commercial deployment and say we have got a viable technology here, the MRDF is there to begin funding for those projects and help these projects through the initial difficulties of getting up and running." In addition, Mr Raggatt said that the government had begun work on the Strategic Environment Assessment for English and Welsh waters and claimed that it would hopefully be published in the next few months.

First step to converting solar energy using 'artificial leaf'

www.eurekalert.org
29-Jun-2009

Structure of artificial light harvesting antenna determined.

An international team of researchers has modified chlorophyll from an alga so that it resembles the extremely efficient light antennae of bacteria. The team was then able to determine the structure of these light antennae. This is the first step to converting sunlight into energy using an artificial leaf. The researchers will be publishing an article on their research findings in the online Early Edition of the PNAS journal in the week starting 29 June. Leiden researcher Swapna Ganapathy has obtained her PhD based on this subject, under the supervision of Professor Huub de Groot, one of the initiators of the research.

Forests at nano scale
They are the subject of dreams: artificial forests at nano scale. Or pavements and motorways where gaps in the surface are filled with pigment molecules that collect sunlight and convert it into fuel and other forms of – clean – energy. But before this can happen, artificial photosynthesis systems first have to be developed that work both quickly and efficiently.

Two things are needed to generate fuel from sunlight: an antenna that harvests light, and a light-driven catalyst. The article in PNAS is about the first of these: the antenna.

Imitating light antennae of bacteria
The fastest light harvesters are to be found in nature: in green leaves, algae and bacteria. The light antennae of bacteria – chlorosomes – are the fastest of all. They have to be capable of harvesting minimal quantities of light particles in highly unfavourable light conditions, such as deep in the sea. These chlorosomes are made up of chlorophyll molecules. The art is to imitate these systems very precisely.

German colleagues from the University of Würzburg in Huub de Groot's team modified chlorophylls from the alga Spirulina, such that they resembled the pigments of bacteria. De Groot's Leiden group then studied the structure of these semi-synthetic light antennae.

Nanotechnology
De Groot: ' Nanotechnology and supramolecular systems are becoming increasingly important, but it is very difficult to determine their structure. So-called cartoons are frequently made that give a schematic indication of what their structure could be.'

De Groot and his colleagues successfully determined the detailed molecular and supramolecular structure of their artificial self-assembled light antennae. They did this using a combination of solid state NMR and X-ray diffraction (see attachment). X-ray diffraction enabled them to determine the overall structure and NMR allowed them to penetrate deeply into the molecules.

Stacking of molecules
De Groot: 'We already knew that the light antennae in bacteria form a structure rather like the annual rings of a tree trunk. The molecules in these semi-synthetic antennae seem to stack in a different way; they are flat. But this, too, is one of four ways we had thought in advance were possible.

New approach
The researchers still have to determine how the light antennae of modified Spirulina chlorophylls work in practice. De Groot: 'This is a completely new approach in this field.'

The new insights are coming in quick succession. Last month, De Groot, with an international team made up partly of different members, also reported a breakthrough in PNAS. In that article he showed how – also with a combination of NMR and another technique, namely electron microscopy – he had resolved the structure of the light antennae of the bacteria themselves. This allowed the researchers to explain how the antennae were able to function so quickly and so efficiently.

Toll Group wins $180m gas project contract

www.news.com.au
June 29, 2009

Toll Group has landed a $180 million deal to manage the supply base and logistics services for a gas project off Western Australia. Toll said today its WA-based Toll Energy division would execute the three-year contract for the $50 billion Gorgon project on Barrow Island. Toll also said its resources business continued to be a strong performer, and it planned to examine further investments and organic growth in the resources sector both in Australia and overseas.

It said its work would begin on Barrow Island once all necessary government approvals for the Gorgon project were received and following the joint venture partners' final decision to proceed, which is expected later this year. Exxon-MobilExxon-Mobil and Shell both have 25 per cent stakes in the project, which will draw gas from Australia's largest-known gas resource, the 40 trillion cubic foot Greater Gorgon fields. Most of the gas will be exported as liquefied natural gas, while a small portion is expected to be sold into the state's domestic gas market. Asian customers are lined up for most of Gorgon's LNG. First production is slated for 2015.

Chevron has so far awarded more than $1 billion of contracts for the project, including a $500 million contract to a Decmil Australia, Thiess Pty Ltd and Kentz Pty Ltd joint venture to build a 3,300 person accommodation camp for the Gorgon construction team. Chevron has operated on the island - Australia's largest onshore oilfield - for the past 40 or so years. Gorgon is Australia's biggest energy project and includes an ambitious geosequestration component. Resources sector consulting group Wood Mackenzie said in a report last month that geosequestration appeared to be "a workable long-term, albeit expensive, solution" to managing Gorgon's carbon dioxide emissions.

