Walking the halls of the Utah State Capitol during the Legislative Session, it is clear that Utah policymakers have embraced modern technologies. From smart phones and tablets, to tweets and blogs, Utah policymakers understand the importance of staying up-to-date in the 21st century.  In the case of clean energy policies considered during Utah’s 2013 Legislative Session, their votes are starting to reflect that same understanding. This year, Utah joined nearly 30 states in adopting a policy that enables Commercial PACE financing in the Beehive State.

Utah’s commercial buildings currently consume one-fifth of Utah’s total energy and close to 40% of Utah’s electricity, the majority of which is generated by burning coal. Enabling Commercial Property Assessed Clean Energy (C-PACE) financing provides Utah businesses with a needed financing mechanism to cut energy costs through energy efficiency retrofits and on-site renewable energy. Despite the interest in renewable energy and energy efficiency projects among Utah businesses, a major barrier for many commercial property owners is the upfront costs and difficulty accessing low-cost, long-term financing for such projects. C-PACE overcomes this obstacle and makes it easy for building owners to transfer repayment obligations to a new owner upon sale.

PACE HISTORY IN UTAH
In 2010, Utah Clean Energy worked with interested parties to develop legislation (Senate Bill 194) that would have enabled PACE financing for both residential and commercial properties. While the bill received strong support from local government and industry, concern from the Utah Bankers Association about subordination of residential mortgages and opposition to PACE on the national level from Federal Housing Financing Agency prevented SB194 from moving forward.

Beginning mid-year 2012, Utah Clean Energy began working closely with interested local governments, property owners, to bring the commercial component of the bill back to life. In mid-February 2013, Senate Bill (SB) 221, Assessment Area Act Amendments, sponsored by Senator Kevin Van Tassel, was introduced to the Utah Legislature. This enabling legislation allows municipalities in Utah to offer C-PACE financing to commercial building owners in Utah.

HOW’D WE GET HERE?
Utah Clean Energy played a major role in developing and securing passage of SB 221. Central to our success in 2013 was the fact that SB 221 is limited to non-residential properties and language was added that requires lenders to provide consent before an existing mortgage can be subordinated by the C-PACE assessment. In addition to these critical changes addressing concerns from the 2010 legislation, we worked strategically to involve key stakeholders and built support among industry and decision-makers. Our success can be attributed to the following strategic efforts leading up to the bill’s passage:

• Hosting a webinar (in partnership with PACENow) to educate parties interested in C-PACE in Utah. The webinar introduced participants to C-PACE concept, along with proposed legislative language that addressed previous concerns.
• Meeting regularly with the Utah Bankers Association, Zions Bank Public Finance, and individual lenders to understand and address their previous concerns. We kept bankers and lenders involved throughout the process to make sure their interests were represented.
• Coordinating with PACENow throughout the process, tapping into their PACE expertise and available resources. PACENow generously hosted an on-line petition, which we circulated during the session to demonstrate the broad support for the legislation.
• Meeting with Utah utilities to make them aware of the legislation and ensure they were comfortable with the language; ultimately, none of Utah’s utilities had issue with the bill, and some of the municipal utilities expressed support for the concept.
• Requesting industry feedback on draft legislation ahead of the legislative session and incorporating necessary changes into the draft bill language. We requested feedback from local governments, local businesses and business associations, and commercial real estate groups; this process was critical to garner broad support.
• Recruiting a coalition of supporters, including members of Utah Clean Energy’sClean Energy Business Coalition, Salt Lake County, Salt Lake City, BOMA Utah, Utah League of Cities and Towns, Utah Association of Counties, Utah Association of Energy Users, and the Vest Pocket Business Coalition, a coalition of small businesses in Utah.
• In partnership with our allies, reaching out to respected legislative sponsors knowledgeable about financing and commercial real estate.Developing simplified factsheets and letters of support to share with lawmakers to help them understand the benefits of this legislation.

SUCCESS AND NEXT STEPS
Senate Bill 221 passed with near unanimity and was signed by Governor Gary Herbert. In the coming months, Utah Clean Energy will continue working with the coalition of supporters, local municipalities, local businesses, lenders, and commercial real estate groups to help interested jurisdictions develop C-PACE program guidelines and launch C-PACE programs in Utah.

