"Energy and Global Warming News for December 15th: U.S. exported $723 million more solar products than it imported in 2009; Is Indiana next clean energy jobs powerhouse? US vulnerable to rare earth shortages"
Next time someone bemoans the fact that even all the renewable energy manufacturing is heading overseas, point this next report out: According to new industry analysis carried out by GTM Research for SEIA, the US is a net exporter of solar power products, to the tune of $723 million in 2009. Here are more of the key points from the US Solar Energy Trade Assessment 2010:
Though the US was a net importer of PV modules in 2009, importing some $232 million more than it exported, polysilicon exports dwarfed imports by $1.1 billion.
Even considering that the majority of solar PV modules in the US were assembled elsewhere, 74% of total value created from US solar power installations in 2009 came from US products. Most of this was due to costs of installation, legal and permitting fees, and system engineering and design.
In total, US solar power installations created $2.6 billion in direct value to the US economy in 2009.
You can read the entire original report at the link above, but here are some of the charts to give you a better idea of where US solar power products are going to and coming from.
HONG KONG “” The United States is too reliant on China for minerals crucial to new clean energy technologies, making the American economy vulnerable to shortages of materials needed for a range of green products “” from compact fluorescent light bulbs to electric cars to giant wind turbines.
So warns a detailed report to be released on Wednesday morning by the United States Energy Department. The report, which predicts that it could take 15 years to break American dependence on Chinese supplies, calls for the nation to increase research and expand diplomatic contacts to find alternative sources, and to develop ways to recycle the minerals or replace them with other materials.
At least 96 percent of the most crucial types of the so-called rare earth minerals are now produced in China, and Beijing has wielded various export controls to limit the minerals’ supply to other countries while favoring its own manufacturers that use them.
“The availability of a number of these materials is at risk due to their location, vulnerability to supply disruptions and lack of suitable substitutes,” the report says, which also mentions some concerns about a few other minerals imported from elsewhere, such as cobalt from the Congo.
The Energy Department report is being released the same morning that cabinet officials from China and the United States will meet in Washington to discuss economic and commercial issues.
While no detailed agenda has been released, the talks are expected to include American objections to China’s tightening restrictions on rare earth exports “” like a two-month halt this autumn on shipments to Japan, and a shorter-lived slowdown of exports to the United States and Europe.
And on Tuesday, China’s finance ministry announced on its Web site, and the official Xinhua news agency later reported as well, that China plans to increase its export taxes on some rare earths next year. The ministry did not say how much the taxes would increase. Although World Trade Organization rules ban export taxes, China has imposed them on rare earths for the last four years.
David Sandalow, the assistant secretary of energy for policy and international affairs, who oversaw preparation of the Energy Department report, said in a telephone interview that the timing of the report’s release and the American-China cabinet meetings was coincidental.
But the report reflects an emerging view within the American government that domestic sources of rare earths are needed, in addition to suppliers in many other countries, to ensure the viability of clean energy manufacturing in the United States.
“We can build a new industry and put our clean energy future on a sound footing, creating many new jobs in the process,” Mr. Sandalow said.
Still, the report presents a fairly gloomy assessment of the United States’ ability to wean itself from Chinese imports. For as long as the next 15 years, the supplies of at least five minerals that come almost exclusively from China will remain as vulnerable to disruption as they are absolutely vital to the manufacture of small yet powerful electric motors, energy-efficient compact fluorescent bulbs and other clean energy technologies, the report said.
The five minerals are medium and heavy rare earth elements of which China mines an estimated 96 percent to 99.8 percent of the world’s supply: dysprosium, terbium, neodymium, europium and yttrium.
China also increasingly dominates the manufacture of clean energy technologies that require such minerals, including the production of million-dollar wind turbines. Chinese export restrictions have added up to $40 a pound to world prices, which makes a big difference particularly for some of the less expensive rare earths, like lanthanum, that sell for several dollars a pound in China.
That is among the reasons, along with cheap labor and extensive Chinese government subsidies, that many clean energy manufacturers have found it cheaper to shift production to China.
