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Climate Progress

Honda And SolarCity Partner On Low-Cost Home Solar Power Leases

By Jeff Spross on Feb 20, 2013 at 4:28 pm

According to the New York Times, a new deal between automakers Honda and Acura and solar developer SolarCity may give a big boost to the already-rapidly burgeoning solar leasing market.

Solar leases, or solar power purchase agreements, are one of the new innovative tools for encouraging solar deployment. Basically, instead of purchasing a solar array outright, the customer plays host to a developer’s solar system in exchange for an agreement to pay a pre-determined fee structure for the electricity over a set period of time. That allows the developer to acquire a new income stream, and most likely the benefits of renewable energy tax credits.

Meanwhile, the customer gets the electricity for a price that’s often slightly below the going market rate. Perhaps more importantly, they avoid many of the problems that have bedeviled solar installations, such as the up-front installment costs, the permitting process, and the performance risk. As a firm with assets, the developer is generally in a far better position to tackle those hurdles than individual solar customers.

As the Times reports, Honda and Acura will offer their customers home solar systems at little-to-no upfront cost via the partnership with SolarCity, the largest player currently in the solar leasing market. (Honda and Acura will also offer their dealers preferential terms to lease or buy SolarCity’s systems on a case-by-case basis.) So SolarCity gets new capital and a massive new customer base, Honda and Accura get a cut of the returns, and customers get an added promotional deal to lease their homes to SolarCity’s systems and purchase its electricity:

The deal, in which Honda will provide financing for $65 million worth of installations, will help the automaker promote its environmental aims and earn a modest return, executives said. It could also open the door for more corporate investment in solar leasing companies, which has largely been limited to a small cluster of banks to provide capital for their projects….

The program will give Honda and Acura customers an extra $400 discount on top of SolarCity’s normal promotions, which they can use to sweeten the terms of the solar contract, like eliminating the escalation of the monthly payment. Honda projects the fund can finance as many as 3,000 systems on homes and 20 for its dealers. If the program catches on, Honda plans to expand it.

The growth of solar leasing has been one of the biggest recent drivers of the United States’ solar market — even more so than increases in cell efficiency — putting new arrays on government buildings, public and private schools, and private businesses and homes.

A new report from GTM Research found that solar leases are now available in 14 states — comprising over 50 percent of the new residential solar capacity in California, Arizona, Colorado, and Massachusetts, and rapidly gaining market share in the ten others. GTM Research anticipates the solar leasing market will rise from $1.35 billion in 2012 to $5.7 billion in 2016.

“I don’t think that by finding Honda buyers you’ve homed in on the perfect solar customer,” Shayle Kann, vice president at GTM, told the Times. But since car owners are more likely to have the income and credit history to qualify for solar leasing, “there’s enough overlapping between the demographics that you’re better off than the general population.” The initial program will be available in 14 states: Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Maryland, Massachusetts, New York, New Jersey, Oregon, Pennsylvania, Texas and Washington, and the District of Columbia.

Apparently, Honda originally proposed the partnership with SolarCity in order to supply solar installations for its hybrid and electric vehicle customers. But when encouraging solar deployment seemed to promise more overall carbon emissions cuts than simply selling electric vehicles, they expanded the program to all customers — including those who’ve just clicked through its web sites as opposed to actually buying a car. Honda and Acura are hopeful the project eventually helps integrate solar power with electric vehicle recharging.

Economy

How The Sequester’s R&D Cuts Will Hurt Science And Innovation

By Andrea Peterson on Feb 14, 2013 at 11:50 am

After President Obama’s called to attain a “level of research and development not seen since the height of the Space Race” in the State of the Union, universities are renewing their cry for a deal to avoid the so-called “sequester” in order to preserve federal research and development (R&D) funds.

ScienceWorksForU.S., a project of the Association of American Universities, the Association of Public and Land-grant Universities, and The Science Coalition, is releasing videos from university leaders across the country about how the scheduled cuts will impact the U.S.’s long-term competitiveness, like this one from University of Kansas Chancellor Bernadette Gray-Little:

National investments in R&D as a percentage of discretionary public spending are down to around 9 percent today from a high of 17 percent in 1962, and the automatic cuts looming in the sequester threaten an 8.4 percent reduction to discretionary spending programs across the board. When you take into account non-discretionary and discretionary spending, total R&D cuts from sequestration over the nine year period will amount to $95 billion.