By enacting this modern energy policy and enabling the clean energy market, Utah policymakers have given Utah’s cities and counties, lenders, and commercial property owners a state-of-the-art financing tool to reduce energy waste and drive renewable energy, thereby addressing the energy challenges of today and tomorrow.

Extra!

The Arkansas legislature passed its own PACE act on April 8.

While some analysts have declared Wuxi Suntech “too big to fail,” the company has already filed for bankruptcy and defaulted on a half a billion dollar bond. This bankruptcy could be the test of the national Chinese government’s willingness to continue to subsidize photovoltaic manufacturers in a market that is already flooded with an oversupply of cheap panels. Meanwhile, local government officials in Wuxi may push for a bailout, fearing the loss of 10,000 jobs and social unrest. They say they will “restructure” the company so that it can continue production.

Meanwhile, an Arizona Suntech plant that installed frames and junction boxes on modules in order to qualify Chinese panels for “Buy American” status, has closed, laying off 43 workers.

Over the past five years, Chinese subsidies for solar manufacturing have encouraged hundreds of companies to enter the market there. From 2008 to 2012, Chinese solar manufacturing capacity expanded ten-fold, pushing prices down 75 percent, to as low as 65 cents per watt ― so low that even Chinese companies cannot make a profit. Prices fell below the cost to manufacture, driving dozens of European and U.S. factories out of business. The list of politically-prominent failures includes Solyndra and Abound; General Electric delayed the opening of a large factory for its Primestar thin-film subsidiary, and is said to be investigating partnership possibilities with Chinese factories. In response to claims of illegal subsidies and dumping, the United States imposed stiff tariffs on Chinese-made solar cells and panels. Europe is considering similar penalties.

While low PV prices have been a boon for consumers and installers, the glut of PV panels, amounting to more than twice worldwide demand equivalent of 30 gigwatts this year, threatens the health of the PV industry overall. Analysts say that by preventing a  necessary correction in the market and allowing PV prices to rise, artificially low prices are stalling the incorporation of new technologies that would improve cell efficiency and further reduce costs of manufacturing.

A Suntech failure, if allowed, may be just the first of a series of Chinese solar business failures. Even business analysts in China say that two-thirds of the PV manufacturers currently operating in China may have to go out of business in order to restore the health of the industry worldwide. But China’s state capitalism system, which encourages government-owned banks to underwrite local production, may make it difficult to decide who the winners and losers will be.

Wuxi Suntech’s parent company, Suntech Power, is not going bankrupt and the company says it will stand behind the warranties on its panels. But Suntech stock, which once traded on the New York Stock Exchange for $85, has fallen to an all-time low of 30 cents.

In an indication of the jockeying that is going on over Suntech’s future in China, two executives have just been barred from leaving the country. Founder Shi Zhengrong, once China’s richest man and now an Australian citizen, has been prevented from leaving the country, as has Suntech CEO David King, while the Chinese government investigates the company’s finances.

Marcellus Shale Gas Rig. Ruhrfisch photo.

The Vail Global Energy Forum, March 1 to 3, was dominated by discussions of what Colorado Governor John Hickenlooper called “the unbelievable surfeit of natural gas.” Hickenlooper, along with many gas advocates, believes that the United States has enough economically-viable gas reserves to last a century.

One pay-off: old, inefficient coal plants are closing, cutting off their high carbon emissions. Oil-stocks financial analyst Tom Petrie predicts that by 2025, the American transportation sector will be driven largely by natural gas, either directly as a motor fuel or indirectly through electric batteries charged by natural gas power stations. “That will back us out of $1 million a day of oil imports,” he said, with profound benefits to the economy. In addition, he said, as natural gas replaces coal, the United States will gradually come to meet Kyoto Protocol goals. New geopolitical alliances will emerge, as Russian and Iranian gas supplant Saudi petroleum in the Chinese and Indian markets.