Mr. Sandalow said that wind turbine manufacturers were capable of building very large turbines without rare earths. But using rare earths could reduce the per megawatt cost of wind energy and improve its competitiveness through savings on other materials, like steel and copper….
China’s finance ministry, in announcing plans to raise export taxes on some rare earths, did not indicate which minerals might be affected.
Since 2006, China has imposed an export tax of 15 percent on light rare earths like lanthanum and cerium, which are needed for oil refining and glass manufacturing, and 25 percent on heavy rare earths like dysprosium and terbium.
China mines about 92 percent of the world’s light rare earths.
Dysprosium, which helps rare earth magnets preserve their magnetism at high temperatures, is mined almost exclusively in southern China and sells for $95 a pound in China and $135 a pound outside, including the export tax.
Dysprosium has emerged as the mineral most vital to clean energy industries yet most vulnerable to supply disruptions, the report said.
Dudley Kingsnorth, a prominent rare earth mining consultant in Perth, Australia, said he agreed that a dysprosium shortage was likely. He added that he expected that a rare earth shortage would slow the overall adoption of new rare earth technologies by clean energy industries for at least the next five years.
Okay, so everybody knows about Hoosiers basketball and the Indy 500, but those two sports powerhouses might soon have to take a back seat to another Indiana superstar: solar power. The largest thin film solar plant in the U.S. is slated to be developed in Tipton, Indiana and it will create more than 1,000 permanent full time green jobs. The new factory, a project ofAbound Solar, is being built with the help of a $400 million loan guaranty from the Department of Energy.
New Green Jobs
Ironically, the announcement came down just a day after President Obama met with corporate leaders and asked them to step up their hiring. As it turns out part of the reason we’re still in the economic doldrums is “companies have stockpiled record amounts of cash” but have chosen not to add staff until – well, until we’re out of the doldrums, basically. Fortunately the Obama administration has recognized that a boost from the federal government is needed to create a more stable, less risky environment for hiring. The new plant is just one of hundreds of new green job ventures created by federal programs including, most notably, the Recovery Act.
1,000 Solar Energy Jobs for Indiana
The new solar plant will occupy an existing facility that was abandoned after the former owner went bankrupt, so it’s also a good example of howalternative energy can revitalize brownfields and other empty industrial facilities – as opposed to fossil fuel harvesting, which all too often destroys the space it occupies. Once up to speed, the plant will have the capacity to produce 640 megawatts’ worth of thin film photovoltaic cells, which Abound Solar describes as based on “next-generation, cadmium telluride” technology.
Alternative Energy in Indiana
Like other midwestern states, Indiana is starting to host new wind farms(which, by the way, can be sited on working farms, providing farmers with new lease income) and new federally funded solar installations. It’s also getting a share of the federal money turned down by Wisconsin and Ohio for high-speed rail projects along with other federal grants for green transportation. As for the iconic Indy 500, as part of this year’s festivities the Indianapolis Motor Speedway hosted an exhibit by the Rose-Hulman Institute of Technology and next-generation battery manufacturer EnerDel, featuring the latest low-emission, sustainable energy automotive technology.
This summer the “US” Chamber of Commerce was found to be taking money from petrostates to ensure Republicans stand firm against renewable energy.
The Senate tax vote today will be the last chance for the Democrats to get the shreds of their clean energy bill through congress, because in January, the House too goes Republican. (The Senate is de facto Republican in that their 40-some votes prevent votes being held: it now takes 60 to get past them.)
But with the tax bill cloture vote (a vote to allow a vote) passed yesterday 83-15, green stimulus tax credits within the tax bill can now get an up or down vote.
Democrats held out for and got a chance to vote for solar and wind cashgrants of 30%, electric vehicle charger tax credits, tax credits for highly efficient distributed energy storage in the form of home heating that can store extra night time off-peak wind power, along with renewable energy incentives to encourage VC funding such as tax credits for developing offshore wind – up to $30 million.
Another piece of good renewable energy policy provides a major incentive for VC investment in renewables in the US. Amendment 4790 to the tax billwas proposed by Senator Feinstein in the Advanced Energy Tax Incentives Act of 2010.