Mobil deal to take Caltex to the top

Age
Wednesday 1/7/2009 Page: 3

DEPARTING Caltex boss Des King is confident the Australian Competition and Consumer Commission will approve the company's bid for more than 300 Exxon-Mobil service stations, which would catapult the petrol retailer into market leadership in all areas of its operations.

In his last interview as Caltex chief executive before heading back to parent company Chevron in the US, Mr King told BusinessDay that one of his legacies would be devising a strategy to make Caltex the market leader in refining, wholesaling and retailing in Australia.

"Our refineries are the largest in Australia with 32% market share," he said. "With our wholesale distribution we are also No. 1, at about a third of market share. But when it gets to fuel retailing we are only No. 4. Coles and Woolworths are No. 1 at 22% each. BP is No. 3 at 19% and we are fourth at 16% and that includes our franchises. Taking that out we are at 5%.

"If this is approved we will get a 6% increase in market share so we would be up there equal No. 1 with Woolies and Coles," Mr King said. He said he believed the commission understood Caltex's relationship as the wholesaler to Woolworths' retail petrol stations and that approval for its $300 million Exxon-Mobil offer would only increase competition.

"I don't think the public appreciates that when there is a Caltex sib in lots of places Caltex is not necessarily the retailer and that has caused confusion," he said. "We actually compete with Woolies at a retail level. The ACCC knows that though and that gives us confidence that we will get this approved."

After a holiday, Mr King will become president of Chevron Technical Ventures, a venture capital arm focused on clean energy. He said the developing world should be given access to the lowest-emitting technologies to allow them to meet their energy needs and help strike a climate change deal in Copenhagen in December.

He applauded the Federal Government for delaying its emissions trading scheme rather than rushing it through but believes the best way to treat petrol is through a tax system rather than emissions trading. "When it comes to distributors having to buy those permits, it drives inefficiency in the system," he said. "I think when it comes to emissions, 'emitter pays' is more effective. I think the debate has moved away from a carbon tax on fuel but...

it would make far more sense to have a carbon price on fuel set by the Government and let the big emitters that are industries work on the trading scheme." Mr King hands over to former Incitec Pivot chief Julian Segal, having just delivered a record first-half profit for Caltex but with a weaker outlook for the second half and doubts about a potential dividend.

Drilling for hot rocks

Daily Telegraph
Wednesday 1/7/2009 Page: 16

DRILLING started for Australia's first "hot rocks" commercial energy project yesterday. The plan is to drill 4km below the earth's surface at Paralana in far northern South Australia to gain access to superheated rocks. The consortium headed by Adelaide's Petratherm will create an underground heat exchanger capable of circulating water of more than 2000C. By 2011 the consortium expects to be supplying geothermal energy on a commercial basis and by 2013 to be powering homes and businesses on a much larger scale.

Closure signals fading BP vision for clean energy

Sydney Morning Herald
Tuesday 30/6/2009 Page: 18

BP HAS turned its back on more than a decade of preparations for a carbon-constrained future, closing its alternative energy headquarters in London and ushering its boss of clean energy out the door.

A BP spokesman, David Nicholas, yesterday confirmed a report in London's Guardian that about 80 staff in the company's alternative energy division would relocate to the corporate head office, and that spending on alternative energy this year would fall to between $US500 million ($620 million) and $USI billion; last year it was about $US1.4 billion.

The resignation of Vivienne Cox, the division's chief and BP's most senior female executive, was announced internally weeks ago and is effective from today. The BP chief executive, Tony Hayward, is said to be courting market favour by refocusing BP as a pure oil play. BP shares were up almost 1% to £478 ($979) in London trade last night.

The chief executive officer of WWF Australia, Greg Bourne, formerly BP's Australasian regional president and who worked for more than 30 years in the oil industry, said BP's alternative energy division was the result of long-range thinking in the 1990s. The former BP chief executive Lord Browne of Madingley drove the strategy, which added the tagline 'Beyond Petroleum" to BP's corporate advertising in 2000.

"What was interesting and quite palpable was the pride and hope that it engendered in employees around the world," Mr Bourne said yesterday. "I am disappointed for the organisation that they've left this behind, and I think many other people within BP would be as well. You must wonder where BP's future now lies."