These cuts will hit universities especially hard because academic institutions perform a huge amount of the research that drives our economy, doing 53 percent of total basic research and 36 percent of all research funded by the U.S. government in 2009. But the $95 billion figure doesn’t reflect the true damage the cuts will have to the U.S. economy because of the exponential impact innovation has in driving our economic growth. A report released last September by the Information Technology and Innovation Foundation estimates the sequester’s R&D cuts will reduce GDP by between $203 billion and $860 billion over nine years, and result in 200,000 job losses in 2013 alone.

While the economic impacts could be devastating, looking beyond the numbers, it’s almost impossible to calculate the value add of innovations fueled by federal R&D funding in the U.S. and how many of them — such as medical treatments, the internet, or cell phones — have fundamentally improved or saved the lives of millions.

Update

Democrats on the House Appropriations Committee have prepared a detailed report on the impacts of the looming sequester, including a breakdown of impacts on science and innovation.

Health

Romney Praises State-Level Innovations In Medicaid, Then Proposes Cuts That Would Stifle Them

By Jeff Spross on Oct 25, 2012 at 11:10 am

Mitt Romney’s plan for Medicaid actually comes in two distinct parts: One, block grant the program, thus turning administration of it completely over to state governments. Two, cut the program as a share of the economy by a third over the next decade, and keep cutting after that. The plan Paul Ryan laid out for Medicaid in the latest House GOP budget is essentially identical. Romney, Ryan, and their cohorts typically defend this scheme by claiming it will open up Medicaid to greater innovation at the state level.

But, as the Huffington Post’s Jeffrey Young noted yesterday, there is a bitter self-contradiction in this argument. Romney’s cuts to Medicaid would almost certainly stifle the very state-level innovations he’s praising:

“Arizona has always been operating in the current financing and entitlement structure of Medicaid. They’re not operating the structure that Mitt Romney wants to go to,” said Joan Alker, co-executive director of the Georgetown Center for Children and Families in Washington.

In recent years, Arizona has raised co-payments and frozen enrollment for poor adults — and is weighing a request for additional federal money to preserve coverage for about 150,000 people and reopen the program to new applicants. The state also put limits on coverage of organ transplants in 2010, but rescinded the policy the following year.

Rhode Island obtained a “waiver” from federal Medicaid rules in 2009 that enabled the state to establish a cap on its spending between 2009 and 2013. The Rhode Island initiative has been hailed by conservatives as a model for future block grant programs because the state has reduced its spending. But Rhode Island implemented its Medicaid reforms with extra federal money and the savings turned out not to be as large as originally believed, according to an analysis by the Center on Budget and Policy Priorities that cites the findings of a report commissioned by Rhode Island Gov. Lincoln Chafee (I).

Ironically, the same could be true of the Massachusetts health care reform Romney himself passed into law as governor of that state. Romney negotiated an increase in the federal Medicaid funding going to Massachusetts. That money funded Commonwealth Care, a subsidized market of private coverage for people living under 300 percent of the poverty line — essentially, the Massachusetts version of Obamacare’s exchanges. John McDonough, one of the plan’s main designers, told the Boston Globe, “It would have been impossible for Massachusetts to do what it did without increased federal Medicaid support.”

Oregon is also running a reform experiment that relies on an increased contribution from the federal government. In a move hailed by conservatives, Florida is trying to expand a health care reform pilot program state-wide. An assessment by the Georgetown University Health Policy Institute determined the program was unlikely to save the state costs, suggesting a much lower level of federal funding would do the experiment no favors.

Of course, Republican lawmakers in Florida see the Romney-Ryan budgets as dovetailing with their state-level plans, which include shifting costs onto Medicaid enrollees through increased fees and reduced benefits. In the end, the state-level innovations most threatened by Romney and Ryan’s plans are the ones that don’t compute with conservatives’ pre-conceived policy preferences.

Alyssa

Cable Scrambling And A Test Of The Piracy Debate

By Alyssa Rosenberg on Oct 17, 2012 at 12:04 pm

Cable companies scored a victory yesterday at the FCC:

Federal regulators are letting cable companies scramble all their TV signals, closing a loophole that lets many households watch basic cable channels for free. The Federal Communications Commission voted Friday to lift a ban on encryption of basic cable signals, saying it will reduce the number of visits by cable technicians to disconnect service and reduce cable theft. Neither the FCC nor the National Cable & Telecommunications Association knows how many households are taking advantage of the unencrypted signals. NCTA spokesman Brian Dietz says most of the theft is by cable modem customers who also connect their line to a TV set.