Tax Credit for Developing Renewable Energy Storage on the grid – up to $30 million a year till 2020
Tax credits of up to $30 million a year would encourage investing in utility-scale renewable energy storage able to store more than a megawatt per hour.
“¢ Hydrogen storage,
“¢ Regenerative fuel cells,
“¢ Advanced batteries,
“¢ Superconducting magnetic energy storage,
“¢ Thermal energy storage systems,
“¢ New hydroelectric pumped storage, (if pass environmental review)
“¢ Compressed air energy storage (CAES).
“¢ or any combination, or new technologies as they become certified.
Priority would be given to projects that provide the greatest increase in reliability or the greatest economic benefit, enable the greatest improvement in integration of renewable resources into the grid, or enable the greatest increase in efficiency in operation of the grid.
The Secretary of Energy (who is currently Nobel prizewinner Steven Chu) would be charged with selecting only those projects which have a reasonable expectation of commercial viability, representing a variety of technologies, applications, and project sizes.
The tax bill vote tomorrow is realistically the last chance, for several years, to get any renewable energy policy. Next year, the Republican House plans to disprove the realities of climate science, in order to win “game, set, match” for those who do not want the US to have energy security with a renewable economy.
To cut human-generated carbon dioxide emissions by 80 percent, an oft-quoted goal, the electricity sector might have to reduce its own emissions even more because other sectors like agriculture or aviation could find 80 percent impossible. Many states currently have quotas for reliance on renewable electricity, but the highest is California’s at just 33 percent.
Yet how much renewable energy can an electric grid tolerate?
A lot more than is generally assumed, according to a new reportcommissioned by an environmental group, HEAL Utah.Yet the group takes a different tack from that of most other organizations that envision a low-carbon future; it wants to forswear both nuclear power and coal-fired power with carbon dioxide capture.
Utah has no renewable energy quota. But the report, released on Tuesday, proposes a system that would be nearly entirely based on solar, wind and geothermal power and the mass deployment of two technologies that are still in their infancy: compressed air energy storage, and a smart grid that takes control of customers’ appliances.
The report was prepared by Arjun Makhijani, the head of a Washington-based anti-nuclear group, the Institute for Energy and Environmental Research. Dr. Makhijani, who has a Ph.D. in nuclear fusion, pointed out that one of the main costs of renewable energy is the amount that is “spilled,” or produced from intermittent sources at a moment when there is no use for it.
Some utilities in the United States and elsewhere are experimenting with large-scale battery storage, but the only two mass storage technologies now available are pumped hydro and compressed air, he said. His report envisions an energy system in which the only fossil fuel is natural gas, used in conjunction with compressed air systems. A utility digs a cavern underground and, when surplus electricity is available, uses it to pump the cavern full of air at high pressure.
When renewable energy is not available, the air is tapped and mixed with a small amount of natural gas and then run through a gas turbine to make electricity. The technology is similar to existing gas-fired generators, except that in a conventional gas generator, some of the energy from burning gas is used to compress air to make the process more efficient. In Dr. Makhijani’s vision, the wind blowing at off hours accomplishes some of the work ordinarily done by gas.
The storage proposal poses a variety of challenges. One is that what it stores is energy, but not always renewable energy. The one commercial compressed air storage project now in service, in Alabama, stores energy that is made late at night by burning coal. One reason is that the goal in that case is not to reduce carbon dioxide emissions but to save money: off-peak coal power is very cheap.
The study is based largely on costs that are estimated or projected and thus could be inaccurate. Still, it reaches some noteworthy conclusions.
One is that the concept of peak demand may have to change. Today, electric systems are designed to cope with peak demand, the hours when demand is highest, usually in the summer. But if a great deal of solar power is installed, summer demand may not be as challenging as the hours when demand is high and renewable supply is low “” for example, in the dead of winter, when it could be quite cold but the wind has died down, Dr. Makhijani suggests.
In some states, like California, companies are exploring whether they can store large amounts of energy as heat by using the sun to heat molten salt. When the sun goes down, the salt can be used to make steam that is converted to electricity. But in a Utah winter, “molten salt doesn’t help you a lot,” Dr. Makhijani said, because there is not enough at any given hour to make much of a surplus.
