Thanks for the $3 billion dollar investment – but you’re not welcome here any more!

That’s the message I heard Matt Riley, CEO of Infinity Wind Power give during a Kansas Senate Utilities hearing to delay the Kansas Renewable Portfolio Standard, put into effect in 2009.

“Modifying the RPS would absolutely send a strong negative signal that would likely cripple the emerging export market,” said Matt Riley, CEO at Infinity Wind Power. “To my knowledge, not one of the 30 other states with an RPS has negatively modified or repealed that important policy. Kansas would be the first to do so, and it would send a shock-wave through our industry, saying, ‘Thank you very much for the $3 billion of investment last year, but you’re not welcome here anymore.”

Matt was one of approximately 18 opponents providing written or oral testimony during the Senate hearing to roll back the RPS.

Former Kansas Senate President Dave Kerr also testified against the bill. He said he was skeptical of the Kansas Policy Institutes projections based on his experience as chairman of the board for Kansas Ethanol. “I have good reason to watch natural gas prices,” said Kerr, who headed the Hutchinson/Reno County Chamber of Commerce after leaving the Senate. “Natural gas prices fluctuate. When somebody gives you an estimate that says wind prices are going to be far higher than natural gas, have they really given you a realistic projection of what natural gas could be?”

Our opposition fell on deaf ears, today the Senate Utilities committee voted to pass Senate Bill 82 out of committee and on to the full Senate.

The economic impacts of the wind industry here in Kansas are indisputable.

Jobs

According to a report by energy experts Polsinelli Shughart and the Kansas Energy Information Network, the Kansas wind industry has created more than 13,000 direct and indirect jobs, most in rural Kansas.  Approximately 3,747 jobs are directly related to the construction and operation of 19 wind projects in Kansas. Based on date from the Department of Energy, and additional 9,827 jobs were created as a result of investment in Kansas wind farms.

Community Impact and Renewable Energy Investment

  • Kansas landowners receive over $13 million dollars annually from wind turbine land rents
  • Wind developers contribute over $10 million dollars annually to Kansas communities
  • Siemens – $50 million dollar investment
  • Draka – $3 million dollar investment
  • Jupiter Group – $2.4 million dollar investment
  • Tindall and New Millennium announced – $90 million dollar investment
  • Clean Line Energy Partners announced – $2 billion dollar investment enabling an additional $7 billion dollars of new wind energy development

Thirty states have mandatory Renewable Portfolio Standards and seven states have voluntary renewable energy goals. The benefits of this policy go beyond the earning revenue for local communities, generating low-cost domestic electricity and creating jobs for Kansas residents and companies.

In today’s highly competitive effort to attract new businesses, many factors come in to play. The Kansas RPS is one visible way to demonstrate the value this state places on sustainability.  The appeal of states that value renewable energy can be seen in both wind manufacturing companies like Siemens as well as those companies who value sustainability like Google and Mars. Ed McCallum, a Senior Principal of McCallum Sweeney Consulting was recently quoted in Trade and Industry Magazine.

“Having been involved in several site searches for renewable energy companies, wind in particular, the question always arises about the finalist state’s position regarding the RPS. Many times it makes the difference between winning and losing the project”.

The Kansas Renewable Portfolio Standard is a smart way to encourage renewable energy projects, spur job growth and keep Kansas businesses competitive.

Stay tuned for more from the House Energy & Environment committee. There is a hearing for House Bill 2241 on Thursday morning to roll back the 2015 threshold and get rid of 20% renewables all together.

Dorothy Barnett, Executive Director CEP

In response to the recent layoffs at the Hutchinson, KS Siemens plant and to the continued lack of support from the KS delegation to the House of Representatives, CEP, the Wind Coalition, Kansas Interfaith Power and Light and the Kansas Natural Resources Council are asking Kansans to sign a letter of support for the Production Tax Credit.

You can read and sign the letter below:

Or sign and share the letter on Facebook here.

We are on track to have 5,000 signatures by October 7th.

Please join us in this effort and spread the word to your friends and neighbors.

posted by Kate Van Cantfort, Director of Communications and Special Projects

Recently, Siemens Wind Energy announced a 30% workforce reduction in their North American staff.  This unfortunate news for Kansans comes on the heels of more than a dozen such layoffs impacting over 3000 workers in at least 14 states over the past several months. We are sorry for the Kansas, Iowa and Florida employees who are paying the price for unstable energy policies in Washington.