Whatever the merits (or lack thereof) of the decision, I think there’s an extent to which this is an interesting test. People who would like to see the cable and media companies, which to an extent are distinct entities, innovate in the service offerings they make available to consumers tend to fall in one of two camps. First, there are those who say that piracy, whether of content or of the cable services that let them access content, are a sign that current offerings aren’t sufficient to meet the specific needs of potential consumers, and that content and cable companies could innovate their way to more business. Second, there are those who say that piracy is committed by people who would never purchase these goods and service in the first place, and who thus shouldn’t be subject to excessive regulation, which is of course a different argument than saying regulations would damage the underlying structure of the internet, etc. This second argument is a decent one against spending money and energy on regulation, but it’s ultimately an argument against innovation. If pirates are people for whom the only acceptable price point is zero dollars, no matter how much content and cable companies innovate, they’ll never be able to capture those consumers, and so it makes no sense to adjust or endanger business models to try to accommodate their needs.

What happens after cable companies start scrambling their signals will be an interesting test of these propositions. If cable subscriptions stay level, they maybe it’s true that the folks who are stealing cable service were never potential consumers. If one company cracks down and another company’s subscription base rises, maybe it’s a sign that consumers are willing to pay, but will be unwilling to sign up with companies that seem sour about enforcement. Or if all companies crack down and all subscriptions go up, then perhaps there’s some indication that there are customers out there available to be culled if the environment gives them few options other than to buy service legally. These will all be shaky correlations, of course. But it’s important to actually start testing the question of whether people who aren’t paying for media they consume now are potential customers or not if we want to push cable and content companies towards new business models.

NEWS FLASH

Many Americans Forced To Start Companies Out Of Economic Necessity | Conventional wisdom holds that America is one of the western world’s havens for entrepreneurship. And indeed, the Global Entrepreneurship Monitor’s 2011 report found that the United States has, at 12.3 percent, a higher portion of entrepreneurs with businesses less than three and a half years old than any of the other developed, “innovation-driven” economies. But The Atlantic’s Jordan Weissmann flagged another datapoint in the same report that’s a reminder of the country’s ongoing economic hardship and rampant inequality: In America, more of these nascent entrepreneurs went into business out of economic necessity — as opposed to trying out a new idea or innovation — than in most of the innovation-driven countries.

Climate Progress

Will There Ever Be A Steve Jobs Of Sustainability?

By Climate Guest Blogger on Jul 8, 2012 at 10:36 am

by Manish Bapna and Kirsty Jenkinson, via WRI Insights

Where is the Steve Jobs of sustainability? The business leader with the big, disruptive ideas—and the force of will—to achieve for sustainable production and consumption what Apple’s visionary chief did for global technology and information?

This question springs strongly to mind after attending the Rio+20 conference.

Unlike the original Earth Summit 20 years earlier, business leaders were everywhere at Rio 2012. And with governments failing to make headway at the UN-led forum, there was much talk of businesses taking a greater lead in fixing the world’s environmental and development challenges.

Yet apart from Unilever CEO Paul Polman (who declared, “We have to bring this world back to sanity and put the greater good ahead of self-interest”), few corporate leaders at Rio appeared ready to take up the baton. While literally hundreds of business-led initiatives were announced, most were incremental rather than transformative. And there was limited evidence that CEOs recognize that the planet is on a fundamentally unsustainable course and the window for action is closing.

Sustainable Business Pathways

That said, Rio did see real progress in a few important areas for the private sector. In particular, assuming corporations follow through, it laid foundations for more sustainable business models and scalable partnerships between companies and governments.

Here are three Rio trends that demonstrate an emerging shift in business thinking and provide a platform that smart, forward-looking CEOs should look to build on:

1) Valuing Natural Assets

Meeting in the country that hosts the Amazon, global corporations launched multiple efforts to do something about their huge impact on nature. Taken together, these reflect a welcome shift in business attitudes toward accounting for the natural resources that underpin the global economy.

The Natural Capital Leadership Compact, signed by 15 global companies, urged action to properly value and maintain natural assets like clean air, clean water, forests, and other ecosystems. The Natural Capital Declaration saw similar commitments from a further 39 banks, insurers, and investors. And an additional 24 companies, worth a collective $500 billion, affirmed accounting for natural capital as a business imperative.