Aside from that that challenge, far more adaptation would be needed in the grid beyond the notion of smart meters, which could manage functions like changing the price of energy at different times of day and informing homeowners instantaneously about their consumption and their energy spending.
“We need a system in which the load is responding to the state of generation,” Dr. Makhijani said. For example, in the morning a residential customer could put soap in the dishwasher, push a button indicating that the machine is ready and leave for work. When the grid had excess electricity, it would turn on the dishwasher. Today, utilities offer supply to meet demand, but in the future, demand will partly tailor itself to supply, Dr. Makhijani said.
Deforestation is a big problem in the Amazon rain forest, the largest such forest in the world, and now technology is being used to help fight the issue. Amazonian trees are being implanted with microchips in order to prevent illegal logging.
Each chip contains a variety of useful information, including the location and size of the tree. This information gives those who buy the wood the knowledge of where it came from and who cut it down. With this information buyers can determine whether or not the tree was cut down by an illegal logging operation. The hope is that thetechnology will help deter such activity.
“People talk a lot these days about wood coming from sustainable forestry practices–this is a system that can prove it,” forestry engineer Paulo Borges told Reuters
A plan to enhance crop growth in greenhouses outside Rotterdam, by pumping in waste CO2 from a nearby bioethanol plant, has been backed with a ‚¬5m (£4.2m) EU grant.
Farmers in the Zuidplaspolder area currently generate their own CO2 to feed into the greenhouses using cogeneration systems or gas-fired boilers, that also help heat the facilities.
But supporters of the carbon capture project predict that installing a pipeline, linking the Abengoa Bioenergy Netherlands plant in the harbour area of Rotterdam to a 550 hectare swathe of agricultural land in the Zuidplaspolder, should prevent around 25 million cubic metres of natural gas being burnt every year – saving 45,000 tons of CO2.
The European Commission had to review its tight competition regulations to determine whether it was able to support the project, proposed by Bio Supply CV, part of the Organic CO2 for the Assimilation of Plants (OCAP) group.
But the commission concluded this week that the aid would not distort markets and, in addition, the emissions savings would not be achieved without the EU funding – given that private investors were unlikely to back a project based on such cutting-edge technology.
Commission vice president in charge of competition policy, Joaqun Almunia, said: “The Dutch aid favours the recycling of waste CO2 from local industry without unduly distorting competition. It reduces greenhouse gas emissions and increases the level of environmentalprotection in the EU.”
Under the terms of the funding, the money is conditional on Bio Supply CV granting third parties access to the pipelines, raising the prospect of a carbon capture and storage hub being developed near Rotterdam
The government’s environmental bank looks likely to be scaled back and may begin life as a fund, jeopardising billions of pounds of badly needed loans to green technology. The green investment bank (GIB) was devised by George Osborne, the chancellor, when he was in opposition. He believed that it was crucial to the development of green energy projects such as clean coal plants and offshore windfarms in Britain.
Now the cabinet minister who is in charge of seeing it come to fruition and is a devoted ambassador for the idea of a fully functioning bank has floated the possibility of staggering its introduction. This would see it initially set up as a more limited fund unable to raise finance by issuing “green bonds” to back projects.
Chris Huhne, the energy and climate change secretary, appears to concede that the Treasury’s concern that the liabilities taken on by a GIB would be added to the government’s budget book. He suggests instead that the new institution could morph into a bank able to raise finance over time as Britain’s deficit is reduced. In an interview with the Guardian, he insisted that the government remained committed to setting up a bank and that setting up a fund initially was only one option. But the prospect of a delay on fully implementing this key green policy will anger environmentalists.
“Obviously, if we were to turn around and have the GIB borrowing vast amounts of money tomorrow I can understand that managers of the national debt would be a little alarmed,” he said. “I am absolutely at one with the Treasury on the need to make sure our fiscal credibility is completely re-established. The key issue is whether or not having established our fiscal credibility, what then happens?
