Category Archives: Energy

Energy economics and changing politics reshaping the solar industry

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It’s interesting to watch how the changing economics in the rooftop solar industry are changing the political landscape as well.

Several published reports have described changes in the industry group, The Alliance for Solar Choice, which is facing the departure of Solar City, the large publicly traded solar company that has been one of the alliance’s key members.

The Las Vegas Sun reported Solar City’s break with TASC last month (“SolarCity cutting ties with rooftop solar advocacy group“), citing differences in approaches for dealing with regulators and political authorities on key energy issues.

TASC has become known for its “scorched earth” political tactics, aggressively filing suit and publicly attacking regulators struggling to develop pricing mechanisms that will allow continued solar growth to continue without overloading existing electrical grids.

But Solar City is now taking a different direction, looking at a less confrontational approach (“Is TASC splintering the rooftop solar industry?“).

Solar City announced a tie-in earlier this year with the new battery systems being built by Tesla, the electric auto maker. Elon Musk,the CEO of Tesla, is also SolarCity’s chairman and biggest shareholder (see “SolarCity, Tesla roll out batteries that store sun’s energy for nighttime“).

And the promise of new battery technologies matched to rooftop solar systems promises to dramatically change the solar industry over the next several years.

Solar City apparently sees the potential for this market, which promises a way around the divisive debate over net metering, and wants to play a more constructive role in discussions with utilities and regulators across the country.

For example, as I understand it, one of Hawaiian Electric’s options offered in their plan to replace net metering would allow homeowners to install relatively self-contained rooftop solar systems with battery backups that would store power to be used in the evenings while remaining connected to the grid. Homeowners would only pay the utility for power they drew when their own systems did not provide enough electricity for their own use.

There’s also growing criticism of rooftop solar companies with business models that have relied on getting consumers to enter into long-term leases and power purchase agreements, usually for 20 years (“Rooftop Solar Shines Light On Bad Business Practices“).

Former PUC chair Mina Morita’s always interesting Energy Dynamics blog has been tracking these industry dynamics (for example, see her post, “Moving On To A Broader Approach: Rooftop Solar Versus Distributed Energy Resources“). This can be dense reading, with lots of supporting data, but well worth the effort.

A different view of NextEra

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Here’s some recent news about NextEra Energy that you wouldn’t expect based on the hostile online comments about the proposed NextEra-Hawaiian Electric takeover. There’s more to this company than we’ve been led to expect.

NextEra Energy’s Corporate Responsibility Report details company’s efforts to build a clean energy future

NextEra Energy Unit Files for Rate Decline in Florida

NextEra Energy, Inc. (NEE) is investing billions of dollars annually to help create a clean energy future sustainably and responsibly. As a result, the company generated more electricity from the wind and sun than any other company in the world last year. In its 2015 corporate responsibility report, released recently at www.NextEraEnergy.com/crr, NextEra Energy details how it is meeting customer and community needs, providing a safe, healthy and challenging work environment for employees, and delivering strong financial results.

While consumers generally expect rates to go up, FPL customers are used to the unusual. At FPL, the monthly residential bill for a typical customer is expected to go down by nearly 13.3% to $94.18 per month.

This March, the company had filed for another rate decline which came into effect from May and led to savings of $3 per month for a residential customer using the standard 1,000 kWh of electricity. The rate decline was primary due to the fall in prices for natural gas used for power generation.

Thanks to these rate cuts, the average electricity bill for a typical FPL residential customer is nearly 30% below the national average.

FPL ranked a top Environmental Champion for supporting environmental causes, helping customers save energy and investing in solar and other clean energy sources

Florida Power & Light Company (FPL) has been recognized as a leader among utilities for its adoption of environmentally encouraging initiatives and operational practices, according to a recent national study. In the Utility Trusted Brand & Customer Engagement™ study, conducted by Cogent Reports™ at Market Strategies International, FPL ranked number one in the south on the Environmental Champions list, which considers consumer beliefs about actions utilities are taking to embrace environmental commitment. Results are based on more than 25,000 consumer performance ratings for 125 leading utilities nationwide.

NextEra puts emphasis on diversity, inclusion

“If we don’t have a diverse and inclusive work environment, we won’t have engaged employees who want to come to work every day and be innovative, do their best and continuously come up with improvements,” Holmes said. “All of that is going to be stymied and we won’t grow as a company. We believe strongly in investing in [diversity].”

Part of what sets NextEra’s diversity efforts apart is that it goes beyond simply hiring workers from a variety of backgrounds. Instead, the company’s 11 resource groups – which include coalitions for women and Asian-Americans – are required to develop their own long-term action plans that they then choose how to implement.