Alternative energy investment has been affected by recent lower oil prices and the difficulty of obtaining project finance in the financial crisis. Last November BP closed its solar photovoltaic manufacturing plant at Homebush Bay- the largest such plant in Australia - with the loss of 200 jobs. Mr Nicholas said the decision to shut the alternative energy office, located about two kilometres from BP's headquarters in London, was "a real estate thing".

Buildings to get energy rating like a car or fridge

Adelaide Advertiser
Tuesday 30/6/2009 Page: 40

THE clock is ticking for commercial property owners to obtain energy-efficiency ratings ahead of a mandatory disclosure scheme next year. Industry experts are saying owners may find it difficult to sell or lease assets unless they have met strict new criteria under the Federal Government's Mandatory Disclosure of Office Building Energy Initiative, expected to be in place from July 1 next year.

From then, any commercial property owner wanting to sell their premises or lease more than 2000sqm of office space will be required by law to disclose the building's energy-efficiency rating before any agreement can be made. Ratings will be determined by government-accredited National Australian Built Environment Rating System, or NABERS, assessors.

Only five Adelaide office buildings have published NABERS ratings, including the ANZ Building on Waymouth St, but not many realise the risk of not complying, says national auditor Big Switch Projects managing director Gavin Gilchrist. "Thousands of local businesses are putting themselves at risk of losing rental income and the ability to sell their premises - or risk breaking the law," Mr Gilchrist said. "Regrettably, Adelaide commercial building owners don't realise this is coming," he adds.

The new mandates will enable tenants shopping for office space to get accurate energy ratings information about a building before they sign a contract, just like with a new fridge or car. It can take from four to six months for assessors to collect data for analysis and determine the rating. The entire process costs between $3000 and $7000, depending on a number of factors including size and tenancy.

Jones Lang LaSalle head of sustainability Anita Mitchell said that combined with new regulatory requirements, current market conditions also would drive a flight to environmentally sound buildings. Investors were de-risking their portfolios and a yield spread between prime and secondary assets was becoming more apparent.

"In softer markets what we are starting to see is a differentiation between prime and second grade yields, which means the market is starting to value building quality," she said. "If you hold an asset in your portfolio that is unable to meet these new standards.., then the real risk is that property owners will be left holding assets that will be devalued by the market."

Ms Mitchell said a recent survey of Adelaide investor sentiment found 68% of investors rated sustainability as deal-breaking or a positive aspect to a deal. She also said tenants were becoming more astute and were increasingly looking for energy-efficient buildings to minimise outgoings, which would further add to the pressure on building owners. "There is a bit of a perfect storm happening at the moment in the building sector with regulation coming together with market dynamics." she said.

3900 villages in Karnataka to light up with solar power

steelguru.com
Sunday, 28 Jun 2009

Projects Today reported that Karnataka Renewable Energy Development has invited bids from solar technology providers to design, finance, build, operate and maintain solar and hybrid power plants. However, this step has been is in response to the state government's plan to launch a self sustaining solar technology program in 3,900 villages in 39 most backward blocks to cater to the energy needs of 5 million people.

As per report, solar energy is to be provided for street lights, household consumption, entertainment, educational purposes, water lifting for irrigation, drinking water supply, purification and desalination plants, deflourination, milk pasteurization and local cottage industrial applications. Meanwhile, the solar energy is expected to be metered and made available at a fee determined in advance. The provider who wins the contract can collect fees from users.

Public still supports emissions scheme

Sydney Morning Herald
Monday 29/6/2009 Page: 4

TWO-THIRDS of voters support the Rudd Government's emissions trading scheme in a finding that will do little to ease pressure on the Opposition to deal with the scheme in the Senate before the end of the year. The latest Herald/Nielsen poll finds 65% support the scheme to reduce greenhouse gas emissions and 25% oppose it. Support for the scheme was virtually unchanged since the question was last polled a year ago, but opposition to it has risen by 10%age points as arguments against the scheme in the midst of an economic crisis have mounted.

However, progress over the weekend in the United States towards establishing a scheme has been seized on by the Government to step up the pressure on Mr Turnbull and the Opposition leader hinted yesterday the Coalition may now move earlier. The Government wanted the Senate to vote on the scheme last week but the Coalition sided with the independent senator Nick Xenophon to delay a vote until August 13.

Keen to avoid an early election on climate change, the Coalition believes nothing should occur until the new year, by which time other nations will have stated their intentions at an international conference at Copenhagen and the US will have settled on a scheme. At the weekend the US House of Representatives passed legislation for an emissions scheme, prompting the Prime Minister, Kevin Rudd, to say yesterday that Mr Turnbull was running out of excuses for delay.