2) Corporate Reporting and Transparency

Although the final Rio communiqué watered down a proposed requirement for large companies to report on sustainability, it still provided a push for voluntary global disclosure of private sector impacts. Also significant was the UK deputy prime minister’s announcement at Rio that from April 2013, Britain will require publicly listed companies to fully report their greenhouse gas emissions. The UK move won public support from major companies—including Cisco, PepsiCo, and Aviva Investors—reflecting growing corporate acceptance of the need to be open about the private sector’s environmental footprint. Other countries are expected to follow suit. Read more

Climate Progress

Winning A Golden Ticket Out Of The Cleantech Valley Of Death

By Climate Guest Blogger on Jun 20, 2012 at 10:07 am

by Adam James

“This is a country who hasn’t gotten the memo that things are impossible.”

Those were the enthusiastic opening words to the Department of Energy’s Clean Energy Business Plan Competition from U.S. Chief Technology Officer Todd Park.

Technology innovation broadly has accounted for three quarters of post-WWII growth in the U.S. And moving forward clean technology innovation will be a key driver for American economic growth. However, advancing clean technology will require the next generation of inventors and entrepreneurs to find the financing they need to scale. And that is the exact purpose of the Department of Energy’s Clean Energy Business Plan Competition, which, under the expert guidance of the Office of Energy Efficiency and Renewable Energy, has developed six innovation regions funneling the best and brightest ideas into a competition with a $100,000 grand prize.

In addition to a kick-off address from Secretary of Energy Steven Chu and an awards ceremony introduced by Deputy Assistant to the President for Energy and Climate Change Heather Zichal, these bright entrepreneurs rubbed elbows with some of the nation’s sharpest (and wealthiest) clean tech venture capitalists — honing their sales skills in the hope of landing essential funding for getting their projects to scale.

“I’ve got it! I’ve got the Golden Ticket!”

Well, the winning team didn’t exactly say that — but they might as well have. In talking to the finalists and runners-up over the two day event, it was very clear that despite bringing brilliant world-changing ideas, these folks would be absolutely nowhere without the committed funding for their research and development. And beyond simple R&D, these technologies will never get to scale without serious financing from venture capital and private equity firms. That’s the goal of this competition.

All the finalist and runner up technologies made it out of the regional competitions for a reason. From radiator efficiency to new battery technologies, these were some of the most creative and revolutionary ideas to come out of America’s innovation ecosystem. I will profile some of the particularly promising prospects in my Climate Progress column UpStarts over the next few weeks.

“What got you here will not get you there”

That was a warning from Ken Morse, Chairman of Entrepreneurship Ventures. Put another way, the skill set that turned these ideas into proof of concept will not get a technology to market. You need sales, marketing, communications, and most importantly, money. Lots and lots of money.

Read more

Climate Progress

Reviving American Manufacturing with Low-Carbon Innovation

By Joe Romm on May 31, 2011 at 1:04 pm

A wind turbine blade is unveiled during the opening of the Vestas blade factory in Colorado.

The United States has historically been a leader in invention and innovation; however, our leadership in manufacturing has fallen dramatically, hurting our ability to compete on the global stage. With the dawn of a new era in the energy sector, America has a unique opportunity to grow its economy and create new jobs while reducing emissions and combating climate change.

A new report on low-carbon innovation written by Bracken Hendricks, Lisbeth Kaufman and Sean Pool of the Center for American Progress outlines how this transition may unfold.

Read more

Education

Comparing Education Priorities In The President’s Budget And The House GOP’s Continuing Resolution

By Guest Blogger on Feb 15, 2011 at 1:15 pm

Our guest blogger is Theodora Chang, Education Policy Analyst at the Center for American Progress Action Fund.

The Obama administration released its annual budget yesterday, and the proposed $2 billion increase in education funding has generated a sigh of relief for some. No shrieks of joy, though — the President’s budget is for fiscal year 2012. Before we get to 2012, however, we need to straighten out fiscal year 2011 funding, which begins with the House Republicans’ Continuing Resolution (CR) scheduled to go to floor debate today.