Similarly, every business unit leader is required to develop and implement a diversity and inclusion action plan. These objective-oriented measures, Holmes said, are vital to ensuring that corporate priorities are maintained across the company’s footprint, which extends to 27 states and Canada.

FPL ranks among the top ten utilities for economic development again

Site Selection magazine evaluates utilities for recognition based on the following mix of objective and subjective criteria: Analysis of corporate end-user project activity in 2014 in that company’s territory based on the Conway Data New Plant Database and submitted materials from utilities; website tools and data; innovative programs and incentives for business, including energy efficiency and renewable energy programs; and the utility’s own job-creating infrastructure and facility investment trends.

“This year’s Top Utilities are the class of their field when it comes to economic development teamwork,” says Adam Bruns, managing editor of Site Selection. “Like the best athletic teams, they know how to look for the open opportunity, turn on a dime when circumstances require it, communicate with teammates and move without the ball so they’re ready when the time comes to close the deal.”

NextEra Unit Adds Green Assets: 3 Solar Projects Underway

Electric utility behemoth, NextEra Energy, Inc. NEE and its primary subsidiary, Florida Power & Light Company (“FPL”), have created a niche for themselves as the top clean power producers of the country.

This Juno Beach, FL-based utility uncovered plans to construct three large-scale solar energy centers in Southwest Florida. With no net cost to electric users over the plants’ operating lifetime, they’re expected to triple FPL’s solar capacity to about 335 megawatt (“MW”) from the present level of 110 MW.

If You’re In Your 50s, Consider Buying These 3 Stocks

NextEra has done a better job than many of its peers in jumping on the opportunity in renewable energy, with extensive holdings in wind and solar power. When you add in extensive nuclear power-generation capabilities, NextEra doesn’t have nearly the carbon footprint that most electrical generating utilities have, and that means that it won’t necessarily face the same challenges in dealing with current and future regulation on carbon emissions that some other utilities will. The utility industry isn’t going to give you much chance of blockbuster returns, but steady and reliable results can help even those in their 50s grow their current investments considerably over time.

Energy Storage Just Got A Massive Vote Of Confidence

The rise of renewables is made more feasible by increasing opportunities in energy storage. Mr. Robo and NextEra Energy appear to see energy storage as a major growth opportunity in the future. Robo said energy storage is one of “three growth platforms” at the company and that the firm is “starting to make very good progress in our energy storage business.”

The opportunity in energy storage is intricately linked to renewables but energy storage is not entirely dependent on renewables either. Most renewable power sources face the problem of inconsistent generation versus more or less constant demand (at least on a day-by-day basis though not an hourly basis). Battery storage, like the products being created by Tesla and others, offers a solution. As the NextEra CEO noted, “Battery storage is the holy grail of the renewables business … If we can deliver firm power to renewable customers at a cost-effective rate, you’ll see renewables explode even faster than they already are.”

Legislator’s tie to NextEra consultant shows gaps in required financial disclosures

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NextEra Energy recently disclosed the list of consultants it has retained as part of its bid to take over Hawaiian Electric Industries (Honolulu Star-Advertiser, “NextEra spends on firms to help it purchase HEI“).

The full list of consultants is contained in a document filed in the ongoing review of the proposed merger by the Public Utilities Commission. There are no details of the type of work performed, and the list is full of abbreviated names and corporate acronyms that make tracking relationships tedious.

The Star-Advertiser did note that one of the consultants is tied to State Senator Donovan Dela Cruz.

As of July 31, NextEra Energy has paid several local law firms, communications agencies and consulting agencies, one of which is tied to a state politician.

DTL HAWAII, a strategy studio where state Sen. Donovan Dela Cruz (D, Mililani Mauka-Waipio Acres-Wheeler) is the vice president for communications, received $84,000 from NextEra.

This is interesting because it demonstrates more gaps in the financial disclosure requirements of the state ethics law.

Dela Cruz filed his 2015 annual financial disclosure at the end of January. It reported no changes in employment from 2014, when he had reported earning $25,000 to $50,000 as “director of communications” for WCIT Architecture.

A check of state business registration records shows that DTL is a limited liability company, with a business purpose of “culturally based strategic planning, community outreach and branding.” WCIT Architecture, and a WCIT officer, Adam Wong, are listed as managers of DTL LLC. So it appears that DTL is essentially a subsidiary or sister company of WCIT.

There is no information as to whether any of the NextEra money for “community outreach” trickled down to Dela Cruz.

Nor is there an indication of whether the senator has advocated for NextEra within the legislature, or how Dela Cruz balances his role as the director of communications for this development-oriented firm and his legislative duties.