Look at what is happening in the United States," Mr Rudd said. "Rather than voting not to vote, which is what the Liberals have done here, let's get on with the business of acting and getting things done." Mr Turnbull hinted during an interview on Ten Network's Meet the Press of proposing amendments in August. One change the Coalition would demand would be to treat the coal industry as an emissions-intensive, trade exposed industry, thus entitling it to free permits.

If the scheme is blocked by the Senate in August, and again three months later, the Government would have a trigger for a double dissolution. The most likely date for an early poll would be March and Mr Turnbull has told his party room the Coalition would most likely lose an election then. The Minerals Council of Australia said the US bill proposed a less harsh transition for industry and its passage "highlights the need for substantial changes" to Australia's scheme.

Of the 25% which the poll found opposed the scheme, 29% felt Australia should not go it alone" but wait for other nations. Another 25% felt it would damage the economy, 24% felt climate change was not a product of human activity, and 17% thought the cuts were inadequate.

Ticket to ride

Summaries - Australian Financial Review
Monday 29/6/2009 Page: 4

Australia's first hybrid-electric bus trial, involving two Melbourne buses on suburban routes, was launched by the Victorian government yesterday. The $500,000 technology is expected to save 20% in greenhouse gas emissions when compared to diesel buses.

A breath of fresh air

Herald Sun
Monday 29/6/2009 Page: 27

In these turbulent times few have remained standing as tall as former Babcock and Brown satellite fund Infigen, writes Olga Galacho

Infigen Energy, short for infinite generation, encapsulates the opportunism expressed in the old Chinese proverb: When the storm comes, some build walls, others build windmills. The $1 billion listed windfarm owner has risen from the ashes of its scorched, former parent company Babcock and Brown, which was burnt beyond recognition in the credit crisis fireball last year. It is the renamed, revamped B&B Wind Partners, which owned and operated the windfarms developed by Babcock and Brown.

This week, Infigen Energy will begin not just the new financial year, but a new life as an independent owner and developer of windfarms in its own right. "We now own a great pipeline of projects and are looking forward to capturing the development profits that we couldn't collect when we were associated with Babcock and Brown," managing director Miles George said. The company has worked hard to disassociate itself from its financially distressed former parent since December when its links were officially severed. "While there was a perception that we were part of Babcock and Brown, there was a negative sentiment towards us," Mr George said.

A chemical engineer by profession, Mr George worked at infrastructure investment company AIDC before joining Babcock and Brown's wind operations in 1999. With palpable relief, he adds that last Monday, Infigen Energy completed its move out of B&B's Sydney offices and tomorrow it will make a final payment of $5 million out of the $40 million in severance fees the parent company demanded. Since splitting away, Infigen Energy has streamlined its portfolio by selling windfarms in Spain and Portugal, and putting its French and German ones up for sale to focus on Australia and the US.

Mr George said these are the two markets that will produce most opportunities for Infigen Energy when renewable energy targets are mandated. "It is our aim to grow in the markets where we have an advantage, which we don't have in some European countries where local utilities have a greater competitive edge." In the US, windfarms accounted for 42% of the new power generation built last year. On Wednesday, the company signed off on a $23.8 million deal to buy out B&B's interest in its Australian and US wind assets.

In Australia, Infigen Energy is twice as large as its nearest rival with generation assets that have a total capacity of 508 MW, and it is the sixth biggest player in the US with 1069 MW of capacity. When fully developed, Infigen Energy's Australian pipeline of 12 windfarms will add about 1000 MW of capacity to its current portfolio. Victoria's largest power generator, the coal-fired Loy Yang A, has a capacity of 2100 MW. "We are quite confident the renewable energy target will be implemented by the Federal Government this year," Mr George said of the much anticipated but yet to be enacted legislation.

The target will require electricity retailers to progressively source 20% of their power from renewable energy generators from 2010 to 2030. He added he was pleased that the proposed legislation included an increased penalty price for retailers not complying with the target to $65 a MW hour from $40 previously, and that the fine will not be tax deductible. Mr George estimates the expanded target, when it finally comes into law, will help to create 30,000 jobs as windfarm operators develop their pipelines.

Infigen Energy expects to finish building a windfarm near Canberra and another in South Australia by this year and is likely to start the first of its pipeline projects in about 12 months. The company has been listed since 2005 and employs 40 staff in Australia. After soaring to $2.02 a share, the stock took a nose dive along with other Babcock and Brown satellites, languishing around the 800 mark until earlier this year, when the parent company sold its 10% stake in Infigen Energy. A buy-back for up to 30% of the shares is under way, with 7% of the stock already reclaimed. On Friday, Infigen Energy shares closed at $1.18.