Other voices say that gas may be a bubble. Last year, with natural gas selling at $2.50 per thousand cubic feet, drilling companies lost money. A report published by the Post Carbon Institute this month suggests that the half-life of a typical well is about two years ― a typical shale-gas well production rate drops about 70 percent in the first year, and 50 percent each year thereafter. According to J. David Hughes, author of “Drill, Baby, Drill: Can Unconventional Fuels User in a New Era of Energy Abundance?”, maintaining today’s level production rate will cost about $42 billion a year to drill 7,000 new wells a year ― and in 2012 existing wells produced gas worth just $32.5 billion. (To download the Hughes report, go to http://www.postcarbon.org/drill-baby-drill/report.)  The price has since risen to $3.50, and will have to go higher to keep shale-gas drilling profitable.

Jim Brown, president/western hemisphere at Halliburton, told the Vail audience that shale gas has increased proven U.S. gas reserves by 66 percent. Still, that’s finite resource, said Mark Zoback, professor of geophysics at Stanford. “If  we do replace coal and oil with natural gas, the gas reserve comes down to about 30 years, not a century,” he said. “The short term is rosy, and we’re in a better position than we were five years ago. But it won’t last forever.”

The lesson: Gas is still a bridge fuel to a grid powered by large-scale renewable sources, and if fully exploited it’s a short bridge. The news this week that a Japanese research team has succeeded in extracting methane from an undersea methane hydrate formation suggests that the world may have enough natural gas to cook the atmosphere many times over.

That fact makes it even more urgent to drive the costs of wind, solar, geothermal and biofuels down below the cost of natural gas.

Flooded homes in Tuckerton, N.J., on Oct. 30 after Hurricane Sandy made landfall on the southern New Jersey coastline on Oct. 29. (US Coast Guard via AFP/Getty Images)

We know that by reducing greenhouse gas emissions by displacing fossil fuels, renewable energy can slow the pace of climate change. It’s now clear that renewable energy can also make vulnerable communities more resilient, and save lives and money during and after extreme weather events.

Recently, by a slim margin of two votes, the U.S. Congress passed a $50 billion dollar aid package for recovery in the wake of Hurricane Sandy. With an additional $10 billion dollars approved for federal flood insurance, that’s somewhat less than the price tag for Katrina, which was over $100 billion. The Sandy appropriation will be used to rebuild about 400,000 buildings, repair New York and New Jersey’s devastated transit systems, and prepare for the future.

ASES has convened a cross-disciplinary group of state and local officials, utility, business and finance representatives, researchers and renewable energy companies, to strategize about the role of renewable energy in reducing risk from extreme weather events. Additional speakers are yet to be confirmed. View the detailed program with dates and times here! 

Highlights now include:

Planning: Creating the Framework for Resiliency

• Moderator: Laurie Reilly, Sustainable CUNY, City University of New York
• State Role:  Overview of State Energy Emergency Plans,  David Terry, Executive  Director, National Association of State Energy Officials
• Local Role:  Casey Johnston, ICLEI – Local Governments for Sustainability
• Utility Role:  Margarett Jolly, ConEdison

Mitigation: Technologies and Strategies to Reduce Risk

• Moderator:  Christine Donovan, Vermont Energy Investment Corporation
• Challenges and Opportunities, Technology Perspective:  John Thornton, President, Thornton Solar Consulting
• Shaun Chapman, Deputy Director/Government Affairs – East Coast, SolarCity
• Solar Energy Industries Association

Recovery: Strategies after the Storm has Passed

• Moderator: Christine Donovan, Vermont Energy Investment Corporation
• What We’ve Learned from Hurricane Disasters: Kevin Lynn, DOE
• Rebuilding for Sustainability: Case Studies in the Making:  Lynn Billman, NREL

Paying for Resilience: Creative Financing Options

• Moderator: Tom Kimbis, Solar Energy Industries Association
• Emerging Financial Tools:  Clay Butler, The Butler Firm, Austin TX
• Commercial Warehouse Roofs:  Urban Fields for PV and Potential Extreme Weather Resiliency:  Drew Torbin, VP-Renewable Energy, ProLogis
• Solar Industry Models:  Tom Leyden, Solar Grid Storage
• John Conely, VP/Structured Finance, SolarCity

New wind capacity grew 247 percent over installations in January 2012, and new solar capacity grew 128 percent over the same month a year ago.