But those issues go beyond my original point here, which is that DTL doesn’t appear in the most recent financial disclosures filed by Dela Cruz, although he does list the company on his LinkedIn profile, and his legislative profile lists his current affiliation as “vice-president for communications” for DTL.

And even if his financial disclosure did list DTL, it would not indicate whether any clients he did work for had issues pending before the legislature or potentially influenced by legislative action.

These appear to be gaps in the financial disclosure provisions of the ethics law that should be addressed.

Republicans apparently fear limits on greenhouse gases more than threat of global warming

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There’s been a rather startling juxtaposition of climate change stories in the news in recent days.

USA Today wrote about a new scientific report on the long-term consequences of continuing to consume all of the fossil fuels available to us (“Study: Fossil fuel burn-off will submerge U.S. cities”).

Over the next 100 years, the authors predict something over one inch of sea level rise per year.

For those of us living on islands, this isn’t a comfortable prospect. In the lifespan of a standard 30-year mortgage, that could mean that many oceanfront properties could become uninhabitable.

Despite that unpleasant prospect, one of the authors, Ken Caldeira, thinks we can deal with those relatively near term impacts. It’s the longer term that he looks at, the next thousand years.

“Most projections this century are two to three feet of sea level rise, which we can deal with,” Caldeira said. “But 100 feet basically means abandoning London, Rome, Paris, Tokyo and New York.”

And, of course, we seem to be feeling some of the impacts of climate change already, with fewer days of tradewinds over the course of the year, more hot, muggy weather, and more frequent threats from tropical storms. Sea level rise is still to come.

So that’s the view from one side.

On the other side have been several news stories detailing the Republicans’ political agenda, which has reportedly moved from opposing measures aimed at reducing greenhouse gas emissions, to active attempts to subvert any international climate change agreements.

An article by Joe Romm was cross-posted on several sites in the past few days (“In Radical Shift, GOP Leaders Actively Embrace Catastrophic Climate Change“).

…for most of the past quarter-century, most of the GOP leadership has at least given lip service to the idea that global warming is a global problem that needs a global solution. Not only have they abandoned that public position, but they now apparently believe the role of the “exceptional” and “indispensable” nation is to actively work to undermine the world’s best chance to save billions of people — including generations of Americans — from needless misery.

See also, Jonathan Chait, writing in New York Magazine, “The Republican Plot to Destroy an International Climate Agreement,” which covers much of the same ground.

Chait writes:

Why would Republicans try to persuade the rest of the world to keep pumping carbon dioxide into the atmosphere? One reason is that, while other countries transitioning to low-emission fuels may not cost American consumers anything, it definitely costs American fossil-fuel companies. People who own large deposits of coal and oil want to sell it abroad. The Republican climate-change strategy has been hatched by a group of Republican politicians and fossil-fuel lobbyists so tightly intermingled there seems to be no distinction between the interests of the two. (“In the early months of 2014, a group of about 30 corporate lawyers, coal lobbyists and Republican political strategists began meeting regularly in the headquarters of the U.S. Chamber of Commerce, often, according to some of the participants, in a conference room overlooking the White House. Their task was to start devising a legal strategy for dismantling the climate change regulations they feared were coming from President Obama.”) Beyond the straightforward self-interest of coal and oil companies, there is the ancient right-wing distrust of international agreements in general. Plus, of course, Republicans continue to follow a policy of across-the-board opposition to the whole Obama administration agenda. Destroying an international climate agreement means denying an Obama legacy; what more do they want?

And focus on the GOP agenda isn’t new.

For example, Lisa Friedman, writing at www.eenews.net in early July, GOP senators vow to block U.S. from complying with global climate deal.”

Sen. James Inhofe (R-Okla.), speaking after a hearing in which he and other GOP lawmakers questioned Obama’s authority to enter into even a voluntary U.N. climate deal, said he expects to follow up with legislation. But, he acknowledged, there is probably not much congressional opponents of reducing carbon emissions can do to stop the Obama administration from signing onto the agreement expected in Paris this December.

“They’re going to tell [the international community] that they don’t need to have ratification. I can’t stop him from doing that. But we can stop us from living with an agreement that we’re not a part of,” Inhofe said.

His solution to meeting the U.S. pledge? “Just don’t do it.”

This is apparently the message being conveyed to leaders of other countries. If the Republicans win the White House, they’ll make sure that the U.S. abrogates whatever agreements are entered into by the Obama administration.

It’s akin to the letter sent by a group of members of Congress to Iranian leaders vowing to scuttle the nuclear deal if they are given a chance.

Pretty spooky stuff, in my view.

Especially after our recent taste of what a warmer ocean means for us in the years ahead.