Inconsistent tax policy is a major factor in these job losses. The American Wind Energy Association repeatedly warned that delaying the extension of the Production Tax Credit (PTC) would cost American’s 10,000 jobs by the end of this year plus 27,000 jobs by the end of the first quarter in 2013.

While Congress is split about extending this incentive, a recent poll from George Mason University says 92% of Americans think that developing sources of clean energy should be a very high (31%), high (38%) or medium (23%) priority for the President and Congress.

Although 92% of Democrats and Independents and 84% of Republicans think clean energy should be a priority, confusion abounds as to how and why Congress should incentivize renewable energy.

Wind energy could cost-effectively provide 20% of our electricity by the year 2030, as reported by the Department of Energy’s 20% Wind report.  Today, wind accounts for less than 4%.

Thanks to advancing technology the cost of wind production is approaching the cost of energy from traditional sources, despite the added cost of transmitting power from wind rich rural areas to population hubs.  Even with these advances, volatility in the market persists, causing wind projects and thus turbine manufacturers to be unstable.

Consistent competitiveness with traditional fuel prices is critical to establish a stable market for renewable energy. This appears to be the government’s main premise for providing tax incentives to the industry.

Even though they have substantially lower maintenance cost and no fuel cost, wind power requires a larger up-front investment as compared to traditional electricity generators.   The high initial investment can make wind energy unattractive to investors.  A tax incentive is necessary to encourage the development of a wind-generated electricity market. [1]

There is no question wind energy has been good for Kansas. By the end of this year Kansas will have 17 wind farms generating more than 3000 MW of wind energy. Several billion dollars in wind generation projects have been invested in Kansas in recent years and hundreds of new jobs have been added.

In response to the Siemens announcement, Governor Sam Brownback shared his support for the Production Tax Credit noting a 2012 $3 billion investment in new wind farms. Senator Jerry Moran also supported wind energy incentives adding “the wind-energy industry has stopped making long-term investments in their businesses because of Washington’s unwillingness to craft a comprehensive domestic energy policy”.

While lawmakers representing Kansas can do little about low natural gas prices and the sluggish economy (two additional reasons Siemens has sighted for their reduction in staff), they can and should extend the Production Tax Credit for at least two years. 

If 92% of us truly think clean energy should be a priority (for jobs, prosperity and energy security) the time to act is now.  Let Congress know how you feel about extending the Production Tax Credit with your phone calls, emails and letters.

Dorothy Barnett, Executive Director

CEP Board of Directors:

Nancy Jackson

James Haines

Cathy Bennett

Ashok Gupta

Ben Champion

Visit our facebook page at facebook.com/CEPHeartland or follow us on Twitter @CEPHeartland to keep up to date on how you can take action to support renewable energy.


[1] From the Houston Business and Tax Law Journal (Vol. XI)

By KAREN DILLON
The Kansas City Star

An environmental group demanded Tuesday that the Environmental Protection Agency halt construction of a coal plant in western Kansas.

Earth Justice, which represents the Sierra Club, sent a letter to Karl Brooks, EPA Region 7 administrator, making a formal demand that Brooks object to a permit issued by the state to build the Sunflower Electric Power Corp. plant.

The permit for Sunflower’s plant issued in December “fails to meet the minimum requirement of the Clean Air Act and fails to adequately protect human health and the environment,” the Earth Justice letter said.

In a statement Tuesday to the media, EPA Administrator Brooks wrote that the issues raised by the nonprofit echo concerns raised by a letter Brooks wrote last month to the Kansas Department of Health and Environment, which issued the permit.

On Feb. 3, Brooks asked state health department officials to set up a meeting “in the very near future and begin a constructive dialogue about how to resolve EPA’s concerns” that the permit’s emission rates are higher than federal law allows.

The Kansas department has yet to schedule a date for that meeting, but on Tuesday, department Secretary Robert Moser said he looked forward to continued dialogue with EPA.

“KDHE takes the obligation to protect the air quality for all citizens of Kansas very seriously,” Moser said.

It took four years for the state to issue the final permit for the controversial plant, but still a construction date has not been scheduled.

After the permit was issued, the Sierra Club filed a challenge to it in January in the Kansas Court of Appeals. That case now is pending before the state Supreme Court.

In February, a study conducted for the project’s opponents found that the plant would not be the “cleanest” in the country, as officials had said. Some of the emissions would actually make it one of the dirtiest in the country, according to the study.