“There are phasing issues, there are transition issues. What is the point at which maybe it begins as a fund and later is a bank, whatever. Let there be no doubt that the first overwhelming priority of the government has to be to get the deficit down.”
Auditor Ernst & Young has said that, without a bank, only about a fifth of the £450bn investment needed for Britain to meet its carbon emissions targets over the next 15 years would be made.
Tomorrow Huhne will announce other measures which, he says, will amount to the biggest change to the electricity market since privatisation in the 1980s. Despite its apparent rethink on the GIB, the government hopes the measures will channel private sector investment into renewables in other ways. Huhne’s plan will also break a key Conservative pre-election pledge on cleaning up coal plants.
In a key note speech to environmentalists in October last year, David Cameron repeated his party’s pledge to introduce rules requiring new power stations to be as clean as a modern gas plant. This would have required energy companies to fit experimental equipment, which captures and stores carbon emissions (CCS), to about two-thirds of their new coal plants. But the policies to be unveiled are expected to recommend that CCS be fitted to only one-third of coal plants.
Huhne declined to comment on the specifics, but was much more effusive about Tesco, particularly when it comes to the environment. Tomorrow, Huhne will, by his own admission (albeit with tongue firmly in cheek), ape Britain’s biggest supermarket when he promises that his plan will make Britain “greener for less”. Huhne will promise that electricity bills will be lower and power plants twice as green as would be the case under the existing energy policies inherited from the previous government. “[It will be] greener for less, more for less,” he said. Told that it sounded a bit like a Tesco promotion, he said: “I am very happy to be the Tesco of the energy industry.” With the coalition government committed to both slashing the deficit and being the “greenest ever”, it’s a fitting slogan.
The power sector accounts for about a third of Britain’s carbon emissions, so cleaning it up is crucial for the country to meet its climate change targets. The task is huge – and it won’t come cheap, whether it is done with Tesco-style efficiency or not. Old coal and nuclear plants are being closed and must be replaced. The UK’s electricity grids will have to be massively upgraded to cope with more intermittent supplies of electricity from wind farms. New flexible gas plants are needed in reserve to come online when the wind does not blow enough. Overall electricity demand is set to increase too, as electric vehicles become more common.
Ofgem, the energy regulator, estimates that £200bn of investment is required in new energy technology over the next decade alone, about double the normal rate of investment. But the existing market regime will not do the job. Some of the technologies are relatively new and untested on a large scale, making them risky for investors. Electricity prices are also volatile, which means the return on huge upfront investments is uncertain.
Huhne’s plan is aimed at incentivising investment in cleaner ways of generating electricity. For example a carbon floor price – effectively a tax on carbon emissions – will be introduced which should make coal and gas plants more expensive to operate and renewables more competitive. Large offshore wind farms will earn a guaranteed premium above the market rate for all or some of the electricity they sell. Standby gas plants will also receive fixed payments in return for being available.
Although Central America has limited conventional energy resources and large numbers of rural poor still not connected to the grid, rising energy demand is, surprisingly, making the region less reliant on oil imports. Instead, it is turning to renewables.
According to a report by the Economic Commission for Latin America and the Caribbean (ECLAC), a United Nations agency tasked with promoting regional economic and social development, 61% of the electricity generated in the region came from clean sources last year. The nation-by-nation breakdown of renewable use is impressive: Costa Rica (95.1%), El Salvador (56.8%), Panama (56.6%), Guatemala (53.2%), Honduras (45.5%) and Nicaragua (29.9%).
And there’s more to come. In power-hungry Nicaragua, a country that has struggled with supply problems in the past, wind power is helping provide energy security; volcano-dotted Guatemala is offering tax breaks to spawn more geothermal power plants; Honduras is currently building the region’s largest wind farm; and Costa Rica, which aims to be 100% renewable, is stepping up is courtship of wind farm developers.
Spain will likely be a big beneficiary of Central America’s move toward renewable energy. Spanish companies and investors are pursuing projects throughout the region. And last month, the Costa Rican government sent a delegation to the European country to meet with green industry leaders.
Some experts estimate that Costa Rica alone has the potential to generate as much as 31,000 megawatts of renewable-based energy.