No new fossil-fuel plants came online anywhere in the country.

FERC Chart

The “Energy Infrastructure Update” details the projects commissioned in January:

Electric Generation Highlights

• BP Wind Energy’s 470 MW Flat Ridge 2 Wind Farm in Nashville, KS is online. Flat Ridge 2 consists of 294 GE 1.6 MW turbines. Another 130 MW is expected to come online by year end 2013. The electricity generated is sold to Southwestern Electric Power Co., Associated Electric Cooperative Inc, and Arkansas Electric Cooperative Corp. under long-term contracts.

• Duke Energy Renewables’ 402 MW Los Vientos I and II in Willacy County, TX are online. Los Vientos I consists of 87 Siemens 2.3 MW turbines; Los Vientos II consists of 84 Mitsubishi Heavy Industries 2.4 MW turbines. The electricity generated is sold to CPS Energy and Austin Energy under long-term contracts.

• Exelon Corp’s 82 MW Beebe Community Wind Farm in Gratiot County, MI is online. Beebe Community Wind consists of 34 Nordex 2.4 MW turbines. Another 82 MW is expected to come online by year end 2013. The electricity generated is sold to Consumers Energy Co. under long-term contract.

• Equity Industrial Turbines’ 4 MW Gloucester Wind in Gloucester, MA in online. Gloucester Wind consists of a pair of 2 MW turbines. The electricity generated is sold to the City of Gloucester under long-term contract.

• Waste Management Inc.’s 4 MW Mahoning LFG Facility in Mahoning County, OH is online. Methane from the landfill is used to fire the Caterpillar Inc Technology generator. The power generated is sold to American Municipal Power Inc. under long-term contract.

• Solar farms in California: 1) Exelon Corp’s 115 MW Antelope Valley Solar Project near Lancaster is online. Another 115 MW is expected to come online by year end 2013. The power generated is sold to PG&E under long-term contract. 2) NRG’s 107.4 MW California Valley Solar Ranch Units 2 and 3 in San Luis Obispo County are online. Units 3 and 4 with 62.5 MW each, are expected to come online by year end 2013. The power generated is sold to PG&E under long-term contract.

• Duke Energy Renewables’ 10 MW Black Mountain Solar Power Project near Kingman, AZ is online. Black Mountain solar consists of 42,000 PV panels. The power generated is sold to UniSource Energy Services under long-term contract.

• Volkswagen Group of America’s 10 MW Chattanooga Volkswagen Solar in Chattanooga, TN is online. The solar park consists of 33,600 JA Solar modules. The electricity generated is contracted on-site to Volkswagen Group of America.

• Exelon Corp’s 5.7 MW Outback Solar in Lake County, OR is online. The solar park consists of 20,000 PV panels. Another 10 MW is expected to come online by year end 2013. The electricity generated is sold to Portland General Electric under long-term contract.

• Siemens AG’s 4.5 MW White Sand Missile Range Solar in Dona Ana County, NM is online. The solar park consists of 15,500 sun-tracking PV panels. The electricity generated is contracted on-site to the U.S. Army.

Click here to download the complete report.

Official White House photo by Chuck Kennedy

This is an excerpt from President Barack Obama’s State of the Union Address, delivered Feb. 12, 2013:

Today, no area holds more promise than our investments in American energy.  After years of talking about it, we’re finally poised to control our own energy future.  We produce more oil at home than we have in 15 years.  (Applause.)  We have doubled the distance our cars will go on a gallon of gas, and the amount of renewable energy we generate from sources like wind and solar — with tens of thousands of good American jobs to show for it.  We produce more natural gas than ever before — and nearly everyone’s energy bill is lower because of it.  And over the last four years, our emissions of the dangerous carbon pollution that threatens our planet have actually fallen.