But Sunflower said its permit followed federal and state laws.

“Sunflower believes KDHE did a thorough and complete job, and we are confident the permit will be upheld as compliant with all environmental laws,” Sunflower spokeswoman Cindy Hertel said Tuesday.

Posted by Kate Gonzalez www.climateandenergy.org/

trackingBy Jim Sullinger, The Kansas City Star

How does old become new? One answer can be found here on the edge of the Kansas River.

That’s where the national drive to create renewable energy meets a 105-year-old hydroelectric plant that produces 2.3 megawatts of clean power.

There are no smokestacks or large piles of coal at the Bowersock Mills and Power Co., just the flow of the river into a 2,000-cubic-foot holding area and the hum of seven large generators.

Each generator produces about 350 kilowatts of electricity. The oldest has been working since 1918.

“We could buy new technology, but it doesn’t last as long,” said Rich Foreman, plant manager.

Bowersock, the only privately owned hydroelectric plant in Kansas, is much more than a renewable energy source. It is living history witnessed each year by several thousand schoolchildren.

The power of the river was first harnessed in the late 1800s when Justin DeWitt Bowersock completed a dam across the river and began selling power to Lawrence merchants. It was essentially water-driven turbines turning just below the dam that operated the machinery of several businesses.

Electricity didn’t arrive until 1905, following a flood in 1903 that severely damaged the facility. After the flood, Bowersock installed four water-powered turbines that rotated and ran four generators that produced electricity.

They generated power to almost all of Lawrence at the time. Three other generators were added in the 1930s.

Flash boards 5-feet high were placed across the top of the dam to give plant operators more control over the water level behind it. They can be lowered or raised when needed.

The principle for generating power at the plant is simple: Divert river water into the holding area on the south side of the plant and use it to push turbine blades before the water is expelled back into the river.

Plant manager Rich Foreman said a drop of about 20 feet is needed from the water level behind the dam to the point where water is expelled back into the river below it. If the river gets too high or floods, the plant can’t operate. Floods have shut it down twice — once in 1951 and then in 1993. High water from spring rains can also hurt its ability to produce electricity.

A shaft runs up from the turbines where electro-magnets spin around a large copper coil to generate the electric current.

A large control panel installed in the 1930s monitors the output from each generator and allows plant personnel to shut down a generator for maintenance. Large iron gates let workers shut off the river to each turbine when maintenance is required.

The simplicity of the equipment is also the key to its long life.

“When the life span of every coal plant in Kansas is over, we’ll still be generating electricity here,” said Sarah Hill-Nelson, a Bowersock company owner.

Most of the parts for the equipment can no longer be purchased and must be made on a 1941 machine lathe. Patterns for iron castings are stored on site and sent to a foundry when needed.

Electricity from Bowersock flows into the electrical grid and is purchased for the Kansas Power Pool. That contract will end on May 31, 2013, and a new chapter will begin for the plant.

A major $20 million addition will be built by then to furnish power to the Kansas City, Kan., Board of Public Utilities under a 25-year contract.

The expansion will add four larger generating units that will produce 5 megawatts of power in additional to the 2.3 megawatts from the existing plant.

When fully operational, the project is expected to produce the equivalent energy of 188 railcars of coal, or enough electricity to supply 3,300 Wyandotte County homes. It will reduce overall carbon dioxide emissions by more than 44,000 tons, according to utility officials.

Once the utility begins purchasing Bowersock power, it will have more than 15 percent renewable energy and exceed Kansas energy standards.

Hill-Nelson said most of the financing for the project is coming from the American Recovery and Reinvestment Act.

Posted by Kate Gonzalez, http://www.climateandenergy.org/

From: Reuters, Reporting by Timothy Gardner

 Wind power groups urged the U.S. government on Wednesday to open up regional electricity markets saying competition between power providers fosters the development of renewable energy better than monopolies do.

The American Wind Energy Association, an industry group also known as AWEA, and the Compete Coalition, a group of more than 500 electricity stakeholders including companies and environmental groups, urged Congress, the Obama Administration, and state and regional governments to promote competitive wholesale electricity markets.

“We can integrate a lot more renewable energy into our power grid if we use competitive wholesale markets,” Rob Gramlich, a vice president for public policy at AWEA, told reporters.