Both the President’s budget and the CR include rhetoric about doing what’s best for students and making effective use of government resources, but there are a couple of key differences in the two proposals:


Program President’s Budget House CR
Title I: Improving the Academic Achievement of the Disadvantaged Increases 2010 funding levels by $300 million to reward high-poverty schools making the most progress in closing the achievement gap. Slashes 2010 funding levels by $693.5 million. This is a brutal mid-year cut to staffed-up districts and would hit high-poverty districts the hardest.
Statewide Longitudinal Data Systems Increases 2010 funding levels by $41.7 million to expand and improve state data systems that track student achievement and link it to teachers. Eliminates the program, which is a key source of funding for states to focus on data-driven results, which ensure that other federal investments in education are good ones.
Race to the Top Provides $900 million for competitive grants to districts that implement key structural reforms. Effectively discontinues program by providing $0 in funding, thus discarding momentum for reform in states and districts.
Investing in Innovation (i3) Provides $300 million in competitive ‘seed money’ grants for innovative ideas that address key problems in education. Effectively discontinues program by providing $0 in funding, and ignores massive appetite in private sector for augmenting R & D infrastructure.

The lack of funding for RTT and i3 seems especially contradictory to Republican statements on innovation. House Education and Workforce Committee Chairman John Kline (R-MN) responded to the President’s budget by saying the following:

A recent hearing highlighted a number of innovative solutions underway at the state and local level that are producing real results on behalf of students and parents. It is time we asked why increasing the federal government’s role in education has failed to improve student achievement. I look forward to charting a new course in education that ensures Washington doesn’t stand in the way of meaningful state and local reforms.

RTT has triggered the most dramatic and meaningful state education reforms the country has seen in many years. At least 10 states changed their laws to make themselves more competitive for the competition’s first round before a single dollar was awarded, and 28 states in total reformed their education policies in 2009 and 2010 to prepare for the first two rounds of the competition.

The Investing in Innovation Fund, or the i3 Fund, is a competitive grant program that takes on the challenging mandate of improving achievement at low-performing schools. Instead of throwing dollars at the problem and hoping that something sticks, it adopts a focused plan that encourages schools to develop innovative solutions that, among other things, increase high school graduation rates and close achievement gaps.

Bottom line? While Republicans may be moved to tears when talking about how all kids should have the opportunity to live the American dream, they fall short on action. Education yields a lot of bang for the buck, and meaningful reform requires Republicans to put their money where their mouths are.

Climate Progress

Joe Barton’s Zombie Caucus Attacks Upton’s ‘Light Bulb Ban’

By Brad Johnson on Jan 7, 2011 at 6:48 pm

Rep. Joe Barton (R-TX), who failed in his bid to take the chairmanship of the House energy committee from Rep. Fred Upton (R-MI), has begun the new congress with a new assault on his fellow Republican. In the first day of the 112th Congress, Barton led a pack of 13 anti-innovation Republicans with the introduction of legislation (H.R. 91) to strike down Upton’s 2007 lighting efficiency standard, painted by conservative activists as a “light bulb ban.” In a statement, Barton accused Upton of legislating an assault on “personal freedom” and “manipulating the free market”:

This is about more than just energy consumption, it is about personal freedom. Voters sent us a message in November that it is time for politicians and activists in Washington to stop interfering in their lives and manipulating the free market. The light bulb ban is the perfect symbol of that frustration. People don’t want congress dictating what light fixtures they can use.

“From the health insurance you’re allowed to have, to the car you can drive, to the light bulbs you can buy,” the polluter-funded Barton concluded, “Washington is making too many decisions that are better left to you and your family.”

Barton’s attack on the tyranny of energy-efficient light bulbs is consponsored by Reps. Marsha Blackburn (TN), Michael Burgess (TX), Rob Bishop (UT), Tom McClintock (CA), Howard Coble (NC), Ron Paul (TX), Todd Akin (MO), Ann-Marie Buerkle (NY), Cynthia Lummis (WY), Steve Scalise, Paul Broun (GA), Dan Burton (IN), and Cliff Stearns (FL). Of these 14 representatives, only Rep. Coble admits that global warming pollution is a real threat.

Upton has already reneged his position on light-bulb efficiency, which was supported by former speaker Rep. Denny Hastert (R-IL), Sen. Bob Corker (R-TN), and the light bulb industry itself. In December, Upton told Politico “he’s not afraid to go back after an issue he once supported but that has come under withering assault on the conservative airwaves, including on Rush Limbaugh and Glenn Beck’s talk shows.”

There was, in fact, no bill to ban incandescent light bulbs. Because of the advanced light-bulb standards Upton helped pass in 2007, “the incandescent bulb is turning into a case study of the way government mandates can spur innovation,” the New York Times reported last year. “There have been more incandescent innovations in the last three years than in the last two decades.”

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