But for the sake of our children and our future, we must do more to combat climate change.  (Applause.)  Now, it’s true that no single event makes a trend.  But the fact is the 12 hottest years on record have all come in the last 15.  Heat waves, droughts, wildfires, floods — all are now more frequent and more intense.  We can choose to believe that Superstorm Sandy, and the most severe drought in decades, and the worst wildfires some states have ever seen were all just a freak coincidence.  Or we can choose to believe in the overwhelming judgment of science — and act before it’s too late.  (Applause.)

Now, the good news is we can make meaningful progress on this issue while driving strong economic growth.  I urge this Congress to get together, pursue a bipartisan, market-based solution to climate change, like the one John McCain and Joe Lieberman worked on together a few years ago.  But if Congress won’t act soon to protect future generations, I will.  (Applause.)  I will direct my Cabinet to come up with executive actions we can take, now and in the future, to reduce pollution, prepare our communities for the consequences of climate change, and speed the transition to more sustainable sources of energy.

Four years ago, other countries dominated the clean energy market and the jobs that came with it.  And we’ve begun to change that.  Last year, wind energy added nearly half of all new power capacity in America.  So let’s generate even more.  Solar energy gets cheaper by the year — let’s drive down costs even further. As long as countries like China keep going all in on clean energy, so must we.

Now, in the meantime, the natural gas boom has led to cleaner power and greater energy independence.  We need to encourage that.  And that’s why my administration will keep cutting red tape and speeding up new oil and gas permits.  (Applause.)  That’s got to be part of an all-of-the-above plan.  But I also want to work with this Congress to encourage the research and technology that helps natural gas burn even cleaner and protects our air and our water.

In fact, much of our new-found energy is drawn from lands and waters that we, the public, own together.  So tonight, I propose we use some of our oil and gas revenues to fund an Energy Security Trust that will drive new research and technology to shift our cars and trucks off oil for good.  If a nonpartisan coalition of CEOs and retired generals and admirals can get behind this idea, then so can we.  Let’s take their advice and free our families and businesses from the painful spikes in gas prices we’ve put up with for far too long.

I’m also issuing a new goal for America:  Let’s cut in half the energy wasted by our homes and businesses over the next 20 years.  (Applause.)  We’ll work with the states to do it.  Those states with the best ideas to create jobs and lower energy bills by constructing more efficient buildings will receive federal support to help make that happen.

Following the address, the Natural Resource Defense Council conducted an overnight poll and found that  67% of Americans approved of the comments Barack Obama made in his speech. Obama’s comments on climate change particularly struck a chord with voters:  62% agree with Obama that we must do more to combat climate change for the sake of our children and our future. And 57% think Obama should make preparing for the consequences of climate change a priority during his second term. On both of those counts seniors are particularly concerned about addressing the impact climate change could have on future generations- 61% of them think this should be a key focus area for Obama during his last four years in office.

Voters stand with the President in believing that the extreme weather events of the last year were not freak coincidences and that they should stand as a call to action on the issue of climate change. 58% of voters think the country needs to do more to address climate change, and 60% think the President should use his authority to reduce dangerous carbon pollution. Pivotal female voters — 63% — are particularly supportive of the President taking the lead on this matter.

Americans are concerned about climate change in general. 65% consider it to be a problem, including 58% of independent voters. 55% think it is already a problem now, rather than something that will be an issue in the future, and voters are particularly concerned about the extreme weather events and negative effects on people’s health that climate change is bringing. Against that backdrop Americans were looking for President Obama to speak out on climate change last night, and they’re glad he did.

Public Policy Polling surveyed 1,218 registered voters following the State of the Union address. The margin of error for the survey is +/-2.8%.

EDF launches TV campaign

In response to President Obama’s proposals to fight climate change, Environmental Defense Fund (EDF) is launching a multi-state TV ad campaign to support that goal.

“The President knows carbon pollution is leading to costly storms, more asthma, and dangerous changes to our climate,” said EDF climate communications director Keith Gaby. “Right now there are no limits on this kind of pollution from some of its largest sources, and we are very encouraged that the President recognizes the need to take action. We strongly support the President’s goal of reducing carbon pollution. This ad campaign is intended to show the American public what’s at stake.”