In states where power markets are monopoly-regulated, such as in the U.S. West, excluding California, and the U.S. Southeast, power providers have little incentive to innovate or lower costs, they said.

After Congress failed to pass a climate bill that would have placed a price on emitting carbon, backers of alternative energy are looking for additional ways to spread development of alternative energy.

The competition of open markets increases reliability and efficiency of power grids, which in turn helps integrate alternative energy like wind and solar into the power mix, the groups said.

The intermittent nature of wind and solar farms, which only produce power when it’s gusty or the sun shines, makes renewables difficult to integrate into the power grid with traditional power sources.  

One advantage of competitive power markets is they are are organized by independent groups such as regional transmission organizations or independent system operators that can give broad regional scope for diversifying energy sources. Monopoly markets do not have such organization.

“We have a third of the country that can barely move here,” Gramlich said about how the lack of organization in monopoly markets stymies development of renewables.

Cheryl LaFleur, a commissioner of the Federal Energy Regulatory Commission, which regulates the interstate transmission of electricity, said her agency was working on ways to measure how much competitive markets have helped integrate alternative energy into power grids. She said she hoped the information would assist regions in making decisions about how their power markets are organized.

-Posted by Kate Gonzalez, http://www.climateandenergy.org/

This was originally taken from a handout floating around the Capitol, and then modified on the basis of several conversations. Don’t take it as gospel (I need hardly say). EDIT: Right at the moment, the actual energy legislation is being drafted, so we will want to wait and doublecheck what is proposed against the provisions at the bottom.

Instead of two 700 MW coal-fired power plants, Sunflower will construct one coal plant – one 895 MW pulverized ultra-super critical coal generating unit (Holcomb 2).

The carbon dioxide emissions for the 1400 MW was 11 million tons per year. The CO2 emissions for 895 MW is 6.7 million tons per year. (I see no numbers here on SOX NOX mercury emissions, etc., but I bet someone else can do the math.)

The following offsets will reduce the CO2 emissions to a little over 3 million tons per year:

•    Sunflower must develop 179 MW of wind immediately (amount equals 20% of nameplate of coal plant)
•    Sunflower must achieve the Governor’s 2020 nameplate RPS goal five years early, by 2015 (ie, construct 36 MW additional renewable energy)
•    Sunflower must use 10% biomass as fuel in both Holcomb 1 and Holcomb 2
•    Sunflower will help develop two 345 kv transmission lines to the western grid
•    Sunflower will dedicate 1% of their gross annual sales for energy efficiency programs
•    Sunflower will decommission two oil burning peaking units – Garden City 1 and Garden City 2 generation units
•    Sunflower will develop Biodigester to capture methane
•    Sunflower will pursue Algae Reactor

No mention of how offsets are measured or verified. (No idea whether the experimental algae reactor counts as a verifiable offset, it’s hard to tell from how the document is drafted.)

Also on the transmission piece, I know many of you already know that Colorado’s RES has an incentive for in-state wind, and given their own wind potential, they are unlikely to need KS wind to meet their renewables goals. As noted in the ACORE study, the market for KS wind lies East, not West.

As a condition of this agreement, Sunflower’s litigation (all of it? don’t know, there are four or five suits going on right now) will be dropped.

Also, the deal is contingent on the legislature passing the Governor’s energy plan:

•    Renewable Portfolio Standard (from Gov’s bill, HB 2127, which was killed early this session by the Renewable Subcommittee of the House Energy and Utilities committee)
•    Net Metering (from Gov’s bill, HB 2127 – 1:1 retail reimbursement, 1 bidirectional meter, only applies to IOUs)
•    Limited energy efficiency standards for state government, plus state vehicle fuel economy standards (found in HB 2014, the currently vetoed coal bill)
•    Expanded KETA authority (from HB 2014)
•    5% Kansas Coal (from HB 2014)
•    Compressed Air Energy Storage (from HB 2014)
•    Subservice Hydrocarbon Storage (from HB 2014)
•    Modified Regulatory Uncertainty (from HB 2014 – this will limit the emergency powers of the KDHE secretary, plus hold the Kansas Clean Air Act implementation to the standard set by the EPA – which as many of you know, is quickly raising the bar re CO2)
•    Larger Cooperative KCC opt-out (from HB 2014 – this provision will allow Sunflower Electric to opt out of rate regulation by the Kansas Corporation Commission)

— Maril Hazlett, www.climateandenergy.org